After the Chinese debacle which knocked the share price to the floor, Providence Resources (PVR) has now agreed non-binding and non-exclusive heads of terms with the Norwegian company, SpotOn Energy, in relation to the farm out of the Barryroe oil and gas field. SpotOn has been given a period of exclusivity until 31 October 2020 during which time they will agree an appraisal work programme for the Barryroe field and develop commercial terms with the aim of concluding a binding farm out agreement. As a sign of good faith, they put up £300,000 of a £2.7 million fundraising at 1.5p, which will fund PVR through to April 2021, Barryroe 20% partner, Lansdowne Oil & Gas (LOGP), already being funded through to the end of this year. It's a step forward, but very far from conclusive.
In contrast, Canadian Overseas Petroleum (COPL) appears to be taking a step back. The joint venture company which owns OPL 226 is being sued by Essar Mauritius, who are claiming $63 million of damages in respect to amounts invested in the OPL 226 project. Unfortunately for COPL, the claim has been filed in the High Court of Justice of England and Wales, where the judges are unlikely to be persuaded by the usual type of statements made by Mr. Millholland.
RockRose Energy (RRE) delivered a strong set of results. At the year end, total cash was $375.5 million, of which $59.7 million was restricted. Pro forma adjusted earnings before interest, tax, depreciation and amortisation was $162.4 million. The Company's current expectation is that in 2020 unit operating costs will fall to below $30 per barrel of oil equivalent. With its heavy burden of upcoming decommissioning costs, RRE remains a highly geared play on oil and gas prices.
To keep us all amused, Zenith Energy (ZEN) announced a quick £525,000 placing at 0.7p, while waiting for the 2.5p "premium placing." This company appears to raise money almost every single week, but what actually happens to all the cash? I suspect this will all end in tears.
88 Energy (88E) announced a large condensate discovery, unfortunately Premier Oil (PMO) viewed it as non-commercial and decided to exit. That's the oil business and prudent traders don’t hold for the end result. I highlighted 88E as a favourite several times around 0.7p and it more than doubled to over 1.4p. As I've always said, it's critical to take profits, derisk and never get greedy.
Block Energy (BLOE) is mothballing West Rustavi. The whole thing is, and always has been, completely unviable. I've been calling this one out as a scam for a year now and, despite personal attacks plus threats from people connected to the company, I've continued to state my views firmly. Following yesterday's announcement, I suspect Block will just fade away now. Interestingly, shareholder Georgia Oil & Gas (of the British Virgin Islands) was selling before this announcement, just as it has done immediately before previous bad news.
As regular readers and listeners know, I also write a private blog available by subscription, which focusses on my actual trade ideas. Details of that can be found at https://www.oilnewslondon.com/oilman-jim In addition, I’ve now compiled a trading course, which vastly expands on some of the principles I expound in the blogs and podcasts and provides information that most will never have heard before.
There are many books and courses on investing and trading, but hardly any that address the actual peculiarities of the speculative small cap markets. The few that do exist deal with the North American markets, which operate in quite different ways to the UK. What does exist is quite useless for AIM and the London small cap market.
Investment techniques which are suitable for main markets and large companies are not appropriate to AIM and most of those that try to apply them lose, and often a lot. It's a completely different game. There’s virtually no genuinely beneficial information out there about trading AIM and small cap companies. Hence I decided to write this course.
I cover everything you won't read elsewhere, particularly subjects which others either don't understand, or even know about, or even if they do, are unwilling to talk about openly. I set out exactly how it all works in detail. Exactly how the insiders make their profits. And how you can profit too. I explain all the things that no one else can or will and all the secrets the insiders don't want you to know. Lots of money can be made if you know how it all actually works, and what goes on behind the scenes may be completely different to what you think. The course will be of great benefit to all trading the AIM and small cap markets, not just oil stocks. I believe most will find it eye-opening.
I’ve been involved in the markets for a long time. I bought my first shares in the 1970s and I’ve worked in the financial sector since the early 1980s. My particular knowledge is of the stock markets and I’ve been actively involved in these, both in the UK and the US for over 40 years from both sides of the fence. I’ve also had significant involvement in the oil and gas industry along the way, from drilling wells to negotiating farm-outs to majors.
Small cap speculative companies exist to enrich their insiders, not their public investors, and everything those involved do is for their benefit, not yours. The vast majority lose with these companies, but some do profit and you can be one of those too. The link is https://www.oilnewslondon.com/trading
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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.