As someone who has been here for a while and seen the heady days of 5p come and go, it's a fair question.
1. You pay your money and you take your choice. I happen to like the business model and the BoD but recognise AIM can appear to be about sentiment not logic; I have the scars to prove it.
2. With thanks to Liz Hurley.. "I never make the same mistake twice; I always do it four or five times to make really sure!" Perhaps MAGP will go stellar one day or perhaps it will crash and burn but buying-in is all voluntary. At this price, I am buying but I understand if others think that is a dopey thing to do. Time will tell. It is not my intent to persuade anyone to part with their hard-earned cash and they can rest assured I will not be unduly influenced by the more colourful posts on a bulletin board.
OK, so you say the price is going to bounce between 0.5p and 1.5p; I'd be interested to hear how you 'calculate' that figure?
-------- You need to consider the long term value of the company, what gives the company its value?
Lets take RS1 as an example as its been in the RNS this week. The total cost of RS1 looks to be circa $800k, but this has an estimated life time return of 56500 boe (value about $4m) - a 4:1 return and I don't think that many here will regard RS1 as a particularly good well. But that's only the start of the story, by drilling that well you hold that area of land by production, meaning that at some point you (or more likely somebody else) can return and drill up the in-fill wells that are possible on that land, plus you gain information about the bit of land next door. So RS1's value is actually the tangible oil it produces plus the associated assets. Now RS1 is one small site, repeat this pattern over 7000 acres and the value starts to add up.
Will MAGP go bust? That comes down to a question of management and risk, basically by taking the multiple well low risk approach the question of going bust remains within the control of the BOD, they will not get beaten even if the market goes against them. Plus SOS is almost unique in that he's basically work for free (OK, so no doubt there are family members etc. employed, but you have to employ somebody, so best those you trust). Rita, this girl knows her stuff.
Look at the recent sale of the Texas assets, read that RNS again, it shows the true value of proven on shore US assets.
I could go on, but the information is all there is the 2 year+ of RNS, you just need to understand that firstly you need to know where to drill your wells and that information come from having an interest in a large number of well and second oil wells produce for 30 years so this is a long term game. If you want to throw the dice on a couple of big quick wells, then this is not the place.
Would be interesting to see how many stakeholders are game for further stock-building in the days ahead.
By proceeding with two verticals in the next 6 months -- in the face of a collapsing oil price -- the signals from management look strong. They would seem to be in credit to the tune of $2+m, let alone the ~$6m credit facility. So no point in coming to a dead halt if "mid-tier" status remains the objective.
I note plasma technology is on track to one day supersede frack jobs . . . California first and then steadily moving east.
Never mind Mr E's reasoning, I'll crawl out from under my stone to ask what planet you are on?
Your 7 posts indicate a significant lack of involvement here - how you perceive MAGP to be likely to go under is a mystery. I am not going to deny that the current oil price has frustrated the continued growth of this company but over the last 3 years this company have shown a shrewd investment strategy having accrued a significant amount of acreage at relatively low cost and have a strike rate most oil companies would give their right arm for.
We have shown a significant and steady growth of wells and yes the individual % of each is relatively minor but then so it the risk and debt. Unlike a lot of oily hopefuls MAGP are backed up by revenue to cover costs with a massive amount of currently untapped potential.
How we tap that potential is key but on the basis of past performance - my money is still on this BoD to succeed.
Perhaps in any future posts you could provide any reasoning or fact to back up your statements. If you can't then jog on to the next BB to deramp
hi - watched you for a long time and you talk a lot of sense generally. For me, this is going to hover 0.5 - 1.5p ad nauseum until it's bought out (likely but not for 4-5 years IMO) or goes under (unlikely but won't rule it out) - what makes you stay in this when it's so likely a) it'll go down further (absolute certainty in my book) and b) it will be at LEAST 1-2 years before MAGP is subsumed by bigger company.
Datafeed and UK data supplied by NBTrader and Digital Look.
While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.