SP Angel Morning View: China Steel PMI recovering as construction sectors looks for fresh stimulus

Endeavour Mining - Ready to finish strong

In the wake of Endeavour’s Q323 results we have updated our FY23 estimates. Endeavour remains on track to achieve its production guidance of 1,060–1,135koz at an AISC of US$895–950/oz (792koz produced year-to-date at an AISC of US$974/oz). Endeavour has reaffirmed its performance is still set to be weighted towards H223 as previously guided, with Q323 recording the strongest performance this year (production of 280.8koz) and Q423 on track to beat this (estimated at 324.4koz). Q323 results were d

Mining Monthly: October Edition

What you need to know: • Precious metal prices were up substantially in October, rebounding from two months of consolidation, significantly outperforming broader markets which were down during the month. Other commodities and battery metals held in relatively flat. • The price of uranium continued to perform well over the last month and resulted in significant equity financings. • Deteriorating economic data leads us to believe we are approaching a long-awaited pivot after both the BoC and the

Endeavour Mining - Leaner and ready to grow

In the wake of the release of Edison’s updated long-term gold price assumptions (Shades of the 1970s), we have amended our forecasts for Endeavour, prior to the release of its Q323 results on 9 November. On a like-for-like basis, this has resulted in a 13.7% increase in our absolute valuation of the company to US$33.52/share. On a headline basis, it compares with a valuation of US$36.73/share prior to the sales of Boungou and Wahgnion, a decline of only 8.7%. Following the sale of the two mines,

LIBERUM: Stay behind the crease: Upgrade sector call to HOLD

SP Angel Morning View: Chinese PMI disappoint highlighting the need for government stimulus

Endeavour Mining - A strong year ahead

Endeavour Mining’s Q123 financial results were materially ahead of both the market and our expectations, on a headline and an underlying basis. Endeavour remains on track to achieve its FY23 production guidance of 1,325–1,425koz (with Q123 production of 301koz) at an AISC of $940–995/oz. Its performance is set to be weighted towards H223 as previously guided, with strong production at Ity and Wahgnion complementing opportunistic development across other assets in Q123. Endeavour continues to enj

Endeavour Mining - Rising gold prices begin to feed through

Endeavour’s Q123 results are to be published on 4 May 2023. Ahead of their release, we have refined our forecasts for Q123. Following a strong Q422 we are perhaps conservatively assuming a slower rate of production in Q123, albeit leaving our full year production forecast little changed. In addition, we have revised our gold prices for the quarter from US$1,849/oz previously to US$1,883/oz and our assumption for the full year from US$1,819/oz to US$1,937/oz.

Oil & Gas - Cavendish sector note

88 Energy, Falcon Oil & Gas, Trinity Exploration & Production, Plexus Holdings, Baron Oil, Harbour Energy, EnQuest, Capricorn Energy, Arrow Exploration, Southern Energy, Serinus Energy, SDX Energy, Panoro Energy, Eco (Atlantic) Oil & Gas, OKEA ASA, Equinor Source: FactSet, weekly change 27/11/23-1/12/23 Oil extended declines, closing out a sixth straight weekly drop, as the OPEC+ output cuts announced Thursday failed to dispel the market’s gloom over swelling global supplies. West Texas Intermed

Pan African Resources - Valuation up 22.2% with new gold price forecasts

On 22 November, Pan African Resources (PAF) announced that operations to date in FY24 had performed in line with, or better than, expected, with gold production for H124 anticipated to be in the range 94,000–98,000oz (cf 92,307oz in H123). As a result, it increased its production guidance for FY24 to 180,000–190,000oz, which caused us to increase our production estimate in turn by 1.9% (or 3,575oz) to 189,725oz. The change made only a modest difference to our EPS forecasts for FY24 (see Exhibit

Morning Note – 4 December 2023

Hartshead Resources - Fully Funded Solution

Hartshead has secured a funding solution with partner Rockrose Energy to fund 100% of the Phase I development costs. Under the agreement, Hartshead has the option to exchange an additional 20% licence interest for an uncapped free carry, thereby covering the total cost of the Phase I development project (financing backstop). Importantly, Hartshead maintains at its election the option not to proceed with the RockRose financing solution, and introduce other financing solutions (eg project debt, pr

New Debt Facility – Lowering TRR Cost of Capital

We have been roadshowing Trident Royalties all week during which time the company released an announcement that they have entered into a commitment letter with BMO and CIBC for a new $40m revolving credit facility (RCF), with the potential to increase the facility to $60m via an accordion feature. The proceeds from the $40m are going to be used to repay the existing secured debt facility of $40m with Macquire in Q1 next year.

Southern Energy - 3Q Results and Comprehensive Update Note

Southern Energy delivered solid 3Q results with the focus of attention now turned towards the completion of 4 drilled uncompleted wells (“DUCs”). We see our investment thesis for Southern Energy – premised on the scale, location, quality, deliverability, low-cost nature of the company's Gwinville gas field in Mississippi, USA – very much strengthening based on our structural commodity price outlook and our growing confidence in the highly prolific Gwinville gas field, sharpening our interest in

SP Angel Morning View: Gold powers through $2,100/oz on outlook for Fed rate cuts

Oil & Gas - Cavendish sector note

Jersey Oil & Gas, Serica Energy, Trinity Exploration & Production, Longboat Energy, Ithaca Energy, Neptune Energy, Pantheon Resources, Nostrum Oil & Gas, Kufpec, ORLEN.

UK-Listed Energy Sector: Review of the UK oil and gas landscape – why the country needs it, current policy and tax

The front of this note takes a look at the UK oil and gas sector, why domestic production is advantageous, what the main political parties think, and what could happen going forward. The latter part contains a review of the companies in our coverage – some that are UK centric, which give exposure to the note’s wider theme, and others that are focused elsewhere.

Diversified Energy Company - Delivering Consistent and Reliable Results

DEC’s Q3/23 trading update was in line with expectations as the company continued to deliver despite further commodity price headwinds. The Q3/23 Adjusted EBITDA margin of 52% (H1/23: 52%) reflects the quality of DEC’s asset base and its ability to efficiently manage every aspect of its operations. Average net daily production in Q3/23 was 134Mboepd (H1/23: 142Mboepd), with exit rate production of 134.4Mboepd. DEC has maintained its dividend at US$0.04375 per share. Since its IPO in 2017, DEC ha

Thor Energy - High-Grade Uranium Intercepts at Groundhog Prospect

Thor today announces the final downhole gamma results for the reverse circulation drill programme undertaken at the Wedding Bell and Radium Mountain projects in the USA. Downhole gamma readings are a commonly used proxy for physical uranium assays.

LIBERUM: Shanta Gold: Another excellent quarter

Strong second half trading

Jersey Oil & Gas - Delivering zero-capex barrels

Last week, JOG successfully secured its second GBA farmout, locking in a path to delivering zero-capex barrels. The surprisingly muted share price response to the farm-out leaves JOG trading at an unjustifiably large discount to our valuation. With a material fully funded development project under its belt and a clean balance sheet, JOG presents a very low-cost way to access high quality development barrels for investors and potential acquirers alike. If the threat of M&A does not narrow JOG’s v

Morning Note – 28 November 2023