The Oil Man: Oil price, Hurricane, Independent
16th January 2017 13:43
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WTI $52.37 -64c, Brent $55.45 -56c, Diff -$3.08 +8c, NG $3.42 +3c
The week ended down a little, as those who believe that quotas will be busted shouted more loudly than the believers; empty vessels and all that.
The rig count actually fell, by six overall to 659 and in oil by seven to 522 - but the above were shouting too loudly about nine or even 10 million barrels per day (b/d) from the USA in the future.
So now to my familiar rant: Dav-oh and all its pretentious, back-slapping claptrap.
I will be monitoring companies who waste shareholders' money (tickets etc. average €29,000 [£25,000] per person) and will try and find the wonderful graph that shows how badly companies perform after their Prima Donna executives schmooze with other grand fromages.
It's 17-20 January - if you have the 30 grand to spare and, of course, can find some lodgings…
The President of China is there tomorrow and Joe Biden and John Kerry have still got the White House Amex card with them - at least until Friday morning.
Hurricane Energy
announced this morning that it has spudded the 205/23-A well (Halifax well) which will drill below local structural closure and then perform an open hole DST and subject to results, possibly deepen to investigate the oil-water contact.
The reason for all this is that the adjacent Lancaster Field possibly extends its boundary into the recently awarded P2308 licence, which is contiguous to and extends north-easterly from that discovery; indeed it is possible that it extends up to the Rona Ridge.
This will be the concluding well of this drilling programme and, as such, by the time this well result is announced towards the end of first-quarter of this year, will have made the most significant oil find in British waters for many years.
Independent Oil & Gas
has signed a memorandum of understanding to buy a disused gas pipeline in the southern North Sea for a nominal amount.
After recommissioning (and a prize if anyone can think of another in the North Sea) the pipeline will provide for the evacuation of gas from the Blythe hub, the Vulcan satellites and possibly the recent Harvey discovery.
It also comes with associated onshore facilities, which makes sense, but not as much sense as ownership confers, which means no tariff to pay and thus better economics; indeed, one day the firm might be in a position to charge third parties for its use.
The company rightly suggests that this is an acquisition of strategic importance, comes for a "nominal cost" and has the approval of the Oil and Gas Association - what's not to like?
The announcement also updates the market on the Skipper appraisal well, which produced, as expected, 11º API oil that might be extractable, but would "present a challenge for refining and marketing and trade at a significant discount to the current Brent price".
Whilst there is little doubt that this will be hard work, it does have a very low wax content and is mobile in the reservoir, so probably best not to rule it out altogether.
And finally…
In the USA we are getting closer to the Super Bowl, to be held in Houston on 5 February; my invitation must be about to be sent out, as it is getting late to ignore me…
This weekend the Packers beat the Cowboys with three seconds left and will next up meet the Falcons, whereas the Steelers beat Kansas and will face the Patriots to be in that final.
The Australian Open tennis is underway and this morning both Sir Andy and Mr Evans went through.
In the footy, Chelski, Spurs and the Gooners all won easily, whilst the HubCap Stealers went to the Theatre of Dreams and got a draw.
James DeGale got a draw and was probably happy to get that; he also left his two front teeth on the canvas….
And, in the first cricket one-dayer, England set India 350, then sat back and watched them win - not quite what they expected.
This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.