Zephyr Energy (ZPHR), the Rocky Mountain oil and gas company, provided an update on operations on the State 36-2R LNW-CC well at the Company’s flagship project in the Paradox Basin, Utah, U.S. The Company has completed the second phase of the production test on the well. Peak production rates achieved during the second test were over 2,100 barrels of oil equivalent per day, a very significant production rate for an onshore U.S. well with only 130 feet of completed reservoir interval. ZPHR said this is a highly significant milestone for the Company in its development of the White Sands Unit and its wider Paradox project acreage. This is the first known use of acidisation stimulation in the Paradox Basin and the results have been extremely encouraging – the well’s deliverability and permeability are particularly notable, leading to the strong peak production rates witnessed.
Comment: Today’s news regarding Paradox is what the market has been waiting for. The question now is how much of a bump in the stock it can deliver, and whether it will improve sentiment in the stock in a meaningful way.
Galileo Resources (GLR) provided an update on the proposed development of the Luansobe copper project in Zambia where a small-scale mining licence has been granted and Galileo holds a 75% interest in the Project. GLR said it was very pleased with our Luansobe acquisition. The investment was based on previous work and since acquiring the project we have also carried out fieldwork, drilling programmes, relogging historic core, modelling for resource and engineering financial modelling. The work it has carried out confirms that the project has the potential to be a large-scale mining project close to existing processing facilities, large and small notwithstanding the Mufulira mine.
Comment: GLR continues with its decent run of newsflow regarding Luansobe, and its other projects, something which really should move the dial as far as the share price, especially given that the market cap is a modest £12m.
Aura Renewable Acquisitions (AURA), a UK-based company, whose objective is to invest in the global renewable energy sector supply chain announced its interim results for the six months ended 30 June 2024. AURA said it was established to identify and acquire businesses operating in the renewable energy sector supply chain. The board continues to identify and assess acquisition and investment opportunities in the UK and overseas, which could offer the quality and scalability required to achieve significant shareholder growth. It also continues to engage with the board’s extensive business network and introducer base to promote the Company expansion strategy.
Comment: Given how hot the renewable energy sector is, and how much governments have thrown / wasted of taxpayers money in this area for virtue signalling and bogus tender purposes, one would have thought AURA is in the box seat in terms of getting a deal over the line.
Gear4music (G4M), the UK’s largest retailer of musical instruments and music equipment, will hold its Annual General Meeting at 10.30am today. G4M said having successfully reduced its net debt and operating costs during FY24, during the early stages of FY25 it has focused on implementing the growth strategy outlined in June and expect this to start delivering results in the second half of this year. It is well prepared operationally for the upcoming seasonal peak trading period, and the Board remains confident of the delivery of our medium and longer-term profitable growth strategy.
Comment: Dealing with the pandemic and its aftermath has clearly not been a walk in the park, with shares of G4M near £2 versus the £10 bubble peak. That said, the situation does look to have stabilised, and there could yet be further valuation recovery.
The Berkeley Group Holdings (BKG) said it was holding its AGM today, at which it will provide the following Trading Update covering the period from 1 May 2024 to 31 August 2024. Pre-tax profits for the year are expected to be weighted towards the first half, similar to last year, and operating margin will therefore be slightly ahead of our long-term range (17.5% to 19.5%) for this period. Net cash at 31 October 2024 will be around £450 million (30 April 2024: £532 million) following shareholder returns of £229 million in the first half, including the £184 million proposed special dividend that is subject to approval by shareholders at today’s AGM.
Comment: It will be interesting to see how land bank hoarding companies like BKG negotiate the new Far Left government’s stance on building new homes for this country’s burgeoning population. Clearly, forced housebuilding will provide pressure on selling prices.
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