Fox Davies Capital Update featuring Parkmead, Nyota Minerals, Noventa, Range Resources, Sound Oil, Obtala Resources, Copper Development, Noricum Gold

Friday, Mar 09 2012 by
Fox Davies Capital Update featuring Parkmead Nyota Minerals Noventa Range Resources Sound Oil Obtala Resources Copper Development Noricum Gold

Mining News

Copper Development (LON:CDC) Corporation (BUY, 102p) (CDC LN, 29p, ? 7.4% ) announced an initial JORC compliant Inferred Resource estimate for its Basay Copper Project on Negros Island in the Philippines. The new resource estimate is 131 Mt at 0.48% Cu using a 0.25% Cu cut-off grade and was prepared based on historical drilling data and CDC drill holes BSM001 to BSM029 and BSM032; using 30 of the 55 drill holes completed to date.

Noricum Gold (LON:NMG) Limited (NMG LN, 2.25p, ? 0.0%) announced that it has obtained a listing on the Frankfurt Stock Exchange. As a result shares in Noricum Gold have been admitted to trading on the exchange under the symbol 'NOG'. The entire issued ordinary share capital will continue to trade on AIM under the symbol NMG.

Noventa (LON:NVTA) Limited (NVTA LN, 12.6p, ? 1.94%) announced that further to the announcement of Thursday, 1 March 2012, the Board of Directors of Noventa confirms that the voluntary delisting of the Company's ordinary shares from the Toronto Stock Exchange took place at the close of trading on Thursday, 8 March 2012. The Company's ordinary shares continue to trade on AIM and PLUS.

Nyota Minerals (LON:NYO) Limited (NYO LN, 8.2p, ? 1.2%) announced a Mineral Resource update for its Tulu Kapi Project, in Ethiopia. The resource consists of 17.97 million tonnes @ 2.90g/t gold containing 1,672,000 ounces of gold. This represents an upgrade and increase in the Indicated category of 82 per cent to 831,000 ounces of gold @ 3.01g/t gold; and an Inferred Resource of 841,000 ounces of gold @ 2.79g/t gold. The new resource incorporates all the drill holes for which gold analyses had been received up to and including the end of January 2012.

Obtala Resources (LON:OBT) Limited (OBT LN, 33.75p, ? 0.0%) announced that Bushveld Minerals Limited (BMN.LN) today announced the proposed admission of its shares to the AIM market of the London Stock Exchange plc. BMN is a new holding company which will acquire the entire share capital of both Bushveld Resources Limited ("BRL") and Greenhills Resources Limited ("GRL"), in each of which the Company will acquire, prior to Admission, a 50% interest. Gross proceeds raised by BMN of approximately GBP5.6 million at a placing price of 20 pence per share. Obtala's interest post Admission will be 46% of the issued share capital of BMN, valued at approximately GBP26.1 million at the Placing Price.

Oil and Gas News

Range Resources (LON:RRL) (BUY, 27p) (RRL, 13.25p, ? 1.9%). Success with the Drillbit. The Company has successfully drilled the Smith #2 and Albrecht #1 wells. The Smith #2 well was drilled to approximately 1,350ft, southwest of the Smith #1 discovery well, further extending the Company?s Proved Reserves in that direction. Initial gross flow rates from the uppermost pay zone, which is one of four principal pay zones reached more than 3.0 MMcfd & 125Bopd, and work is now being conducted to remove all of the plugs below the upper pay zone and combine the remaining lower pay zones to achieve maximum rate and recovery. The Albrecht #1, situated southeast of the Smith #2 well and drilled almost immediately after Smith #2, drilled more than 1,500ft. The well confirmed the presence of the Howell Hight reservoir in that area and is also expected to add significant Proved Reserves to the Company's portfolio. The well is scheduled for completion and fracture stimulation sometime in April this year. With four wells now drilled in the field, Range estimates that over 80% of the structural closure at the Howell Hight reservoir falls into the Proved and Probable (2P) category. Work is currently underway to revise the reserve estimates at North Chapman Ranch, and is expected to be finalized once The Albrecht #1 well comes online. The Company believes that its net production and cash flow from the project will increase by more than 200% over current levels once both wells (Smith #2 and Albrecht #1) come online. While this is good news which management should be delighted with, this asset would be considered one of the less key assets within the Company?s portfolio with regards to size. While today?s RNS has an impact on valuation in terms of increasing reserves, it also has the impact of raising management?s credibility in identifying opportunities. Ahead of an updated result statement, we reiterate our 27p target price and BUY recommendation.

Leni Gas & Oil (LGO LN, 1.52p, ? 4.1%) ? Progress update: Eugene Island Field. The Company reported that A2ST01 well in the Eugene Island Field (7.2% WI) in the US Gulf of Mexico has been drilled to a depth of 12,566 ft, with just 500ft remaining for the targeted depth 13000 ft. The targeted Cranberry Creek prospect is estimated to hold mean recoverable reserve of 0.5mm bbl of oil within the Tex-X2 target level. Positive update; we will be watching this one for the results from the well.

Sound Oil (LON:SOU) (SOU LN, 1.33p, ? 9.9%) - Upbeat update on Casa Tiberi-1, Italy. The Company announced that Casa Tiberi-1 well testing has been completed; the well as expected flowed at a stabilised rate of 0.28 MMscfd at apressure of 54 bar. Following its update on 6th March, we believe that the company is making good all round progress on its Italian blocks. We expect some positive movements today.

Parkmead (LON:PMG) (PMG, 19.75p, ? 1.25%). First Production achieved with acquisition. The Company has raised approximately £8.53m gross through a placing of 60,960,182 new Ordinary Shares at 14 pence per share. The proceeds of the raise will add to existing resources available to the Company, and used to finance its capital commitments, one of which includes the recent acquisition in the Netherlands. The Company signed an agreement with Dyas B.V. to acquire a portfolio of onshore assets in Netherlands. The acquisition comprises of interests in four producing gas fields and two oil fields for a total consideration of ?7.5million. This consideration is split in two - an initial cash payment of ?4.5 million for the acquisition of the interests and a contingent payment of ?3 million, payable on the first commercial sale of oil from the Papekop field development. The assets specifically comprise of a 15 percent interest in the Papekop Production Licence including the Papekop oil field development; a 15 percent interest in the Andel V Production Licence including the two producing gas fields at Wijk en Aalburg and Brake as well as the Ottoland oil field development; and finally a 15 percent interest in the Drenthe III Production Licence (excluding Vinkega) and the Drenthe IV Production Licence, which together include the two producing gas fields at Geesbrug and Grolloo. Once partner and regulatory approvals have been granted for the completion of the acquisition, Parkmead can accelerate its plans to build a new oil and gas company. The portfolio being acquired provides Parkmead with the first producing assets to the Company?s portfolio and also near term oil field developments at Ottoland and Papekop with the former forecast to come onstream later in 2012 or in 2013. The recent successful extended well test performed on Ottoland during Q4 2011 produced oil at a stable rate from the existing single well on this accumulation. Analysis of the test results will allow optimisation of the development plan, including determination of the number of production wells required to efficiently drain the field. As Parkmead builds its operations in areas where its team is highly experienced, such as the UK and the Netherlands, today's announcement which follows the Group's two recent acquisitions in the UK Southern North Sea, highlights the accelerated growth plans of the Group. In November last year, the Company acquired stakes in the Platypus gas field and Possum gas prospect. This was then followed closely by the acquisition of stakes in the Pharos gas prospect and four UKCS Gas basins in December. It?s clear that management at Parkmead are focusing on areas of expertise and experience (UK and the Netherlands). The recent acquisition highlights the accelerated growth of the Company, and it?s obvious to see why shares in the Company have risen strongly in recent weeks.

Oilfield Services News

Technip (HOLD) (TEC FP, EUR 84.7, ? 5.7%): Technip announced yesterday the award of a lump sum front-end engineering design (FEED) contract by Statoil for the development of the Luva floating platform, offshore Norway, at a water depth of approximately 1,300m. The contract covers the design and planning for procurement, construction and transportation of a Spar hull and the mooring systems as well as the design of the steel catenary risers. The award builds on the study work that has been ongoing since early 2010.


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Parkmead Group plc is an upstream oil and gas company. The Company is an independent oil and gas, exploration and production company. The Company operates through two segments: oil and gas exploration and production segment, which invests in oil and gas exploration and production assets, and energy economics segment, which provides energy sector economics, valuation and benchmarking, advising on energy policies and fiscal matters, undertaking economic evaluations, supply benchmarking services and training. The Company produces from approximately four gas fields in the Netherlands and holds interests in approximately 40 exploration and production blocks. The Company has oil and gas development opportunities across the United Kingdom and Netherlands, including the Greater Perth Area oil development located in the Central North Sea. The Company also holds interests in a portfolio of exploration prospects alongside international partners. more »

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Nyota Minerals Limited is an Australia-based company engaged in mineral exploration and evaluation. The Company is focused on the exploration and development of resource projects across the globe. Its mineral footprint includes base metal interests in Italy. The Company has approximately 70% interest in the Ivrea Nickel-Copper Project in the Piemonte Region of Italy. The existing licenses and the adjacent applications cover a total of 117 square kilometers at the northern end of the Ivrea Gabbroic Complex that is the host to known nickel mineralization and include over nine nickel mines and exploratory workings. The Alpe di Laghetto survey block consists of six kilometers anomaly that encompasses the Alpe de Laghetto and La Balma mine workings. Its subsidiaries include Nyota Minerals (UK) Limited, Nyota Minerals (Bermuda) Limited and KEC Investments Pty Ltd. more »

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Paragon Resources PLC is focused on the mining and natural resources sector, and in particular on rare earths, gold, copper gold and strategic metals. The Company is engaged in the process of acquiring a high grade, rare earth project in Central Madagascar owned by MRE Mining (Mauritius) Limited. The Company will focus on opportunities in Madagascar, Africa, Asia, and South and Latin America. It seeks to acquire a direct and/or an indirect interest in projects and assets in the mining and natural sector. The Company may invest by way of purchasing quoted or unquoted shares in appropriate companies, outright acquisition or by the acquisition of assets, including the intellectual property, of a business, or by entering into partnerships or joint venture arrangements or by providing loan funding. The Company intends to be a medium to long-term investor. more »

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About Fox Davies Capital

Fox Davies Capital

Fox-Davies Capital Limited (FDC) has been advising and raising funds for the natural resource sector since February 2001. The firm specialises in assisting international resource companies to gain access to the UK, European and North American capital markets and has a substantial background in emerging markets particularly in Africa, Asia, Russia and the CIS.  FDC enjoys a successful track record in advising and undertaking fundraising transactions for its clients ranging from private equity to IPO and secondary offerings and works with over 350 specialised institutional resource and emerging markets funds worldwide.  FDC is authorised and regulated by the Financial Services Authority (FSA) and is a member firm of the London Stock Exchange (LSE). more »

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