Oilman Jim's Letter - July 31, 2024

Eco (Atlantic) Oil & Gas (EOG.V ECO.L ECAOF EOI.F) announced that via its subsidiary it has signed an assignment and share cancellation agreement pursuant to which it has agreed to sell and assign a 1% participating interest in Block 3B/4B offshore South Africa to a subsidiary of Africa Oil (AOI.TSX AOIFF AFZ.F) in exchange for the cancellation of all common shares in the company and warrants over common shares held by Africa Oil, which assuming conversion of the warrants, would equal 16.16% on a diluted basis of the total outstanding common shares of Eco worth approximately C$11m. Upon completion, Eco will hold a fully carried 5.25% interest in Block 3B/4B offshore South Africa, reducing from the current 6.25%. The subsequent announcement of audited results for the year ended 31 March 2024 disclosed that the company had cash and cash equivalents of $2.97 million and no debt as at 31 March 2024 and, following the successful farm-out deal of Block 3B/4B, expects to receive a first tranche of $8.3 million during August 2024, giving Eco a cash and cash equivalents position of $10 million, with no near-term capital commitments for operational expenses…more…more

Helium One Global (HE1.L HLOGF HE1.F) announced that operations at the Itumbula West-1 well have commenced ahead of the planned extended well test. The company plans to test two intervals: the fractured basement and faulted Karoo, following what is said to have been a successful flow of 4.7% helium to surface during the drill stem test in February 2024. Prior to undertaking the extended well test, the well will be deepened further into the basement. Phase III operations from spud to completion of the extended well test are anticipated to take approximately five weeks…more

Invictus Energy (IVZ.ASX IVCTF) announced that it has entered into a binding share subscription offer with Mangwana Capital, which has coordinated up to a $10 million placement to institutional Zimbabwe investors through the issuance of 151,515,152 shares at a share price of A$0.10. Participants will also receive an option to subscribe for one share for every four shares subscribed exercisable at A$0.30 with a two-year option period. Funds raised from the placement will be used to advance the Cabora Bassa project, including Mukuyu-2 flow testing and advancement of early monetisation opportunities, purchase of long lead items for shallow exploration wells targeting the Eastern Margin and Basin Margin plays and general working capital. Additionally, Invictus says it is engaged in active discussions on multiple fronts to bring in strategic participants to the Cabora Bassa project through the completion of a farmout to accelerate development of the project…more

Deltic Energy (DELT.L 7RC0.F) announced that it has been informed by Shell, operator of Licence P2437, that drilling operations on the Selene exploration well have commenced, which are expected to take approximately 90 days. The well is designed to collect all key information in relation to reservoir quality and gas composition that is required to support a field development plan and final investment decision on the potential development of the Selene gas field without the requirement for a further appraisal well. Deltic estimates the Selene structure to contain gross P50 prospective resources of 318 billion cubic feet with a 69% geological chance of success. The company is fully carried for its 25% working interest in the well up to a gross success case well cost of $49 million, which is in excess of the operator's success case well authorisation for expenditure of $47 million…more

Arrow Exploration (AXL.V CSTPF AXL.L C1JT.F) announced an update on operational activity, with particularly reference to the Carrizales Norte field on the Tapir Block in the Llanos Basin of Colombia where the company holds a 50 percent beneficial interest. The second of the Ubaque horizontal wells, CNB HZ-3, is now on production exceeding expectations and is being restricted to a current flow rate of 3,038 barrels of oil per day with less than 6.5% water cut while still recovering load fluid. CNB HZ-1 continues to perform above expectations and is being restricted to a current flow rate of 2,220 barrels of oil per day with approximately 34% water cut. The well cost approximately $4.9 million and paid out in under 30 days. The rig has now been moved to the fourth cellar on the Carrizales Norte B Pad where the company has spud the third horizontal well, CNB HZ-4. Thereafter, Arrow expects to drill the fourth horizontal well on the B pad, followed by the Baquiano-1 exploration well.  Following the drilling program at Baquiano, Arrow plans to return to the CNB pad for two additional horizontal wells…more

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