Energy & Materials Sector

• Korea Zinc is launching a 3.21M share buyback (15.5% of total shares) via a KRW 2.66T tender offer at ₩830,000 per share, with Bain Capital involved.
• If tendered shares fall short, Korea Zinc and Bain Capital will buy all. If over the target, they’ll buy pro rata. Below 1,215,283 shares, they will opt out.
• Should we dive into Korea Zinc’s risky buyback or choose safer, lower-priced MBK? The market vibe favors MBK, reflected in Korea Zinc’s closing price today.

• The court rejected MBK and Young Poong’s injunction to block Korea Zinc’s buyback, allowing Choi’s side to continue using buybacks to defend control.
• Korea Zinc plans an emergency board meeting to launch a tender offer, using internal funds, to buy back shares at 800K-850K KRW starting around October 7.
• If Choi converts discretionary reserves into distributable profits, Korea Zinc could unlock 2-3 trillion KRW for the buyback, but uncertainty keeps the stock around 700K KRW.

• Unsurprisingly, the Greatview Aseptic Packaging (468 HK) Board has recommended shareholders vote against the appointment of Shandong Xinjufeng Technology Packaging (301296 CH)’s two director nominees.
• The EGM vote on 18 October is too close to call and depends on Shandong Xinjufeng and management’s ability to rally disengaged minorities to their respective causes.   
• Irrespective of the EGM vote results, Shandong Xinjufeng will be keen to launch its offer to ward off the threat of a possible competing offer from management. 

• Korea Zinc plans to repurchase and cancel shares worth 2.663 trillion won. Korea Zinc’s partner Bain Capital also plans to purchase around 430 billion won for a 2.5% stake. 
• Korea Zinc plans to buy back shares at 830,000 won per share, which is 11% higher than MBK’s revised up tender offer price of 750,000 won.
• Choi family/Bain Capital’s efforts to conduct a massive share buyback and cancellation at higher prices than the market price goes against the globally accepted market practices.

• Price surge to continue until 2025
• 13% higher precipitation in Thailand in Jan-Aug 2024 vs 2023

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Nickel Industries
• Tata Motors ADR

• In a filing released last evening after the market, Mongolian Mining (975 HK) announced it had redeemed the entire outstanding principal amount of the perpetual securities and their distribution.
• The announcement is significant as it prepares the company to distribute dividends for FY24 in the March results. 
• The stock trades at 5.2x FY24 PE and 2.5x EV-EBITDA, and we expect the company to have massive net cash by the end of the year.

• Veren has demonstrated robust financial and operational performance in the second quarter of 2024, marked by strategic advancements in both its asset base optimization and financial structure.
• The company reported significant operational efficiency with stable production levels, having produced 192,500 barrels of oil equivalent per day (BOE/d), of which 65% comprised oil and liquids.
• This production performance is consistent with the company’s strategic focus on high-margin liquids-rich plays in the Western Canadian Sedimentary Basin, particularly in the Alberta Montney and Kaybob Duvernay areas.

• • The B6 well on the Bittern field is now in production at a stable gross rate of ~8 mboe/d.
• Net to Serica, this represents ~5.2 mboe/d.
• This is well above our expectations of ~3 mboe/d (net).

• The WTR Sustainable Index was up 3.5% W/W versus the S&P 500 Index (up 0.6%), the Russell 2000 Index (down 0.1%) and the Nasdaq Index (up 1.1%).
• Energy Technology (13.5% of the index) was up 3.3%, while Industrial Climate and Ag Technology (46.3% of the index) was up 1.1%, ClimateTech Mining was up 4.2%, and Advanced Transportation Solutions (21.0% of index) was up 8.4%.
• Top 10 Performers: VIHD, NNOMF, WAVE, EGT, NVVE, CPWHF, VLI, XPEV, MP, DNMR

• Recent policy changes in China have sparked a surge in commodity prices and stock markets
• China’s focus on stimulating the real economy over asset prices sets them apart from Western policies
• Chinese government has implemented measures such as interest rate cuts and lower bank reserve requirements to boost liquidity and investment

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• At last, Covestro signed an Investment Agreement with ADNOC for an all-cash €62.00/share offer (same as June proposal), 54% premium to June 2023, €11.7 billion implied equity value.. 
• The offer represents 9.1x EV/Fwd NTM EBITDA (vs. peers at 8.3x), 7.4x 26e EBITDA and 1.8x P/BVPS. The share price implies 6.4% gross spread and 66% probability of deal completion.
• The agreement is well-crafted and now has a strong likelihood of reaching a successful completion, although there is a lengthy period before completion and likely political opposition. Long.

• In this insight, we highlight the recent pricing gap divergences of the major Korean holdcos and opcos which could provide trading opportunities in 4Q 2024.
• Volatility has been high in the Korean stock market in the past several weeks resulting in some interesting widening of some gaps among numerous holdcos and opcos in Korea. 
• Of the 38 pair trades, 19 of them involved holdcos outperforming opcos in the past six months and the other 19 opcos outperforming holdcos in the same period. 

• Coterra Energy held its 2024 Earnings Call, reporting robust results for the second quarter.
• The company highlighted strong financial performance alongside diligent execution of operational strategies, despite facing a 42% drop in realized natural gas prices between Q1 and Q2 2024.
• Ensuing from this price drop, revenue only saw a modest 12% decline, illustrating Coterra Energy’s resilience and strong market positioning.

• Civitas Resources provided a detailed overview of its operations and financial results during the second quarter of 2024 earnings.
• The company, having undergone significant structural transformations, particularly with its strategic entry into the Permian Basin, demonstrated notable advancements in operational efficiencies and financial performance.
• Civitas Resources has demonstrated robust operational success, particularly in integrating and optimizing its Permian assets, which are now producing over 185,000 barrels of oil equivalent per day.

• Sailfish Royalty is a precious metals royalty and streaming company focusing on assets in the Americas.
• The Company has a strong respect for shareholder capital, currently offering a 5.0% dividend yield and actively repurchasing shares.
• FISH has a 3% NSR on the Spring Valley project in Nevada that is expected to begin production in 2028 and scale to 349Koz Au per year.

• SM Energy Company delivered a mixed set of results for the second quarter of 2024, showcasing both strengths and some areas that invite caution.
• Below is a holistic investment thesis and summary based on the company’s recent earnings call.
• Starting with the positives, SM Energy posted significant production growth, particularly in the Permian region.

• Commodity markets are down despite stimulatory measures from China, with oil prices falling due to increased supply from Libya and OPEC plus alliance
• China’s demand outlook for oil remains steady, with forecasts for oil demand growth unchanged despite stimulus measures
• Base metals, particularly copper, have seen a price increase due to stronger demand impulses from China, with bullish outlook and potential upside risks for the first half of 2025

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• For the month of September 2024, 15 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$23bn. 
• The average premium for the new transactions announced (or first discussed) in September was ~43%. The average premium YTD is ~44%
• This compares to the average premium for transactions in 2023 (117 transactions), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) of 39%, 41%, 33%, 31%, and 31% respectively.

• Did China Just Trigger Commodity Markets?
• China’s central bank last week announced a new stimulus package to the economy to curb the growth decline that is still going on.
• Chinese stocks jumped and also “Chinese-linked commodity prices” like soy, copper and steel gained momentum as Governor Pan Gongsheng announced plans to lower borrowing costs and inject more funds into the economy, as well as to ease households’ mortgage repayment burden.

• US rig count declined by one to 587 for the week ending 27/Sep, marking the sixth drop in seven weeks. Despite this, the rig count increased by six in Q3.
• The US oil rig count fell by four to 484 after staying flat last week. Gas rigs rose by three to 99, marking its second increase in six weeks.
• For the week ending 27/Sep, US energy producers added one rig in Texas and cut two in New Mexico and one in Louisiana.  

• Harbour Energy plans to acquire Wintershall Dea’s non-Russian upstream assets, which will triple its 2p resources, increase production, lower operating costs, and boost free cash flow
• This move will reduce HBR’s reliance on the UK Continental Shelf and diversify its resource base
• Despite concerns about the future of UK oil and gas producers, HBR’s stock presents a potential upside of over 100% within the next 12-18 months, making it an attractive investment opportunity.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• This flash note is an update for our readers on the indicative probability of default for Energy Absolute Public Company Limited (EA).
• We plotted EA’s probability of default, using Criat’s iRAP Global Plus PD Toolkit (iRap), against its peers, and we believe the chart indicated a high probability of default still.
• Given a lack of reliable bond quotes in the THB bond market, we continue to issue our report on EA without a recommendation.

• US natural gas prices jumped 19.2% for the week ending 27/Sept, marking the largest weekly increase since November 2023, driven by strong demand and concerns over supply cuts.
• Henry Hub Put/Call volume ratio fell to 1.03 (27/Sep) from 1.69 the previous week as put volumes fell by 45.5% WoW, while call volumes declined by 10.1%.
• Put OI increased for contracts expiring in October and November, while call OI rose for expiries in December, January, February, and March.

• We are initiating coverage on PEMEX with an Outperform recommendation.
• We think the potential reclassification to a public company will lead to an improved credit profile, resulting in spread compression due to the increased linkage with the sovereign.
• We prefer the PEMEX (B3/BBB/B+) 5.950% 2031, PEMEX 6.625% 2038, and PEMEX 7.690% 2050 bonds, as they are trading wide to the overall PEMEX curve.

• NOV Inc. has reported a strong performance in the second quarter of 2024, with revenues reaching $2.22 billion, indicating a 6% increase compared to the same period in 2023.
• Notably, international markets demonstrated double-digit growth, and the offshore sector grew by 6%, contrasting with a slight 1% decline in North American sales.
• The company achieved a net income of $226 million or $0.57 per fully diluted share, an improvement from the previous year.

• SGX Iron Ore futures surged by $10.24/ton to $102.09/ton last week, hitting the highest level since July, driven by China’s stimulus announcement.
• A bullish technical signal emerged as the 9-day moving average crossed over the 21-day, yet RSI overbought levels (72.35) suggest a potential correction.
• Trading volume spiked mid-week but thinned near $105/ton, indicating waning volume above $100/ton and setting up volatility for a short-term price drop.

• On September 26, Nippon Steel’s president affirmed the company’s commitment to completing the United States Steel (X US) acquisition by year-end, despite the CFIUS review being extended until December.
• U.S. Steel, with an expected value of $45.19/share offers 27% upside potential. This discount, driven by acquisition/fundamental value, supports a buy recommendation thus, I would be long U.S. Steel.
• If the deal were to succeed, the likelihood of it closing before the end of 2024 is low, primarily due to the complexities surrounding the American presidential elections.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Medco Energi

• Kumyang’s major shareholders are backing the capital raise, committing ₩160B of the ₩450B total. We’re also likely to see some robust price support for the stock rights in early phases.
• Institutional investors still make up about 10% of the SO, with around 8% being active players. These guys could easily start dumping stock rights in bulk.
• Retail holds nearly 50% of the SO, increasing volatility and boosting chances for arb spreads. Kumyang’s stock futures have solid liquidity, making it a prime arb trading setup.

• Kum Yang announced a rights offering capital raise of 450 billion won which will be used for facility investments and debt repayment. 
• The estimated rights offering price is 38,950 won, which is 31% lower than current price (56,500 won). 
• We remain negative on Kum Yang. Despite the sharply lower rights offering price relative to current price, we would avoid the rights offering. 

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Trivium’s ESG as “Strong”, in line with its Environmental and Social scores, while Governance is “Adequate”. Controversies are “Immaterial” and Disclosure is “Strong”.

In 2023, Trivium received EcoVadis’ Platinum rating for the third consecutive year, and earned an A rating from CDP for Climate.

• Overseas institutions might tender around 4%, locals about 6%, giving a realistic max of 10%. MBK may struggle to even reach that minimum of 7%.
• Mirae Asset and Samsung Life, holding the largest portion of the targetable stakes, hinted they’ll participate in the tender but won’t tender all their shares.
• Allocation risk for the tender is minimal, but cancellation risk remains. MBK may barely exceed the 7% minimum, making predictions tough and reducing chances of a post-tender stock price drop.

• Himadri Speciality Chemical (HSCH IN)‘s expansion into Li-ion batteries and tires, with a massive Rs. 1,100 crore capex and Birla Tyres acquisition.
• Diversification into sunrise industries boosts margins, strengthens competitive positioning, and supports long-term growth.
• HSCL’s evolving business model makes it more than just a carbon company, enhancing its growth potential and resilience.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• China Hongqiao
• Continuum Green Energy

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Biocon Ltd
2. Yankuang Energy Group
3. Wynn Macau Ltd
4. Rakuten
5. China Jinmao Holdings

and more…

• Chevron’s Q3 revenue is expected to decline by 7% YoY, with EPS projected to fall 8.9% due to contracting refining margins and lower price realisations.
• The early September plunge in oil prices may further squeeze already tight refining margins. Management anticipates a slowdown in output due to increased maintenance in Q3.
• Chevron became the most shorted large-cap stock in the US in August, with shares shorted increasing by over USD 200 million amid growing bearish sentiment.

• WTO chief Ngozi Okonjo-Iweala’s request goes unheeded  
• EPP agriculture chief quotes EC chief offering temporary solution  
• EUDR system to be opened for user registration in November

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Guala Closures’ ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Strong”.

Pan African Resources’ (PAF’s) FY24 results, announced on 11 September, were within 1% of our prior forecasts for both EPS (4.14c cf 4.17c) and headline EPS (HEPS; 4.15c cf 4.17c). However, if the contract liability related to its ZAR400m financing facility for Mintails is stripped out, we calculate that PAF would have recorded HEPS of 5.27c, which would have been close to the top of the range of analysts’ expectations and also a record for both 12-month and six-month periods. While arguably academic for FY24, this nevertheless sets the stage for more material EPS and cash flow increases in the future as the Mintails contract liability concludes in February 2025 at the same time that opex stabilises and capex begins to fall away.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Constellium’s ESG as “Adequate”, in line with its Environmental and Social scores, while the Governance pillar is “Strong”. Controversies are “Immaterial” and Disclosure is “Strong”.

• The SET50 index tracks the performance of the top 50 largest and most liquid names listed on the Stock Exchange of Thailand (SET).
• In this insight, we take a look at the potential ADDs/DELs for SET 50 during the index rebal event in December 2024.
• Currently, we see 3 expected ADDs/DELs and given that the 3-month reference period used for average market cap rankings have now started the rankings may be more stable. 

• The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
• Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
• The key stocks mentioned in this regular insight include: Dongyue Group (189 HK), C&D International Investment (1908 HK), and China Aoyuan Property (3883 HK).

• Huy Anh Natural Rubber appoints Koltiva to help it  
• VRG holds training as per PEFC ST 2002-1:2024 Module Standard  
• Experts call for a national support website

• For the week ending 20/Sep, US crude inventories declined by 4.5m barrels, surpassing expectations of a 1.3m barrel drawdown. Gasoline and distillate stockpiles also decreased more than analyst estimates.
• US natural gas inventories rise 47 Bcf for the week ending 20/Sep, lower than analyst expectations of a 52 Bcf buildup. Inventories are 7.1% above the 5-year seasonal average.
• BP and Shell experienced rating downgrades and target price reductions, while TotalEnergies and Exxon Mobil saw upward revisions in their target prices.

• CEO and Director Patrick Gruber joined us on the WTR Small-Cap Spotlight to discuss Gevo’s recent acquisition of Red Trail in North Dakota.
• Those interested can listen to this podcast on Apple Podcasts, Spotify, or on our website
• With the planned $210-million Red Trail acquisition, Gevo will add low-carbon ethanol and carbon capture and sequestration (CCS) as new operational business lines. 

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Techem’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.

• ChampionX Corporation recently discussed their fourth quarter and full year 2023 earnings, revealing a mix of achievements and strategic initiatives that position the company for future growth while acknowledging some market challenges.
• The company reported a solid performance for the fiscal year 2023, marking significant financial milestones.
• ChampionX expanded its adjusted EBITDA margin by 430 basis points and achieved a 25% growth in adjusted EBITDA.

• 1H24 sales volumes in the Williston were 1,239 boe/d.
• The FY24 production guidance for the Williston is unchanged at 1.1-1.3 mboe/d.
• This excludes >100 boe/d of natural gas liquids.

• Magnolia Oil & Gas Corporation reported their Second Quarter 2024 earnings with a few key highlights indicating both challenges and achievements.
• In the positive spectrum, Magnolia achieved a record total company production of approximately 90,000 barrels of oil equivalent per day, marking a year-over-year growth of 10% and a sequential increase of 6%.
• This is particularly notable in their Giddings segment, which reported a production rise of 21% compared to the previous year, with oil production growing by 28%.

• NOG (Northern Oil and Gas, Inc.), in its second quarter earnings for the fiscal year 2024, presented a solid operational and financial performance, hinting at strategic advancement and operational efficiency, albeit with considerations regarding market dynamics and strategic executions.
• The company reported a 31% year-over-year increase in its adjusted EBITDA and an approximately 33% rise in cash flow from operations, excluding working capital changes.
• This growth is underscored by an effective management of debt levels, maintaining a low debt-to-equity ratio which stood at around 1.1, similar to the previous year, despite significant capital investments and acquisitions.

• KRX 300 hit 1 trillion won AUM fast, but with local pensions more aggressive, the value-up’s early AUM could top 1 trillion, hitting up to 3 trillion in six months.
• Hanjin KAL, S1 Corp, Hyundai Elevator, Nice Info, and Huchems are set for strong price action. The financial sector also stands out, seeing the biggest impact compared to other sectors.
• Small caps under 1 trillion won see little passive impact, but solid plays exist under 3 trillion, so splitting large and small caps won’t limit target options much.

• Hankyung reports MBK will raise Korea Zinc’s tender offer to ₩750,000 (14%) and Young Poong Precision’s to ₩25,000 (25%) before today’s market opens.
• Hankyung and Maeil are top sources for market scoops, so it’s almost certain MBK leaked the tender price hike ahead of today’s trading.
• MBK leaves Choi just five trading days to respond. Korea Zinc plans to raise ₩400 billion, but it’s still not enough for a counter-bid.

• MBK announced that it will raise the tender offer prices on Korea Zinc by 13.6% to 750,000 won and Young Poong Precision by 25% to 25,000 won. 
• If 100% of the 3,024,881 shares of Korea Zinc tender offer is completed, at the revised tender offer price of 750,000 won, this would be 2.27 trillion won in amount.
• In term of probabilities, we would put a 80-85% probability that MBK/Jang family successfully completes the tender offers and takes over the controlling stakes of these two companies.

• MBK Partners has increased the Tender Offer prices for Korea Zinc (010130 KS) by 13.6% to ₩750,000 and Young Poong Precision (036560 KS) by 25% to ₩25,000.
• All other terms remain the same.  IF MBK secures the maximum 14.61% in KZ, this will be Korea’s largest-ever Tender Offer.
• MBK made a public offering correction announcement today. The Choi family now has 5 business days in which to respond with a counteroffer.

• Tocvan is centred around its clear and achievable objectives, looking to develop its flagship Gran Pilar Gold Project to near-term production.
• Following a maiden resource this fall, a pilot plant is expected to be permitted, constructed, and producing gold as early as H1/25.
• Beyond the pending resource estimate, the Gran Pilar Project shows significant growth potential across its 2,200ha+ land package.

• Deepak Fertilisers & Petro (DFPC IN) commissioned 500KT of ammonia plant that will remove their dependence on import of critical raw material.
• DFPCL’s TAN capacity stands at 629 KTPA, with plans to increase it to 1,000 KTPA by FY26 through a new facility in Gopalpur, Odisha.
• Deepak Fertilisers & Petro (DFPC IN) is about to complete its restructuring by creating a separate subsidiary for mining chemicals, which in future they may plan to list separately. 

• ADD slapped on the US, the EU, the UK, and Singapore imports
• ADD probe initiated against Canada, Japan and India
• Russia to be a major beneficiary of the measures

• The S&P 500 (SPX) is approaching 5783, which is the upper-end of an important target/resistance area we have discussed for over a month (5670-5783).
• 2007 SPX topping analog has tracked the current market almost perfectly, suggests a 2% or less move above the prior all-time high set in July at 5670 before topping (i.e.,5783)
• SPX is “breaking out” which is bullish, but time and time again we have seen bull/bear traps (false breakouts/breakdowns) at major turning points. Bull trap confirmed on break below 5670

• US natural gas prices rose by 5.6% for the week ending 20/Sep, driven by a shrinking storage surplus and an improved demand outlook.
• Henry Hub Put/Call volume ratio rose to 1.69 (20/Sep) from 1.45 the previous week as put volumes rose by 102.7% WoW, while call volumes grew by 74.4%.
• Put OI surged for contracts expiring on 25/Sep, Oct, and Nov. Call OI rose for expiries on Dec, Jan, Feb, and Mar.

• WTI futures increased 3.4% for the week ending 20/Sep, driven by the Fed’s rate cut, supply disruptions in Libya, and falling US crude stockpiles, which alleviated demand concerns.
• WTI options Put/Call volume ratio fell to 0.83 (20/Sep) from 1.30 (13/Sep) as put volume fell by 45.8% WoW while call volume fell by 14.6%.
• WTI OI PCR grew to 0.77 for the week ending 20/Sep from 0.76 on 13/Sep. Call OI fell 16.7% WoW and put OI declined by 16.1%.

• Current production has reached 950 bbl/d, representing an increase of 90 bbl/d since August.
• This reflects the very good performance of the work-over programme with 98 bbl/d incremental production from three new workovers in Tranche 3 from early August.
• Overall, the programme (three tranches with a total of 11 work-overs so far) has delivered 227 bbl/d of incremental production.

• ADF announced $55M in new contracts across Quebec and the U.S. Midwest, including additional work for its U.S. pharmaceutical client.
• Today’s announcement gives us further confidence that ADF can continue to grow the backlog as the infrastructure spending cycle prolongs.
• ADF trades at 3.5x EBITDA, the lowest multiple we have seen since covering the stock and a major discount to its peers and precedent transactions.

• In this insight, we discuss three particular allies that could help the Choi family that have been highlighted by the local media including Hanwha, KIS, and Softbank.
• The Hanwha Group is one of the largest shareholders of Korea Zinc. In addition, Hanwha Group Vice Chairman Kim Dong-Kwan has a close relationship with Korea Zinc Chairman Choi Yoon-Beom.
• Korea Zinc is planning to hold an important press conference on the 24 September to reveal its position on the tender offer of Korea Zinc shares by MBK.

• Back on the 23rd July, YTL Cement entered into a S&P agreement with 98 Holdings to acquire a 81.24% stake in building material manufacturing/supplier NSL Ltd (NSL SP) at S$0.75/share. 
• Pre-Conditions are now satisfied, and YTL Cement has launched a mandatory unconditional cash Offer. The Offer price is also S$0.75/share. 
• Super straightforward deal. And will trade tight to – or through terms. YTL’s intention is to maintain NSL’s listing. 

• Over the past week we visited parts of Kazakhstan, the 9th largest country in the world.
• Long a favorite of the oil and uranium industry the country is now attracting more metals and mining exploration activity.
• Arras Minerals (ARK V EQUITY) has assembled the 4th largest exploration package and is looking for elephant sized gold/copper deposits. Success at any of its projects could catapult shares higher.

• Adverse weather impacts Chinese prices   
• Arbitrage buying spurs prices up  
• TSR inventory drops in September 

• US oil and gas rig count fell by two to 588 for the week ending 20/Sep, the fifth decline in six weeks, after rising by eight last week.
• The US oil rig count stayed flat at 488 after rising by five last week. Gas rigs fell by one to 96, marking its fourth decrease in five weeks.
• For the week ending 20/Sep, US energy producers added two rigs in Texas. Conversely, they cut one rig each in Colorado, Louisiana, New Mexico, and Utah.   

• SGX Iron Ore futures closed the week $1.38 lower, with wide trading range of $5.85/ton in a week filled with economic releases including FOMC and PBoC rate decisions.
• Momentum indicators are neutral; RSI at 37.70 signals potential upside, while the price remains below key moving averages, including the 9, 21, 50, 100, and 200-day SMAs.
• Prices broke below key volume profile support at $91.27 and may see a short-term rebound to $90/ton due to limited trading volume below this level.

• Schlumberger’s Q3 2024 revenue is projected to increase by 12% YoY and EPS by 15.4%, driven by international growth, digital sales, and cost-efficiency programs.
• Management expects 2024 EBITDA margin to reach or exceed 25%, driven by stronger H2 performance led by seasonally higher year-end digital and product sales.
• Schlumberger announced a milestone in sustainable lithium production and secured significant contracts through its carbon capture and OneSubsea joint ventures.

• Allegiant provided an update on its ongoing 5,000m 2024 drill program at Eastside.
• AUAU will look to update its mineral resource estimate at Eastside by Q1/25, noting that the most recent update was in July 2021, with much drilling being done since.
• We recently initiated coverage on Allegiant, find the report here.

• The fourth horizontal well at Carrizales Notre (CNB HZ-5) has been put on production at a gross oil rate of 2.7 mbbl/d (1.35 mbbl/d net to Arrow) with a water cut of 11%.
• This flow rate compares favourably with CNB HZ-4 that was put on production at a gross oil rate of >2.5 mbbl/d (8% water cut).
• Overall gross oil production from the three other horizontal wells is ~5.62 mbbl/d (~2.8 mbbl/d net to Arrow) including 2.1 mbbl/d for CNB HZ-4, 1.9 mbbl/d for CNB HZ-3 and 1.6 mbbl/d for CNB HZ-1.