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No one is questioning his motives, least of all me, just his gung ho method of communicating with the market, particularly as ECO are in the seat behind the pilot and co pilot. I sat in that seat once on a flight fronJoburg to Cape Town but that's another story.
As I said previously, I'm currently not a holder, awaiting the Carapa result, which could come at any time, so with the market opening in under 12 hours time, I'll leave you good folk in peace and wish you all good fortune.
Always amuses me when talking about director or management buying shares. Either they don’t buy, and are accused of not having their interests aligned with shareholders, or they do buy, and don’t pay enough for them. Sometimes they can’t win.
He is invested so he is motivated to make things right. People who are still invested with him want to believe he will make it right. The psychology of those not invested is equally obvious.
It's not so bad though when it's cushioned by £4.9 million against a purchase price of around £1.3 million.
12.3m pounds to 4.9m pounds in less than a week. That's even worse than my account. I'm can't see how he's enjoying his PR stunt.
Another pr stunt. Don't forget he holds over 8 million shares.
It's like someone with 100,000 shares buying another 400.
the ceo was confident enough to buy 50k+ (sterling) worth of shrease not that far back at 148p
Nothing personal, just the first part more in response to your posts. Good debate is important, confirmation bias based definitely stopped me booking more profit on this and left me holding more.
The sulphur content becomes quite important now but with hydrogen desulfurisation (or something similar) this can be overcome but I dont know and haven't seen if there is a percentage content where this becomes untenable.
Tullow are maybe my biggest concern right now, they're fighting fires on too many fronts and dont know which way to turn. I note they have assigned the Stena Forth to Karoon energy for a March drill in Peru and expect the ship to be back in Guyana after that. So 6 weeks from early March plus a week or so sail time and another week or so for set up.
Given they are assigning the rig, I'm surprised it is not being put to use earlier.
I think Gil sees a huge opportunity and is frustrated it is.not being grasped by the market how he sees it. He isnt necessarily a tamper or pumper and dumper (I'm sure that is similar to a Sat night rugby phrase) but comms now are important and need to be clear. Another area where Tullow are suffering.
Perhaps it is buying time until the Carapa result. CoS 15% is similar to the 20% Tullow assigned to Jethro about half the CPR CoS. The big question is likely seal and trap.
Anyway, enough from me enjoy your Sunday.
I don't know why you particularly aimed that post at me (and others) my major gripe is the communications and to that you can add a question mark to the validity of the CPR, certainly in part. If folk are content with the points I've raised, then fine, we are all big boys.
Another way of looking at things is the fact that the heavy oil story took so long to come to light (sic) has enabled many people to book good profits at up to £1.70 for jethro and £2.00 for Joe. There's no need for me to mention the downside.
In the final analysis, I haven't a probelm with the mid to long term prospects for Orinduik but have taken my cards off the table pending the Carapa result. I wouldn't be surprised to see the rally continue into those results but I'm keeping my profits dry, in order to re enter at a later date. There's one thing that GH has said that I do believe, "this is only the beginning." :)
Noix (and others)
1. Heavy Oil is not in itself uncommercial, it may be liss profitable yes but perhaps a hit of 25% to base case for medium/light.
2. The Hess CEO may have a false narrative on oil being heavier the closer to shore, their heavy oil is Hammerhead their only Tertiary drill to date. Jethro is by all accounts a replication of this field and they have made clear Hammerhead is commercial th e read across that was there to Jethro before remains that it likely is too.
3. Jimmy is very similar to Joe which sit above Rappu. That is likely a joint accumulation of 750m barrels and Rappunis likely lighter oil in the Cretaceous. One of the ways to blend heavy oil is to mix it with lighter and we have our own supply in the field.
4. There are a further 3bn barrels plus of Cretaceous likely lighter oil to chase but the company is confident of finding close to 1bn barrels of oil through Jethro, Channel, Joe and Jimmy along with Hammerhead. To suggest that is worth only 80c a barrel to Eco as the current MCAP does seems fanciful even if one disregards the rest of the field.
5. Tullow have materially harmed Ecos prospects with a vague statement and further clarification is needed which Gil (and likely colin along with maybe Keith Hill) will.likely try to give markets this week.
6. Tullow SP has been hammered and they're quickest win isn't the portfolio is to prove up 2bn barrels in the Cretaceous and test Jethro and its channel by end H1 next year and then farm down the licence to solve its debt issue and get a free carry.
7. This is also Ecos best hope as 3 to 4 drills and then a pause would allow either a fundraise or a sale and likely is a sale to Exxon or Total in my mind who see overlapping blocks with possibly 15bn barrels of oil to extract and the balance sheet to do it.
8. Again to use Maynard Keynes, when this will happen I dont know as the market can remain irrational longer than an individual can remain solvent.
There's no doubt in my mind that he said "three drills" Futhermore it was a one syllable word not a three syllable word, such as several. Perhaps more relevant is the "funded for 4 further drills" comment.
In the post Jethro interview, he without hesitation replied to the specific question that they were funded for an additional 6 drills and then described them. It's at 6 mins 37 secs:
What's changed in just 3 months ? It's either bulls*it or the cheaper, shallow drills in the Tertiary are now off the programme. Either way, we should be told.
Listen at 1 min 20 secs when he talks about the quality of the discovery "That's a lot of oil and the quality of it."
I've done some research on heavy oils and they are normally found in the younger age formations such as the Miocene, where we have been drilling (Tertiary). Heavy oils are formed as a result of biodegradation of the lighter oils by bacteria which enter the trap due to poor sealing. They can also be found in the older age Cretaceous plays. These are facts that must have been known to the experts of ECO, Tullow and Total and they fly in the face of the CPR which had these prospects listed as a likely 35 API, with a minimum of 30 API. P91 in the report:
That in itself is cause for concern.
I've seen lots of comments on the boards this week about great presentation or interview. I believe the lesson learned is take little or no notice of the interviews. Stick to presentations and more particualrly the rns releases.
Agree it is important to be careful in comms, he admits to being optimistic and would like to see the exploration moving more quickly than currently.
Success in those drills would be significant.
I agree with your second paragraph entirely and understand your points. Therefore, the question of how many drills next year is perhaps moot in that context, but I'm sure he is saying several drills next year not 3. The accent and my aging ears may account for my hearing 'several' but could you give it another listen svp.
Apologies to one and all, that 3 drill in 2020 comment was at the end of the Guyana part of the inrterview and not the end.
4mins 16 secs in:
James, the point is, he shouldn't be making promises he can't keep. You have in a sense hit the nail on the head. If he wants to promote assets in licences where ECO are not the operator, I'd have thought there are certain protocols to adhere to, that will alleviate problems further down the line. You may be right that the situation changed over the course of a few days but that is precisely why he shouldn't be so gung ho in his announcments. And if the plans have suddenly changed then he could/should have qualified the change and why. He can't have it both ways. If you are right and given the heavy oil story, they might well be putting the Upper Tertiary (to my mind the heaviest oil) on ice and now plan to test a Cretaceous prospect and the Jethro Channel, initially in 2020.
One interview is before the Tullow update and the next is after. Circumstances change and as Keynes isnpurported to have said, "When the facts change, I change my mind - what do you do Sir?"
Essentially, the operator can change their mind at any point. Depending on Carapa outcome, I'd suggest Total will be keen to accelerate things. I should think Tullow will be keen to do this also and explore how to demonstrate sizeable finds in key areas of the field.
Can see Jethro and its channel as the first drill followed by one or two of the 600m barrel plus cretaceous prospects. If these have similarly impressive porosity and pay zones as Jethro and Joe with lighter oil and Jethro oil is commercial then that is a 3 FPSO field that can do 600k bopd plus in 3yrs with the right investment.
For Eco share that is $1bn plus a year and only half the field size if that.
With respect, I think you are missing the point. Particularly in view of previous and recent events he has to be consistent in what he says to the media.
At the beginning of the podcast he said they will drill ‘at least’ two wells.. at least two doesn’t mean only two !
If you listen to the podcast again and watch last week’s interviews .. he mentioned 4 wells on several occasions so as he said, drilling 2 wells has been confirmed for early 2020 and the rest towards the end of the year .. anyway they will publish their drilling targets and budgets in January (listen to the podcast from @5:15)
There was probably the likelihood of a 3td well by backup in the Tertiary but that may be less so for now. Other 2 probably being by rug/drillship.
I'm not a holder at present, so wasn't going to post but you are correct that GH mentioned funded for 4 drills and 2 drills are planned for 2020. HOWEVER in the aforementioned Malcy interview from Cape Town, right at the very end he states 3 drills next year. He's still not learned the lesson, or perhaps the plans have changed in the course of a few days.
“ but in these latest poscasts/interviews i believe he said were funded for 2 more wells , so 2 less than originally planned?”
He mentioned in the podcast that they have funds to ‘easily’ drill 4 more wells next year if needed, each well costs around 4m and they already have 20m to drill 4 wells if needed (@ 5:15 from the interview) .. so the plan is to ‘start’ with drilling two wells early 2020.
One other concern of mine is originally Gil said (before the last two drills) we were funded for 6 wells... maybe i can be corrected ?? but in these latest poscasts/interviews i believe he said were funded for 2 more wells , so 2 less than originally planned?
Frankly many people were surprised by this market reaction. Maybe induced by the double whammy of Tullow's profit warning and some uncertainty about the value of these initial wells creating the perfect storm (probably in a teacup). Both wells drilled found oil whatever the commerciality and viability of them. As he said this is just the beginning of a very exciting prospect in possibly one of the best areas of exploration currently. Worst case and unlikely scenario they get abandoned and move on to the next 4 drills for which they are fully financed.
He didn't address it directly!
I'd asked about the length of time taken to release the info in the RNS, the selling before it, and why he continued to ramp when he must have known the nature of the find. He answered these questions with much the same wording you've seen, for the last one citing the 4th November Malcy interview and his comment on the analysis being ongoing and his using the words "if and when" in relation to future production.
Frankly, I have lost faith in him (as you may have surmised!), but still believe the block may be attractive to a buyer. Hopefully one less cash strapped than Tullow, and with a bit more wit.
What did he say to that question ? Lol
I got a pretty well identical reply from Gil this morning. It also had the same courteous signoff, although I had suggested he should resign for misleading shareholders. It's genuine.