88 Energy (AIM & ASX 88E OTC EEENF) announced another operational update. There are three highlights: encouraging evidence of oil in down hole samples is being investigated in the laboratory; additional fluorescence has been recorded at previously unidentified depths; and final payment of vendors in stock is being made. Costs associated with the Merlin-1 well have now been largely finalised and 88 Energy's net share of well costs is estimated to be around the $9 million mark.
Helping preserve the cash balance, though, discussions with vendors of services provided to 88E during Merlin-1 operations have resulted in further willingness to accept partial payment for their invoices in 88E stock in lieu of cash and the company will now issue 345,000,000 new ordinary shares at a price of A$0.025 per share (total A$8,625,000) in order to finalise these payments. 88 Energy says this will leave it in a strong financial position ahead of next winter's exploration program. The second well, Harrier-1, is planned to be drilled early 2022 and is targeting gross mean prospective oil resources of 417 million barrels. More on 88E EEENF in the private blog.
A further meaningful drill now upcoming is the Anchois Gas Development appraisal well, offshore Morocco, in respect of which 75% owner and operator, Chariot Oil & Gas (AIM CHAR OTC OIGLF) last week announced a placing, subscription and open offer to raise up to $23 million (£16.3 million) at 5.5p per share. Chariot anticipates that drilling will commence in Q4 2021. More on CHAR OIGLF in the private blog.
Another Morocco drill is coming up soon from Predator Oil & Gas (LSE PRD), which also announced an operational update last week. It has now awarded the contract for the construction of the MOU-1 well pad platform and the improvement and extension of up to 5 kilometres of access roads. Civil works are to start immediately to facilitate the commencement of drilling activities, which are expected to start during June, subject to the timing of the completion of the current SDX Energy (AIM SDX OTC SDXEF) drilling programme in the Rharb Basin. More on PRD in the private blog.
Hurricane Energy (AIM HUR OTC HRCXF) announced its full year results for 2020. It recorded a loss for the year of $625.3 million. In respect of its proposed financial restructuring, the High Court in London has now given directions for the convening and conduct of a virtual meeting of the shareholders, which will be held via video conference on 11 June 2021. The restructuring plan will require the support of 75% by value of the shareholders voting at the meeting.
With Crystal Amber Fund (AIM CRS), who oppose the restructuring, already holding 14.7% of the equity, further votes from other shareholders representing only 10.3% are required to defeat the board. The directors’ big problem is that if all the shareholders are going to get should the resolution go through is equity valued by the company and bondholders at less than 0.1p per share, why should the shareholders not just decide to roll the dice and take a gamble on the threat of liquidation, which many now just regard as a bluff? More on HUR HRCXF in the private blog.
Finally, spoof of the week has to be the €96 million offer for 200 million shares of Petroteq Energy (TSX.V PQE OTC PQEFF) from Uppgård Konsult AB, a Swedish company with total assets per their last filed accounts of less than €175,000. It is said by some that Uppgård is making the offer on behalf of an unidentified third party, but what genuine €96 million offeror would chose to retain as their intermediary what appears to be a dormant company with an address on an industrial estate in the middle of nowhere.
Uppgård says the offer is only open to German investors, which is convenient since none of them are likely to have the minimum 1,000,000 shares (€480,000 worth) necessary to accept the offer. Plus, with the offer only being made in Germany, it’s also quite curious that it’s only published in English. It is of course meant to attract the eye of gullible investors in the USA, UK and Canada, who pushed the Petroteq share price up over 200% following its release.
In the private blog this evening, ADV IOG DELT PRD LBE 88E EEENF CHAR OIGLF AEX AEXFF TRP RTWRF PVR PVDRF LOGP and HUR HRCXF (but please note that commentary on all of these is not necessarily positive). More on that at https://www.oilnewslondon.com/oilman-jim
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The author may hold one or more investments in one or more of the companies mentioned so this post cannot be viewed as independent research. This post does not constitute investment advice or a recommendation to buy or sell and may be incorrect or outdated.