AUCTUS ON FRIDAY - 09/02/2024

AUCTUS PUBLICATIONS ________________________________________ Chariot (CHAR LN)C; target price of £0.50 per share: Receiving EIA approval for onshore drilling in Morocco – Chariot has received approval for its EIA for a total of 20 well at Loukos, onshore Morocco. The approval covers the initial drilling campaign of two exploration wells (Gaufrette and Dartois) as well as 17 further well locations and the re-entry of an existing gas discovery. Operations are expected to start at the end of 1Q24 a

Auctus on Friday - 26/01/2024

AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C; target price of A$0.65 per share: Drilling rig on location of high impact well by the end of January – A rig is expected to be mobilised to the high impact Welchau-1 drilling location during the last week of January. Drilling is expected to last for 6-8 weeks. The total vertical depth of the well is only 1,800 m with a dry hole cost estimated at ~EUR5.1 mm. Welchau gross prospective resources have been independent

Auctus on Friday - 03/11/2023

AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C; target price of A$0.80 per share: On Track to start drilling in early November - 3Q23 production of 324 boe/d and cash of A$5.7 mm at the end of September were near our expectations. This includes 101 bbl/d gross production for Anshof that was shut-in on 19 September after reaching the regulatory limit for test production. Until that date the Anshof-3 well produced at a stable rate of 114 bbl/d, which is above the

Q3: A profits shortfall on the back of weak gas trading casts a shadow over the upstream

Unlike its peers, bp posted a big miss versus estimates as the company’s quarterly profits remained 13% below the consensus figures. A strong oil trading result was offset by weaker gas trading in the quarter due to subdued volatility. The overall operational performance was supported by increased hydrocarbon production. Despite the consolidation trend in the US, bp is focusing on organic growth for its oil and gas portfolio at high prices while looking at inorganic growth in the energy transiti

Dangled in the “G” anomaly after CEO’s sudden departure begs questions

In an unexpected move, bp announced CEO Bernard Looney’s resignation over his failure to disclose transparently the number of past relationships with colleagues. He will be replaced by CFO Murray Auchincloss on an interim basis. Looney took over the job in early 2020 and immediately introduced a strategic overhaul that should drive the company through the energy transition and towards a net zero path. While the overall strategy of the company may not change, the CEO’s surprising departure (shoul

Auctus on Friday - 04/08/2023

AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C; target price of A$0.10 per share: Growing production. New Anshof well to be spudded in September - 2Q23 production was 317 boe/d reaching 366 boe/d in June and including ~115 bbl/d at Anshof. Anshof-3 production performance continues to exceed expectations with strong pressure support and deliverability with no water production. Work-over activities at Zistersdorf and Gaiselberg (Vienna basin) in mid-August are ex

Q2: saved by promising projects, cash returns

Among its peers, bp reported the biggest annual decline in profits (c.-70%). Across the business segments, refining and products suffered the most with low margins and prolonged costly maintenance, and weaker oil trading. Despite the negative surplus due to a 46% drop in operating cash flow, bp committed to returning $1.5bn in buybacks in Q3 and announced a 10% increase in the quarterly dividend. Disclosure in the energy transition businesses as of the next quarter is a welcome development.

AXL LN/CN, LBE LN, PTAL LN/TAL CN, SOUC LN/SOU CN, VLE CN, ANGS LN, AST LN, BP LN, CEG LN, COP US, EME LN, EQNR NO, GTE LN/CN/US, ITH LN, KIST LN, TCF CN, TRIN LN, TTE FP, UOG LN

AUCTUS PUBLICATIONS ________________________________________ Arrow Exploration (AXL LN/CN)C; target price of £0.50 per share: Zone at Carrizales Norte with no booked reserves has flowed >1 mbbl/d – The Ubaque horizon at the Carrizales Norte-1 (CN-1) exploration well was put on three tests, the last of which tested at 1,134 bbl/d of 13.5 API oil on pump. The flow rate was stabilized with a 28.3% water cut (completion fluid). The water cut has been decreasing throughout testing. This is a very go

Auctus on Friday - 05/05/2023

AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU)C: Target price of A$0.100 per share: 1Q23 in line with expectations. Growing production at Anshof – 1Q23 production was 299 boe/d including 88 bbl/d for Anshof. In March net production from Anshof has increased to 94 bbl/d. Overall net production in March including the Zistersdorf & Gaiselberg fields (Z&G) was 336 boe/d. Additional site storage is planned to be installed at the Anshof-3 well location in June which

Q1: Another quarter boosted by trading, but the buyback outlook is disappointing

Strong oil and gas trading lifted the results for another quarter, enabling bp to book $5n in the Q1 and beat the consensus by 16%. The adjusted EBIT at $9.2bn was broadly in line with the Q4 FY22 and higher than ENI and TotalEnergies. Surplus cash flow significantly dropped (54%) qoq due to lower operating cash flow, down 44% qoq, on the back of declining commodity prices. Accordingly, bp announced a lower share buyback program at $1.75bn, which disappointed the markets.

Auctus on Friday - 31/03/2023

AUCTUS PUBLICATIONS ________________________________________ Arrow Exploration (AXL LN) C; Target price of £0.45 per share: Adding reserves in Colombia – Arrow’s 1P, 2P and 3P reserves were estimated at respectively 3.4 mmboe, 7.7 mmboe and 11.7 mmboe at YE22. This includes 2.1 mmboe 2P reserves and 4.3 mmboe 3P reserves at the company’s core assets in Colombia (Tapir and Oso Pardo). Even after deducting 6 months of production (~0.18 mmbbl), the 2P and 3P reserves at the core assets have increas

BP PLC: Major Drivers, Financial Forecasts, DCF & Comparables Valuation, ESG & Other Risks (02/23)

BP had a mixed quarter and its revenues were significantly above Wall Street expectations. The management’s emphasis on cost performance as well as operational reliability underpinned robust financial delivery. Despite the fact that its costs are being controlled, the company missed out on meeting the earnings estimates of analysts. BP saw a sharp decline in both spots as well as futures prices. Global margins decreased modestly, consistent with trends in seasonal demand. The company is planning

CEQ CN, GPRK US, HHR AU, TETY SS, AKERBP NO, APA US, ALV CN, BP LN, CNE CN, DEC LN, DELT LN, DNO NO, EQNR NO, FEC CN, IOG LN, MAHA-A SS, SQZ LN, TTE FP, VAR NO

AUCTUS PUBLICATIONS ________________________________________ Criterium Energy (CEQ CN) C; Resources report in Indonesia – The Lengo gas field is estimated to hold 359 bcf (134 bcf net to Criterium). The contingent resources for the Lengo field are contingent on signing a Gas Sales Agreement (GSA) and securing financing and a final investment decision (FID). A Heads of Agreement was signed in August 2022 with a credible gas offtaker and the partners are now progressing to a formal GSA. It is ant

Q4: bp appreciates high returns from O&G in commitment to stable returns

A more-than-doubling in FY2022 profits and an impressive increase in cash flow from operations have led bp to increase its quarterly dividend by 10% and continue its buyback spree with $2.75 in Q1 FY2023. The updated outlook highlights increased EBITDA from the energy transition business of around $10-$12bn by 2030, with double-digit returns across the EV charging, hydrogen, and bioenergy businesses while “resilient hydrocarbons” will still contribute 75%-76% of the EBITDA at an assumed oil pric

Auctus on Friday - 04/11/2022

AUCTUS PUBLICATIONS ________________________________________ ADX Energy (ADX AU) C; Target price of A$0.070 per share: Anshof Reserves estimate well above expectations – RISC estimates that the Anshof field holds 5.2 mmboe of 2P gross reserves (4.2 mmboe net to ADX). This is well ahead of our expectations of ~1.8 mmboe. 85% of the previously estimated mid-case recoverable resources are now classified as 2P reserves. The 2P reserves estimate is based on an assumption of a water oil contact at 1,

NextSource Materials - Initiation

NextSource is uniquely positioned to build a leading vertically integrated position, ex China, in the supply of Lithium-ion battery anode material which is essential for the Energy Transition. The company is commissioning phase 1 of its world-class Molo graphite mine in Madagascar and is in the final permitting process for its first Battery Anode Facility (BAF) to be located in Mauritius. The company is backed by Vision Blue, established by Sir Mick Davis, former CEO of Xstrata. On our calculat

Falcon Oil & Gas - Funding a Multi TCF Resource

Falcon has raised gross proceeds of US$8.9m via a placing and subscription at a price of 6p/share and the granting of overriding royalty interests. The net proceeds, together with Falcon’s existing cash resources (cUS$4.3m) will be used to fund Falcon’s net share of 2024 capex (cUS$9m) associated with the 40MMscf/d Shenandoah South Pilot Project, including the drilling, stimulation, and flow testing of two 10,000ft horizontal wells. The funds will also enable Falcon to fund its share of the cost

Initiation of Coverage - Critical raw materials for Europe’s green transition

Beowulf is advancing a portfolio of projects in Europe focussed on metals and minerals that are critical to enabling the continent’s transition to a greener economy. Awareness of Europe’s over-reliance on external supply sources for such vital raw materials is driving growing political support for ‘home-grown’ projects. Beowulf is strategically positioned to leverage this fast-evolving trend – its Kallak project in Sweden holds potential to deliver high-quality iron ore to lower the carbon-inten

Morning Note – 22 April 2024

Sintana Energy Inc. (TSX-V: SEI): Constrained test rate of 14 mboe/d at Mopane-1X. 10+ bn boe in place confirmed.

• Multiple tests over multiple zones in multiple horizons were run at the Mopane-1X exploration well. The flows achieved during the well test reached the maximum allowed limits of 14 mboe/d. The flow rate was constrained by the size of the available surface facilities. • The AVO-1 horizon encountered at Mopane-1X and Mopane-2X are in the same pressure regime, suggesting that the entire area (8 km diameter) between the two wells is connected. Overall, in the Mopane complex alone, and before dril

Touchstone Exploration+ (TXP, House Stock at 44p) - Closing of expanded bank facilities

LIBERUM: Ferrexpo: Production triples

SP Angel Morning View: Copper prices hit $9,700/t as China smelts concentrates for zero charge Tc/Rc

Jubilee Metals - Operational Update Q3 FY2024

Jubilee today reports its Q3 and third quarter operational results from its expanding operations in Zambia (copper) and South Africa (chrome and PGM). South Africa is on a growth trajectory with record chrome production of 409kt in the quarter (Q2 FY2024 381kt) and a monthly record in March of 145kt and production YTD of 1.13Mt (0.94Mt). Jubilee is well underway to its annual target capacity of 2,1Mt/yr especially with the new 300kt/yr chrome plant at Thutse expected to be operational in August

Alien Metals - Hancock Project, Mining Lease Granted

Alien today reports intraday that the Western Australian Government has granted a mining licence for the Hancock iron ore project for a 21-year term. The granting of the mining licence is the latest milestone delivered by Alien as it advances the project towards development and production.

I3 Energy (I3E LN) - Canada royalty assets sale

I3 has announced the sale of the majority of its royalty interests in Canada, for US$24.8m cash. This allows the company to fully repay amounts drawn on its debt facility and create a working capital surplus, giving I3 significant additional funding flexibility going forward

Jersey Oil & Gas (JOG LN) - Share price fall creates opportunity

Since November, the JOG share price has moderated from a high of 250p to current levels of 149.5p. This is despite JOG having now made significant progress towards FID on its c.70mmboe Buchan project, with FID upcoming later this year. In our view this share price move is unjustified, with current levels further enhancing the value on offer, and making an attractive opportunity for investors.

SP Angel Morning View: Gold resilient as US interest rates climb on long-term inflation concerns

Transition to Mining Operator

Adriatic Metals has announced their transition from mining contractor to mining operator at Rupice. The transition is expected to continue to benefit the development and productivity rates being achieved at Rupice mine, as well as result in cost efficiencies and improved HSE standards. The company has also announced a short-term loan facility with Orion of $25m, that is drawable at the option of the company in Q3/4 this year.

Trinity Exploration and Production - Reserves Reduction but Solid Core Business

Trinity has announced a c28% reduction to its 2P reserves following a YE23 review. Despite the decrease in the Company’s 2P reserves, Trinity’s core business remains robust, with a reserves/production ratio of >12.5 years at YE23. Whilst there is significant potential for growth within the current portfolio, this will be difficult to unlock from the current balance sheet and we believe further financing will be required. We update our target price to 76p (from 202p), a c85% premium to the curren