It’s been a fantastic week for the BMD blog with lots of press interest. On the Oil front there’s been a busy week. So read on & enjoy The Famous Smallcap Oil & Gas Round Up!
3Legs Resources (LON: 3LEG)
There’s a revolt on at 3Legs as the company confirmed that it has received a notice from Singer Nominees Limited requisitioning a meeting of the Company’s shareholders. The Requisition proposes a number of ordinary resolutions which include, the removal of the majority of the board of directors (being all of the directors except for Kamlesh Parmar and Richard Hills); the appointment of certain new directors to the board being Brett Lance Miller and Rhys Cathan Davies and the proposal that the company adopt a new investment strategy. On the basis that this Requisition is not withdrawn, the Company intends to post, in due course, a notice to all shareholders convening a general meeting. Shareholders should take no action at this point; rather they should await receipt of the notice from the company convening the general meeting and full details of the resolutions being proposed.
Borders & Southern (LON: BOR),
Provided an update on its activities in the South Falkland Basin. The PGS vessel Ramform Challenger has commenced the Company’s 3D seismic programme, located approximately 140 kilometres south of the Falkland Islands. Covering an area in excess of 1,000 square kilometres, the survey is situated in Quad 61, adjacent to the Company’s 2007/2008 3D survey. It is anticipated that acquisition will take approx’ six weeks to complete. The 3D programme has been designed to evaluate a number of fault/dip closed structures similar to the Darwin discovery, tracking the high quality shallow marine sands that comprise the Darwin reservoir. Additional objectives are to further investigate the Early Cretaceous slope fan system and to identify new prospects in areas where current data coverage is low.
Edge Resources (LON: EDG)
Released its unaudited third quarter results for the three month period ended 31 December 2012 (“Q3 2012”) and for the nine months ended 31 December 2012. You can read it HERE
Faroe Petroleum (LON: FPM)
Has acquired a 25% interest in the Pil prospect in the Norwegian Sea and a 50% interest in the Lowlander discovery in the UK Central North Sea. The Pil prospect is located within tie-back distance to the producing Njord field in which Faroe holds a 7.5% interest and an exploration well is scheduled to be drilled in the first half of 2014. The Lowlander deal involves an agreement with Talisman Sinopec for Faroe to acquire a 50% interest in UK Licence P.324, block 14/20c containing the Lowlander oil discovery. Lowlander has similar characteristics to Faroe’s Perth Field and the planned work programme will include a joint Perth/Lowlander development study.
Gulf Keystone Petroleum (LON: GKP)
It’s fill your boots time yet again at GKP. As the company announced that it had resolved to issue, in aggregate, 7,125,837 new common shares of USD 0.01 to Directors, employees and former employees in respect of awards due pursuant to and in accordance with the terms of the Company’s 2010 and 2011 Executive Bonus Schemes.
New Zealand based oil and gas explorer Kea Petroleum (LON: KEA) reported that drilling work was once again under way at its Mauku 1 well, which was part-drilled and temporarily suspended in January. Half the cost of the well is being funded by Kea’s off-take partner Methanex but the oil junior still holds a 100% interest in the well despite “multiple parties” expressing an interest in participating. On a P50 basis the Mauku prospect addresses a gross mean prospective recoverable resource of 485 BCF of gas and 27 million barrels of associated liquids.
Lochard Energy (LON: LHD)
Released interims this week. In the first half to 31 December 2012, Lochard Energy has paid the final instalment of a $9 million litigation settlement agreement with Senergy, let the Thunderball licence lapse as an industry partner could not be found to participate in a £16 million exploration well, paid off $10.5 million of a $28 million loan from Gemini for the Athena field development and expects to repay a $1.1 million drawdown from the Henderson funding facility by the end of June. The Gemini loan, which is non recourse and tied to Athena production, gets repaid at a rate of 50% of gross production revenues until the first $13.5 million is repaid and then the rate drops down to 20%. Lochard expects this drop to happen in May. Lochard has a 10% interest in the Athena field.
Mediterranean Oil & Gas (LON: MOG)
Said it has successfully completed the sale of 75% of MOG’s shareholding in its wholly owned subsidiary, Phoenicia Energy Company Ltd to Genel Energy plc. PECL owns the rights to exploration activity in Malta Offshore Area 4. Under the terms of the sale agreement Genel has acquired MOG’s 75% interest for the following consideration: An immediate cash payment of US$10 million; 100% carry of the cost for the first exploration well Hagar Qim 1, planned to be drilled to a minimum depth of 2,500 metres; 100% carry of the cost for the second exploration well up to a maximum of US$30 million gross expenditure; At MOG’s option, should the costs of the second well exceed US$30 million, Genel will provide a financing arrangement to fund MOG’s 25% share of any additional expenditure, at an interest rate equivalent to 3 Month Libor plus 400 bps.
New World Oil & Gas (LON: NEW)
Has formally received a 75% working interest in its Blue Creek Project in the producing Petén Basin in Northwest Belize. This follows the Belize Ministry of Natural Resources and the Environment formally approving the assignment of a further 40% working interest in the project to New World. Having drilled two wells to date in Belize, the Blue Creek #2 and #2A ST, under the terms of the company’s farm-out agreement, it is on track to earn-in to a 100% working interest in the project by drilling the West Gallon Jug Crest prospect, which is expected to begin in March 2013.
Sefton Resources (LON: SER)
Can it get any worse at Sefton Resources? In a statement to the London Stock Exchange this week Sefton said it had initiated legal proceedings against Tom Winnifrith and our man Daniel Levi (Broker Man Daniel) for libel in the Queen’s Bench Division of the High Court of Justice. The action from Sefton follows publication of articles by both Tom Winnifrith and Daniel Levi on their websites attacking both the company and its Chairman Jim Ellerton. The chaps have respectively accused the company of Lies and Fraud. The Sefton SP currently stands at 0.9p of a penny. Some weeks ago Winnifrith and Levi upon receipt of “lawyers letters”, published articles inviting Sefton to bring the threatened legal action. Daniel Levi responded by widening his AIM Regulation formal complaint of Fraud by publishing an open letter to the Financial Services Authority. Whilst commenting “I relish the opportunity to finally be in a position to put the whole cast (Past & present) of Sefton and their 13 year claims of bringing value to share-holders before a UK Jury for Fraud. For 13 years Ellerton has reigned supreme banking millions upon millions of dollars in pay, expenses, consultancy fees, share options and pension pot payments. Why has this man who has delivered total abject failure for 13 years been allowed to carry on unchecked fleecing UK Investors? Ellerton has become a multi-millionaire while UK Investors have been taken to the cleaners. This will all be put before A UK Jury of our peers. It is a fight to the death. No quarter will be given. Strong stuff from our man Dan.
Victoria Oil & Gas (LON: VOG)
The AIM quoted emerging markets natural gas utility and production company with assets in Africa and the Former Soviet Union released their unaudited interim results for the six months ended 30 November 2012. Mucho too long for the Smallcap round up. Click the link to read them HERE
Ruspetro (LSE: RPO)
Has encountered further difficulties in its attempts to increase production in Siberia. In early January, Ruspetro, which has assets located in the Khanty-Mansiysk region of the West Siberian basin, said that during the second half of 2012, it re-focused its drilling efforts towards the condensate rich Palyanovo region of its acreage. Despite prolific wells, a sharply higher than expected gas-oil ratio with the associated challenges of temperature management led to technical challenges in stabilising the condensate from the hydrocarbons being produced. Ruspetro said that it planned to bring on-line a heat exchange system during February in the Palyanovo gas & gas-condensate field with the aim of boosting condensate production towards 4,000 bpd. The heat exchange system has now been commissioned and has reduced the temperature of the hydrocarbon stream to a target level of 40 degrees Celsius. The wells that have recently come on line have had lower than expected flow rates and condensate yields and the company no longer expects to achieve the 4,000 barrels per day of condensate production in February. Condensate production actually currently stands at 1,450 bpd, with most of this production continuing to come from established wells.
Sound Oil (LON: SOU)
Releas news of a revised drilling programme for its projects in Italy. The exploration group said it was deferring plans to drill at Strombone in preference for a planned second well on the as yet undrilled Nervesa project and a development well at Laura. Sound Oil said it was also planning to drill the potentially large and 100% held Badille project on its own as well as a second material prospect called Zibido. Sound also announced the signature of an asset swap agreement with Compagnia Generale Idrocarburi SpA. Prior to the transaction CGI and Sound Oil each held a 50% equity position in four assets: two awarded licences (Villa Gigli and Colle Ginestre) and two outstanding applications (Posta del Giudice and Il Convento). The terms of this transaction are that Sound Oil increases its equity position to 100% in Posta del Giudice and Villa Gigli in exchange for eliminating any equity interest in Il Convento and Colle Ginestre. No cash payment is involved in the transaction.
Tethys Petroleum (LON: TPL)
Announced that the Ministry of Oil and Gas of the Republic of Kazakhstan (“MOG”) has agreed to extend the Exploration Period for the Company’s Kul-Bas Exploration and Production Contract by a further two years until November 11, 2015. The Kul-Bas contract area (which currently covers an area of 7,632 km2 (1.9 million acres)) surrounds the Akkulka contract area which contains the Company’s producing oil and gas fields. This extension gives Tethys further time to explore this attractive area which has several prospects and leads and with a proved commercial oil and gas system in the Akkulka block. In addition the Kul-Bas block contains the KBD01 (Kalypso) well which is awaiting testing later this year after having encountered several intervals with hydrocarbon indications.
Wessex Exploration (LON: WSX)
Announced its unaudited interim results for the half year ended 31 December 2012. The highlights? In Guyane, drilling activities continue on GM-ES-3 (Priodontes)…. Extensive 3-D seismic programme to the southeast and northwest of the Cingulata fan system in Guyane is complete and processing/interpretation underway… Regional review of petroleum systems in Juan de Nova has commenced… Cash position at 31 December 2012 was £7.9m… Appointment of Iain Patrick as non-executive director in February 2013. Commenting on the results, Malcolm Butler (Chairman of Wessex) said… I should have took the 10p offer! Ooops my mistake he actually said “There has been substantial activity in Guyane over recent months with the spudding of Priodontes (GM-ES-3) and the completion of the 3-D seismic programme over the remainder of the potential turbidite fan complexes. Over the coming year, we intend to focus our financial resources on the Guyane asset in order to participate fully in the calendar 2013 drilling campaign.”
