Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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Slawek, if it wasn’t for the North Sea acquisition announcement IMO we would have been well over 2p by now.
My message to EOG via their website:
New North Sea acquisition - is holding back Share Price (SP) appreciation:
I am an EOG shareholder very disappointed with the failure of the SP to appreciate following the stellar results from Wressle.
Now, the projected yearly revenues from onshore UK operations are expected to be equal to roughly half the value of the EOG MCap and the SP should have had a substantial increase to reflect this positive change, but instead remained stagnant.
I feel that this failure of the SP to appreciate is due to fear of placing to finance this new North Sea venture. I am holding back from buying more EOG shares due to this financing uncertainty. I feel that the SP would now be much higher had it not been for this North Sea announcement.
These same views were also expressed by many shareholders in shareholder forums.
This North Sea venture was announced over 4 weeks ago (24 August, Proactive http://www.youtube.com/watch?v=HK1b1k3iaRE) and it was stated then that a further announcement on the North Sea acquisition will be made “shortly”.
Would you please clarify to the market the status of this new North Sea venture to remove this uncertainty.
I would appreciate email confirmation of receipt of this communication. Thank you.
Best wishes
Good stuff! Worth checking out IGAS for your next ride!
@Yamis2005 I have also sent the polite message asking for some update on the same matter.
SP up somethings afoot! Maybe more good news coming!
IMHO
We need EOG to clarify the North Sea acquisition before this can really take off. I contacted them on this via the website earlier.
Let's hope there is a few more of them. ;-)
@cfq. The trade today was a buy not a sell @1.54, delayed reporting. It’s what took the price up this am.
It certainly is fustration. I still think that the problem is the CEO and BOD, the market has no confidence in them at all. Yes, we all know the issues with Ireland, but the CEO/BOD, just don't seem to have any drive in generating revenue themselves, rather than relying on others.
Noticed also, that there has been a seller dumping a large amount, 9k yesterday, then another 9k today.
II don’t honestly know if oil hit $180 it would make a difference here. Having watched and listened for so many long years, seeing days like yesterday with 2 trades I’ve started to seriously wonder if our BOD could deliver parcels for Amazon let alone an ounce of value for share holders.
Brent over $80 and finally even this share has to take notice and begin to move up!
@Grey cheers matey; like I say I'm no expert! Thanks for the additional info.
Hi Tovoc. An important difference between our revenue calculations is probably that you see the reported Wressle "instantaneous flow rates in excess of 884 bopd" (about 960 boepd if the gas is included) as meaning CONTINUOUS production at this rate. Based on an analysis of partners' reported revenues since the proppant squeeze job, I think that "instantaneous" really means for a short period of time. This might be as little as an hour or two on just one day. As well as that, there's no revenue from the 80 boepd of gas. The gas is being flared because it can't currently be used. I estimate, based on the partners' reported revenues, that Wressle has averaged between 500 and 600 bopd of oil sold since the PS was carried out. There's also bound to be some down time, as Serif has pointed out. We don't yet know how much, but it would probably be wise to allow about 5% each month while Egdon are getting the optimum flow rate sorted out for Wtessle.
I hope it is too, because then we should see a major re-rate and shouldn’t get held back by any placing fears!!
@Serif Hopefully we'll get another update soon. My understanding of bopd is the average over the year; this includes downtime. But it's all speculation on my part. I hope its closer to my figures than your ;-)
@Tovoc. Haven’t done detailed analysis but your figure looks high to me. A couple of thoughts. Shouldn’t we allow some “downtime” in the year for maintenance etc? Also pre Wressle production had dropped to 86 bopd in the Interims and allowing for our approximately 5% annual depletion rate is probably c82 bopd now.
I realise that putting all the production together gives a total revenue figure but I think this is sometimes not helpful as extraction costs are a lot higher on the older assets - whereas Wressle is sub $9 a barrel - extremely profitable. I presume Egdon will take the extraction costs out of the money raised from Wressle before we get it as revenue - and this will reduce the EOG revenue figure.
Personally I find it simpler and clearer to think of current production comfortably covering EOG costs, perhaps with a couple of £200-300k spare over the year for contingencies, while everything we get from Wressle (current OP minus $9 or less) is pure profit - I think this would be around £220k a month on a 500 bopd flow rate with oil close to $80 - so just scale this up once the final production flow rate is confirmed. My reading across the 3 JV RNSs is that they can probably get higher flows than the 884 declared ( think the gas will just be used to power operation so not extra revenue) but may decide to go for a lower production rate than the max achievable based on well longevity etc..
@Grey My original calculation was based on $70 bopd and includes existing production of 92 bopd.
The RNS says "The well has achieved instantaneous flow rates in excess of 884 barrels of oil per day ("bopd")"
I interpreted the continuous flow rate to be 950 bopd from Wressle (this includes the Gas flow converted to 80 bopd also in RNS).
The calculation:
I worked out that Europa will earn £7.0M (at $70 per barrel) based on:
950 bopd / 100 x 30 = 285 bopd (Europa's share)
285 + 92 ( Europa's current production, from existing fields) = 377 bopd (Europa's total oil production)
377 * $70 (oil price) * 365 (day in year) = $9.6M or £7M Income to Europa
At $80 bopd:
377 * $80 (oil price) * 365 (day in year) = $11M or £8.46M Income to Europa
I'm not technical so please feel free to correct.
IMHO
Ho Tovoc. I've had a look at your $80 / barrel and £700k a month calculation but I can't really make it work - unless you're talking about the entire field. Have I missed something? The reported 884 bopd was an "instantaneous" flow rate, not a sustained production rate. So, assuming Wressle is currently averaging 600 bopd at $71 ($80 less $9 operating costs) x Europa's 30% = $12,780 per day. Assuming £1 = $1.37 and an average 30.5 days per month, this would give Europa about £285k / month, IMO of course. And 100% of Wressle's production would yield about £950k / month after deducting the reported $9 opex.
If we hit $80 in this week or next; we should making approx. £700K a month gross.
This should fill our coffers very quickly!
IMHO
@itsawrap This is a disappointing surprise to me also; money must be pouring into the coffers of Europa; we are hitting far higher production then expected which may soon be much higher as we have a significant choke in place suggesting even higher flow rates may be achieved.
I would have expected a SP of 4p to 5p or higher. If the oil price continues to rise we may start to see the SP rise too!
I still think a share buy back next year would help the SP!
IMHO
barely any sp action after the great news from Wressle, I'm a little puzzled!
What we really need is for oil to stay around $70 any thing higher is a good bonus.
Should be lots of money rolling in for Europa right now!!
IMHO