SMALL CAP MOVERS: Shares in EnergyPathways surge after gasoline storage licence approval

EnergyPathways has had quite a week. Shares in the energy transition company surged 74 per cent after the North Sea Transition Authority awarded it a gas storage licence for its MESH project in the East Irish Sea.

With the Strait of Hormuz closed to commercial shipping and the Iran conflict squeezing global gas supplies, Britain’s dependence on imported energy has rarely looked more exposed. MESH is shaping up as one of the more credible domestic answers to that problem.

The Gas Storage Licence covers an offshore area capable of supporting up to 60 large-scale salt caverns. 

That is enough, in theory, to double Britain’s existing gas storage capacity and deliver up to six days of national energy supply at flow rates of around 15million cubic metres per day.

Siemens Energy, Costain, Wood and Zenith Energy are all on board. The project, already nationally significant under UK government designation, targets a final investment decision in 2028 and first operations by late 2031.

For a stock that began the year largely unnoticed, it has been a remarkable few months with the shares up 122 per cent year-to-date.

Strong week for AIM

Turning to the wider market, the AIM All Share enjoyed another strong week, rising 2 per cent to 815, around 17 points shy of its 2026 high. 

It is up almost 16 per cent from the low set in late March, prompted by the onset of hostilities in Iran. Small-caps outperformed their larger peers, with the FTSE 100 down 1.7 per cent over the foreshortened trading week.

Speculative buying activity sent shares in Engage XR Holdings soaring more than 70 per cent. The last concrete news from the AI special technology company came at the turn of the year in the form of a trading update.

For Light Science Technologies, up 53 per cent, the story was different. 

Commercial traction in fire-resistant cladding and a substantial contract electronics manufacturing order lifted sentiment. Broker Shore Capital singled out the cladding opportunity as potentially transformational for the business.

Flying the flag

Union Jack Oil & Gas, which is flying the flag for the UK Stateside, gushed 33 per cent higher after announcing the start of drilling at its Crossroads Well in Oklahoma, putting the explorer on a short timeline to the next operational readout from its US portfolio.

The wind was well and truly in the sails of Iofina, which captures iodine from brine water recovered during onshore oil production from America’s shale basins. 

A stellar trading update at the end of last month, allied to expansion plans and the goal of supplying 5 per cent of the world’s iodine, seems to have captured the market’s imagination. The shares, up another 17 per cent this week, have risen 63 per cent in the past month.

From here to Ethernity

Now the fallers. Ethernity Networks, the semiconductor and networking technology company, tumbled 46 per cent after warning that a failure to raise cash through warrant exercises has forced sweeping cost cuts. 

Senior management, including the chief executive and head of research and development, will move to part-time roles to reduce the cost base.

Investors in GenIP, the AI research and development firm, felt the fall-out from last Friday’s heavily discounted fundraiser, with the stock off 39 per cent. It was the same story for ADM Energy, which dropped 29 per cent.

Shield Therapeutics, the iron deficiency treatment specialist, dropped 22 per cent as a good news-bad news statement a week ago served as a slow-acting depressant. 

It reported a 54 per cent surge in first-quarter sales of its lead product ACCRUFeR, an oral iron therapy, to $9.9million and a positive operating profit of $2.5million.

The sell-off likely reflected two concerns. New prior authorisation requirements in New York’s Medicaid programme have disrupted sales, forcing a pivot toward commercial insurance plans and introducing uncertainty over US growth. 

Add to this the departure of the chief financial officer, with the chief executive stepping in on an interim basis, and you have a layer of management risk investors tend to punish in small-cap stocks.

Bargain hunt

Finally, there has been a spate of takeovers targeting the UK’s undervalued mid-caps. Now, it seems, cashed-up buyers are starting to dig a little deeper to unearth value.

Atlantic Lithium is a case in point. The Africa-focused miner has agreed to a takeover by Zhejiang Huayou Cobalt, a Chinese new energy materials company, in an all-cash deal valuing the company at approximately $210million. 

The deal centres on Atlantic Lithium’s flagship Ewoyaa Lithium Project in Ghana, one of Africa’s more advanced hard rock lithium discoveries, seen as a potential supplier to the electric vehicle and energy storage sectors.

Atlantic’s board has unanimously recommended shareholders vote in favour of the scheme, citing lithium price volatility, the complexity of developing the project under its existing joint venture structure, and the risks attached to financing and construction as factors weighing against pursuing the project independently.