The Smallcap Oil & Gas round up.

It’s been a very busy week in the smallcaps oil and gas underverse. It’s also been a busy week for myself fighting the good fight against the corporate hyenas. Have a good weekend and remember research, research and research some more. Tip of the week do not open a bank account in Cyprus!

Amerisur Resources (LON: AMER)
Updated on its operations in the Platanillo field, Colombia. Platanillo-1 ST1 sidetrack encountered a 22ft net pay interval in the U sand and produced 530 bopd in a controlled production test.. Platanillo-10 encountered 68 ft net pay in U and T sands.. Platanillo Field production currently at 4,700 bopd, constrained by pipeline and export facility availability. Total field production capacity estimated at 6,400 bopd.. Alea-1 ST1 sidetrack to commence shortly. Platanillo-10, the sixth well of the current Platanillo drilling programme and located on platform 5 South (5S) was deviated approximately 1,865ft north east of platform 5S. The well encountered an interval of 80ft Gross, 68ft net indicated pay in the U sand and T sand. As predicted by the geophysical model, the N sand was not well developed at this point. It is expected the well will be completed and placed on production during March. Platanillo-1, drilled in 2007, and not tested by the previous operator, ECOPETROL, was re-entered and was sidetracked to a location approximately 2,485ft to the east. The objective of this sidetrack was to further delineate the oil columns in the Platanillo reservoirs and potentially to provide a water injection facility for the field. This well, named Platanillo-1 ST1, encountered a 22ft net pay interval in the U sands, of which 7ft was perforated, producing 530 BOPD on test. The well has now been placed on commercial production. Platanillo field production continues to be constrained by local conditions. The Company has been active in developing new alternatives for oil delivery, and expects those options to allow a continued growth in production over the coming months. The Serinco D-10 drilling rig is currently being moved from the Platanillo-1 ST1 location to the Alea-1 location. It is planned to re-enter and sidetrack that well to a structurally more favourable position for oil production. Rig Latco-01 continues operations on Platanillo-10, after which it will be skidded to drill well Platanillo-11, the seventh new well of the current drilling programme on the same platform. Well done Amerisur. One to watchlist.

Enegi Oil (LON: ENEG)
Provided the following update on the Phoenix Block, UK North Sea, which contains the Phoenix oil discovery. Under the work programme, the Company is required to obtain 250km2 of 3D data processed to PSTM and PostSTM and Enegi has secured this data over the Block. The Company will now carry out in-house interpretation, subsurface analysis and reservoir modelling to determine the full range of recoverable reserves for the Phoenix discovery. The Phoenix oil discovery was discovered in 2004 by the Shell operated well 22/12a-10. Geologically, the discovery is a low – relief dip closed structure that lies on the Forties-Montrose High, located between the Nelson Field 16km to the northwest and the Montrose Field 12km to the southeast. The Phoenix reservoir is on trend with the Forties, Montrose and Nelson fields and has been proven to contain many similar properties to these fields, as well as the Arbroath and Arkwright fields which have been also identified as analogous to the Phoenix discovery. All of these analogues share the same Palaeocene sandstone formation and have produced light sweet crude with an API range of 38 – 42°. Recovery factors across the fields have ranged from 57% for the Forties field to 34% to the Arkwright field. Permeability and porosity levels across these fields are also considered to be very good leading to significant flow rates being achieved from these fields. The remaining acreage in the Block is also believed to contain a lead and a prospect known as “Lead A” and the “Manx Prospect”, respectively which are in the area covered by the agreement with Azimuth. A review of the Phoenix discovery by the Company prior to securing this data, has produced a preliminary minimum STOIIP estimate of 15MMBBL, based on a defined structural closure and the oil-water-contact (OWC) encountered by well 22/12a-10. The previous operator of the Block, indicated a STOIIP of up to 93.5MMBBL.

Europa Oil & Gas (LON: EOG)
Announced the commencement of 2D seismic acquisition on PEDL 181, East Lincolnshire

Fastnet (LON: FAST)
The listed E&P company focused on near term exploration acreage in the Celtic Sea and Morocco, as well as announcing that it has executed a seismic contract with CGG to acquire, using the SR/V Vantage, 1,710 sq. km. of 3D seismic in the Celtic Sea beginning in mid-April 2013. Invented a new word for inclusion into the Oxford English dictionary. “FARMINEES” The total value of the programme is up to US$18 million. The programme is likely to last for approximately 50 days, depending on weather and standby time. 510 Km2 of 3D seismic will first be acquired over the “Deep Kinsale Prospect” beneath the producing Kinsale Head gas field. Seismic operations will include an undershoot of the Kinsale Alpha and Bravo platforms, which are protected by a 500 meter safety exclusion zone. This will require, under the existing seismic contract, mobilising a second 3D seismic vessel for a short period of time during the acquisition of the data by the SR/V Vantage. The geological target will be the same reservoir section that has been successfully tested at Barryroe by the 48/24-10z appraisal well. 1,200 sq. km. of 3D seismic will then be acquired over Licensing Option 12/3 (“Mizzen”) and adjoining areas. Several large structures have been identified on existing 2D seismic data that are prospective for Triassic, Jurassic and Lower Cretaceous reservoir targets. The 3D seismic surveys are the largest ever to be undertaken in the Celtic Sea. There is flexibility to accommodate up to two additional contingent 3D seismic surveys over other acreage subject to the level of interest from potential farminees. A farm-out process has commenced and initial expressions of interest have already been received from a range of multi-nationals, mid-caps and small-caps. I tried to contact the company for a comment on their new word “FARMINEES” however NOONEEES was available.

Leyshon Resources (LON: LRL)
It’s been a good start to 2013 for Atherley’s LRL. As they announced this week that its wholly owned subsidiary, Pacific Asia Petroleum Limited (PAPL), will commence testing well ZJS6 this week. The flow testing of ZJS6 and immediately followed by the testing of ZJS5 is to determine whether commercial flow rates can be established from selected pay zones as part of the previously announced $20 million accelerated exploration and appraisal programme on the Zijinshan Gas Project, located on the eastern fringe of the prolific Ordos Gas Basin in Central China. Results will be reported as they come to hand with the initial results expected towards the end of the month. Both wells ZJS5 and ZJS6 are part of an initial programme designed to explore and test the potential for commercial gas production in a highly prospective and unexplored 380 km2 central depression area that appears to demonstrate good continuity with the neighbouring Sanjiaobei discovery.

Rita from Magnolia Petroleum (LON: MAGP)
The AIM quoted US onshore oil and gas exploration and production company reported an update on the Company’s commercial activities in proven US onshore formations including the Bakken/Three Forks Sanish, North Dakota and the Mississippi Lime and Woodford/Hunton formations in Oklahoma. Still no definitive bopd figures from Rita. Buyer beware?

Matra Petroleum (LON: MTA)
A piss poor RNS came this week from Maxim Barskiy’s MTA as the company announced the results of the seismic survey conducted on its 100% owned Sokolovskoe oil field in Orenburg, Russia. The survey included 100 kilometres of 2D seismic and 60 square kilometers of 3D seismic. Interpretation phase works enabled Matra to correctly determine the configuration of the target horizons and reduce uncertainty in the range of potential reserves: (All very well and good so far) Seismic results have determined the complexity of the field configuration compared to what was previously mapped as one big structure. The seismic data interpretation identified that the Aphoninsky reservoir of the Sokolovskoye field splits into four separate domes within the boundaries of the license area from south-west to north-east. Yes I like the sound of that but the link to the seismic map revealed what can best be described as a sickly depressing drawing that wasn’t at all helpful.

Mediterranean Oil & Gas (LON: MOG)
Was “pleased” to announce that its subsidiary Medoilgas Italia SpA has signed a gas sales contract with Repower Italia SpA relating to the Company’s entire net gas production from the Guendalina gas field for a period of one year from 1 October 2013 until 30 September 2014. Repower has purchased all of the Company’s production from Guendalina since 1 April 2012 under an existing contract that is valid until 30 September 2013. I’m pleased to say “Yawn”

New World Oil & Gas (LON: NEW)
Said that the Danish Energy Authority, part of the Government of Denmark, has formally approved the assignment to New World’s wholly owned subsidiary, New World Resources ApS, a 25% working interest in Licence 1/08 of the Danica Resources Project in Denmark. Licence 1/08 is located in the productive Western Baltic region of the South Permian Basin in Southern Denmark, totalling 6,420 sq km. The assignment of 25% working interest to New World is in accordance with the Farm-Out Agreement announced on 17 April 2012 and follows the completion of Phase 1 of a 2-D seismic acquisition programme consisting of 166.44 sq km, and an additional 38.5 sq km 2-D seismic acquisition programme on two re-confirmed leads. Results from Phase 1 were incorporated into an updated Competent Person’s Report (released 22 January 2013) which confirmed the prospectivity of the drill-ready Als prospect with an estimated P50 un-risked prospective recoverable resources of 1.4 TCF & 97MMbo & NPV10 of US$2.4billion (unrisked). Additionally, four previously identified Zechstein leads were confirmed on Falster and Lolland Islands from the new seismic data on which a 38.5 km 2-D acquisition programme has recently been completed. “We are delighted to have now earned into a 25% working interest in both of our Danish projects. In tandem with increasing our interests in these three exciting licences, we are delivering on our strategy to systematically identify, delineate and de-risk multiple prospects to the point of drilling” Said New World CEO William Kelleher. Yes of course you are Willy. That’s why the sp is 2.9p down from the highs of 14p. Keep delivering nonsense in your RNS’s & we’ll keep highlighting them.

Northern Petroleum (LON: NOP)
A busy week on the RNS front for NOP with no less than 5 releases. Northern acquired additional leases over 4,000 acres increasing its aggregate holding of petroleum and natural gas mineral rights in Canada to 9,300 acres. These leases are all centred in one basin in Northern Alberta. To date they have produced a combined 11 million barrels of oil from an estimated 56 million barrels of oil originally in place, representing a recovery factor of approximately 20 per cent. The total acreage contains 37 abandoned wells, of which 19 have initially been identified by Northern as being capable of re-entry for further production. This area has multiple redevelopment opportunities for the existing high productivity reefs in the Keg River Formation as well as the Muskwa emerging unconventional shale play. A busy week on the RNS front for NOP with no less than 5 RNS’s released this week. Too much for the round up. You can access them all by clicking this LINK

PetroNeft Resources (LON: PTR)
Released an Operating Update this week. Highlights: Arbuzovskoye well 105 successfully completed.. Initial oil flow rate of 160 bopd, with no water production.. Successful workover restores production at Arbuzovskoye well 102 to 380 bopd.. Recent pressure testing of two Arbuzovskoye wells shows normal pressure decline.. Arbuzovskoye water source well completed, planned pressure maintenance to commence shortly. Timing and location of future Arbuzovskoye wells to be determined by response to pressure maintenance programme.. Total production increased to 2,800 bopd.

San Leon Energy (LON: SLE)
Signed a Memorandum of Understanding with Halliburton Company Germany GmBH Sp. Z.o.o. to develop a strategic relationship to jointly explore and develop the Carboniferous unconventional gas potential in San Leon’s Wschowa, Gora, and Rawicz Concessions (“the Concessions”) in Poland. San Leon will continue to serve as operator and manage the operations on the Concessions. All activities covered under this relationship will be limited to the Carboniferous and deeper sections. For clarity, the shallower Permian Rotliegendes and Main Dolomite sections are excluded from this relationship. Under the MOU, it is anticipated that Halliburton will perform and fund a Diagnostic Fracture Injection Test (“DFIT”) for the Siciny-2 well in Q2 2013. Upon completion of the DFIT, Halliburton will have the option to perform and fund a minimum two-stage vertical hydraulic fracture in the Siciny-2 well with San Leon paying 50% of the wholesale proppant (fracturing fluid) cost to Halliburton. This procedure is also planned for Q2 2013. San Leon will fund other third party costs on the well-site, such as security and waste disposal, in connection with the DFIT and fracture.

Serica Energy (LON: SQZ)
Trustees of the Serica Energy Share Incentive Plan have made purchases of and allocated Serica shares under the terms of the plan on behalf of employees and officers of the Company as a result of which certain directors increased their beneficial shareholdings in the Company by a total of 4,131 shares on 13 March 2013, as follows: Christopher Hearne (Finance Director) acquired 1,377 ordinary shares at an average price of 27.25 pence per share taking his total beneficial shareholding to 798,685 shares representing 0.44% of the voting rights; Peter Sadler (Business Development Director) acquired 1,377 ordinary shares at an average price of 27.25 pence per share taking his total beneficial shareholding to 190,225 shares representing 0.10% of the voting rights. Mitchell Flegg (Chief Operating Officer) acquired 1,377 ordinary shares at an average price of 27.25 pence per share taking his total beneficial shareholding to 106,872 shares representing 0.06% of the voting rights.

Solo Oil (LON: SOLO)
Confirmed that FirstEnergy Capital LLP, on behalf of Aminex plc and the Company, are continuing to hold discussions with a number of parties concerning a farm-out of the Company’s interests in the Ruvuma PSA in Tanzania. Further announcements will be made in due course. Participants in the Ruvuma PSA are: Ndovu Resources Ltd (Aminex) 75% (operator) and Solo Oil Plc 25%.

Sound Oil (LON: SOU)
It’s a great life for these companies that consolidate their shares then start all over again issuing stock. It’s like resetting the clock, I call it “Super Dilution” Sounds Open Offer to raise up to £1 million (before expenses) through the issue of up to 12,386,968 Open Offer Shares at 8.073 pence per New Ordinary Share. The Open Offer was not underwritten. The Company has received valid acceptances in respect of 605,662 Open Offer Shares from Eligible Shareholders. Application has been made to the London Stock Exchange for the Open Offer Shares, which rank pari passu with the Company’s issued Ordinary Shares, to be admitted to trading on AIM. It is expected that Admission will become effective and that dealings will commence at 8.00 a.m. on 25 March 2013. Following the issue of the Open Offer Shares, the Company will have 287,618,544 Ordinary Shares in issue. Let’s take a wild guess. More placing’s and super dilution over the coming 24 months?

Trapoil (LON: TRAP)
Concluded on the Magnolia (Licence P.1610, Block 13/23a) exploration prospect. The exploration well was drilled to its target depth of approximately 5,028 feet Measured Depth Below Rotary Table (“MDRT”) or 4,920 feet True Vertical Depth Sub Sea and as such has fulfilled the licence obligation. The well achieved its primary targets, being the Captain, Coracle and Punt sandstones within the Lower Cretaceous interval, however no significant hydrocarbons were encountered. Accordingly, there are no plans to conduct a drill stem test and the well is to be plugged and abandoned. So this well “achieved it’s primary target?” Really? George Orwell eat your heart out. News-speak is alive & well.

Valiant Petroleum (LON: VPP)
Announces its full year results for 2012. You can view by clicking HERE.

Zoltav Resources (LON: ZOL)
The company controlled by Kid (Arkadiy) Abramovich, the 19-year-old son of the Russian billionaire, has entered into an agreement to acquire the entire issued share capital and shareholder loans of CenGeo which, through its wholly owned subsidiary ZAO Siberian Geologicheskaya Kompanya (“SibGeCo”), holds the Koltogor Licence located in the Khantiy-Mansisk region of western Siberia. The Koltogor Licence contains the undeveloped Koltogor oil field. The Company has commissioned a competent person’s report to assess the volume of contingent resources; the results of which will be included in the Circular. The consideration payable for CenGeo is US$26 million to be satisfied entirely through the issue of 473,157,416 Zoltav shares at 3.5 pence per share. CenGeo is a private company of which Valentin Bukhtoyarov is the beneficial majority-owner. CenGeo recently acquired SibGeCo and successfully obtained a new 25 year exploration and production licence covering the Koltogor oil field. SibGeCo was previously owned by the Gazprom Neft Group. The Koltogor Licence was issued by the Russian Federal Agency for Subsoil Use (Rosnedra) on 15 February 2013. Further details in relation to the acquisition will be set out in the Circular which will be sent to shareholders in due course. Trading in the shares remains suspended. Like father like son. I expect he’ll do on the Chelsea Board soon enough! Got to admire this kid. 19 and running an oil company. Grovel! grovel, grovel…. Interview Arkadiy? You know how to contact me. Dead letter drop under Nelson’s column. Chalk an X.

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