Malcy's Oil Report - BG., CIU

Friday, Oct 30 2015 by
Malcys Oil Report  BG CIU

WTI $46.06 +12c, Brent $48.80 -25c, Diff $2.74 -37c, NG $2.26 -4c

Oil price

It looks like oil will have an up week unless something goes terribly wrong, yesterday was listless with US GDP and new homes data being described as sluggish. The differential is down to below three bucks as WTI outperformed Brent but if they hold around these levels the chartists at least remain optimistic.

Natural gas prices are all over the place, the EIA inventory report showed a 63bn cubic feet injection against forecasts of 69bn but wild gyrations ahead of the winter are not unusual. The 5 year average injection for this week is 73bn and last year was 88bn but stocks are still 12% above this time last year, make out of that what you can…

BG Group

With the Shell bid for BG not completing until early next year it is business as usual for the company who reported 3rd quarter results this morning. E&P production was up 26% at 716/- b/d and guidance is upped to 680-700/- b/d with QCLNG and Brazil boosting the numbers. EBITDA guidance is maintained  amid an increase in the oil mix but obvious hit on prices. LNG is said to be ‘robust’ which is about as good as it gets, I am looking forward to seeing the combined Shell/BG LNG division in operation. As with everybody else, costs are down sharply with savings being made across the board and capex is down 30% at $6.5bn. If you assume that Shell will complete the acquisition, BG shares are an undeniably cheap way into the new combo but the big call is when to do it, there will be a magic time in which the cash and divvi sums all add up and so a close watch will be needed on the market, as they say in the best horse racing circles.

Cape

The Cape/UGL JV has won a two year contract with Woodside for their Karratha Gas Plant Life extension programme. I am still a big fan of Cape and the work that Joe Oatley and team are doing there and in a difficult market place are delivering the goods day in, day out.

Sundry

Global Petroleum has updated the market, in Namibia they are in discussions with the authorities to extend their licence period and in Italy they are progressing their four offshore blocks. Sometimes accused of taking their time over promised acquisitions,…

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BG Group Limited, formerly BG Group plc, is a United Kingdom-based natural gas company. The Company has a portfolio of business interests focused on gas and oil exploration and production and on liquefied natural gas (LNG). It has two business segments: Upstream, which includes exploration and production and liquefaction, and LNG Shipping & Marketing, which combines the development and use of LNG import facilities with the purchase, shipping and sale of LNG and re-gasified natural gas. Its remaining Transmission and Distribution businesses, principally Mahanagar Gas Limited in India, and certain corporate activities are included in the Other activities segment. The Upstream business segment covers exploration and production activities plus liquefaction operations associated with integrated LNG projects. The LNG Shipping & Marketing segment covers activities, including purchases, ships, markets and sells LNG, as well as the Company's interests and capacity in re-gasification facilities. more »

Price
1062p
Change
4.1%
Mkt Cap (£m)
n/a
P/E (fwd)
n/a
Yield (fwd)
n/a

Cape plc (Cape) is a holding company. The Company is engaged in the provision of critical industrial services principally to the energy and natural resources sectors. Cape provides a multi-disciplinary service offering, including the traditional services of access, insulation, coatings and mechanical, and a range of specialist services, including refractory linings, oil and gas storage tanks, heat exchanger replacement and refurbishment, and environmental services. The Company's segments include the United Kingdom, Europe and Commonwealth of Independent States (CIS); Middle East and North Africa (MENA), and Asia Pacific. Its access services include tensioned netting, mobile elevated work platforms, rope access and powered access. It serves various sectors, including oil and gas onshore, oil and gas offshore, power generation, minerals and mining, chemical, steel, marine, pharmaceutical, food industries and other sectors. more »

LSE Price
263.13p
Change
-0.6%
Mkt Cap (£m)
322.1
P/E (fwd)
9.7
Yield (fwd)
3.0



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About Malcolm Graham Wood

Malcolm Graham Wood

Malcolm has over 30 years' experience in the Oil & Gas sector and is a widely used media source. He often appears in print and on screen, and also writes an acclaimed daily blog read by much of the resources industry as well as investors both institutional and retail.Malcolm is a Founding Partner of HydroCarbon Capital, which provides independent advisory services to the Oil and Gas sector. He is a Director of the Maven Income and Growth VCT 4 PLC, a venture capital trust listed on the Premium segment of the main market of the London Stock Exchange.He started his career at Wood Mackenzie in 1979. He was an inaugural member of the No 1 Extel rated James Capel Oil & Gas team and also headed up corporate broking, acting for the Government in sales of British Gas, Britoil and other utilities. Subsequently he became Head of Equities and main board Director at Williams de Broe before moving to Teather & Greenwood. Following that, he ran his own consultancy for several years, acting for a number of quoted and private companies as well as being a board member and advisor. He has been a Director at Noble and then Westhouse Securities and has extensive contacts in the Oil & Gas sector globally. More recently Malcolm has been the lead advisor to an HSBC Zurich trust on oil, gas and energy investments as well as working with the oil team at VSA Capital.- See more at: http://www.malcysblog.com/about/#sthash.Jdn1d7dK.d... more »

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