Oil & Gas Corporate News
Rockhopper Exploration (LON:RKH) (BUY, £4.00) (RKH, 240p, ? (0.0%)) provided an update regarding analysis of the results of the Sea Lion 14/10-2 well oil discovery recently completed in the North Falkland Basin. Well 14/10-2 on the Sea Lion prospect was drilled to a depth of 2,744m. The well penetrated what the Company believes is a regional seal between 2,250-2,374m subsea. Based on log analysis, well site evaluation of shows and samples, sidewall cores and wireline formation testing, it appears that all sands encountered beneath this regional seal at the Sea Lion location are charged with oil and no oil water contacts were encountered. The top oil sand in the Sea Lion well was encountered at 2,374m subsea, and the base of the lowest oil sand level was encountered at 2,591m subsea. The total vertical oil column is 217m, with total net pay of 53m in seven identified pay zones, the thickest of which is approximately 30m gross. Samples analysed in a dedicated laboratory confirmed as medium gravity crude oil of 26.4-29.2oAPI. The RPS Energy Best Estimate recoverable has been upgraded from 170MMbbl to 242MMbbl recoverable with significant upside potential.
Comment: This better than expected results give us confidence that Sea Lion is likely to be a commercial success of material size, whereas the current share price only discounts a 30% probability of success for Sea Lion and no success elsewhere. The Ernest prospect is also materially de-risked and carries estimates of some 150MMbbl. Assigning a 50% probability of success to the 242MMbbl new estimate at Sea Lion and a 25% probability of success to 150MMbbl at Ernest result in a risked NAV in excess of 400p; hence we upgrade the stock to a Buy rating with a 400p target.
Maple Energy Plc (LON:MPLE) (MPLE, 49.5p, ? (3.88%)) announced that it has executed a Placing Agreement in relation to the proposed issue of up to 43,075,000 ordinary shares at 44p per ordinary share in a private placement to investors for aggregate gross proceeds of up to approximately £19m. Maple intends to use the net proceeds from the Placing to fund a portion of its remaining equity contribution requirement in connection with the Company's Ethanol Project.
Empyrean Energy (LON:EME) (EME, 6p, ? (11.63%)) provided an update on operations at the Sugarloaf Project within the Sugarkane Gas & Condensate Field, Texas. The…
