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Problem is they are running out if levers to pull now.
Probably need a decent deep correction somewhere along the line but if the credit crunch wasn’t enough to make it happen then who knows what will.
A couple of ideas Girlie, I think history has shown the w0rld that recessions are very bad things. And as everything is much more global and interconnected than ever before I think the severity of future recessions will be much less than we are usedto as govts will simply print money and fudge figures to avoid it. (My rose tinted's are based on the financial crash and covid. The amount of money spent in both those huge events I think demonstrates that fiscal prudence has been consigned for now at least, to the dustbin, and the more global banks and govts that spend these vast sums means that no one can let them fail, so it should in theory just carry on....)
However if my head in the sand view does not wash, then perhaps you need to put aside a proportion of your investment capital to wait for the crash and then pick up some bargains. (The dilema of course is that there is a pull to invest 100% now to make money while the sun shines and sell next week, next month, next year to give your "recession fund" even more fire power for when it happens.... Its tricky, this investment malarky....)
islandgirl, you can spend your life worrying about that . crystal balls however are in short supply.gl
I'm more worried of what a global crash will do to the markets and whens it going to come
And what will happen in a couple of years if as some predict global gets to$200/B
Agreed, the 12.6p is conservative, but I wonder how can we determine the ‘potential’ value as this should be linked to the projected oil price once production starts, which is estimated end of 2023?.
Would it be reasonable to value ADV (after the drill) based on projected reserves at todays price, or projected future price?
What is clear is that whatever value is attributed to the oil price for valuing the reserves, it will be north of the RISC valuation. If the column of oil is higher too, then end of this year/early next year could see a decent rise from the current SP level.
With the rig appearing to be mobilised this weekend too, next week could be another good one for us.
'Tennyson's April 2021 note said...
"At US$60/bbl Brent price we value a redevelopment in excess of US$200m (>12p/Share) unrisked, net to Advance."
This looks conservative:
From the CPR, using the Contractor NPV tornado diagram I calculate the value of redevelopment(net to Advance) at $60 Brent to be $239 million(14.9p/share inclusive of the regional low sulphur light sweet crude oil $2-3/bbl price premium to dated Brent)
Value of Redevelopment(net to Advance Energy):
$297m @ $70 Brent (18.40p/share - with regional oil price premium)
$356m @ $80 Brent (21.90p/share)
$412m @ $90 Brent (25.30p/share)
So, at today's $85 Brent the value of redevelopment(Net to Advance) could potentially be in excess of $384 million (24.16p/share) for the 2C scenario, 41.97p/share for 3C, and 17.33p for 1C.
AIMHO/DYOR