Source - SMW
Victoria Oil & Gas (LON:VOG) was one of the sector's biggest fallers after issuing an update on its operations for the quarter ended 30 September.

The company said the third quarter was the first full period specifically covering the wet season in Cameroon since its operating subsidiary Gaz du Cameroun S.A.  started supplying gas to ENEO, the key power provider to the Douala grid. 

Across all of the GDC gas supply markets Q3 is the lowest demand period primarily due to the seasonal increase in power output from Cameroon's hydroelectric dams. 

GDC's existing take-or-pay terms in place with ENEO, split minimum payment levels between distinct six month demand periods covering higher dry (January-June) and lower wet (July-December) seasons.   Highlights:   ·     8.2mmscf/d Q3 average gas production (Q2: 12.6mmscf/d)

·     105% increase in production compared to Q3 2014 (4.0mmscf/d)

·     $8.1m cash received from gas and condensate sales during Q3 (Q2: $9.8m)

·     2,242mmscf of gas sold in nine months to 30 September 2015 (893mmscf for the nine months to 30 September 2014)

·     ENEO consumption 32% above minimum take-or-pay wet seasons levels

·     Well engineering under way for two wells scheduled for H2 2016

·     New seismic programme under way initially focused on acquisition and reprocessing of historic data points

·     $12.8m Group cash balance Q3 (Q2: $14.2m)

·     $2.4m reduction of debt during the quarter

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Kea Petroleum (LON:KEA) has provided an update following shareholder approval in July for the proposed disposal of its oil and gas assets to become an investing company.

The disposal of the company's Puka asset is still awaiting the consent of the New Zealand Petroleum and Minerals, the regulatory body for oil and gas, giving a Section 41 approval to sell Kea Petroleum's 70% share of the PEP51153 licence area. 

The company expects to receive this shortly and, subject to that happening, it will have sufficient funds to complete the divestment phase but will need to raise further funds to seek a restoration of trading in its shares and begin reactivation as a shell company with a different activity. 

It says it has made progress towards identifying opportunities that it may pursue as an investing company. As disclosed in the previous annual report Kea has been involved in an ongoing litigation with NRG Drilling. 

This is in relation to drilling costs it was seeking from Kea. Whilst the company said it viewed the claim as vexatious, and believed that it had a robust defence to the claims and a strong counterclaim, albeit against a company with no assets, and given the decision to cease as an oil and gas company it was decided to place those NZ subsidiaries involved in the litigation into liquidation rather than to run up additional costs associated with a High Court hearing. 

The effect of this is that the asset held by Kea Exploration, PEP381204 that includes the Mauku prospect, falls under the control of the Official Assignee who will make a decision on the proposal to sell the asset that had been subject to a conditional heads of terms with New Endeavour Resources.

Kea has sought to keep costs to a minimum and the number of employees has been significantly reduced, down from 17 in 2012 to just six today, including the Board, in order to reduce costs and realign with the company's current size.

Its financial position remains critical and is currently dependent on the forebearance of its creditors and directors who have not been paid. The company will need to raise additional funds for its present needs and also to continue as an investing company following the proposed disposal of Puka.

Trading in the company's shares was suspended from 26 May, pending clarification of its financial position. Pursuant to the AIM Rules for Companies, the admission of the company's shares will be cancelled if its shares are not restored to trading by 26 November. 

Consequently, the company is seeking to raise further funds by that date and seek a restoration of trading.

* * *

Urals Energy (LON:UEN) - the independent exploration and production company with operations in Russia - has spudded Well #109 as planned.

The well on the Petrosakh licence is expected to be completed in the first quarter 2016, with the expected depth of the well being approximately 1,800 metres. Chairman Andrew Shrager said: "Following the success at Well #54 last month, we are pleased to be progressing the current drilling programme at Petrosakh as planned. Well #109 is part of a wider drilling programme aimed at optimising production from Petrosakh licence, with a view to developing Petrosakh's existing reserves." 

* * *

The sector's biggest risers were Nighthawk Energy (LON:HAWK) and LGO Energy (LON:LGO) - up by more than 11.9% and over 11.7% in late trading - while the biggest faller was Premier Oil (LON:PMO) - down by more than 9.5%.

At 3:54pm:

(LON:AUR) Aurum Mining PLC share price was +0.01p at 0.93p

(LON:BOR) Borders  Southern Petroleum PLC share price was -0.15p at 2.15p

(LON:CHAR) Chariot Oil  Gas Ltd share price was +0.03p at 5.83p

(LON:ENQ) EnQuest Plc share price was -1.12p at 27.13p

(LON:FOGL) Falkland Oil  Gas Ltd share price was +0.5p at 10.5p

(LON:GKP) Gulf Keystone Petroleum share price was -0.87p at 27.13p

(LON:GPX) Gulfsands Petroleum PLC share price was +0.01p at 4.13p

(LON:HAWK) Nighthawk Energy PLC share price was +0.28p at 2.63p

(LON:INDI) Indus Gas Ltd share price was +2.26p at 118.63p

(LON:LGO) LGO Energy PLC share price was +0.06p at 0.48p

(LON:PET) Petrel Resources PLC share price was 0p at 3.75p

(LON:RKH) Rockhopper Exploration PLC share price was -0.75p at 41.25p

(LON:RPT) Regal Petroleum PLC share price was -0.25p at 3.88p

(LON:UEN) Urals Energy PLC share price was +0.13p at 2.88p

(LON:VOG) Victoria Oil  Gas PLC share price was -3.75p at 53.5p

(LON:XEL) Xcite Energy Ltd share price was -0.12p at 21.88p