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An investor in ANGS.
And who are you, meldrewmark2?
All we had to do was turn on the taps.
So for you to be analyzing this to death and giving a ridiculous up-rate rings major alarm bells.
Who exactly are you ?
Since you say that the Balcombe Discovery is considered to be in the sweet spot of the Weald Basin and given the 568m thickness and highest maturity of the Kimmeridge layersand that the Balcombe 2Z side track has opened up an approximately 1,700 ft horizontal section through the upper Kimmeridge Micrite,
on what basis are you targeting such a conservative flow rate 300bpd from this well? Asked on 19 November 2019
Good question. We do indeed believe that the Kimmeridge at Balcombe is in the sweet spot of the basin, and we are confident that the well will flow oil given that we have already seen this during the previous test. Rates in the Autumn 2018 test were, however, short lived as the dense drilling fluid in the well made sustained oil flow impossible. As a result we cannot accurately predict flow rates based on the limited information we have, and we are left to use geological information and analogous rates from offset wells. Horse Hill, which has a vertical well, has been flowing oil from the Kimmeridge at rates of 200 – 300 BOPD and being very conservative we would expect to match this. Given, as you correctly note, this well is a long lateral, one might expect rates to be 2 – 3 times higher than that of a vertical well and so we would certainly want to exceed the 300 BOPD rate, however, until we test the well we simply do not know for certain how the reservoir will perform. We want shareholders to have understanding of our reasonable expectations but would also, as a company, prefer to surprise on the upside rather than overpromise and underdeliver.
With all due respect, I think any futures graph is now out the window until the world becomes more normal. I think the next couple of years will be rocky for all after we get the covid aftershock. Certainly right now, this project appears to be worthless.
I also now dont understand how they have gone from 3000 bopd to 300 for their balcombe asset. Are the bod just making it up because this is getting impossible to value currently - and thats using the maths given by the company.
... The therm price is currently 80percent less, but you have revised your price upwards?...
Here is the futures curve:
I revised up my ball-park figure for Angus's share price from 5.50p to 8p for the reason I gave, the conservative discount rate of 10% used in calculating the net present value of the Saltfleetby CPR's mid-case forecast.
It really is unconscionable of you to go off on a tangent and mislead people by going on about NPV calculations.
You are completely ignoring the macro-economic environment,the severe recession which will deepen and be prolonged,and its devastating effect on the demand for oil and gas.I would remind you that oil prices actually turned negative,and it isnt impossible for gas prices to do the same.You are trying to foment a big bubble in the Angus share price,which will burst in the same devastating way that the dot com bubble did.
This is the opinion of 'Petroleum economist' magazine-
"The global gas market is facing difficult times due to:
1) demand uncertainty;
3)Sustained oil prices into the medium term;
New supply continues to come online in an over saturated market for gas.
Economic growth is a proxy for greater global usage(negative and very low economic growth 2020-22).
Consultancy Geopolitical Centre(GPC)..a specialist econometric forecaster,predicts 2 medium term scenarios:
A 'flash pandemic' where Covid-19 suddenly reappears with a vengeance.
The other scenario is that of a 'double whammy(DW)'where the prolonged impact of coronavirus is accompanied by a very long recession.
They havent even factored in the economic shock of a no trade deal brexit next year.
But I suppose 'Petroleum economist' and the economic forecasters are just 'sore losers' who invested in Angus too lol?
Gas price has collapsed...as has oil, but that doesn’t concern Angus.
The asset of Saltfleetby is worth nothing as it stands.
How on earth do you value this dog at 8p ??
0.8p I would agree with you, but 8p ...fantasy island with Nicnac beckons.
Thanks but you have now confused me more. The therm price is currently 80percent less, but you have revised your price upwards? Im clearly not very smart but even I know that less isnt more when it comes to selling prices. Of course we dont know what the future will hold, but to say the world hasnt changed would seem unrealistic. To say this is worth 8p on the revenue are you trying to take advantage of my inexperience! Even I know thats unlikely, but nice to have a joke even at my expense.
Let's make that 6-9 months, to be more prudent.
Would hope to see it within about the next 6 months - think the share price rise should accelerate as the year progresses.
When do you anticipate seeing your 8p share price?
Because of the conservative 10% discount rate used to calculate the net present value of the Saltfleetby mid-case forecast, have revised up my own ball-park share price, from about 5.5p to about 8p.
Suspect a less conservative discount rate than 10% might produce a net present value for the Saltfleetby mid-case forecast of, say, about £40m instead of £25.2m.
Just to follow through re the net present value calculation:
interest rates are currently closer to 0% than 10%. Discounted at 0%, the net present value to ANGS of the Saltfleetby mid-case forecast would be £50.5m and not £25.2m.
PS: that 10% rate to calculate net present value may be generally accepted but does look, given where interest rates are currently, to be very conservative in itself.
And the £50.5m becomes £25.2m when discounted at 10% pa to calculate the net present value, ie the mid-case value to ANGS "right now".
As I understand it, you've simply put aside the calculation of the net present value.
I see what you've done, but, imho, you are being very, very conservative.
Why assume today's gas price will still prevail through the next 10-12 years when, through the futures curve, the market provides you with prices for gas during the next several years?
It is also wrong analytically simply to reduce £50m by 80%, because you are applying a reduction derived from today's gas price to a figure of £50.5m which is pre-tax future NET revenue, ie AFTER operating expenses (see pp52-53 of the Saltfleetby CPR).
That was £50million x 80percent reduction (ie 50p therm to 10p therm). It is very well saying gas prices will be multiples - but im trying to go on what we know today. The project itself is over 10 years as per mr lucan.
The figures dont stack up to me, hence why im hoping someone can help me where I have gone wrong.
To comment on your figures, MichaelGoodwilll, one needs to be able to understand what they mean.
You say: "Right now, it is £10m over 10 years or so, ...":
1/ what exactly does "it" refer to? The net present value of Saltfleetby's mid-case forecast? Something else?
2/ how have you arrived at your figure of "£10m over 10 years or so"?
Who has said this is a scam? That isnt a normal way to describe investments.
And I dont take kindly to being told to use my brain. You said this was worth £50million, I have now looked through the numbers in detail. Right now, it is £10m over 10 years or so, but running costs seem to be nearly 2.5m. I think it would be reasonable to say that the next couple of years are likely to see a global recession so even if we double the therm price now, its loss making still, treble and very modest profit. The return for shareholders seems small. Now if someone can tell me where my figures are wrong then id appreciate the help. I have used figures by the company and adjusted accordingly. Also I did look into some figures that were kindly sent across, and it said that Brockham will be producing oil but that was wrong. Can I ask, can the same happen with saltfleetby and they under or overestimate the gas there?
I have expressed my opinions not provided/offered any advice. You seem to be swimming with the bulls when the SP is rising and now with the bears on a disappointing day. Frankly, you need to switch your brain on and figure out for yourself the commercial reality.
1. why would one believe or even pay attention to the prophets of doom who are not invested here? Those prophets ,who claim to be invested, consider this company to be a scam (especially the BOD) yet they are still invested. Surely, the prophets of doom ,who are still invested here require their head to be thoroughly examined as no sane person will hand over his/her money to a con.
2. The only information that one should be considering is that published by the company . The gas project and Balcombe are real and progressing.
3. I found it very encouraging that the major shareholder (10%) invested further sums (£1.4 million) via a convertible loan. Surely they must have seen something tangible and lucrative to justify their investment when the share price was at all time lows.
4. The news flow is very positive. company adequately funded and subject to minor delays due to covid19 all matters are progressing very well.
5.Oil and gas prices ,presently are low. These prices will not remain static at current levels. there will be a lot of fluctuation. Besides, gas prices are always low in summer and higher in winter. One should be considering the average trend over the next 10 years and that will be along the lines of forecasts.
Finally, you should never buy or sell shares based upon opinions here. Use your research and make your own opinion.
I am ,personally , ready for a major top up at any weakening price. GLA