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Geezo, a big announcement and next to zero movement. This lot are clearly hated by IIs and many PIs too by now!! :)
could be in PMO.
Given the scale of opportunity in the block I consider it a perfectly realistic expectation. ONGC will be as keen as AMER to now expedite in line with recent tenders.
Multiple rigs for CPO5 is highly desirable but not AMER's gift to make. Why set unrealistic expectations?
1) will add to cash position and fund drill prog in Put
2) see this as a Govt endorsement for AMER
3) local indigenous didn’t want the pipeline upsetting Putumayo river ‘spirits’ (aka not happy with their compensation and heat from authorities as they continue to grow and illicitly sell Coca (which the vast majority of farmers still do)
4) signals future throughput increases, Govt keen to open Putumayo Basin. Timing of OXY farm-in not ‘accidental’ ;o)
There will be more news with the AGM. I expect the announcement of a 2H19 multi-rig campaign in CPO5 for starters.
Attend attend attend.
I believe this is the bottom for Amer, Spud news over next few weeks.
Just buy and hold, think we will be back up to 20p within next 4 months.
You are probably right about the BoD not being interested in getting rid of the Golden Goose. However, if I were a potential purchaser, knowing what we now know about discontent by major shareholders re the performance of the company, Directors remuneration, and unhappiness with management generally, I would be informally approaching these shareholders and asking them at what price they would look to exit! At least then if they go 'hostile' they will have a good idea if the bid will succeed, whatever the BoD recommend!
The BoD should have one and at what price! They are more likely to get “off the record” enquiries rather than any formal bid out of the blue, IMHO.
The BoD will have no intention of selling whilst they are “raping” us. Would you in their shoes.
Not b***** likely. All my Very humble opinion.
Stuff the shareholders, after all who are they and who do they think they are.
Yes & no. Deal subject to regulatory approval so not sure if the funds have transferred and $15m VAT refund to offset, net cost $4m
Haven’t we just spent $19m of this cash pile?
What is the latest net cash position is one of my questions which is not price sensitive, so why will not the FD answer this will be my retort if I get no answer.
Who’s coming???????
We need a list of points to raise on this site.
Anyone willing to promote this.
Clearly voting against res 2 and 4 will make a “tiny pinprick”. Reminds me of when Idi Amin said something about one of our politicians, how small they were relative to the whole world. Might find the quote as it was very amusing.
The point has to be made that Rewarding the BoD handsomely is fine if shareholders are seeing rewards as well.
"Today looks more about 'managing expectations..."
I think it is about the AGM and director scalps. I think this is the best news they can get out before the AGM to talk it up and try and save a job or two. Doesn't wash. Very transparent.
Maybe I have lower expectations but just happy with positive news :-)
BBN hitting the nail on the head as usual. This is surely a precursor to the OXY deal with the big news being that we are now licensed to transport third party oil, I.e OXYs future oil, and not that we are making a few bucks on the side.
not that impressed to be honest.
feel like i have - unlike the share - been oversold.
I think this is great news. Pure extra profit for few additional costs. Someone mentioned below $3m. If so thats +30% extra profit. All good I think the 2k limit signifies a few things: a). Cautious to fully test the system -ramp up over time; b) local contractor issues - this is essentially talking money from Colombian truck drivers - they are unionised and strong having blocked Bogotá before in disputes with the govt so need to tread carefully with them: and finally c) suggests we may be looking to fill that extra capacity later in the year ourselves. See nothing to grumble about. All good. Now get bloody drilling!!!
@ColonelDrake
Whilst you talk about the 3rd party oil being talked about last year, the Chiritza station wasn't announced as being completed until 21st November 2019, and the company needed to establish how they wanted to exploit this 4,000 bopd gain. To do that they needed to understand where Platanillo was heading.
It was only 6-7 weeks prior to that that we were told that the company had discovered oil in the T sands at Pintadillo. It would have taken at least the time inbetween those two announcements to establish if they could/should push on with Platanillo drilling to the north. Bear in mind they had planned 3 drills there.
Clearly, they didn't feel they could get the required growth from Pintadillo, which bears out in the 2,000 bopd now committed to 3rd party oil transport. However, they now only have 3,000 bopd head room with an improving Platanillo.
The decision to conclude a 2,000 bopd deal says more to me about their thoughts on future Platanillo and Putamayo production than it does about their 'inability' to exploit this further capacity.
The company is pushing to drill Put 8 and Put 9/12 later in the year (I suspect Put 8 has the bigger chance). Any level of decent success on any one of those licenses and the circa 2-3,000 bopd of spare capacity comes under pressure, given that OXY signed up to their licenses because of what OBA enables them to do.
There is certainly room to criticise but we are arguing over limited uplift in my view. I would dearly love to have seen 4-5,000 bopd, but for reasons i explained earlier, how can a local oil company cancel its contracts in order to rely on the OBA, if it has a break clause that says the moment AMER find oil they are out? That doesn't work. The deal has to be medium to long term.
So with drilling due to pick up substantially in 2020 in the Putamayo, AMER needs to start planning for the future and levels above 9,000 bopd, and that from what we are told in the reports, will have to come from a more captial intensive programme along the lines of what I posted earlier.
They can only utilise the OBA as quickly as they can improve the RODA. The next capital investment will be a big one and that will need capex, and that capex will come from greater utilisation of the OBA. Yes its slow but it isn't all down to AMER.
Beating guidance by 2 months is significant when the BOD is constantly being accused of not hitting its targets. This BOD is accused of being overzealous with dates but when they issue a conservative one and beat it, they are criticised anyway. Your 'conditioned' statment assumes you know me and I assure you, you certainly do not.
One key point I feel you are missing by concentrating on the numbers is the fact that AMER is now an authorised transporter of oil and it is that which is key here not the physical barrels that will be initially achieved in 2019.
This is about OXY, 2020, and what comes from this development.
CD, I don't think it is totally ONGC's fault at the 'snails pace' of the CPO 5 block. I think the pace of production has picked up so quickly in Colombia that resources are stretched as other producers rush to try and take advantage of the PoO. I posted a few months ago that securing a second rig or indeed a third would be near impossible until the supply chain to the industry has caught up.
Things will turnaround but at a pace a lot slower than investors expected on the back of the successful Mars-1 drill. Production and reserves increase will follow and imo a great price at this level. I never invest in a company with the hope of a takeover but right now the company is very vulnerable to a cheeky bid. You could argue that the BoD's IR or the lack of it invites interest.
Fantastic News today. Was this the news the majors were waiting for before attempting a takeover? At this price Amerisur is a sitting duck. However if a takeover was to come it would be multiples of current share price imo
A coupe of more tender docs added over the Bank Holiday. One for HSE and the other for production from the well head. From page 59 of the link posted you can get the technicals, bore dia and choke. Also the scope of work expected from the successful bidder.
www.ongcvidesh.com/wp-content/uploads/2019/05/Tenderdoc-Production-Facilities-2019.pdf
I am slightly confised reading the reactions this morning. This RNS is positive revenue generating news. Yes the exact vlumes will need to be clarified as this development unfolds, but first and foremost the company has achieved the self imposed deadline of H1 and beaten it by nearly 2 months.
To me it look s like they have signed up one initial local producer with a view to testing the concept. Onc e they are comfortable with this they will look to add numbers be it through the first signed contract or others.
I would think that once they have agreed to take 3rd pary oil they are committed to the purchase over a contracted period, otherwise the seller would perhaps face issues with alternatives arragements, which they are perhaps looking to cancel 9i.e. trucking contracts), and therefore must be careful not to over step their position. Since this deal was introduced earlier in the year Platanillo has begun to show signs of improved production. Therefore, the size of the 3rd party deal may well be affected by this development also.
All of that aside it is a good deal and from where I am sitting it is a deal that will generate steady cash flows even if oil prices fall back because the profit is made from the transport cost savings, which are fairly static, and not the oil price itself.
Lastly, I would think that this now opens up the possibility of a further development of the transport network in and around the RODA system. Hence the indication regarding OXY ;
"the ability to transport additional volumes, including third party oil through the Ecuadorian network was a significant factor in securing the Occidental farm-in deal."
They cannot possibly be talking about the initial 9,000 bopd because they already had that and as the Anardarko deal has demonstrated, OXY aren't in this for the 4-5,000 bopd that is available through the system. They are here for the 50,000 bopd capacity that OBA can achieve when the RODA system is taken out of the equation.
That quote is for me a direct indication that there is a plan to either twin the RODA or run an additional pipeline that perhaps bypasses the RODA altogether. The available capacity (limitations) is tied solely to the RODA system and not the SOTE or OCP.
For me this deal signals the start of the process to prove that 3rd party oil is viable and can act as a driver to invest larger capital in the export system.
If not then why would the OXY comment be included? 3rdparty oil through the OBA has nothing to do with OXY, yet.
So the initial deal and its details may not be as wished for but it isn't about that, it is about what this starts because either OXY want large scale success on their shared licenses or they want to take AMER out completely, either way it will be at a premium that grows each time AMER adds further production or 3rd party oil to that pipeline.
Not sure management ever said 5000 think that was just speculation on this board
Third line in highlights - Initial volumes to be sent shortly, building through H2/19 to around 2,000BOPD
I don't think anyone said it would run at that level from day one - who knows exactly what the initial levels are going to be
Cash generation with no risk is always good for the Company the OBA pipeline will generate millions over its lifetime
GLA LTH will benefit shareholders over the coming years on Dividend returns