I cant understand at this juncture why LGO will need to dilute unless we buy another bargain basement old oil field to milk with our new improved methods and that is not what I would deem as dilution but increasing profit and value and ultimately SP.
I believe broadly speaking that oil production from the new wells on phase 1 will fund phase 2 and phase 2 will help fund TI. Also with the expected oil flow LGO can get loans at cheaper rates to assist/ finance drilling.
Therefore can you explain why you think this dilution is necessary please, I need to understand it?
However you do make a very good point that as of this moment we don't know and cannot guarantee the flow rates of the new wells on pad 2, many of us including me are investing here on the strength of the potential of getting good oil flows from future new wells. Of course we all wish for large flows but we could end up with nothing at all or minimal flows. This is a risk and you are correct in pointing it out.
To justify taking that risk LGO use several tools at their disposal, they have the surveys that they have done, they have the logging data that they have taken, they have the knowledge that Goudron was an old oil field that was productive decades ago and they have what appears to be one of the foremost oil hounds in Neil Ritson whose reputation is impeccable and who is highly respected throughout the industry who is staking his money and reputation on getting good oil flows for us.
In addition to these tools LGO have some extremely knowledgeable investors who would not be in here for the large amounts of money they have invested if the risk was too great. Some of these investors have shared fantastic data, research and knowledge on this bb and have displayed a depth of knowledge and understanding of oil companies and share dealing on AIM that even LGO BOD recognise as being equal to their own ability. This is bb gold, so educational.
Now I personally do not know a great deal about oil companies but I can read and am fairly intelligent, although I do have my meltdown moments, I also am the kind of guy who is all or nothing with anything I do and as such I have devoted time, effort and for me a large amount of £ in this company based on everything I have read and am willing to take the risk. I hope I am correct.
I try not to dig anyone out as I am a good target for that myself, although I dont give a rats clakker, to coin a phrase. I am interested in all comments and do want to understand more so do not think I am having a pop here .
I understand people getting touchy about negativity from others, but if we get to the bottom of their seemingly negative comments we may be more able to understand them.
Of course if the negative commentators are proven to be related to that famous vindictive destructive red indian chieftain of the wild west big chief Talkin Bowlocks then its open season.
I believe you have to review sence2's posting history in order to get a idea of his basic trading strategy. He plays on news, and using the lull in-between drilling news he will sell or buy LGO.If you read his posts last week (prior to TD of GY-667, the posts were all positive on LGO going forward, now that we have had that RNS, he has sold to take whatever advantage of the sp he can. IMHO, he trades on no cash commodity, simple spread betting and maybe 'T' trades, therefore a sell will close the position and he can then re-open near spud of the next well. A simple strategy, which is perhaps helped by the use of new multi alias names on LSE at times, which unfortunately for him get removed rather quickly by Admin. If you understand his trading strategy, then it is easier to read his posts, although I do not bother, as the content is always badly written, clumsy and very amertueristic.
The current well program is costing us $800k per well, with 5 wells done, that is approximately £2.3m GBP, we have had some costs on pad preparation, at the last count we had a debt facility of £15m, we were £4.5m into this facility with 2 wells pre-paid, therefore we should be around £4.5m plus 3 wells (£1.5m) = £6m, leaving us headroom of around £9m.
Lets say the placing of £1.375m has paid all the costs of the MOG case, therefore that is now not a burden to consider.
We raised £7m recently to which £2.9m is for the purchase of T-I, that leaves us in the following position:
£4.1m cash £9m debt facility left.
On top of all this we have a income NET of $462k per month since GY-664 went online, that covers all of our admin costs, as well as interest on debt etc.
Now we are around 4 weeks away, from turning on the taps of Pad 2, I estimate 1,000 bopd from this pad, that is a income NET of $154k per week extra, the pad will generate $660k every 30 days, this pad alone will pay Pad 3 well costs on a working scale of economics.
Pad 1 + Goudron work overs + Spain pay all admin, debt interest etc, while each 4 well pad will pay for the next pad, after that it is all gravy.
Dilution, why? what do we need it for at this stage, or for the foreseeable future. I would also like to add, that there is a high chance of a new debt facility this year.
Go with the fundamentals, crunch some numbers, but do not listen to ramblings from posters who only trade LGO, and need the price held down before they get another position in LGO.
That's his game to spread doubt as he has missed the boat and wants to buy back in once it's dropped. He did it the other month going on about the number of wells on this pad and now dilution is being banded about. Fairly pathetic really
Agree 100% with your sentiments and thoughts. notice one or two mentioning dilution, where on earth did this spring from? Not seen it ever mentioned until last 24 hours. QPP did it and appears to have been a disaster plus many comments on here remind me of QPP shorters. Like many I have total confidence in LGO and its merry men. On wards and upwards surely?
I've just read last night's posts. I really do wonder what you motive is for posting on this board. To me your psychology shows through quite clearly. Somebody who has either missed the boat or has no funds to invest in a life changing opportunity - so let's try and spoil things for those who are in. The problem for you is that you have no credibility as you continually ignore the growing income we have and concentrate on spreading doom and gloom. Yes, we had dilution last month, but what a dilution! T purchase another field at a snip not dilution - investment a, as the previous poster pointed out to you. I would support this kind of placing every time if it were for such purposes. We will have the income to cover Goudron costs once Pad 2 flowing. We get people like you every now and then and they disappear when the SP rises dramatically. Will you still be posting here when Pad 2 flow rates double the SP I think you will have quite a bit of egg on your face. It will be interesting to see your posts then Promise me that you will make a post following flow results and rise in SP which should be at latest 2nd week in September. I will be looking out for you. GLA
I agree - British Bulls still have their short and MMs have tried very hard to drive this down but this is a rock solid support level - 6p does look like a good bet for the next high - but at some point DL does have to raise cash because this is going to be another huge success story for him, He does tap up the shareholder but he does deliver again in rapid time...
Hehe, my apologies MTJK, I was only out by 450,000/day'ish. Again, a wee bit poetic discriptive,, but kinda nice, nobody picked it up? Promise to do better/ & keep awake! 2nd rig & relation to our current flow, sadly.. Psssshhhh, best not!
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