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If this were end of 2023 now, oil price at $70, first production flowing at 20k BOPD, $125m raised and say the $37.5m equity raised at, say 8p, meaning around another 400m shares in issue - so total c1.4bn shares - you would expect a market cap at least £250m given the cash flows.
The life of field may be fairly short, with fast decline, but several hundred $'m in free cash flow will be generated in just a couple of years in this price environment - which will either mean epic dividends, or other accretive projects purchased/progressed etc. I think I read in the CPR that the base case for the field was something like $600m free cash flow over 5 or 6 years at $50 oil - so half net to ADV.
So, I am thinking around 20p might be possible, depending on a) Appraisal results and how big a reserve can be booked b) Success of development capital raising c) Development going to plan/cost/timetables d) Oil price remaining favourable.
So, 3p today is a very good risk/reward. Market cap on appraisal success is anyone's guess. It will almost definitely be higher than here, but will be limited to some extent by the need to raise development capital through equity at some point along the way - early 2022 I guess after FDP submitted and approved. You have to think share price should be double figures when in production and that is not too far away - 18 months from appraisal has been quoted.
what market cap would you expect?
Difficult to believe this is a 32 MILL,MC
100%
We wanted a close above 3p and thats exactly what we got, i cant argue with that..
That'll do pig that'll do..
More acquisitions. Makes me think of Rock Rose Energy run by the folks now in charge of Kistos. After gathering lots of super assets in double quick time it was taken out with massive gains for early door investors. GLA
Very close to the all time high going into the close. Excellent.
Couldn’t agree more Sunday roast. You know the pull back / profit taking is coming, but can’t bring myself to call when! Less stressful option is to sit, hold and wait for double digits before year end :)
Were a long way off spud so expect pull backs.
As long as we start seeing higher highs I'm more than happy to hold.
Too nerve racking for me trying to sell the highs and buy the lows. Would rather take a position and wait
Dropped back a bit, profit taking going on??
Another little top up!
if they announce another couple of deals , why not
Only up 8.7%. A gentle jog.
MM's seem like they are pretty intent on bidding for shares