Auctus Advisers Research Note, 4 March 2024

Please click HERE to see the latest research published by Auctus Advisers

Gearing up for the return to drilling in the Paradox

4Q23 production in the Williston was 1,053 boe/d. This only reflects oil and natural gas production. Adding our estimates of NGL production (reported in previous periods but not in 4Q23) would lead to ~1,200 boe/d (we forecasted ~1,400 boe/d).
While production reached 1,440 boe/d in late November (~1,650 boe/d including NGL), 4Q23 production was negatively impacted by the curtailment of production from the new Slawson wells in mid-December due to adverse weather condition and infrastructure constraints.
Production from the Slawson wells resumed in late January.
During February, ten additional wells were placed on production adding ~75 boe/d net production. The wells are performing ahead of expectations.
With regulatory approvals in place, depending on rig availability, drilling of the State 36-2 well could start in April or May.
We are cautiously reducing our production forecast in 1Q24 to ~1.1mboe/d by deferring 1/3 of 1Q24 production to 2Q24 and 3Q24.
As we revisit our production forecast and activity assumptions for the Paradox in 2024, we have changed our target price to £0.12/sh in line with our new ReNAV.
Overall production is expected to increase by 250% by 4Q24 (compared to the FY23 average production) and the drilling programme could unlock the Paradox (£0.13/sh unrisked just for the 2C contingent resources) and the Salt Wash helium (£0.03/sh unrisked for the 0.13 bcf of helium)