Saints & Sinners: Oil & Gas
Matra Petroleum (LON:MTA) slipped 10% to 1p during early trading after the company said that subject to shareholder approval, Maxim Barskiy will become a strategic investor in the company, taking a 29.8% stake for around £4.6 million. Barskiy, the former deputy chief executive of TNK-BP will also be invited to join the board of Matra as a non-executive director. His involvement with Matra is expected to "significantly enhance new venture opportunities for the company", adding a wider range of growth possibilities than those that were previously available to it, the firm said. This includes potential acquisition opportunities in other parts of Russia in the short term and potential expansion internationally in the medium term, Matra added. Barskiy will subscribe to 575 million shares at a price of 0.8 pence a share. The proceeds of the private placing will be used to advance Matra's operations on its Sokolovskoe field in Orenburg and to enable a more progressive new ventures strategy, the company said. Barskiy is currently chief executive of Pechora LNG, a company in which he is a shareholder and which was formed to develop a large gas resource via a liquefied natural gas facility close to the Barents Sea. We (FoxDavies) as a shop currently have a BUY rating on the stock, with a 3.9p price target.
Roxi Petroleum (LON:RXP) slipped 25% during early trading to 2.3p after the company said that Well NK-10 in the Galaz contract area is being abandoned after testing revealed high water content and only minor gas and oil film shows. Exploration and appraisal work on NW Konys will continue with production from the Galaz Contract Area currently running at the rate of 160 bopd. Disappointing test results provide very useful information on the boundaries of the reservoir encountered, together with the results of tests in March 2012 on Well NK-9. The shares did rebound a touch to settle at 3p down 15%. Holders here will be looking for further updates regarding the recent BNG Farm-out deal to help get the shares back on a more bullish footing.
Gulf Keystone (LON:GKP) slipped 4% to 230p during early trading before bouncing back to 240p and flat on the day. The shares have been slipping over the last few trading sessions, back to levels not seen since the 6th of March when the shares capitulated from 332p, down to a low of 218p. With all of the recent news flow, and speculation surrounding the company, it is hard not to take a serious look at the company down at these levels. We will continue to watch this one very closely over the next few trading sessions to see if the bulls take charge once again.
Aminex (LON:AEX) slipped 25% to 4.8p during afternoon trading after the company announced the results from deepening the Ntorya-1 exploration well in the Ruvuma Basin onshore in Tanzania. On February 27(th) 2012, Aminex reported that a gas discovery had been made in a 25 metre gross sand interval between 2,660 metres and 2,685 metres with a 3 metre net gas bearing pay zone in sandstones having 20% porosity at the top and a 16.5 metre thick lower sandstone interval with further possible gas pay. After running a 7-inch liner to 2,750 metres, the well was deepened to a final total depth of 3,150 metres and wireline logging was carried out. Although encouraging gas readings were recorded over a 300 metre interval from 2,850 metres to TD, a deeper target horizon identified on seismic at approximately 3,000 metres was found not to have reservoir potential. The well will now be plugged back to the base of the 7-inch liner and completed for testing the gas pay interval. A test programme will be carried out after the rig has been moved off location.
Solo Oil (LON:SOLO) also slipped 6% to 0.58p on the back of the Aminex update from the Ntorya-1 well in Tanzania, as the company owns 25% of the asset. Aminex have the other 75%.
Wessex Exploration (LON:WSX) slipped 5% to 8.8p during early trading which had many of us scratching our heads. It was only a few weeks ago that Total offered 10p per share for the company, and as far as the market is concerned there has been no change to that offer, but with the shares slipping under 9p it does raise a few questions. The only bit of information the company has given the market so far is this "Wessex Exploration PLC (WSX.LN), the hydrocarbon exploration company, Monday said its board believes that Total SA's (FP.FR) 10 pence per share offer undervalues the firm, and added that its principal shareholders are unwilling to support any offer which Total might consider at this level. The company also confirms it is fully funded for all current requirements, including participation in a further Zaedyus appraisal well and at least one additional well intended to prove up the scope of the new hydrocarbon frontier established by the successful Zaedyus exploration well. All eyes on the newswires here to see if the company has anything additional to say.
Enegi Oil (LON:ENEG) slipped 7% to 17p after the company said it has raised GBP2.9 million through the issue of 19.5 million new ordinary shares at a price of 15 pence per share. The net proceeds of the placing will be used to facilitate the Company's planned activity in western Newfoundland, which includes purchasing additional production equipment for the Garden Hill South site to enable it to move quickly into the production phase once regulatory approval is secured. The PaP#1-ST#3 well continues to flow on a 24 hour basis, with additional on-site personnel already hired to cope with the increase in activity level.
Leni Gas & Oil (LON:LGO) slipped another 6% to 1.03p during trading today, drifting back towards the support at 1p. Holders here are waiting on addition updates from the Eugene Island Field in the Gulf of Mexico. The last update said Leni Gas & Oil plc. today announces that the A2ST01 sidetrack at the Eugene Island Field in the US Gulf of Mexico has reached a total depth of 13,496 feet. The A2ST01 sidetrack was designed to test the Cranberry Creek prospect at the Tex-X2 reservoir level at a depth of approximately 13,000 feet subsea. The Tex-X2 reservoir was encountered slightly high to prognosis and was found to be water wet. Logging while drilling results show a 5 foot thick hydrocarbon pay zone at a different level within the well, however, this is not considered by the operator to be sufficient to justify installation of a production completion. This sidetrack from the A2 well is being plugged. With the new data obtained, which will require study and integration with the existing well and seismic data, and the need to release the rig due to its sale by Diamond Offshore to Hercules the operator Marlin Energy LLC ("Marlin") was not able to drill and complete the second well and has therefore released the rig back to the owners. When a suitable rig is located the operator will commence drilling of the planned 2(nd) well. The A2ST01 sidetrack was drilled from the non-producing A2 well of the Eugene Island-184 platform whilst production from the A1, A3, A4, A5 and A8 wells continued as normal. The Eugene Island-184 leases are operated by Marlin, and LGO holds a 7.25% working interest.
Saints & Sinners: Mining
Edenville Energy (LON:EDL) finally found a few friends after the recent sell off. The shares jumped 13% to 0.265p on decent volume, as punters decided to bottom fish on a beaten up stock. The most recent update did look to be a very bullish one after the company announced its maiden in-situ resource estimate, at the Mkomolo Basin on the Rukwa Coalfield project in South Western Tanzania, adding that it believes it highlights the positive potential of the project. The drilling has further confirmed the quality of the coal as suitable, with appropriate processing, for coal fired power generation. Company is investigating the Mkomolo Basin on the Rukwa Coalfield, one of Edenville's three known coal deposits on the field. Maiden inferred JORC compliant Mkomolo resource of 39 million tons (39Mt) @ 17 MJ/kg (float density - 2.0 and Yield - 26%). Phase 1 drilling at Mkomolo covered a strike length of 6km. Mkomolo remains open to the north, potentially for a further 3.5 km, and down dip.-The 2012 drill program will delineate these extensions to the Mkomolo coal seams and also test the Muze and Namwele Deposits. The company is fully funded to undertake the proposed 2012 work program. Geophysics and drill contracts signed, field work to commence May.
Rambler Metals (LON:RMM) pushed 3% to 36p during afternoon trading after the company said a total of 9,714 ounces of gold has been poured to date at its 100% owned Ming Copper-Gold Mine, in Newfoundland and Labrador's Baie Verte Peninsula, Canada. Exploration diamond drilling in the 1806 zone returned new visible gold intersections. 4.45 meters (core length) of 49.69 g/ton gold uncut (7.57 g/t gold cut). 29.80 meters(core length) of 39.80 g/ton gold uncut (4.47 g/t gold cut). Copper concentrate production scheduled to start in May, beginning with commissioning ore. Continued development of the high grade copper 1807 zone. Development face sampling in the 1807 zone 346 level returned grades of 5.08% copper, 0.94 g/t gold and 10.04 g/t silver and 0.13% Zn over 3.50 meters. Development of the 1807 down ramp has intersected a previously unknown massive sulphide lens with grades of 4.05% Cu, 4.08 g/t Au, 42.95 g/t Ag and 0.31% Zn over 1.5 meters.
Red Rock Resources (LON:RRR) jumped 13% to 2.7p during early trading after the company said that 'significant' preliminary results have been returned from a two part aircore drilling program at its Migori Project in Kenya. Significant initial results have been received from laboratory analysis of an 8,500 meter regional aircore drilling of the weathered zone at the Migori Project. New prospects have been defined, with five samples from three areas registering 1.0g/t Au, or grams per ton of gold, or more in this untargeted regional sampling; including within a coherent anomalous zone of greater than 0.1g/t Au that is 1.5km in strike and 0.5km wide. Results from a further seven samples across four areas exceed 0.25g/t Au. Further trace element analysis and geological interpretation to occur.
Triple Plate Junction (LON:TPJ) slipped 7% to 2.7p during late morning trading after the Indonesia reported an earthquake that read 8.9 on the Richter scale. Tsunami warnings were issued shortly after the announcement, so we will be watching the news wires to see if the company has anything to say.
Kalimantan Gold (LON:KLG) also slipped 10% to 5.625p on the news of the earthquake and the market will also be watching the headlines from the company to see if the quake has effected business in any way.
Sierra Rutile (LON:SRX) jumped 7% to 58p during afternoon trading, after the recent sell off from 64p to 51p. The company has been in bull mode since yesterday when the company gave the market a production update that said "Rutile production increased 48% to 20,693 tonnes vs. 13,977 tonnes in Q1 2011. Ilmenite production up 57% to 4,960 tonnes vs. 3,155 tonnes in Q1 2011. Full-year 2012 rutile production guidance of approximately 80,000 tonnes maintained. Significant cash generated in the quarter. Cash balance of $35.1 million (as of 5 April 2012) vs. $10.7 million at 31 December 2011, after spending $10.4 million on capital and the D3 feasibility study during the quarter. Expansion projects on track, first items of plant and machinery now landed in Sierra Leone. Due to strong cash generation, SRL does not anticipate it will need further financing to fund the dry mining or Mogwbwemotailings projects.
GCM Resources (LON:GCM) slipped 13% to 77p on decent volume even though the company said "In accordance with 3.1.2 R of the Disclosure Rules and Transparency Rules, GCM Resources plc. ("the Company") has received notification that an entity associated with Mr David Weill (Non-Executive Director) purchased 8,500 ordinary 10p shares in the Company at a price of 94p per share on Thursday, 5 April 2012. Following this transaction entities associated with Mr Weill have an interest in 27,250 ordinary 10p shares." Holders here are still waiting to see what Polo Resources (LON:POL) intends to do with its near 30% holding in the company.
From the trading floor
After a decent set of earnings from ALCOA across the pond, it was no surprise to see the FTSE 100 up close to 50 points during trading today to 5643 (-0.86%) on decent volume. Although, we did slip into negative territory for a short period after Indonesia announced they have been hit with an earthquake that reached 8.9 on the Richter scale. The FTSE AIM All-Share was a touch easier (-0.11%) on volume of just under 900 million shares.
Gold - ↑Trading at $1660, up $1 (+0.07%)
Silver - ↑Trading at $31.70, up 4c (+0.12%)
Copper - ↓Trading at $8046, down $18 (-0.23%)
Zinc - ↓Trading at $1985, down $10 (-0.49%)
WTI Crude - ↑Trading at $101.56, up 55c (+0.54%)
Brent Crude - ↓Trading at $119.42, down 45c (-0.38%)
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