WTI (Mar) $76.34 -$2.15, Brent (Apr) $83.00 -$1.14, Diff -$6.66 +1c
USNG (Mar) $2.27 -11c, UKNG (Mar) 121.0p -5.1p, TTF (Mar) €51.180 -€2.12

Oil price

Oil fell back last week after the previous gains, this was primarily due to US CPI rising and a feeling that interest rates and thus the dollar would stay higher for longer. With most US markets closed for Presidents’ Day today I don’t expect much movement.

On Friday the Baker Hughes rig count saw overall units fall by 1 to 760 and by 2 in oil down to 607.

Serica Energy

Serica has provided the following update.

Final commissioning of the Gannet GE-04 well has now been completed and production via the Triton FPSO has commenced.

The Diving Support Vessel Deep Discoverer mobilised to the Triton area in early February to carry out the subsea tie in of the Gannet GE-04 well, currently owned 100% by Tailwind Mistral Ltd, a wholly owned subsidiary of Tailwind Energy Investments Ltd (“Tailwind”).  Serica announced the intended acquisition of Tailwind Energy Investments Ltd on 20 December 2022 and the acquisition is expected to complete in March 2023. The Gannet GE-04 well was drilled late in 2022 and completed in January 2023.

The well results were above the pre-drill expectation and initial production rates have exceeded 10,000 barrels of oil per day.

Mitch Flegg, Chief Executive of Serica Energy, commented:
“Including the Tailwind Acquisition assets, we have an exciting investment programme of value-adding activities throughout 2023 and 2024 which has started with the Gannet GE-04 well being brought onto production. We are delighted with the strong initial results.

This additional production means that the Triton hub is now producing at gross rates not seen for the last 10 years. This performance is a credit to the outstanding work completed by the Tailwind team, their contractors, and Dana Petroleum (E&P) Limited, the Triton operator. We look forward to welcoming the Tailwind team to Serica on completion of the acquisition which is expected next month.”

Discussed the other day here, this well has exceeded expectations and providing the Tailwind acquisition goes ahead, and I see no reason why not, then it adds substantially to Serica’s production and of course starts upping that oil ratio. 

Completion should also rest easy any market concerns about the deal and I would expect a well deserved rally in SQZ shares.

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