I'd second DevEx. I fully support his planned approach in the 16:04 post. Very balanced. Am slightly excited to see Liz's initial reaction. IG PS: What's the bets the Steve steps out from behind the curtain and reveals all tomorrow!
462Milion confirmed and 90.5Mil unconfirmed (waiting email further clarification of holdings) 75 contributors. I suggest Devex/DevonianExile would make an ideal lead rep as he post on both boards and is in my mind the one of the most balanced contributors. Therefore, the first mail confirming the FoFRR group should come from him to Liz/Helen and invite a shared approach to investor communications (as some have suggested).
2 mill by my count. Would love to be wrong and not see a 2 mill sell @ 0.71 [or just under] Although I don't actually see this as negative in the long run. IMO there can only be good reasons why someone would want the sp held down. One would in fact be wise to fear more an sp being overly pumped (lenigas!)
PS: My suspicions of yesterday remain today - that a new aproach is being take and sells are being inserted during the trading day to match buys and keep a lid on things, rather than it all being done on close
there sadly . Lets stick to Niko .anything else is a bonus .
Nothing much else to say other than I hope we get an oil production cut agreement from Russia and Saudi , though capex for oil companies is at 20 year lows , and US Shale is swiftly see strong production cuts , down 400,000 bopds . Rig counts down too
EIA report out now ( as for every Wed at 15.30 bar holidays ) saw inventories rise again by 3m which was expected , ( despite the American Petroluem Institute yesterday posting a good withdrawal ) Not sure why but will go through the data now .
So despite the zero comms from our executives , RNSs give as amble insights into risk vs reward here
Any asset is valued as the present value of the cash you can take out over its life . So lets start with Niko : ( I am going to use 50% ownership , 900bopds and $50 for Brent - currently rallying and over $52 )
Using a simple NPV 10 , industry standard on 450bopd * $50 ( assuming the well can produce at the same rate for 10 years - not sure it will - and assuming oil stays at $50 - again not sure it will stay this low .There are many assumptions but Niko could be worth $49.7 m ( which is $8.1m for 10 years at present value at 10% discount ) So divided by the current 3.278bn shares one can easily see how 1p per share can be added to this .
Now the argument of the naysayers may be that depletion rates risk skewing this figure but I would then argue that Ryder report implies reserves just for that well that substantiate that value creation as well as likely for the whole Taribani field . One can equally argue that oil may soon return to much higher levels , making the above calculation a lot more interesting .
At $60 - NPV 10 for Niko = 1.2p per share .
So that makes it interesting as the extra cash flow will also benefit our bottom line . Relieving issues with dilution
Then the mythical 7 MCFs , ( i'll pretend I never read the 'in excess' _ am guessing we will all be happy with 7 to start off 2016 in good form . ) Am going to be using $220 per 1000 cubic metres , Feet to cubic = 7mcf = 198,217 cubic metres. So at 220 per 1000 cubic metres = $15.7m a year ( I have reduced my gas price from my usual $250 ) But increase it and you approach the often quoted $18m annualised . Again move that figure to a NPV of the cash flows ( this time I exclude the initial costs ) and that adds about 1.9p per share .
We know that if 7mcf is achieved , 2016 should be even higher so this gets interesting very quickly . Equally we would have an implied reserves of gas valuation , which I am leaving out for now till I see the 7mcf
So being very conservative Niko and 7mcf could add 3p to current levels
And given that it would add quite some cash we would be able to get the firm to push on with the rest . Indeed the possible 135 TCfs would send FRR into the £s level , but they need to start with the first step . Thereafter it could snowball into an avalanche .
Given that the above is taken from the RNSs you can excuse me if any doesn't materialise , I just add a numerical personal interpretation of what Niko and 7MCFs would imply as realistically as I can . I want to make money just like everyone else not score bb points that are actually worth less than Tesco or Sainsbury points ;-)
So a Christmas 4p prediction - should all be on target . But a heck more there after as I suspect the cash worries will start to dissipate and the asset ( large oil and gas field ) would be coming into play at last . Plus we will then hear about 2016 targets
Also do note I excluded any up lift in oil production , no idea of whats going on ther
Various views expressed, all valid, and I for one have always preferred to fight my own corner. And if I felt so anti a company as to form any form of action group I would rather just quietly sell my holding and take the hit. But this feels different, and a good number are great believers in the potential here, and that SN and Co are quietly working through a plan .
Quite simply I would like:
- to see ideally 2 respected holders attend the AGM, meet the BoD, ask a number of key questions, and report back. Done properly this can be very useful, and I am sure SN will touch on the strategic context at every AGM - tp press for a video/sound link to the AGM. Or at least a later recording to get onto the FRR site - to press for some form of UK based presentation next year - to occassionally have a link to Liz et al to ask key questions (accepting that any price sensitive answers will only appear via an RNS) - most importantly to try to impress upon the BoD that there are real advantages to all in better comms. And by the way that PIs are not all short term chancers simply in it to make a fast buck and disappear in a puff of smoke
Nothing complicated, and hopefully not seen in any way as getting in the way of running the business
Simple as that in my view, and the risk on information disclosure is very low in my view. Biggest risk is that whoever represents this group gets stage struck and goes beyond the brief agreed - simply antagonising all and sundry.
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