WTI $43.20 -78c, Brent $46.81 -73c, Diff $3.61 +5c, NG $2.09 +3c

Oil price

The API stats came in late yesterday and although they showed a slightly bigger than expected rise of 4.1m barrels (F/c 3.4) there was a small draw at Cushing which the bulls latched on to. Having seen a low of $42.58 during the day the close was therefore a modest rally, this morning that has continued and crude is at $44 and $47 respectively. The EIA numbers tonight will, as ever, be more widely respected.

Pantheon Resources - Don't you just love it when….

Deserved jubilation in Texas as the VOBM#1 well comes in, this is a plan that really has come off and I am delighted for Jay Cheatham and his team and for the small band of committed shareholders who have held their nerve. I have been in touch with the team despite the early hour and will report back more fully tomorrow but meantime, here are the bare bones.

The well encountered 62 feet of net pay in the Eagle Ford Sandstone which flowed natural gas at 6,145 mcf/d and oil of 504 b/d which equates to over 1,500 b/d which is incredibly good. The well has even exceeded initial pre-drill estimates of P50 prospective Resources which had been 1.4 mmboe. Suffice it to say, Jay was effervescent, saying ‘this is truly transformational for Pantheon adding valuable revenue and NPV to our company’. It should be noted that Pantheon has extremely low operating costs which add even more value to this find. Despite the shares being up 36% as I write, valuing the company at £101m, I see no reason why the shares should not rise much further in due course. If the second well was to come in equally well I could conservatively consider a value of twice the current price, conceivably significantly more…

Victoria Oil & Gas

Not much to add as usual in results to June but Kevin Foo makes an interesting case for the company to be valued much more highly than the £65m market cap. There is no doubt that this is a serious success story not yet appreciated by the market and readers will know that I have been a fan for some time. Russia aside, the Cameroon story has been efficiently converted and the wellhead to customer model is highly profitable. The succession issue has been one point of…

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