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Scot. Thank you for your lovely expertly written answer. The thing is, if you were invested, I would give a toss. That fact that you are not, I don't.
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9) Pretty much all E&Ps globally rely for funding on farm outs and/or their shareholders. Fact.
10) Fine, you don’t rate amateur valuations. Fine, we get it. That doesn’t mean you can wage a war against posters who seek to rely only on questions of established *fact* and who then apply those facts to globally-accepted valuation techniques which have been applied by equity markets for decades. That’s just a ridiculous approach, completely childish.
You are not going to intimidate me from posting. Be under no illusion about that. *You*, GS, may have no time for facts and analysis but a) other posters/shareholders do and b) plus far more importantly, when all is said and done the market only cares about facts and maths. It doesn’t give two hoots about some anonymous guy called Goldstinger on a bulletin board because he’s just “having a punt, a bit of a gamble”. Sure, it's 100% your choice what you do with your money, and if you don’t wish to research the fundamentals, that’s your call.
The market will move ahead regardless of what GS and his punting money believe or desire.
11) Opinions are fine, brilliant, to be encouraged, no worries whatsoever. The problem arises when posters a) dress up opinions as established facts and b) when they lie or obfuscate to manipulate those who are less experienced, less educated about investing/trading small cap E&P stocks. /ends
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4)I don’t do the whole “spurious information” thing. I don’t need to, I wasn’t trained that way, my sense of honour and ethics wouldn’t allow me to behave that way….plus that would be intellectually lazy and would almost inevitably harm my own financial interests in the long run. Nope, no interest in that nonsense at this end.
5) The irony about sharing the fruits of your research is that if anyone on this bulletin board did actually engage with me on the fundamentals and provided me with the percentage of the current 88E mkt cap ascribed to each of the asset locations, I could then work with them (and all other readers of the thread) to walk through the comparative analysis, at which point everyone would be free to act on the conclusions of the comparative analysis, or not. What’s everyone so scared of? That UK and Aussie shareholders will understand the fair value of 88E before the US OTC hordes? So what?
6) Fine, I get it, caveat emptor. Quite right too. But in the adult world, this is how valuations are tested in the stockmarket, GS. Fact. Someone thinks something is awry and challenges the consensus view. The holders of the consensus view offer a defence and the debate begins. If shareholders just stay loyal to a bunch of opportunistic and prolific posters (>25k for goodness sake!) and choose to bury their collective heads in the sand, that’s fine. But what if by doing a little work and background reading, you end up saving yourself a small (or large?) fortune by acting before the fundamentals catch up with the SP?
7) No, GS, they both most definitely ***don’t*** have “lots of oil”. The northern neighbour has a contingent resource of 1.9bbo and 88E has reserves of 100mmbo. The northern neighbours has formally guided figure of 16bbo OIP and 88E has what? What OIP does 88E have, GS? What's 88E's P50 TRR guidance?
8) Aye, they have different styles alright. I refer you to my earlier answer about sentiment/emotions v’s fundamentals. You can add “style” to the left hand side of that particular dispute.
Goldstinger – I’ll try to answer your points in turn.
1) I’ve worked in stockbroking/investment banking since 1994 so I don’t need to dream. I recognise fully not everyone involved with 88E has that background but it is what it is and I can’t change my profession.
2) Hmmmm, *I* don’t think 88E will be bought out, certainly not for a number of years. The development of Yukon is years and billions of dollars away IMHO. Even if Umiat/Peregrine is dripping with oil (which I do not believe is the case reading the currently available information), Willow is >5 years and $8bn away from producing its first oil and Peregrine is 15-20 miles south of Willow, Umiat further south still.
The Central Blocks certainly hold some interest potentially and may have some value in the future, depending on the success or otherwise of the northern neighbour. Until the reservoirs at Talitha and Theta West are properly delineated and proven up, 88E’s Central Blocks will be the distant cousin waiting for hints and tips from the family matriarch. Horrible analogy (lol) but when the northern neighbour has spent >$250m on 3D seismic and drilling over the last decade and 88E hasn’t, that’s what happens.
3) We don’t have sufficient information to calculate 88E’s NAV. However I contend with a very high degree of confidence that the NPV per barrel of contingent oil in the ground for 88E will be markedly below that of the northern neighbour. Why am I so sure? It’s honestly really, really simple. Location.
If both companies possessed the exact same volume of oil, at the exact same depth, with the exact same reservoir characteristics, the northern neighbour’s NPV per barrel would still be far higher because the infrastructure construction required to produce commercial oil is going to be a fraction of that required by all other new projects on the Slope (due to TAPS and Dalton Highway intersecting the acreage). QED the capex required will be far lower and it will take less time to deliver first production and cashflow. The location is what it is. Was it chosen by accident or design? Doesn’t matter now. The NPV per barrel calculations are now purely a question of maths.
Thank you for your reply. I understand what you mean about sentiment driving AIM, of course I do. However, despite the critics’ claims, AIM is not a casino and mkt caps have *got* to have a relationship with the fundamentals at some point in their existence. I know this is true because I’ve worked on hundreds of AIM stocks over the last 20 years when working in investment banking/stockbroking.
You may earnestly believe you cannot assign a value for a share but I do. It’s not always correct, and *even if it is correct* the timing might be waaaayyyy too early but eventually, either sooner or later, the market forces the fundamentals of the investment case to the front’n’centre. Occasionally there’ll be an Autonomy which escapes the market’s beady eye during its history as a listed company *and* when it is the subject of a change of ownership – but those occasions are thankfully exceptionally rare.
There’s a couple of accepted valuation methods used by E&P equity analysts the world over, and they’ve been applied for decades. The main reason for this is that a barrel of oil can be bought or sold anywhere on the planet - more or less, but you catch my drift. The added good news in the case of 88E and its southern neighbour is that comparative analysis is fully and righteously applicable to these two stocks. The reason for that? Because both companies have admitted that they share an asset. Simple as that.
You may not believe comparative analysis is applicable and that’s fine, Turnstone. The thing is, the market doesn’t give a monkey's about what you think. If you honestly believe there aren’t institutions, sellside analysts, sector corporate analysts, experienced shareholders who have worked on financial models for both stocks, you are being incredibly naïve. No matter how many posters on this bulletin board bleat, gnash their teeth and invite other posters to commit suicide (Ddraig did that, truly unforgivable behaviour and, quite inexplicably, he *still* receives support on this thread?), that will *not* stop the relentless progress of the fundamentals. It’s just the way that capitalism and stockmarkets work, you see.
Another thing to ponder. The fundamentals eventually overpower sentiment and emotions. In the end, the maths don’t lie.
Unlike you, it has been my experience that bulletin boards can and do affect SPs and influence investment decisions. I’ll be blunt. I’d prefer they didn’t, but in my estimation they do.
Delighted to read that you’re old *and* chilled. I’m neither and that’s fine with me at time of writing. Oh, and for the record, how or where you choose to invest your cash is none of my business. Good luck with your investments, Turnstone.
Hi Scot, thank you for the response. I do strongly believe that the Aim market is driven on sentiment, people like to have hope, people like to have a bargain, people like to feel as though they have an opportunity to beat the odds. this is why people invest / gamble Im no different, the difference of opion i think is that I don't believe on aim that you can assign a price for a share, why ? because emotions will drive it not fundematals, why do Biotech companies rise and then crash ( been there done that One) the Technology Bubble ( missed that one) the Uber car investment yet to deliver shareholder value. I don't believe We and I mean we have jack diddly squat influence on the share price when we post on these Boards.. everyone told me that 88E was going under at 0.026 at deaths door, don't touch so guess what I bought them, an investment NO a Gamble Yes.. we all want to make money but unfortunately there will be some winners and some losers , there is only so much money changing hands, ( exclude quantitive easing) any way I hear what your saying but Chill lines too short and Im too Old ;-)
HI Turnstone - thanks for your genuine post below. To answer your questions directly, after I met Dave Wall a couple of years ago I became a shareholder, albeit relatively briefly. I understand what you are describing when you say my posts have contributed to a feeling of doom for you. I get it. The thing is, I haven't done anything wrong. It's the "market" which has assigned a valuation to 88E which is miles and miles ahead of the fundamentals, not me. And where has the vast majority of the firepower >1p come from to propel 88E to these ridiculous heights (and higher in the Spring)? From a veritable army of uneducated, unsophisticated, inexperienced punters consuming social media hype after the bizarre Gamestop-related "attack on Wall St"!
Why don't you ask Brom and jefbobbit if they sold into that social media frenzy? Both have admitted to it so they likely did, agreed? Why did they sell? Because they knew and continue to know fine well the data collected *thus far* by 88E does *not* justify the current mkt cap on all recognised fundamental valuation metrics. Trade the speculative energy surrounding the stock? Fine, knock yourself and themselves out.....but don't kid the bulletin board that you're doing anything but trading that wave of ill-informed punting emanating mostly from the US.
Have you read the content or watched the videos of the social media influencers who hold themselves out as 88E experts and the 'source of all the DD you could wish for'? It's absolute gibberish, and that's being kind. It makes you cringe. For the record, I still can't decide if the US PR campaign was organised professionally or was the result of a whole bunch of digital coincidences. I'm genuinely fascinated about the answer to that question but, equally, I completely accept it doesn't really matter now.
Go on then, where would the SP be if the US OTC punters hadn't chanced upon 88E? Whatever number you come up with, subtract it from the closing SP today and overlay your investment/shareholding. That's the hard cash at risk because that amount is supported *solely* by speculation engendered and encouraged by nefarious or ludicrously naïve (doesn't matter which, effect is still the same tbh) social media influencers in the US, plus a few in the UK and Oz.
I appreciate it appears I am baiting the prolific posters here. How can I bait anonymous usernames? It's not personal, it's business, right? It's just maths and facts for me, Turnstone....no more, no less. Two companies share an asset. Both BoDs admit it. My investment process incorporates comparative analysis - always has, for years and years. These prolific posters are lying. They're obfuscating. They're taking advantage of the trusting nature of others. Don't believe me? Challenge them yourself. The market cap of 88E is plain wrong IMHO and until one of these prolific posters steps up and justifies it to me or provides the answers to my questions, I'm going nowhere.
I’m not sure about something so I’ll put this out there. How many of you share holders who write on these boards get up in a morning and think. Yes, I just dreamt that I’m an analyst! That’s great so now I can get to work on deciding how much 88e will be bought out for or what their NAV should be, based on this spurious information I’ve gathered over the last 5 years. It’s probably gonna take me 3 months work, on and off. But I’ll then share my findings free with Scot126. Such a nice bloke, he deserves everything for free.
Even analysts get it wrong over and over again. What chance does a novice investor have? We’ve all lost money on some shares and gained on others. That’s life, because we can’t know all there is to know.
So why would anyone really care to compare the Value of 2 separate companies, even when they are neighbours with similar goals. Except to decide for oneself where to put ones money in the case of indecision. I’m in both, because I want to be in both. I don’t care which one wins as the profits from a winner will more than make up for the losses on the other. They both have lots of oil, but totally different styles of selling themselves to would be buyers, and investors.
They also have a great many ways of ‘disguising’ capital raising. They weave a tangled web, all a mystery for some, and a put-off for others.
I think I am one of the majority on this board who have simply taken a punt on a share. I’ve seen enough ‘amateur’ valuations to last me a lifetime. Please don’t think you are an analyst tomorrow or the next day or the next. Opinions are fine with me though.
FWIW, I think 88e’s market cap will go higher towards the next drill too. They’ve told us what they are going to do and why, so why not expect a rise? After all, that’s what happens on every drill. A successful Merlin 2 could dramatically alter the course of things.
It's a trading stock pure and simple. Little action for nine months, then three months of pumpleicious excitement created mainly by traders but also genuine shareholders in the belief of hitting the holy grail, although I believe the latter numbers have dwindled. Asser wise, 88e do not own anything. It's all leases.
please give it a rest, I read the BB and very rarely post, but I see is your name..
I understand that you feel frustrated with the current market CAP, I understand that you don't think it is Valid, I understand that you feel share holders should justify to you why the share price is where it is..
I am not as articulate as your self so will have to ask a very simple question, if you are not Invested ( which I think I read from one of your Posts that you are Not) why do you want to save me from investing or gambling on 88e ???
I appreciate we all have the right to an opinion but it really has got to the stage where I am reminded of Dads army and we are doomed..
By all means post but don't take over a BB that you are not invested in and have no interest in investing in, baiting people to lock horns with you... there are better ways to pass the day.. IMOH
Hi Ecuagold - I understand the general point you're making, of course I do, and recognise this widely held view. However, and for the record, I genuinely believe 88E has an asset value, just nowhere near £200m currently.
It's for shareholders to justify the current mkt cap. Not the company, not me, not you.....it's the shareholders' task to do that. The fact that even the most prolific, aggressive and intimidatory posters have gone completely silent on that task should be a gigantic warning sign that there's a whole load of pure speculation wrapped up in the current mkt cap. Furthermore, we all know where the majority of that speculative money came from and that's retail punters on the US OTC market. If folk in the UK and Oz cannot admit that to themselves then they're little more than punters too.
Scot this is AIM. Heads tails, win or lose. 88E can keep spinning, selling more shares. The company has zero value. It's just all speculation.
Hi Reaper007 - most respectfully, point 1) of your post is a bit of a cop out, isn't it? Taken to its natural conclusion, E&P companies should just tell the market they own x, y and z leases and not bother giving any other information, commentary or guidance because 'what would be the point, it would "all be a vacuous exercise and waste of time?"'
Also, Reaper007, a SP *always* gives a sensible indication of mkt cap because it's one of the two figures required which, when multiplied together, arrives at the mkt cap.
Anyhoo, let's just say the mkt cap is £100 because all I'm requesting from the prolific, obfuscating posters is a ***percentage*** by value they ascribe to each project location by asset grouping in order to undertake a *comparative* analysis on the *shared* asset. NB. both companies have confirmed the presence of a shared asset so comparative analysis is a fully justified endeavour.
An example of the structure of an answer would be: Yukon 15%, Icewine 35%, Umiat/Peregrine 50%. Couldn't be simpler, Reaper007. And yet.....and yet these prolific posters who would have readers believe they are incredibly well-informed about all matters 88E, cannot or will not answer the question.
Why will they not answer? Either because they don't know how to arrive at an answer (in which case they're nothing more than anonymous loud voices on a bulletin board and ought not be listened to) or they *do* have a financial model and are scared rigid to post the answer because it would amount to a painful admission on their parts. Any mathematical answer would be a confession they were lying to the readers of this thread in order to take advantage of them financially. Shameful conduct, isn't it Reaper007?
PS please ignore post below, incredibly fat fingers.
Hi reaper007 - most respectfully
1. Whenever did an oil explorer SP give a sensible indication of 'mkt cap'? Could compare ratios of various assets or otherwise, even read the tealeaves - it would all be a vacuous exercise and waste of time, not only imo.
2. 'Why does 88E management appear to'.... no more needs be said.
As ever, VGLA
17.29 he’s about as courteous as a hand grenade…we all live in hope that one day the voices in his head make it pop…
Not quite, jefhobbit. I have accused him of obfuscation at best and manipulation at worst of those investors who do not possess the experience and expertise that he does.
And c'mon, let's get real here. I have posted the questions a bunch of times. I posted and directed them to individually-named posters and sometimes to a group of prolific posters. Being one of those prolific posters, jefhobbit, you've also been asked those *exact same* "standard, reasonable, polite and courteous" questions. I am perfectly entitled to conclude deliberate evasion and guilt when not one reply has arrived to address my point from the prolific posters, one of whom has posted on this bulletin board >25k times for goodness sake!!! Are you kidding me?????
Instead of engaging with me, not one of the prolific posters has replied except you. Even then, you attempted to deflect me by saying you didn't have the NAV guidance when that's not what I asked. You must think this is my first rodeo, jefhobbit? You are making a profound error if you think that. My first job in the equity markets was in 1994 and although I'm older and fatter, I'm still going strong.
My attempt to arrive at a valuation via comparative analysis is a perfectly reasonable and righteous pursuit. My continuing presence on this thread may bug you but it doesn't make the content I post any less factual, any less honest or any less confronting, especially for those who have taken advantage of their fellow man in order to profit from the peaks and troughs of the SP whilst supporting the insane narrative that the mkt cap at £200m is supported by the fundamentals.
I can state quite categorically, using *historically accepted E&P equity valuation methods* and the *information currently and publicly available*, 88E's mkt cap of c.£200m cannot be justified on the fundamentals alone. The major (only?) reason the SP is anywhere approaching the current level is due to the initial frenzy associated with the US OTC retail market, a frenzy which is being maintained by a number of social media influencers/commentators who are spreading downright lies and misinformation. Fact.
Go on, jefhobbit......tell me I'm wrong? Oh, and feel free to back up anything you say by posting your valuation model for 88E.
You claim to be courteous and polite and then accuse him of ramping a share in order to sell. What a vile plonker you are Scott. Cut and paste one post where Brombarb has ramped this share. I find Brom to be generally positive as a LTH as like many of us he believes in the long term prospects of the company but he does not post false hoods like you do, in order to pump the share price.
Well it is on the rise again, and that's certainly opened some of the Government Minister's brain cells. Would you say.
Agree rfarfa, there is only so money gas price updates one can take.
I see that a new gramophone record needs to be purchased as the old one keeps sticking. Gordon Bennett!
Nice to see you back Brom
Thanks for info
Thanks Brom, that's all really interesting. Something else that's really interesting is your continuing evasion of my perfectly standard, polite and courteous questions directed to you. To remind you and everyone else:
1) What percentage of the current 88E mkt cap do you ascribe to each of the three main project locations, being Umiat/Peregrine, Yukon and Icewine?
2) Why does 88E management appear to have no plan to flow test Merlin-2 even if data from the logs would ordinarily support further data collection immediately via a flow test and particularly when the site is accessible to personnel and equipment? Do you agree this is a rather odd situation and goes against the SOP for E&P operations in Alaska? Further, why has a flow test not been planned, even if only provisionally? Does the company not have the required funds? Are the funds raised recently pre-committed elsewhere? What's going on here?
I look forward to your responses to the above questions, Brom.
However, judging by recent history, neither the thread nor I will receive the courtesy of a reply. Therefore, I contend that you are quite deliberately communicating to the readers of this thread, using >25k posts for goodness sake, a message which at best can be described as obfuscation and at worst, manipulation. All the while you are encouraging a tribal loyalty to the company you are relying on that same loyalty to ensure you are able to trade the SP peaks and troughs to your personal benefit. Look above, below and between the lines, eh? Shameful behaviour, truly shameful.
All other readers, don't believe me? No worries, just look through his posting history because on at least one occasion (perhaps he was feeling guilty on that day?) he admitted to doing exactly as I describe above. Brom has the background knowledge, the intelligence and the experience to have calculated the 88E SP at £200m is running waaaayyyyy ahead of the fundamentals due almost entirely to the social media frenzy coming from the US OTC market and social media. Tell me I'm wrong, Brom?
Last year the the jv and Rig contract were confirmed November and December respectively.
So perhaps plenty of time for announcements yet in respect of the aforementioned.
BLM Environmental Assessment for the project was completed and approved last year so permits should be forthcoming for this coming drilling season but we will not see permit to drill until much closer to the event.
Political manoeuvring not withstanding.
Alaska may be seeing wintery conditions but the ice roads will not be reforming those long days of summer will have seen them melt away.
As we are planning to drill in February, I'm sure all is in hand. The reforming of the ice roads now makes no difference to us and I'm sure there will be no takeover this year. I'm sure we will get an RNS soon about the rig, etc.