Today’s Market View – ATOME Energy, Barryroe Offshore Energy, Helium One Global, and more…

Market Replace: 22 Might 2023

ATOME Vitality PLC (AIM:ATOM)* – NAV Replace – Inexperienced fertiliser to reinforce Villeta undertaking NPV

Lansdowne Oil & Gasoline (AIM:LOGP)* & LON:BEY- Barryroe software refused

Petro Matad Restricted (AIM:MATD, OTC:PRTDF) – Delays proceed to frustrate Heron improvement

Helium One World Ltd (AIM:HE1, OTCQB:HLOGF) – Unbiased CPR highlights potential

Vitality Information

Brent Oil US$75.6/bbl vs US$76.4/bbl final Friday

WTI Oil US$71.7/bbl vs US$72.4/bbl final Friday

Henry Hub Gasoline US$2.55/mmBtu vs US$2.60/mmBtu final Friday

UK NBP Futures 65p/therm vs 68p/therm final Friday

TTF Dutch Futures €29/MWh vs €30/MWh final Friday

• Vitality costs traded down as stalled bipartisan talks in Washington on a debt-ceiling deal proceed to weigh on wider market sentiment.
• The US Baker Hughes rig depend was down 11 items to 720 rigs final week (-8 y/y), with oil rigs down 11 to 575 and fuel rigs unchanged at 141 items, largely as a result of a reported 9-rig drop to 357 items in Texas.

Firm Information

ATOME Vitality PLC (AIM:ATOM)* 94p, Mkt Cap £34m: NAV Replace – Inexperienced fertiliser to reinforce Villeta undertaking NPV

Valuation: 190p/sh, BUY

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• ATOME introduced a £2.4m strategic subscription by the worldwide vitality know-how large Baker Hughes for a 6.6% fairness stake at a value of 95p/sh (based mostly on the 30-day VWAP).
• ATOME additionally confirmed that the Section 1 120MW Villeta undertaking in Paraguay has been upgraded to provide a ultimate finish product of Calcium Ammonium Nitrate (CAN), which is a premium inexperienced fertiliser.
• The Firm has been out speaking to potential offtakers who’ve recognized inexperienced fertiliser as a high-graded product that may warrant a pricing premium from customers within the agriculture industries trying to market their very own low-carbon credentials.
• We have now up to date our monetary fashions and NAV for right now’s updates and reiterate our BUY ranking with a brand new TP of 190p/share (from 181p/sh), providing over 100% potential upside to the present share value.
• Buyers can register right here for a administration presentation on Friday twenty sixth Might 2023 at 1pm (GMT).

*SP Angel acts as Company Dealer to ATOME Vitality

Lansdowne Oil & Gasoline (AIM:LOGP)* 0.25p, Market Cap £2.5m: Barryroe software refused

• Lansdowne has confirmed that the Minister for the Division of Atmosphere, Local weather and Communications (DECC) in Eire is unwilling to grant the Barryroe Lease Endeavor on the grounds of monetary functionality.
• The DECC had confirmed that the applying was passable from a technical perspective, however the candidates didn’t meet the funding cowl criterion and the SEL1/11 licence is taken into account expired as of thirteenth July 2021.
• The operator, Barryroe Offshore Vitality (BEY LN), beforehand introduced it had secured funding for as much as €40m, which lined 100% of the estimated value of the work programme within the Lease Endeavor software.
• The Firm now plans to pursue a declare in worldwide arbitration pursuant to the funding safety regime established beneath the Vitality Constitution Treaty to which each Eire and the UK are signatories.

Each shares are down by over 40% in early buying and selling as buyers digest this irritating replace. The revised Barryroe Lease Endeavor for appraisal drilling was submitted to DECC in April 2021 and the choice by the Minister, who can also be the Chief of the Inexperienced Occasion in Eire, to refuse the applying has been taken whereas Eire continues to import important quantities of oil & fuel, one thing the event of Barryroe might assist to deal with. We stay of the view that materials fields equivalent to these ought to come into better focus set in opposition to the backdrop of elevated commodity pricing and home vitality safety considerations. With nice reluctance, the companions will now resort to authorized proceedings.

*SP Angel acts as Nominated Advisor and Dealer to Lansdowne Oil & Gasoline (AIM:LOGP)

Petro Matad Restricted (AIM:MATD, OTC:PRTDF) 5.05p, Market Cap £56m: Delays proceed to frustrate Heron improvement

• Petro Matad introduced that the Mongolian Ministry of Development and City Improvement has now insisted that it’s the ministry accountable for land points, and is due to this fact accountable for the licence submission.
• Submission to safe Cupboard approval to certify Block XX (100% WI) as a Particular Goal Space is due to this fact delayed, additional placing again plans to finish the 2019 Heron-1 oil discovery properly as a producing properly.
• The Velociraptor-1 excessive threat/affect exploration properly on Block V (100% WI) is because of spud in mid-June and is predicted to take c.30 days to achieve the prognosed whole depth 1,500m at a price of beneath $2m.
• The Velociraptor wildcat is focusing on an inversion anticline with 200mb of potential useful resource potential, which on success would de-risk the adjoining Oviraptor and Tsagaanraptor prospects alongside the thrilling Raptor Development.

The inventory is off by over 15% in early buying and selling, reflecting investor frustration at Petro Matad’s lengthy battle with native and central authorities authorities to acquire the required land entry (2022) and allowing (2023) on Block XX to permit the corporate to start out creating the Heron discovery. Nonetheless, that is the primary oil undertaking to be put by this bureaucratic course of based mostly on laws launched in 2017 and the authorities concerned haven’t any apparent precedent to observe, such that this course of will hopefully clean the trail for future certifications. Preparations to drill a wildcat exploration properly on the Velociraptor prospect are additionally advancing and buyers can stay up for testing the potential of the Raptor pattern, with 1Q23’s $6m elevate offering enough funds to hold out its deliberate actions.

Helium One World Ltd (AIM:HE1, OTCQB:HLOGF) 7.0p, Market Cap £57m: Unbiased CPR highlights potential

• Helium One introduced the Tai prospect (100% WI) has been independently estimated to carry 2.8bcf of web helium potential sources, as a part of 212bcf in unrisked 2U whole fuel potential sources.
• The up to date CPR by ERC Equipoise represents a 61% enhance from the 2020 useful resource estimate because of extra detailed interpretation of the extra 2D seismic knowledge acquired over the prospect in 2021.
• Final month, the Firm signed a Letter of Intent, alongside Noble Helium (NHE AU), with SOFORI to contract a rig for a three-well drilling programme commencing 3Q23 within the onshore Tanzania Rukwa Basin.

Helium One considers the drill-ready Tai construction to be the best-defined prospect inside the Firm’s portfolio and is totally funded for drilling by a £10m fund elevate final December. With a brand new CEO in place, the Firm is trying to make good on a dedication to shareholders in securing a rig to check the helium potential inside the Rukwa Rift Basin onshore south-west Tanzania. We stay up for additional updates concerning the conclusion of a rig contract and the potential for drilling operations to start within the latter half of this yr.

Analysis

David Mirzai – David.Mirzai@spangel.co.uk – 0203 470 0473

Gross sales

Richard Parlons – Richard.Parlons@spangel.co.uk – 0203 470 0472

Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471

Rob Rees – Rob.Rees@spangel.co.uk – 0203 470 0535

Abigail Wayne – Abigail.Wayne@spangel.co.uk – 0203 470 0534

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Sources of commodity costs

Oil Brent – ICE

Pure Gasoline – NYMEX

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Purchase – Anticipated return >15%

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