FoxDavies Daily Monitor - Global Energy Development, Aminex and Cadogan Petroleum

Friday, August 31, 2012

Global Energy Development (GED LN, 73.5p, ? 0.0%) - Cash IS King: The extension of maturity date of its $5mm Senior Secured Note Payable to April 2013 keeps liquidity position intact. In exchange, the company has agreed to an increase in interest rate by 2% to 12.5%. The focus is very much on retention of cash, principally to implement its "3-Year Plan" development strategy. The outlook continues to lift for the stock; we are placing GED on our watch list.

Aminex (AEX LN, 4.20p, ? 1.2%) - Interim Results - All eyes on Tanzanian assets: The major highlight of the first half was the significant gas discovery at Ntorya in the Ruvuma Basin. Ntorya-1 well flowed gas at 20.1mm cfpd and condensate at 139 barrels per day of 48 degrees API. Ntorya field potential is estimated at 1.17 tcf (195mm boe). Importantly, Tanzanian Government's decision to build the 36" diameter gas pipeline from Mtwara, which is just 25 km away from the Ntorya-1 discovery, to Dar es Salaam further enhances the commercial potential of the discovery. Upcoming seismic and drilling programmes for appraising the Ntorya discovery and Nyuni Area PSA would be the key catalysts. In this news:

• 16% increase in oil and gas production from continuing operations to 49,500 BOE (2011: 42,600 BOE)
• Loss before tax of $3.26 million (2011: $0.90 million)
• Advanced negotiations for $15 million loan to fund on-going exploration programme in Tanzania
• 11.4 TCF of discovered and undiscovered gas initially in place (GIIP) volumes for the Nyuni Area and Ruvuma PSAs as defined in an independent report (a 400% increase compared to previous study)
• An increase in our working interest in the Ruvuma PSA from 56.5% to 75%
• Completion of the sale of the Somerset Field in Texas signalling the beginning of the US asset divestiture

Cadogan Petroleum (CAD LN, 17.75p, ? 8.9%) - Time To Stop Talking and Start Delivering: Following transaction with Eni in June 2011, we can expect traction in the exploration programme at two west Ukraine licences, Debeslavetska and Cheremkhivska. Results of on-going workover programme on other Ukrainian asset, Zagoryanska, has not been per company's expectations. Operations at Pokrovskoe remain temporarily suspended. Production from the Zagoryanska, Debeslavetska and Cheremkivska licences continued at a combined rate of approximately 51 mcm/day of gas and 5.1 tons/day of condensate. The company needs to step up exploration and development activities to catch investor's eye. In this news:

• Continued production from the Zagoryanska, Debeslavetska and Cheremkivska licences at a combined rate of about 51 mcm/day of gas and 5.1 tons/day of condensate
• Joint venture established to develop unconventional shale gas in Lviv western Ukraine announced
• New well at Zagoryanska 11 drilled
• Total capital expenditure of $16.2 million during the first half of 2012 (30 June 2011: $3.0 million)
• Decreased operating costs to $4.9 million (H1 2011: $5.4 million) despite significant increase in activity
• Net cash and cash equivalents at 30 June 2012 of $51.3 million (31 December 2011: $65.0 million)

Exillon Energy (EXI LN, 132.5p, ? 0.76%) - Upbeat Interim update: Oil production during H1-2012 increased by 48% to 11.5mbpd and the company expects to achieve 17.0mbpd by year end. EBIDTA climbed 98% to $7.8mm on the back of positive operating leverage due to the commissioning of captive entry point into Transneft pipeline and captive power generation facilities. We expect operating margins to further improve in H2-2012 as it will reflect full period benefit of captive pipeline and power facilities. The balance sheet of the company is strong with $138.5 million of cash and cash equivalents as at 30 June 2012 and net cash position was US$38.3mm. In this news:

• Oil production increased 48% from 1.42 million to 2.1 million barrels. Production guidance of 17,000 bpd by end of 2012 reiterated.
• Drill time in Exillon WS reduced to around 20 days per well
• New strategy of drilling wells at 60 degree angle doubles exposed net pay
• Lack of oil water contact in wells drilled to North East of the EWS I field suggests substantial reserves increase likely in this area of the field
• Improved completion and cementing procedures across portfolio
• Completion of oil treatment and power generation facilities in both Exillon TP and Exillon WS

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser. More

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Source: http://www.oilvoice.com/n/FoxDavies_Daily_Monitor_Global_Energy_Development_Aminex_and_Cadogan_Petroleum/35d03085ee45.aspx

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