The Smallcap Oil & Gas round up. Souvenir Victory Edition!

The White Flag is flying over the London offices of Uber Expensive City solicitors Pinsent Masons this morning, as I and comrade Tom Winnifrith accept their signed terms. (Surrender) No doubt a tsunami of shame will hit the beaches of Hawaii in due course. I will be signing at 12 noon today! The matter is now closed.


Bridge Energy (LON: BRDG) Advises that the Asha East well has been drilled to its total depth. The primary target in Asha East was Hugin (Jurassic) sandstone with a secondary target in the Skagerrak Fm (Triassic). A 55m core has been retrieved from the Jurassic section. Preliminary assessment of the acquired data indicates that, despite oil shows, there are no signs of movable hydrocarbons in the well. As a consequence, no drill stem test will be carried out. After completion of the on-going data acquisition, the well will be plugged and abandoned.

Egdon Resources (LON: EDR) Announced the completion of the acquisition of a 3D seismic survey to the south and east of Dorchester in the County of Dorset, onshore U.K. The survey, which covers parts of Petroleum Exploration and Production Licence PEDL237 and Production Licence PL090, was acquired by Tesla Exploration International Ltd. and comprised the acquisition of a total of 2,631 vibroseis source points covering an area of approximately 68.5 square kilometres. The survey was designed to provide detailed structural data over a number of leads and prospects at various reservoir levels including the Sherwood Sandstone, the primary reservoir at the nearby Wytch Farm oilfield. The main focus of the survey was over the area of the Casterbridge and Broadmayne structures where, based on previous 2D seismic data, Egdon evaluated combined gross Best Estimate Prospective Resources of around 50 million barrels of oil. The data will now be processed by a specialist contractor to generate a 3D image of the geological structure of the area to enable the licence group to identify locations for possible future exploration drilling.

Fastnet (LON: FAST) The listed E&P company focused on near term exploration acreage in Morocco and the Celtic Sea, is pleased to note that its partner, Kosmos Energy (NYSE: KOS), announced that it has entered into a farm-out agreement with BP plc (LSE: BP) (NYSE: BP) to earn a 26.325% stake in the Foum Assaka permit Offshore Morocco.

Fortune Oil (LON: FTO) Said it was “pleased” on the signing of a US$300 million (GBP188 million) loan agreement by Fortune Oil PRC Holdings Limited, the Company’s principal intermediate holding company in Hong Kong. (Why any company would be “pleased” to be racking up further debt is a mystery to me!) The facility is denominated in US$ with a term of three years and a margin of 2.75% over LIBOR. The facility is guaranteed by Fortune Oil and secured by share charges over its various investment holdings subsidiaries. The facility structure is similar to the Company’s US$180 million three year loan facility signed in April 2011. This new facility will be used to repay the existing syndicated debt, provide the Company with working capital, and finance new investment. (And ever more debt!)

The directors of Forum Energy (LON: FEP) noted the recent movement in the Company’s share price and confirmed that they are not aware of any reason for such a movement. They then went on to say; “However, the Company notes the speculation in relation to the status of the Phase II development wells being drilled at the producing Galoc oilfield offshore the Philippines (in which Forum Energy has a 2.27% participating interest). Otto Energy Limited, the operator of the permit, has announced that the results from the flow test of the first development well, 5-H, are still in line with the previous forecast of an overall field production rate of 12,000 bopd gross (272 bopd net to Forum Energy), to be delivered once Phase II is brought in to production which is expected to be in late November 2013. The Company also announces that it is in the process of negotiating the refinancing of its US$15m related party loan facility with Philex Mining Corporation. The directors of the Company expect this process to be concluded in the coming weeks. A further announcement will be made as soon as these negotiations have been concluded.” Now which is it? You are either non-plused as to why your sp is moving or your not! Call me a cynic but some Boards will try to use any opportunity to move their sp!

Ithaca Energy (LON: IAE) Provided an update on third quarter 2013 (“Q3-2013”) operational activities, including recent key milestones achieved on the Greater Stella Area development and production performance. The Company’s Q3-2013 financial results are scheduled to be published on 11 November 2013. Much too long for the smallcap round up. Click HERE to read

Max Petroleum (LON: MXP) Has completed drilling the SAGW-14 appraisal well to a vertical depth of 1,423 metres without encountering sufficient hydrocarbons to be commercial and it will be plugged and abandoned. The results of the well will be analysed and integrated into the geotechnical evaluation of the field. The Zhanros ZJ-30 rig will next move to drill the SAGW-9 well, one of seven wells remaining in the current appraisal programme in the field. In the Uytas field, the UTS-9 appraisal well reached a total depth of 550 metres, without encountering sufficient hydrocarbons to be commercial and will also be plugged and abandoned. The Zhanros mobile truck mounted rig is now moving to the UTS-18 appraisal well, which will be drilled to a total depth of approximately 450 metres targeting Cretaceous and Jurassic reservoirs. After UTS-18, an additional three wells remain to be drilled as part of the initial appraisal programme in the field.

Mediterranean Oil & Gas (LON: MOG) Released a Q3 operational update today. You can read it by clicking this LINK

Range Resources (LON: RRL) International Petroleum announced it had entered into two binding conditional terms sheets for the sale of its assets in Kazakhstan and Russia for US$60 million. As previously announced, Range had proposed a merger with International Petroleum, subject to various conditions being met, which when announced was likely to be conducted as an off-market takeover offer by Range to International Petroleum shareholders. In conjunction with the proposed merger Range has advanced US$8 million in secured loan financing to International Petroleum. While the sale process for the Russian Assets was known to and supported by the Range board, the final terms of the proposed transaction, and the sale of the Kazakhstan Assets have only now been defined. As a result of clarity on the sale of these assets, the likely proceeds from this sale and the associated shift in focus of International Petroleum to its African assets, Range will now identify and consider a range of corporate alternatives to the original merger proposal, which may or may not include a merger of the two companies – albeit on terms to be renegotiated. (Is it on or is it off?  Simple question! No wonder the sp is in the toilet!)

Sefton Resources (LON: SER) Noted the recent press speculation regarding a settlement of the legal action initiated against Tom Winnifrith and Daniel Levi, as announced by the Company on 25 February 2013. The Company can confirm that it is in negotiations regarding a settlement of the legal action but no agreement has as yet been signed by the parties. All over bar the shouting?

Tethys Petroleum (LON: TPL) The E&P Company focused on Central Asia and the Caspian Region, provided an update on operations in Kazakhstan. Click the LINK to read it.

Urals Energy (LON: UEN) The independent exploration and production company with operations in Russia, announced that following the requisition of an EGM, further details of which were announced on 25 September 2013, it has posted a notice convening an extraordinary general meeting of the Company’s shareholders for 11.00 a.m. on Monday 27 January 2014 at Evagoras Building, Office 34, 3rd floor, 31 Evagorou Avenue, Nicosia, CY-1066, Cyprus. The key points in the Circular are: Removal of Ingeborg Srenger from the Board will be an ‘Event of Default’ under the Petraco Oil Company debt restructuring agreement giving Petraco the right to require immediate repayment of the amounts owing to it. Urals Energy would face litigation from Petraco and this would be extremely detrimental to the Company and its shareholders. Potential cash offer received at an indicative price of 12.25 pence per share for 100% of the entire issued share capital of Urals Energy. Potential cash offer is subject to due diligence from a highly credible purchaser with previous Russian operational oil experience. Uncertainty as to who has ultimate control and ownership of Fire East Corporation.The requisitioners have failed to provide any information on their future plans for Urals Energy. The Board believes that the requisitioners are planning on using the Company to acquire a high risk asset. Existing management have saved Urals Energy from near bankruptcy. The resolutions proposed are not in the interests of shareholders. The Board of Urals Energy recommends that shareholders vote against all the resolutions proposed by the requisitioners. Copies of the Circular convening the EGM are available from Urals Energy’s website in accordance with Rule 20 of the AIM Rules for Companies

Wessex Exploration (LON: WSX) Released their final results for the year ended 30 June 2013. (It’s been a terrible year for them. A real stinker.) Time for heads to roll! In the year to 30 June 2013, the loss before taxation was £3.39m (2012: loss £1.64m) and loss per share was 0.47p (2012: loss 0.26p). Operations continue in Guyane on the GM-ES-5 well, a prospect located down-dip from the Zaedyus discovery. Election made to conserve up to £1.5m of cash resources by diluting interest in Guyane Maritime venture to around 1.1% (from 1.25%). New 2D seismic data being acquired in Southern England (P1928), major reprocessing effort completed and now being interpreted. Renewal Application for Juan de Nova Est Permit made with Wessex having the right to hold 50% if awarded. Cash as at 30 June 2013 was £4.4m, of which the Company had projected further commitments of £3.3m, almost all relating to Guyane (pre-dilution) as the current four well drilling campaign draws to a conclusion.

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