The Oil Man: SDX Energy, Amerisur Resources, Trinity E&P
13th November 2017 11:16
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WTI $56.74 -43c, Brent $63.52 -41c, Diff -$6.78 +2c, NG $3.21 +1c
Despite the EIA inventory stats disappointing slightly and the rig count showing a rise of 9 oil units, the oil price acquitted itself fairly honourably last week.
WTI gained $1.10 and Brent $1.45 which we can probably put down to geopolitical events.
With the MbS round-up continuing and an escalation in the tension between the KSA and Iran, this ain't going away. Before long the Non-OPEC and OPEC meetings will be upon us and, with the Saudis leading by example, the stage is set for an extension of the agreement and possibly further cutbacks.
SDX Energy
has announced another gas discovery, this time at their KSR-15 development well on the Sebou Permit in Morocco.
They encountered 17.2 metres of net conventional natural gas reservoir section across four intervals and the Hoot Sand, their primary objective had average porosity of 29%.
This is the highest rate in the basin and exceeded their pre-drill estimates. The well will now be connected to the nearby infrastructure and should be on production in December.
With two wells now successfully drilled (the KSR-14 well should start testing this week), the company's strategy of increasing local gas sales in Morocco by 50% by 2018 is getting much closer.
SDX continue to deliver and with an exciting portfolio of prospects in both Morocco and Egypt the outlook is very promising, cheap as chips as I have been know to remark…
Amerisur Resources
A short and sweet Colombia operational update from this morning. The Plat-27 well has been spudded on Pad 2N and should be complete in around 30 days.
This is an appraisal well to access the northern part of the accumulation discovered by the Plat-22 well. They have also heard from CPO-5 that the inspection is complete and the long term test should begin shortly.
Trinity Exploration & Production
The good news from just keeps on coming. With today's Q3 operational update we get a continuation of the increase in profitable production and further strengthening of the balance sheet where there is cash of $12.3 million (£9.4 million).
Production wise the quarterly rise is 7.4% to 2,506 barrels per day with all the usual methods delivering the goods.
Recompletions, workovers, reactivations and swabbing have provided all this with not an exploration well in sight, yet. Indeed, we can expect more as the October figure was 2,754 barrels per day making the current quarter look potentially better again.
Trinity remain highly disciplined on costs, every time I meet Bruce or Jeremy some poor supplier has taken a hit and they are also hedging through a zero cost collar structure to protect some of the downside.
The way that the Trinity team have gone about restructuring the company is as good as I've seen lately and this is paying off in a big way.
As Bruce Dingwall said recently, the company pride themselves on genuinely profitable barrels with some of the lowest net costs in the sector, which is why they are looking so good now.
And finally…
Last night Northern Ireland could only draw 0-0 with Switzerland, making even more of a mockery of the incorrect award of a pen in the first leg which sent the Swiss through.
The rugby was a bit mixed, Ireland were very good in stuffing South Africa whilst England made heavy weather against the Pumas. Wales were beaten by the Wallabies whilst Scotland just beat Samoa in a high-scoring game.
With Vettel winning in Brazil he must have been thinking of what might have been, but Hamilton was coming from the back of the grid. Final stop will be Abu Dhabi where it would be great to see a wheel to wheel race from the start.
In Valencia, the MotoGP season came to a fitting end when Marc Marquez won the World Championship for the fourth time.
After a stunning season challenger Dovizioso couldn't keep up with Marquez and unfortunately finished in the gravel.
The race was won by Marquez's teammate Dani Pedrosa from Johann Zarco (a 'satellite' rider and definitely one to watch in 2018) and Marquez, despite a near off and a miraculous save, managed 3rd with enough points for the title.
First Brit home again was Cal Crutchlow in 8th. (And big thanks to John Rimmer who has kept me in touch with the MotoGP season, you knew it couldn't be me!)
Malcolm Graham-Wood is an independent oil industry expert and freelance contributor, not a direct employee of Interactive Investor.
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.