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If anyone hasn't studied the latest Block 2A presentation - the Kertang 9 tcf mid case recoverable prospect is described as an undrilled giant and on slide 5 it is compared as analogous to Lang Lebah 5 TCF and Kasawari 6TCF. LBE include the reference to Lang Lebah - "Unravelling an abandoned giant" by Aquilah (Amir Jamalullail and others- The leading edge 2020)
https://longboatenergy.com/wp-content/uploads/2024/01/Malaysia-license-SK2A-extract-from-EAGE-presentation-January-2024.pdf
Yet in that article, Lang Lebah lay dormant for 25 years after initial drilling and it was only in 2016 that new 3D seismic and reprocessing was carried out and a new well drilled that made Lang Lebah one of the largest gas discoveries of 2019
https://www.researchgate.net/publication/343411866_Unravelling_an_abandoned_giant_in_Central_Luconia_Province_offshore_Sarawak_Malaysia_-_Success_story_of_Lang_Lebah
"Lang Lebah, located in block SK410B in the South China Sea, is one of the biggest gas discoveries off the Malaysian coast.
The Lang Lebah field is estimated to hold five trillion cubic feet (Tcf) of gas in place.
The field was discovered by the Lang Lebah-1RDR2 exploration well, drilled in March 2019 to a total depth of 3,810m. The discovery well encountered 252m of net gas pay in the Middle Miocene carbonate reservoir.
The Lang Lebah-2 appraisal well, drilled in January 2021, confirmed Lang Lebah as one of the biggest gas discoveries in the region. Drilled to a total depth of 4,320m, the appraisal well encountered more than 600m of proven net gas pay in the carbonate reservoir. The well test demonstrated a flow rate of 50 million cubic feet (Mcf) of non-associated gas a day. The Lang Lebah field is expected to come on stream in 2027 and will produce up to one billion cubic feet (Bcf) of gas per day." (165,000 boepd)
https://www.offshore-technology.com/projects/lang-lebah-field-development-sk410b-malaysia/?cf-view
Kasawari - "Discovered in 2011 offshore the Malaysian state of Sarawak, the Kasawari sour gas field is today a symbol of Southeast Asia’s energy challenge.
Petronas is eyeing next year for first gas. By 2025 it hopes to see 900 MMscf/D (150,000 boepd) flowing from the field to its sprawling Bintulu LNG export facility on the Sarawak coast.
The scale of Kasawari, found at a water depth of about 108 m (350 ft), is a result of its ranking as one of the most CO2-laden gas fields planned for development globally. When wells are flowing, it’s expected that up to 40% of what will come out will be CO2.
New research from Rystad Energy suggests that the capital inputs required to add CCS to Kasawari will hike the project’s breakeven gas prices from roughly $3.50/Mcf to more than $5.00/Mcf. "
https://jpt.spe.org/what-you-should-know-about-offshore-and-sour-gas-ccs-high-cost-leak-mitigation-and-transportation
@zengas : excellent summary of potential here. A reminder why I am invested. My comment was more rhetorical question why the share price suddenly moving now. Would agree that 40p a fair price based on progress to date (Japex deal, Stratford production, Norwegian discoveries and Malaysian potential)
All the below plus free carries on drills off Norway starting in 6 months. And a possible extension of the carmen discovery off Norway in the block adjacent. Plus Carmen possibly leaks over to our block.
Mental value to be had if you see the wood through the trees
Nothing to do with leaks imo but the fact of the assets it has added as well as the super deal with Japex in Norway and that investors are waking up to it. It is and was very oversold plus the the low available free float which i highlighted.
The M/cap at 25p is £14m m/cap and is a producer on it's existing assets which will soon have paid for itself as well as expecting to double production on those.
It has $100m of available Japex funding for acquisitions in Norway. Use some of that for Norwegian production acquisitions (expected) and will further transform the company.
It has also underestimated play opening discoveries in Norway with major partners.
It has a world class exploration block off Sarawak with multiple large prospects.
The block has 6,000 km2 3D seismic which would cost a fortune to replicate and at least $20m - or more than the current m/cap.
Kertang is a world class 1.5 billion boe recoverable estimate (9 TCF) drill ready prospect DHIs, gas cloud, significant methane measurements.
Two smaller adjacent prospects about half the size each may add 6 TCF to this so imo a target potential of 15 TCF.
Those 3 are covered by 2900 km2 3D.
Farming down from 52.5% to 15-20 % could yield $ 1billion of value.
57m now or expanded to 100m shares at £4 = £400m/$500m
With still further structures.
Also intending to pick up producing assets in that region seperate to Norway.
By comparrison - Upland (UPL) in the same Malaysian region, no production, financial backing, no 3D and unknown stake in a PSC block not even awarded yet, no recoverable estimates and nothing else of value on 1.2 billion shares and todays share price of 3.3p (recently 4 and 5p) = £40m m/cap and nothing else to underpin an entry price.
Fair starting value for LBE would and should be 40p which is only £22.5m and on the above looking for north of 100p from Norway in growth (ie barely £60m) and a potential future target as above of value on a success case on Kertang detailed above.
Doesn't take much volume to move price here.
The obvious question is why this is suddenly motoring now?
News leaked of incoming deal?
Despite the lack of progress over the years and that I'd bottom drawered these, I'm thinking top up on this sudden movement in sp.
This is after me thinking I'm not putting a penny more in lbe 🤷♂️🤷♂️🤷♂️
-- BB --
This will absolutely fly on any significant news
Nice one! Not a bad day here. Blip in the ocean though compared to what could be on the horizon with acquisitions and Kertang!
Looking forward to the updated production guidance!
After months of sideways action between 17.5p and 21.5p could this be a next leg up?
Okea AS went ahead and completed their acquisition from Equinor in the Statfjord Unit as well as Statfjord Ost, Nord and Sygna.
'The Statfjord Area comprises the Statfjord Unit, Statfjord Øst Unit, Statfjord Nord and Sygna Unit. The Statfjord Unit development covers the Statfjord A, B and C concrete gravity-based platforms. The other fields are subsea developments tied back to the main field platforms.
Statfjord Area is one of the largest fields on the NCS in terms of initial oil in place which was in excess of 6 billion barrels. Statfjord A was put on production in 1979, followed by Statfjord B in 1982 and Statfjord C in 1985. The field is operated by Equinor and the Field Life extension (FLX) unit was established in 2020 with an ambition to deliver 200% increase in remaining reserves, 25% cost reduction and 50% CO2 reduction in the Statfjord Area by 2030. The FLX unit focuses on safe operations, improving recovery from the field as well as reducing costs and CO2 emissions and has a strong track record of deliveries in recent years.'
As LBE partners Equinor, VAR, DNO etc most of the existing discoveries made are close to existing facilities and some of those at the lower end of the threshold may yet come on to the development stage or swap in the future, but that is where all these companies have a major focus similar to the details in the Equinor transcript.
Kjetil Hove Equinor ASA - EVP of Exploration & Production Norway
In addition to the large sanctioned project portfolio, we have an even larger number of non-sanctioned projects. We have more than 30 projects that we are maturing towards investment decisions in the coming years. The projects are in an early maturation phase, but we expect an average breakeven of the portfolio of around $35 per barrel and a payback time of around 1.5 years. For many of the new subsea tieback fields, we are looking into new ways of working to reduce the maturation and execution time with 50% and the cost level of at least 30%.
This will reduce the breakeven from these fields with 30% compared to a more standard subsea development. And this will be done through new technologies such as the Cap-X subsea wells and by taking out portfolio synergies. These projects will give us around 350,000 barrels in production after 2030
In addition to the large sanctioned and non-sanctioned project portfolio, we are working hard to increase the recovery factor from our fields. Historically, we have been, since sanctioning, been able to increase the average recovery factor from around 30% to around 50% from our oil fields. And there is still a large remaining potential in our fields, and we plan to deliver 50 to 70 increased recovery wells annually in this decade.
Many of these wells are using new technologies such as retrofit multilateral wells, multi-stage fracking and advanced completion solutions, reducing the cost and increasing the production. And these are highly profitable barrels with a breakeven of around $20 per barrel and a payback time less than a year.
We're also planning for around 300 interventions annually to increase production from our existing wells. And in addition, for many of our late life assets, we are planning to sanction low-pressure projects to reduce the reservoir pressure and thereby increasing the recovery from our fields. This increased recovery effort will give us an annual production of around 150,000 towards 2035
Our exploration strategy is that around 80% of the exploration wells will be drilled close to the infrastructure in known exploration plays. This is normally low-risk exploration with high probability of success. And new discoveries can be put on stream quickly since they will require limited new infrastructure.
The remaining 20% of the exploration wells will be drilled in new plays, still quite close to our infrastructure. These are higher potential wells but with somewhat higher risk than the pure infrastructure-led exploration targets. These wells can open new plays also in known areas such as the Kveikje, Heisenberg and Norma discoveries during the last years. Discoveries that you may not have heard about, but you should not underestimate them because there are many of them, and these could open new plays with large potential on the NCS.
Potential is great i agree but thats all the BOD have delivered to date, potential
Chart wedge ready to move n
Great post Deeko19, 2024 has real potential and I’m patiently waiting to see how it unfolds for LBE, major catalysts, firstly in Norway, the JV with JAPEX has to deliver something significant, they have the funds available. Worth noting that JAPEX are having a very good year and their shareprice has hit record levels, lets hope that some of that confidence gets passed down with a bold acquisition.
Then there’s the Malaysia block that has the size and potential to get the majors interested, a JV with a major player will add significant value for a £10m company.
Absolutely agree PaulD.
Personally i simply want cash flow and they haven't delivered.
The below is of course all speculation based on getting the results we all desire but the blueprint is there, just need stars to align
Folks… let’s see what 2024 brings. We got cash available to buy assets, JV partners that have joined and keen for production ading acquisition hence they are willing to pay upto $100 million at their initial expense the for them.
We’ve got Menzies who seems to be one of the most ‘get after it’ and industrious people I’ve seen presenting on aim in the last 5 years.
The story is building month by month! We tried exploration which didn’t bear significant fruit and hasn’t been desirable with investors for a decade, particularly in old basins. We’re now moving to farm outs and free carries on exploration. We’ve got our first slither of production (personally I can’t get excited about a few hundred barrels) and now we’re in the market for more in Norway.
We’ve then got a monstrous block in SE Asia which has more potential reserves (and solid indicators that the gas is there) than most mid cap companies have! It won’t be long before a major (possibly shell) comes in,50 million is small risk with massive reward for a major and they are all looking for LNG gas assets because they make a fortune trading it around the world.
Longboat genuinely has the most potential I’ve see on AIM. I just hope it’s well managed and we don’t get snapped up by some other company that will dilute us to with an already huge market cap.
Easily a 10 bagger on a decent production deal and a >50 bagger on a find in Asia
All a matter of perspective Zengas.
Perhaps I was slightly flippant, but with a market capital of 11.28mill, just perhaps its vulnerable. Japex and Malaysia are building blocks and I was purely adding 2+2, making 5 and considering it an opportunity for Serica to have some assets outwith the UK sector and EPL.
Concur that things are happening here for LBE after 4yrs and 3 months - but a year low of 8.5p from 100 or 75p is hardly outstanding.
ZENGAS,
With respect I think I say on behalf of all shareholders who have been involved In Longboat since the IPO, everything they have done so far has been a disaster. They bottled picking up assets during the downturn and then commodity prices shot up, meaning they couldn’t do a production deal at all. Their exploration campaign was a total disaster except for Kveikje which had over 50% CoS.
The JAPEX deal is certainly encouraging but they haven’t done anything with it yet. I’m sure all holders (old and new) hope for the best but so far all that Longboat has done is erode shareholder value whilst paying themselves handsomely.
Mommur
"perhaps after 5 years the major shareholdrers here feel the same"
To be factual -
LBE listed in November 2019 with only 10m shares just slightly over 4 years ago. (4 yrs/3 mnths).
58.% (5.8m) was held by instituitions and mangement had 8.3% (830k) leaving 33% or 3.3m free float shares.
The main fundraising of 45m shares at 75p came just 2.5 years ago in June 2021 which would be 4 in 5 of the current shareholders so i don't think you could describe them as - "perhaps after 5 years the major shareholdrers here feel the same" - any more than the share price swings as in Serica.
This is supported by 46% held by institutions with 26.3m, Directors & related parties on 3.22m at 5.7% with a free float of 27m of the total 57m shares in issue.
Regardless of the share price in that time, i think they've done fairly well with the opening discoveries to date. Followed all in the last 9 months by attracting a JV venture partner in Japex (with $100m of funding available that can attract a doubling to $200m in RBL for assets), adding the initial production assets and opening up with a significant asset with over $20m spend on it in Malaysia that on it's own could offer $1b of value on a success case given the multiple prospects, DHIs and methane measurements and gas cloud similar and described as analogous to 2 other milti tcf discoveries. But i expect it to deliver a decent valuation on lesser assets such as production and the existing discoveries.
Just because their ex Faroe holds no bearing. I don't see HH as the CEO in it anywhere (apologies if mistaken). As COO he follows the CEOs decision. There's may an ex director of Tullow who have gone and set up companies (AET from SEY for eg1).
Likewise for many shareholsders there's been a number of times to exit with substantial multi baggers at various times.
GKP listed at 48p and after it's operations in Algeria under performed and hamered down in 2008 to 3-7p was a buy for me on the very promising Shaikan block in Kurdistan and finally got out at 320p 3.5 years later before it ran on to 420p and over the following few years completely crashed to 1p and a restructuring. To me it's all about an optimum time for entry/exit and not trying to extract the last penny of profit but certianly looking for a multi bagger from here on the current strategy.
Painful comparison Zengas, like Mr & Mrs Hardy I bought heavily in the 4-5p range and was a holder from even earlier (2009) for the sum of 60p and added through all the heartache downwards until 2015. Never lost faith in Mr Craven Walker and it certainly came good.
Over the same period I was a holder of Faroes Petroleum which showed great promise, but never quite reached the next level. Management (some now at Longboat) forgot about its disillusioned major shareholders who sold out to DNO.
I'm sure Mr & Mrs Hardy are just as disappointed in Serica as I and many lth are - a catalyst may be to put an offer in for Longboat - perhaps after 5 years the major shareholders here feel the same as Faroes II's. Not to good for holders here from 100p and even myself from 50p!!!
I remember it being a painfully slow burn so to speak at Sterling waiting for the asset injection which happened with the new strategy in May 21 and a rename. Could have been picked up at 8.5p Dec 19 and 14.5p in late 21 - now 41p and only the start for more acquisitions.
Likewise look at Serica 43p in March 2012 and could have been picked up in the 3p range Jan -April 2015 and at 5p to Sept that year.
90p Jan 2018. 57p 6 months later end of June.
140p range Feb 2019 - Jan 2020.
150p+ mid 2021
420p early 2022 retreating to 245p May 2022..
Averaged 240p for 2023.
Jan 2024 220p to it's current 178p.
12/6/22 - Britain's savviest investment couple are sitting on shares worth more than £80million after good news last week from Serica Energy. David and Debbie Hardy, who run a Midlands building firm, are the largest shareholders in the North Sea energy producer. Serica's shares to £2.90, sending the value of the Hardys' 10.4 per cent soaring to £82million. David, 63, and Debbie, 58, bought into the business for as little as 3p a share.
https://www.thisismoney.co.uk/money/investing/article-10907389/STOCKS-WATCH-Canny-couples-80m-oil-gusher-Serica.html
I see someone perhaps equally canny has bought and increased to 4m here or 7% up from 6% back in October.
Painfully slow burn Deeko. We've been through various oil price/demand/supply cycles with still no meaningful production and therefore constant erosion of cash. Very poor showing...
OMV seem to have gotten what they paid for the Sapura interest when the JV was formed in 2019 (9/11/18) on top of 5 years production income.
At the time Sapura had 260 mmboe 2P reserves and 2C resources. This went into the newly formed 50-50 Sapura/OMV JV ie 130 mmboe (or in gas around 0.8 TCF).
As OMVs Chairman (J Pleininger) said at the time - production trebled from 10,000 boepd at the time to around 36,000 boepd for the JV at the time of the present sale (Jan 2024) to Total Energies for $903m.
There has been significant production over the last 5 years. The large Jerun Gas field to start production later this year.
This from November 2018 -
'Sapura and OMV inked a joint venture (JV) agreement for the strategic partnership today, as a follow-up to a Heads of Agreement (HoA) signed between the two parties on Sept 12.
The deal entails OMV subscribing to 50% of the enlarged issued share capital of Sapura Upstream for US$540 million, and to repay US$350 million worth of shareholders’ loan owed by Sapura Upstream to Sapura Energy.
This marks a cash consideration of US$890 million to Sapura Energy.
OMV also agreed for an additional consideration worth US$55 million plus up to another US$30 million in contingency funds mainly linked to the resource volume in Block 30, Mexico at the time of taking the final investment decision.
Under the agreement, OMV will fully consolidate the JV company’s assets in its financial statements, which comprises 260 million barrels of oil equivalent (boe) in proven and probable (2P) and contingent (2C) reserves,
“Already right now, [the JV] has a great portfolio that is fit for growth. So what we are aiming for is to triple the production in the next two years from close to 10,000 boe/d currently to 30,000 boe/d in 2020,” said Pleininger.
https://theedgemalaysia.com/article/sapura-seals-deal-divest-50-upstream-unit-omv-ag-us975m