United Oil & Gas PLC (LON:UOG) was a strong performer this week after the group revealed on Wednesday the latest successful well result at the Abu Sennan concession in Egypt.
The company said the El Salmiyah-5 well had encountered some 120 metres of net hydrocarbon pay across four intervals which, as United highlighted, makes the main target materially larger than was previously believed
Testing of the Kharita Reservoir achieved a rate of 8,700 barrels oil equivalent per day, comprising 4,100 barrels of oil equivalent per day (boepd) plus 18mln cubic feet of gas per day, the group added.
In the wake of the news, United O&G had its share price target bumped up by Cenkos Securities to 7.3p, which said it was impressed by the result from the El Salmiya-5 well.
The City broker noted that the well encountered net pay in all the target intervals, while there were indications of a potential thicker and larger undrained area up-dip of the existing El Salmiya wells.
As a comparison, the El Salmiya-2 well, drilled in 2013, encountered 56 metres of net pay within the Kharita and was tested at a rate of 3,530 boepd and 4.7MMscf/d of gas, said Cenkos.
The broker also noted that the 8,700 boepd achieved on test is just from the primary Kharita target and does not include production from the Abu Roash C or E Members.
Another good gainer this week was Canadian Overseas Petroleum Limited (LON:COPL) which on Thursday announced a settlement in principle regarding its dispute with Essar over the OML 226 prospect off Nigeria.
The agreement will see COPL’s 50% owned affiliate ShoreCan transfer 70% of its stake in Essar Nigeria to Essar Mauritius in return for an end to the legal action brought by the Indian conglomerate.
Essar Nigeria’s sole asset is a 100% interest and operatorship of OPL 226, which lies 50 kilometres offshore in the central area of the Niger Delta.
Through the agreement, Essar Mauritius will grant Shorecan a 10% carried interest (capped at US$5mln net) on all costs relating to the drilling of a first appraisal well at OPL 226.
Essar Nigeria will also now seek an extension of the production sharing contract for OPL 226 beyond the current term that ends on September 30.
Among the bigger companies, Premier Oil PLC (LON:PMO) shares jumped higher on Friday after it agreed revised payment terms for its North Sea acquisitions from BP PLC (LON:BP.).
Having pledged to pay US$625mln in January, before the crash in oil prices, Premier has now agreed in principle to pay cash of just US$210mln on completion, funded with equity.
Then roughly US$300mln of cash flows will be retained by BP from the 23,000 daily barrels of oil equivalent the assets produce on average, with a final US$115mln only payable if oil and gas prices recover further in the future.
Otherwise, it was a fairly quiet week for the junior oilers.
On Monday, Bahamas Petroleum Company PLC (LON:BPC) posted full-year results that highlighted the explorer’s relatively…
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