WTI $58.93 -22c, Brent $66.45 -1c, Diff $7.52 +21c, NG $2.82 +5c
Oil price
The oil market was quiet yesterday and is much the same this morning. The strong dollar hasn't helped and further downward pressure is evident from the forecast increase in crude oil stocks when the agencies report tonight and tomorrow, consensus is for a further build of around 2m barrels. Add to that an albeit temporary cease fire in the Yemen as the Saudis halt air attacks to let humanitarian aid through and most pressure is modestly down. The only upward influence is that Libyan production has fallen back below 500/- b/d as the protesters have closed the eastern port of Zueitina again.
The bog will be a bit sporadic this week and next as I am abroad visiting companies, I hope to file reports either while in Italy or next week from Houston.
Kosmos
Kosmos held their analysts presentation yesterday and whilst I didn't listen in I have seen the slides and more importantly the new resource numbers following last week's discovery in Mauritania. The company have estimated resources at Tortue West at 5-12 TCF with a mean figure of 8 TCF and in the Greater Tortue Complex which extends into Northern Senegal they have suggested a number of between 6 and 22 TCF. This is even more than I had expected when I wrote about it last week and for Kosmos and indeed a number of other players in the two countries will provide significant optimism.
Chariot
One of those with a read-through to Mauritania is of course Chariot who are also most excited about the find, with their local acreage being more likely oil rather than gas prone. However this morning they have announced that they have taken a knife to board costs and have cut remuneration by 50% which they say will save around $1.5m next year. The first casualty of this is that CFO Mark Reid has decided to leave which is a shame as he was one of the 'new brooms' that came in post previous management debacles. The company say that this is very much a 'precautionary measure' aimed at protecting cash 2 ½ years down the road and indeed the G&A costs have nearly halved since they came on board. I remain of the view that Chariot, which is fully funded, has few commitments and therefore is comparatively well placed is as…
