Energy prices remain volatile as tensions rise in the Middle East and demand concerns linked to slowing global growth persist.
In the background several AIM companies with material exposure to natural gas have issued significant announcements in the last week.
On 17 June shares in Reabold Resources (RBD:AIM) and Union Jack Oil (UJO:AIM) gushed higher after drilling on their West Newton site in the North East uncovered what they claim could be the UK’s largest ever onshore natural gas discovery.
READ MORE ON REABOLD HERE
The find is initially estimated to contain up to 189bn cubic feet of gas – equivalent to 31.3m barrels of oil.
Broker Cantor Fitzgerald described it as a ‘cracking result’, however, testing still needs to be carried out to confirm the discovery is commercially viable, with all eyes now on a production test slated for the third quarter.
On 13 June Romanian gas producer Prospex Oil & Gas (PXOG:AIM) marked itself out as something of a rarity in the sector as it posted a maiden profit. The company announcing a net profit of £779,904 for 2018 compared with a loss of £3.2m in 2017.
Today the focus is on one-time sector darling Sound Energy (SOU:AIM) which is cutting executive pay and looking to raise $3m as it continues to explore the sale of gas assets in Morocco following disappointing drilling results. Its shares are down 7.2% at 9.8p.
Cantor says: ‘The wheels have come off very quickly for Sound. What, if anything, it can achieve for a sale will be very interesting.’