WTI $61.91 -23c, Brent $65.65 -46c, Diff -$3.74 -23c, NG $2.79 +6c, UKNG 51.5p +0.25p

Oil price

Still a see-saw market with modest movements, who would know it was the day of an Opec+ meeting? Well partly as the JTC that reports the day before a lot of the sting has been taken out, yesterday they suggested that they expected growth of some 6m b/d which would reduce inventories accordingly.

The virus numbers in India are marginally down this morning but still awful, markets are betting on international help coming through this week. In Libya production has resumed although for how long is anyone’s guess, the market are not relying on it by the look of it.

Finally it is retail gasoline day, a gallon will rush you on average some $2.872 but in California they are paying over $3.50 a gallon. In general that puts gas up 1.7c w/w, 2c m/m and $1.099 y/y.

Union Jack Oil

Union Jack has announced the launch of a new corporate website at www.unionjackoil.com which, whilst I wouldnt normally mention such a launch it does contain several new features, many of which have ‘excellent animations, educational videos, a world oil and gas consumption meter and several other state-of-the-art aspects of the company and the industry it works in’.

‘The Board of Union Jack hopes that the new website will turn web searchers into visitors and those visitors into new shareholders’.

The website is a massive step-up by UJO as it indicates that the company is preparing to grow and is no longer a small player in the UK onshore space, indeed looking at the spread of assets and potential of the portfolio, growth is very much on the cards.

Reabold Resources

Reabold has announced that it has conditionally offered to acquire additional Corallian shares from existing Corallian shareholders, in exchange for Reabold shares, at a ratio of 474 Reabold shares for 1 Corallian share, potentially increasing Reabold’s shareholding in Corallian to a maximum of 49.99%.

A share offer to acquire up to 13.12% of Corallian Energy shares at a ratio of 474 Reabold shares per Corallian share which could significantly increase Reabold’s position in the low-risk, high potential Victory Gas Discovery to up to 49.99%. A Draft Field Development Plan is anticipated to be submitted by year end and planned 3-year gas production plateau from Victory, at a rate of 70 mmscf/d (11,666 boepd) from Q4 2024, delivering over 25 BCF of gas per year.

Stephen Williams, Co-CEO of Reabold, commented:
“We see Victory as not only adding significant value to Reabold, but also as one of the lowest risk development projects offered in the 32nd Round and one of the best remaining undeveloped assets in the UK Continental Shelf. The Victory development is likely to be relatively simple as it can utilise nearby existing infrastructure, in particular that of the Greater Laggan Area operated by Total, and as such offers a fast-tracked timeline to production.”

Egdon Resources

Egdon announce figures for the 6 months to 31st January 2021.

Oil and gas revenues during the period of £0.424 million (H1 2020: £0.675 million) as a result of declining production and weaker prices and a loss of £0.763 million (H1 2020: £1.044 million) before impairments. Overall loss for the period of £1.039 million including £0.276 million of impairments (H1 2020: loss of £3.235 million, £2.191 of impairments)

Cash and cash equivalents of £2.422 million (H1 2020: £0.781 million) and net current liabilities as at 31 January 2021 of £0.126 million, which includes liability for £0.962 million convertible loan (H1 2020: £Nil) and £0.417 million deferred consideration for Wressle (H1 2020: net current assets of £0.370 million; including liability for Wressle deferred consideration of £0.417 million).

Net Assets at 31 January 2021 of £25.658 million (H1 2020: £27.812 million), a £1 million loan facility secured with Union Jack Oil plc and £1.051 million convertible loan notes issued following approval at a General Meeting in January 2021.

Production guidance for the full year of 110-130 boepd.(2020: 145 boepd) which is not likely to give too much excitement to shareholders, the stock, at 1.65p is close to its annual and 5 year lows and with no reason to change the markets perception at the moment, there are more questions than answers. Changes would probably need to be a portfolio restructuring and maybe even the top of the board, after all it’s a young man’s game but having said that Mark Abbott and James Elston are very smart  but then the other question is what will happen to the Premier stake now that Harbour are in charge? An interesting time ahead for EDR, doing nothing may not be an option…

Commenting on the results, Philip Stephens, Chairman of Egdon said;
“The most significant event during the period was the completion of site and recompletion works and commencement of oil flows at Wressle. We continue to await consent to proceed with the proppant squeeze in order to bring production up to the expected level of 500 bopd which will have a meaningful impact on our production and cash flow.  Additionally during the period, the Company completed refinancing arrangements providing working capital to pursue our key objectives.  We continue to proactively screen new low carbon Energy Transition opportunities, and are pleased to have announced an initial MoU to explore the possibilities for geothermal repurposing of some of our existing assets.    We look forward to pursuing our revised strategy in the context of an improving operating backdrop compared to the last 12 months.”

KeyFacts Energy Industry Directory: Malcy's Blog