The Oil Man: Sound Energy, Echo Energy, Amerisur
5th July 2017 10:03
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WTI $47.08 -4c, Brent $49.64 +3c, Diff -$2.61 n/c, NG $2.99 +4c
Sound Energy
It's never a dull moment at as today they report excellent news from Sidi Moktar, where the Koba-1 well has come in as a 'producible gas accumulation' that can move rapidly to production.
The local market is very strong with additional demand from a large phosphate plant who crave gas to significantly add value to their product, which otherwise would be exported untreated.
The company also believes that there is potential for the pre-salt, so will reprocess existing 2D seismic and acquire new to complete the picture. With poor quality cement bonding at Koba-1 it has been decided that there is little point in drilling Kmar-1, so the rig will now be demobilised and returns to Tendrara.
This is good news for Sound and proves that it is now a meaningful player in Eastern Morocco with a growing asset base.
Echo Energy
Starting as they mean to go on, are reporting quarterly on operations, although clearly there is not much to say at this stage.
Technical work has commenced at Huayco after which the decision to go ahead with the operation. The company report that they are looking for more opportunities in Bolivia and a number of projects are being assessed.
President Energy
Very good news from this morning as they update the market on record sales in June. Invoice revenue at the Puesto Guardian concession alone was in excess of $1.2 million and, if you add the Louisiana expanded production, which contributes $200,000 of highly added value free cash flow even at current oil prices, you have a significant set-up.
I think that the market has yet to understand quite how potentially valuable PPC might be, continually increasing production in Argentina, with a highly favourable oil price regime gives potential for growth of free cash flow releasing value.
With over 20 million barrels of oil equivalent, the reserves are not taken into account by the market, investors should take another look at my recent interview with Chairman Peter Levine to see how determined he is to prove up this incredible opportunity.
Amerisur Resources
Another monthly update from who announce average daily production of 4,576 barrels per day, with a peak of 5,109 barrels per day and now at 6,075 barrels per day due to successful well treatments.
The OBA had a peak of 4,180 barrels per day with a peak of 4,518 barrels per day, which is below par due to equipment maintenance in Ecuador that will be completed shortly. In the meantime, excess production is being stored in the field.
SDX Energy
is rapidly becoming the gift that keeps on giving as every report to the market gives more potential for value add in its African portfolio.
Today it releases an operational update which starts with a resource update, its CPR on South Disouq gives it 47-180 billion standard cubic feet of gas and 2.29-8.73 one million barrels of condensate.
With the company moving to an early production system that is scheduled to bring it on in early 2018 (and may be sooner), value is coming from this source amazingly swiftly.
Put another way this is 50 million barrels of oil equivalent per day on a single discovery, and their 55% WI gives them 29.6 million barrels of oil equivalent per day which is 3x their current reserves, seriously boosting the bottom line.
In Morocco, things are hotting up as the rig is being mobilised and on schedule to spud in September, while at Meseda the kit to facilitate the long awaited production increase is being tested.
SDX is showing signs of aggressively progressing its portfolio and new opportunities are being assessed all the time, the recent oil price dip has delivered one or two possible gems I am led to believe.
Today's share price move is just completely wrong, SDX is increasing in value all the time as today's report shows on every measurement possible, with reserves increasing, valuable production not far away and a top quality management team busting a gut to deliver added value, investors in SDX should count their blessings. Commodity risk apart their company is cheap as chips and should be bought.
Empyrean Energy
Very briefly on as I have only just started to look at the company again, and yesterday had a long call with Tom Kelly whom I rate very highly.
Today he announces that Mako South-1 has exceeded the operators expectations and delivered exceptional performance with 23 feet of net pay in 'excellent rocks'. The gas is 100% methane so expect further action from here before long. The Dempsey well in California shouldn't be long, so I will comment more when time permits, but after the Sugar Loaf sale it seems that the boy is back with avengence…
And finally…
Very briefly today, lack of time, but Rangers supporters had a tough start to the new season and, although we are only in July appear to have already been knocked out of Europe by a team of part-timers from Luxembourg…
Muzza, Bedene and Konta have hard matches at Wimbledon today, after yesterday's debacle of players turning up and leaving shortly after 'injured', but still claiming their 40,000 euros things can only get better…
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.