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@oilheadgame You are entitled to share your opinion but I feel the comparison with ECO is flawed.
Whilst the neighbouring blocks to ECO had already found massive oil finds, the risk reward for ECO still remained substantially below what we have here with I3E.
Furthermore, ECO peaked at 94p on 14th May but the day before the spud was sat at just 72.2p, which when we compare to the day prior to the well result (68p), equates to circa 5.8% lower only and not the perceived average 24% drop you have demonstrated in your post.
If the same were to happen here then we are talking 48.5p. Whilst we would all like to achieve the lowest buy in price we can, thé amount on offer through your theory is too low for me given things could just as easily go the other way.
It is important to remember for the ECO drill that "the targeted prospect is(was) estimated by the Company to hold 250mmbbl of gross prospective resources and the Chance Of Success is estimated to be 44%.
Whilst the neighbouring block has been prolific with its discoveries, until Jethro came in the recoverable resources for the first drill presented the chance for ECO to secure circa 37.5mmbbl as the holder of a minor interest. It is that position and the 44% COS that will have guided investors through the spud and up to the result.
I3E isn't drilling for prospective resources. It already has 11m barrels of 2P reserves when the 2P 38m STOIIP is measured at 28% recovery. However, the neighboring block in the same Captain Sands play has already demonstrated that 50% recovery is achievable. Thus that figure should rise to circa 19m when on production.
The pilot drill should then boost the STOIIP upto circa 58mmbbl and circa 29mmbbl recoverable oil. That takes I3E above the pre-drill expectations of ECO on a pilot drill vs exploration drill. That alone positions the 2 firms at this stage some distance apart in terms of risk reward at the same stage of progress, and it is that which will ultimately drive the decision to hold or bail.
I acknowledge that ECO post drill has potentially far greater resources to recover but I3E holds 100% of its license, has a plan and a proposed debt line to get it into production and on a far quicker timescale, such that it will likely have far greater capital at its disposal through revenues before ECO even gets into production, and thus can employ that capital to expand its footprint and grow.
So there is plenty of info out there to dispute even that 5% drop prior to the drill result here.
To be clear I do not believe there is any true worth in comparing ECO and I3E but wished merely to highlight how dangerous it is to merely throw out share price figures without getting into the detail and understanding the drivers behind these share price moves.
ECO at £132m valuation on spud is sporty. I3E at £48m looks very light given what I have just explained.
not a shorter or have any agendas.
just stating facts that I've observed in good drills this year and already seeing it here.
my position is 37p, large.
Assuming you now have your short on @oilheadgame, do us all a favour and get lost. Thanks.
Ophidian
I fear more than one of these institutions might be selling as they have policy to not to be involved after spud to reduce risk. I guess these lot got involved in 30s?
Good return if you ask me. They may buy later on confirmation- reduce and what have you. They all have strategies they have to stick by unlike us pi s who believe In story than the binary
It is very likely there will be a barrage of people selling on spud news which is imminent.
Also recent years we have seen many oilers sp gradually going down after the spud by 10-20%. Take recent example of ECO was trading heathy 80-90p prior spud then for 40days during drill went down to 65p. I see more the same here unfortunately. and you have the naysayers who boast what happened to JOG which approaisal was an appraisal well that came dry
Nothing is certain only what you see on paper. Market are crap so people are hesitant to do anything and guess what you can’t blame them
ECO and I3E are different prospects (both highly appealing in my opinion). ECO may only have 15% but the field could be 4 billion barrels (600m net to ECO). It's more exploration but it's massive, they've got cash for six drills and they've confirmed oil with a successful well. ECO will be bought out based on reserves.
I3E don't quite have those telephone numbers, but targeting several hundred million barrels at 100% is almost as much. I3E are more development/ appraisal in my opinion (a known play in a proven area) we also have near term production at low cost. I3E can generate a lot of money, I suspect to end up a mid-cap oiler but may be bought out for reserves. As soon as we drill (and if successful) we will see that mcap gap close with ECO.
I'm invested heavily in both and have been since both IPO'd. In my opinion, have been the two best risk/ reward plays in the junior market for the last year or two.
Eco is in a different league to i3E, cant be compared
Hmm anything is possible but hard to believe on 50mil mcap, meanwhile eco is on 260 and growing on 15% interesting in the field... just lol
Market is wrong.
Judging by the current SP to me it looks as though the market thinks we are going to find custard not oil.
I think the share needs some good news, if its lucky enough (worked well enough) that good news on the drill coincides with Miton finishing their sell off, then i would expect a very healthy jump in price.
looking at the current sp could the first drill be already factored into the share price
at 90%cos ?