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O&W, you are responsible for over 25% of today's volume. Shows how little interest there is here and how illiquid this stock is. So many shares are locked up in tighty clasped hands and retail just isn't interest...yet.
Fair comment. I lost a lot of profit due to PW as well and should have sold at 70p but hindsight is a wonderful thing.
The reason why none of the successes with the drill bit increased the SP was due to an ii selling in that 50-55p bracket hence why we stayed there for ages.
As for new customers yes will not be easy but it will still add more to the reserves of the company.
Finally you can’t ignore the extra revenue that SD has the potential to bring in and now Welch has gone that will be the end of the lying and overpromising. As they say proof is in the pudding, but I think at 22p there is huge upside just a case of sentiment restoring through targets being hit by Mark.
Harts, They did have great success with the drill bit in Morrocco but I remained invested throughout and despite the success exited with a 55% loss and yes I am angry about it particularly PW lies. I did not see why further success would make any difference as they have hugely cut back their guidance from 9.5 to 11 down to 6.4 (approximate figures) so getting new customers may be more difficult than you think. I genuinely wish you all the best in your investment here but PW killed this one for me I lost a lot here and see better risk reward elsewhere
Older and Wiser info on the drilling programme for you....
"Planning for the drilling of 12 wells in Morocco is at an advanced stage, with the campaign targeted to begin in Q4 2019 and complete in H1 2020. All long lead items have been ordered and all key contracts finalised. The programme will be targeting 15bcf of gross unrisked prospective resources."
"The drilling campaign in Morocco will target sufficient reserves to satisfy existing customers' forecast demands and test new play opening areas of prospectivity across the portfolio."
The margins in Morocco are brilliant we just need to expand the customer base and demand which will happen as Shakey said their success rate has been amazing with the drill bit. Also there are many more lookalike targets at South Disouq, once the CPF is up and running, adding more to the pipeline will be much quicker and easier.
There is also the possibility of oil at SD, although this has been downplayed and is possibly not even on the cards anymore. Quite possibly another Welchism. Wherever that guy is, if he ever comes back to another publically listed company, I will be watching with interest with a view to short it at some point.
SD at 50mmcf/d + condensates is worth very roughly $10-$12m per year in after tax profits (not including cost recovery which will increase profits in the first few years). I don't see why they can't double the production to 100mmcf/d + condensates with some successful drilling in the region. It is highly prospective ground for gas and their drilling success there to date has been phenominal. One failure, the rest successes. So $20-$24m per from SD alone in relatively short order and at low cost given the vast majority of CAPEX for getting the current wells hooked up and producing was the Central Processing Facility which is now paid for. There is supposedly capacity for 150mmcf/d in the trunk line SDX's processing facility will connect to. I don't know how that figure is derived though. Is it spare capacity or what? No idea and Squelch is the source of the figure so could easily be BS.
Not so. I do have a small position here, bought in the last month, but I am just trying to figure out if sdx has the multi-bagging potential through organic growth that my major positions in Eco and Savp have. Shakeypremis made a valid point about the SD assets diversifying SDX's future revenue base away from total reliance on volatile oil sales due to price variations, which is fine, but I can take volatility as long as it is associated with major growth in producing assets and/or proven reserves established. A doubling of potential BOE (though not necessarily in revenue terms) via SD is obviously a bull point for the shares, and is why I am here, but to some extent this may be just replacing plateauing production on the books now?
What about the Moroccan 12-well drilling program? When will it start? And could that be as important as SD if SDX's historic success rate is replicated there? 15Bcf of gross unrisked resources is about 2mn boe, I think.
I rate SDX as a very safe investment here, and an easy double, but I need a push to be convinced it can get to £1.
Aside from the fact a BOE is not equivalent to barrel of oil on a value basis (SDX's BOE's from South Disouq aren't as worth as much as a barrel of brent), I don't understand how you can think a doubling of production on a BOE basis (again, not a doubling on a value of production basis) is not transformative. Even a 50% increase would be a lot.
Also, it 'transforms' SDX from a majority oil producer on variable revenues to due fluctuating prices do a majority gas producer on fixed pricing. I believe this is why the company appear to be prepping the ground for dividends as revenue and profits will be pretty predictable going forward making dividends easier to pay.
These wells are small development wells and aren't expected to produce a lot. Remember, SDX aren't paying all the drilling costs as circa 50% is borne by the partner. These wells will provide return on investment and are also done to get the most out of a producing field.
Agreed SD has been a significant drain on finances and when turned intro production will generate cash rather than consume it so almost a double whammy of less going out and more coming in. Everyone knows this to be a game-changer hence us all sitting on the edge of our seats.