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Harold,
I wont bother getting into the calculation to try to work out what 30% of the asset might be worth. That's advanced mathematics.
Whatever they are going to do they need to hurry up. Tic toc, only financed until year end. It's like the 40 year old virgin. The longer they wait the harder it gets!
harold ,
I assume that you cannot read as well as add up.
I give up, if anyone thinks you can raise 35mp out of 8mp mc then good luck with that.
E_AL,
No one "in the know" is loading up on the cheap or otherwise the SP would be moving sharply up.
Let me write slowly so Harold & Oiler87 can follow - Here goes - "Trying to work out the possible terms of a farm out. Imagine you had to raise the funds by issuing additional shares" - are you with me Harold & Oiler so far - good. "440m shares at 8p each would raise about 35M, this would approximate to existing shareholders holding about 30% of shares or 30% of the asset after a farm out"
"Join Harel in the corner - no one said that they were going to issue 440m shares to raise 31M pounds."
Well someone just wrote "Assuming they need to Raise GBP 35M at an SP of 8p . This equates to an additional 440M shares".
So lets say i was talking to that guy that writes in your name.
To make simplier for you, if 440m shares were issued than we would have 550m shares that value 8m ukp, thats 0.145p a share and not 0.8p a share.
Sorry but this 8p placing doesnt make sense . II paid 35p recently to buy in and has warrant exercisable at 40p, 40.7p, 55.5p & 56.85p. Neither BOD nor IIs accept raising at 8p or even 20p. At the time the sp was 12.5, II paid 35p to get 14,285,715 shares.
I think someone in the know is loading up on the cheap here and the current sp is a bargain for the patience ones...........
sorry 35m
Oiler87,
Join Harel in the corner - no one said that they were going to issue 440m shares to raise 31M pounds.
Harel,
Get your battery charger and charge up the Old Texas Instrument and type in this:
440,000,000 x 0.8p = (let me know the answer)
Then get back to the corner and put your pointy hat on.
Its you that wrote that 440m shares in issue will raise 35m pound when it will raise only its share of the 8m pound value of around 6.5m pound, please dont call your self stupid, you just made a funny mistake.
Harel - surely if you issue a trillion shares at 1 pound each - the market cap would then be 1 trillion pounds + 8m. Are you stupid or what ?
"Assuming they need to Raise GBP 35M at an SP of 8p . This equates to an additional 440M shares".
that's a funny remark to start the morning with...
how to raise 35m ukp with a 8m ukp value... hhh
you can issue a trillion more shares, the market cap will remain 8m ukp...
The SP / Market Cap last time round before the Junior Loan Notes & Funding package was announced turned out to be a good indicator of the Shareholder Dilution required to get the funding.
I believe the current Market Cap / SP is also an indicator of the potential dilution required to get a funding package in place whether by farmout or equity raise to fund this year drilling program.
Assuming they need to Raise GBP 35M at an SP of 8p . This equates to an additional 440M shares.
Lets also assume that warrants get renegotiated and exercised - this would mean that the potential share count of existing share holders would be about 177M. i.e. current shareholders would retain about 30% of the asset whether by farmout or dilution after a new funding package.
Then assume oil in the ground is worth $3, $4 or $5 / barrel and then assume they prove up 50M barrels, 100M barrels or 250M Barrels. This would indicate a potential SP of:
50M Barrels 20-33p per share
100M barrels 40 -66p per share
250M Barrels 100 - 160p per share
Apart from the 13m Shares that Neill and Graham hold of course.. Freshair.
But they have it all to do now... SP points to Money burned.
I don't go along with that. Their is nothing to stop i3 from issuing new stock if they need to raise funds.
"and of course dilution for shareholders...."
Wrong, no dilution will take place, its just dual listing, same number of shares in circulation, just open to another market on which to trade on. The increase in demand will drive the SP forward, one hopes !
A second listing gives extra cash if i3 release further shares to the market, and of course dilution for shareholders. The y mentioned noteholders, this is a further avenue for large holders to trade their shares. We should concentrate on a farm in which is what everyone is looking for. Lets believe them. Renegotiating warrants does not help the shareholder; they have a four year life span and that's the way they should stay. If the warrant price was dropped and they vested we would have cash but not as much as the warrants are worth now; we would also suffer dilution so the best way forward is a farm in with Repsol who would be the operator. Aimo.
3G, 60p might be over optimistic, but if such a deal will be striked its a metter of time before sp is 60-100p when serenity is confirmed, pre lib minos high which has its own risks and rewards.
If A1 development well will prove the the 11m bboe and produce 4,000 boed its a game changer as well.
Fd, correct.
Agree listing points harel. Agree circa 15p before news. Agree good deal terms being $50m value. But no way we're going to be anywhere near 60p pre-spud. Halve that and we're in full agreement. I just hope they get the f/o done in the next month or so. I have a baby coming end-April and simply want my money back in time.
So in a nutshell, Harel, the total number of shares in issue remains the same just spread over 2 markets?
Oiler, please stop plucking numbers out of your @rse. There is no way of knowing we have £15m in cash remaining. And I still don't know where you're getting £20m for 2P reserves. The cost of drilling the production well won't be far off this number. The cost of extraction is greater, although not as much as the 23m 2P, it's still substantially more than any numbers you're quoting. Graham refers to the RBL in a recent interview as costing less due to the lower reserves, but it not being a linear reduction. You can work out numbers from that if you wish but suggest you start around the $50m mark (allowing for equity raise). If I was to put fair value on this stock at the moment I'd say £15m max. There's too many unknowns and recent bad memories for it to break out above these levels unless we get a farm-out. If we do secure a farm-out our value is entirely dependent on the terms but I'd say the best we can hope for is 25-30p in the run up to drilling. We may get a spike on news, which is when I will be exiting and you will hear no more from me. But don't expect anything before-hand. Reality has hope, but unless your average is less than 10p don't expect to make lots of money on this stock for at least 1-2 years (depending on the f/o agreement and i3e actually hitting their f@cking oil targets).
Second listing does not give extra cash, it gives extra demand to the stock and prevents manipulations.
As it is a requirent by the junior lenders it might be a step towards a senior loan for phase 1.
With the extra demand to our shares and the PR needed before listing which will surely inclood a new presentation, i can see us at 15-20p by april on no news.
After the farm out update i am optimistic that not only a farm out is a metter of months away but a good deal will be made.
A good deal for us is 50m$ for 50%, through cash or cash + carry, a deal like that means well be at 60p on spud.
I will be very happy with a 7% rise by the close of pay.