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Substantial news is expected over the next 100 days. Some will possibly be unexpected and come out of the blue.
1. Stena: Will they do a JV? If not, clearly they have no concerns getting paid otherwise they wouldn’t have committed to sail a $1B ship across the Atlantic, to end up as a staff Christmas cruise.
2. Farm-in by a major? For those that say oil companies are broke or covid bla bla bla, ….refer to a list of recent farm-ins and farm-outs https://www.keyfactsenergy.com/news/?news_type=5 . For those that opine oil majors aren’t interested in wildcat drills, I would remind them of 2 facts: The huge potential of what lies underneath Bahamas’ Percy-1 spud…..and ……. in 2018 a major paid $1m for exclusivity in our data room which it extended. They clearly liked what they saw and did not walk out after the first week demanding their money back. A farm-in option is on the cards especially now that our drill date is confirmed.
3. Geo-political considerations: Russia and China exert influence and spend money in the Caribbean. Will they want to be energy players at the USA’s front door? Refer to my post early yesterday.
4. CERP: Although some on this BB consider CERP to be a dog, as I’ve stated before dogs can win BGT and Crufts. We would appreciate if CERP LTHs give us BPCers feedback on upcoming news releases. The key question being: If CERP had not merged, assuming a market cap of £20m (worth 0.6p in the overall SP today), by how much would this figure increase or decrease based on the news?
5. A competent persons report is expected shortly. I believe the unfortunately acronym-ed ‘CPR’ will be up-beat.
6. Institutional investors have probably been ‘watching this space’ since the CERP merger and may act based on all the above.
Bottom line: Yesterday’s RNS proves we’re serious and the drill will happen. A farm-in is still a possibility. It’s a great time to be a BPC shareholder and IMHO the SP is still a bargain. CONVICTION STRONG BUY however always DYOR.
Have a great Saturday
Starchild
xxx
SC - well said. As I mentioned in my last post yesterday it's basically a placing vs many alternatives to fund the drill(s) which will materialise in the next 2-3 months. Given the recent dilutions it would definitely not be good politics to go for a placing as the bulk will be given to IC's at bargain prices only for them to dump a la Trafalgar. The CERP business plan needs more meat on the bone and I trust the BOD will be working on this in parallel with the P1 activities. Yesterday's RNS was the firing gun for the next 100 days as you put it. Let's see what transpires in that time...
In light of the excellent Stena oil drilling confirmation RNS Friday morning, and the heavy trading that ensued, I analysed all BPC’s trades at eod by using the spreadsheet function provided by the LSE. (source: https://www.londonstockexchange.com/stock/BPC/bahamas-petroleum-company-plc/trade-recap [Press ‘download’ button. After saving the spreadsheet, sort by trade value.] ) You will note 23 trades were for over £10,000 with a very unusual BUY @3p, delayed reporting, for just under 2 million shares for £57,000. I use the word ‘unusual’ because the Market Makers EMS is 200,000 shares. (Simply put, EMS is the guaranteed number of shares a MM will buy/sell at the minimum /maximum spread rate publicly shown. Without an EMS number, someone could in theory attempt to buy the whole company and demand the MM gives them a price.) After doing the above, I cross referenced the bid/ask price at the time (level 2 data) and concluded most of these large trades were buys. One disclaimer: I did this while watching footie, so please don’t assume I am a total nerd….. and check for yourself as watching the game did distract me.
IMH Opinion:
1. The buyer for 2m is a whale/fat cat and will likely buy a lot more over the coming days. If not, I consider what s/he did in one hit, a bit daft.
2. Both professional and amateur day traders were in play. Why? If only long-term new and current investors topping up (at least until SP soars leading to spud), there would have been few sells.
3. On Friday, day traders were trying to gauge the new support / resistance levels. On one hand they want to make their 10-20%, on the other they know (a) a lot of ‘watch this space’ news is imminent (b) the SP could soar well into the 3-4p range quite quickly and stick there (c) whales are in the water, may be even from Wales, (d) a lot of new PIs may have analysed what’s going on over the weekend based on mainstream news articles.
If you are new to BPC, and want the latest 45 minute elevator pitch:
• Refer to the BPC official presentation: https://d1ssu070pg2v9i.cloudfront.net/pex/bahamas/2020/08/19180949/BPC-Management-Presentation-August-2020.pdf
• Refer to my ‘100 day’ post yesterday early morning for expected news.
• Refer to Brynjon’s ‘cast your mind back’ post at 09:46am yesterday and the links.
I believe it’s going to be a very interesting next 10 trading days. IMHO CONVICTION STRONG BUY. But always always always DYOR. Have a great Sunday.
Starchild
xxx