WTI (Jan) $57.95 -89c, Brent (Jan) $62.48 -89c, Diff -$4.53 u/c
USNG (Jan)* $4.48 -3c, UKNG (Dec) 77.0p -1.19p, TTF (Dec) €29.26 -€0.295
*Denotes December contract expiry

Oil price

The oil price is unchanged today, little influence except the ongoing concerns that a peace deal in Ukraine might ease US sanctions on Russia and its crude supplies will increase, not a realistic worry really given it is probably exporting as much as it wants to China. 

The API stats last night were a mixed bag, crude stocks fell by a decent 1.9m barrels but gasoline added 500/- b’s and distillates 800/-, the distillate figure is the only slight concern but the weather in the US is still mild. The EIA stats will be interesting tonight. 

Ahead of the Thanksgiving holiday tomorrow and running into a long weekend oil traders rarely take big open positions so no surprise that today is flat.

Arrow Exploration Corp

Arrow has provided an update on the operational activity at the Mateguafa Attic field on the Tapir Block in the Llanos Basin of Colombia where Arrow holds a 50 percent beneficial interest.

Mateguafa 6 well

The Mateguafa 6 well (M-6) well was spud on November 8th, 2025, and reached target depth on November 15th, 2025.  The M-6 well was drilled, on time and on budget, to a total measured depth of 10,000 MD feet (9,328 feet true vertical depth) and encountered multiple hydrocarbon-bearing intervals.

Arrow has put the M-6 well on production in the Carbonera C7 formation (“C7”), which has approximately 18 feet of net oil pay (true vertical depth). The pay zone is a clean sandstone exhibiting an average porosity of 20% with high resistivities. An electric submersible pump (ESP) has been inserted in the well after perforating.

The M-6 well also encountered approximately 30 feet of net oil pay (true vertical depth) in the Carbonera C9 formation (“C9”) (previously referred to as the Guadalupe) and 14 feet of net oil pay (true vertical depth) in the Lower Gacheta.  Arrow plans to test these formations in future wells.

The well was put on production at a heavily restricted rate, 28/128 choke and 45 Hz pump frequency, of approximately 824 BOPD gross (412 BOPD net). The oil quality is 32° API and there is a 3% water cut (completion fluid and formation water).

The testing results indicate the well is capable of higher rates and the ultimate flow rate will be determined in the first few weeks of production.

Initial production results are not necessarily indicative of long-term performance or ultimate recovery.

Mateguafa 5 well

The Mateguafa 5 well (M-5) continues to produce at approximately 550 BOPD gross (275 BOPD net) with an 18% water cut. The M-5 well is producing from the C9 formation.  The official designation of the formation was changed from the Guadalupe to the C9 formation after final analysis of the drill cuttings.

Mateguafa 7 well

The Mateguafa HZ7 (M-HZ7) well was spud on November 22nd, 2025.  This horizontal well is targeting the C9 formation, which both M-5 and M-6 encountered and reinforced the horizontal development concept.  Expectations are that the well will take 2-3 weeks to drill and complete and will be put on production in December.

Marshall Abbott, CEO of Arrow commented:
“The M-6 well was drilled on time and on budget and initial production has exceeded expectations. In addition to the thick pay zones encountered in the C7 formation, an additional pay zone currently behind pipe, the C9, provides further production opportunities in the future.”

“The M-6 well reinforces that the Mateguafa Attic discovery is material to Arrow and we are looking forward to the results of the horizontal well M-HZ7 which will further develop this discovery and help determine the extent of the pools and the potential reserves additions.  Initial results indicate that the discovery will develop into another core area for Arrow with the potential for horizontal drilling development.”

“We look forward to providing further updates on this low-risk development drilling program.”

This is a robust announcement from Arrow and it is good to see that the M-6 well has come in so successfully and ahead of pre-drill expectations. The well has found ‘multiple hydrocarbon-bearing intervals, 18ft of oil pay in the C7 formation which is already on production with an ESP, approximately 30 feet of net oil pay in the C9 formation and 14 feet in the Lower Gacheta.

These formations will be tested in future wells and the Mateguafa 7 well, designated the HZ7 well has already spudded and is a horizontal well targeting the C9 formation already encountered and of course ‘reinforces the horizontal drilling concept’. 

This is all very encouraging and the company are expecting that the ongoing drilling programme is set to determine the ‘extent of the pools and the potential reserves additions’. Perhaps more importantly the ‘initial results indicate that the discovery will develop into another core area for Arrow with the potential for horizontal drilling development’. 

This is as much as I had expected and makes the Mateguafa Attic discovery material to Arrow, indeed with initial production, itself below possible rates due to a restricted choke, looking good with added upside across the board in different formations, accessible via horizontal drilling methods. 

As Arrow head into 2026, the progress on the Tapir Block and in particular the Mateguafa Attic discovery gives serious room for optimism, I expect the added income from this campaign to drive the programme next year with consequent upside opportunities. 

Challenger Energy Group

Eni signed today an agreement for the acquisition from YPF of a 50% share and operatorship in the exploration Block OFF-5 in Uruguay’s offshore. The agreement will become effective after the approval of the Uruguayan authorities.

Block OFF-5 covers an area of 16,883 km2 in water depths ranging from 800m to 4,100 m, at 200 km from the coast. It is currently held and operated by MIWEN (fully owned by YPF) and is in the first exploration period. The area falls within the unexplored part of the Atlantic Margin with close geologic analogies with proven petroleum basins.

Block OFF-5 represents a highly prospective area that further strengthens Eni’s exploration portfolio that combines a large and robust set of near-field and infrastructure-led exploration prospects with diversified selected high impact opportunities, on which to apply Eni’s proprietary technologies to expedite and maximize value.

This agreement further strengthens the collaboration between Eni and YPF, which recently have signed several agreements in the framework of the integrated upstream-midstream project Argentina LNG (ARGLNG). Eni has been selected by YPF as strategic partner of a phase of the ARLNG project and now as preferred operator of exploration projects in Uruguay.

This is a very interesting release as Eni has announced that it has farmed-in to Block OFF-5 offshore Uruguay. The reason that it is of serious significance is that it is the first official confirmation of the batch of farm-ins underway across Uruguay and there are clearly more to come. 

My spies in the industry tell me that a number of these deals are imminent with rumours of Qatar Energy apparently farming-in to the Shell blocks and Chevron interested in other blocks having already shown their interest in the area. But apart from the official release from ANCAP above nothing has been confirmed publicly about them-yet…

In addition, adding excitement to the play it looks like APA are already talking about drilling their well on OFF-6 as soon as the end of next year. It will come as no surprise to readers that such excitement is being generated, as Eni point out, the area that they have farmed-into  ‘falls within the unexplored part of the Atlantic margin with close geologic analogies with proven petroleum basins’. 

In conclusion I think that this announcement validates everything that Challenger has said in recent years and undoubtedly means that their position, as holder of two of the most desired blocks offshore Uruguay, is of significant dominance. 

Without blowing any smoke, it does show that for a small company as CEG was at the time, acquiring these blocks without any major industry players finding out, was a master stroke which has already benefited by the farm-out of 60% of area OFF-1 to Chevron. 

The process between CEG and Sintana Energy is still ongoing but I can say that having been a huge fan of both companies before, I am of the view that as a combined entity, the new vehicle will have massive potential and with a first rate management and portfolio will be a must-have investment in the sector.

Since I wrote this the announcement regarding the Sintana deal has been posted, it is pretty self explanatory so let the process continue…

Results of Court Meeting and General Meeting

On 9 October 2025, the board of Sintana and the Independent Challenger Directors announced they had reached agreement on the terms of a recommended acquisition by Sintana for the entire issued and to be issued ordinary share capital of Challenger (the “Acquisition“), to be implemented by way of a Court-sanctioned scheme of arrangement under Part IV (section 152) of the Isle of Man Companies Act 1931 as amended from time to time (the “Scheme“).

Terms used but not otherwise defined in this announcement shall have the meanings given to them in the Scheme Document (defined below). All references to times in this announcement are to London, United Kingdom times unless stated otherwise.

Results of the Court Meeting and the General Meeting

The Independent Challenger Directors are pleased to announce that at the Court Meeting and the General Meeting held earlier today in connection with the Acquisition:

1.   the requisite majority of Scheme Shareholders voted, either in person or by proxy, to approve the Scheme, being a majority in number of Scheme Shareholders present and voting, either in person or by proxy, representing not less than 75 per cent. in value of the Scheme Shares voted by such holders, at the Court Meeting held on 26 November 2025; and

2.   the requisite majority of Challenger Shareholders voted, either in person or by proxy, to approve the Special Resolution to implement the Scheme, including the amendments to the Articles of Association, at the General Meeting held on 26 November 2025.

Details of the resolutions passed are set out in the notices of the Court Meeting and the General Meeting contained in the circular in relation to the Scheme sent to Challenger Shareholders on and dated 3 November 2025 (the “Scheme Document“), which is available on Sintana’s and Challenger’s websites (subject to any restrictions relating to persons resident in a Restricted Jurisdiction) at:

 https://sintanaenergy.com/investor/business-combination-disclosure/
and https://www.cegplc.com/documents-disclaimer/.

Voting results of the Court Meeting

The table below sets out the results of the poll at the Court Meeting. Each Scheme Shareholder present, in person or by proxy, was entitled to one vote per Scheme Share held at the Voting Record Time.

(1)   Rounded to two decimal places

Voting results of the General Meeting

The table below sets out the results of the poll vote taken at the General Meeting. Each Challenger Shareholder present, in person or by proxy, was entitled to one vote per Challenger Share held at the Voting Record Time.

(1)   Rounded to two decimal places.

(2)   Includes discretionary votes.

(3)   A vote withheld is not a vote in law and is not counted in the calculation of the proportion of votes ‘for’ or ‘against’ the Special Resolution.

The total number of Challenger Shares in issue as at the Voting Record Time was 249,312,660. Challenger does not hold any ordinary shares in treasury. Accordingly, the total number of voting rights in Challenger as at the Voting Record Time was 249,312,660.

Update on Conditions

The outcome of the Court Meeting and the General Meetings means that Conditions 2.1 and 2.2, as set out in Part A of Part 3 of the Scheme Document, have been satisfied.

Completion of the Acquisition remains subject to the sanction by the Court at the Court Sanction Hearing and the satisfaction or (if capable of waiver) waiver of the other Conditions set out in Part 3 of the Scheme Document.

Subject to the satisfaction or (if capable of waiver) waiver of the remaining Conditions, Challenger and Sintana expect that the Scheme will become Effective on 11 December 2025. The Scheme Document contains an expected timetable of principal events in relation to the Scheme, which is also set out in the Appendix to this announcement. If any of the dates and/or times in this expected timetable change, the revised dates and/or times will be notified to Challenger Shareholders by an announcement through a Regulatory Information Service, with such announcement also being made available on Challenger’s website at https://www.cegplc.com/documents-disclaimer/.

Listing of New Sintana Shares and cancellation of admission of Challenger Shares on AIM

Application will be made to the TSXV for Admission of the New Sintana Shares. It is expected that Admission will become effective and dealings for normal settlement in the New Sintana Shares will commence at or shortly after 8:00 a.m. (Toronto time) on the Business Day following the Effective Date.

Prior to the Scheme becoming Effective, application will be made by Challenger to the London Stock Exchange for the cancellation of the admission of the Challenger Shares to AIM to take effect on or shortly after the Effective Date. The last day of dealings in Challenger Shares on AIM is expected to take place on 10 December 2025, the Business Day immediately prior to the Effective Date and no transfers shall be registered after 6:00 p.m. on that date. By 8:00 a.m. on 12 December 2025, share certificates in respect of Challenger Shares shall cease to be valid and entitlements to Challenger Shares held within the CREST system shall be cancelled.

It is also proposed that, following the Effective Date and after its shares are de-listed, Challenger will be re-registered as a private limited company.

Sintana AIM admission

As part of the Acquisition, Sintana intends to seek admission of the Sintana Shares (including the New Sintana Shares) to trading on AIM as soon as practicable after the Effective Date. Obtaining the Dual Listing is not a condition to the Scheme.

Prospex Energy

Prospex on Monday provided the following unaudited quarterly financial indicators for the Prospex group of companies (the “Group”), including group cash and near-cash balances under the Company’s direct control, net results of financing activities, additions to investments and the Group’s share of gross operating revenues for the first three quarters of 2025.

Key Points

• £3.763m of additional investments have been made in the year-to-date.  Of this, £2.645m (70%) has been funded from internal resources and the balance, from a net equity raise of £1.118m in Q3.
• £379k cash and near-cash held in the Group (excluding Viura) at 30 September 2025, reflecting a £1.26m reduction year-to-date due primarily to the increased investment in Group assets.
• Group full-year 2025 share of gross sales on-track to surpass 2024.

Prospex Energy Group – Unaudited

Notes

1          Includes PXEN £916k share of Viura Q1 net income, retained in the joint-venture company, to be utilised in the ongoing Viura drilling program.  The joint-venture company is not controlled by PXEN.
2          Includes PXEN £1.222m share of gas and condensate sales at Viura.
3          Includes £484k paid for the remaining shares in Tarba Energía, and £905k new capital invested in Viura.
4          There was no Q2 production at Viura due to workover.
5          Includes £1,137k new capital invested in Viura and £87k further investment in Tarba Energía.
6          No Q3 production at Romeral or Viura.  Production at Viura recommenced in October.

Mark Routh, Prospex’s CEO, commented:
“I am pleased to share the unaudited group financial indicators for the first three quarters of 2025 which show the significant steps made in re-investing production income during the year.  In the year-to-date ended 30 September 2025, the Company raised a net £1.118m via equity and utilised a further £2.645m of the Group’s internal funds to invest a total of £3.763m in growing the Group’s assets.  Part of this was the acquisition of shares of Tarba Energía in April 2025 resulting in the Company owning 100% of the El Romeral power plant, the three El Romeral Production Concessions and 100% of the Tesorillo & Ruedalabola exploration licences with their related gas reserves and resources.  The process to approve the drilling of five further wells on the El Romeral concessions is progressing with the full EIA documentation now with the central Ministry in Madrid for final approvals.

“Substantial further investments have been made in HEYCO Energy Iberia, the Company which owns and operates the Viura producing gas field in northern Spain, in which Prospex is a 7.5% shareholder.

“The Selva Malvezzi production concession in northern Italy continues its steady production and cash generation with a new gas sales contract agreed with Hera Trading in Q3-2025 and permits to drill four further wells on the concession advancing at pace.  The 3D-seismic survey acquisition which is currently underway will optimise the targets for those wells.

“With the planned expansion into Poland where the licence applications are underway, it is satisfying to be delivering on the strategy of growing the Company’s portfolio of gas reserves to deliver natural gas into the European energy markets where demand is strong and continues to increase.

“It continues to be the Company’s intention to finance Capex requirements over the next 2-3 years through a combination of farm-downs, debt-finance, internal resources and, as appropriate, equity funding.  All financing options are being advanced to support the Company’s growth and deliver shareholder value.

“Prospex remains one of the few UK-listed companies offering investors direct exposure to onshore European gas markets, estimated to be valued at circ. US$130 billion in 2024, and expected to have a compound annual growth rate (CAGR) of 4.8% from the estimated US$130 billion in 2025 to 2033*.”

Despite the detailed announcement there is nothing new here, Prospex is in interesting areas in Europe and should do well albeit, as ever in Europe it will be a long haul. 

Original article   l   KeyFacts Energy Industry Directory: Malcy's Blog