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Background
There were some very good posts yesterday discussing the history of CERP and Leo’s vision of making it a £500m market-cap company. Thanks guys. My post this morning provides opinions how it can become £200m by late 2021 which is actually less than the +/-£220-250m analysts’ forecasts and recent company vision below.
21.6p/sh (c£220m mCap) From March 2020: https://www.proactiveinvestors.co.uk/companies/news/916212/vsa-capital-market-movers---columbus-energy-resources-916212.html
25p/sh (c£250m mCap) from July 2018 https://www.stockmarketwire.com/article/6041186/Broker-Forecast-VSA-Capital-issues-a-broker-note-on-Columbus-Energy-Resources-Plc-Ord-0-point-05p.html
Refer to slide 21 (left) https://d1ssu070pg2v9i.cloudfront.net/pex/bahamas/2020/10/20121621/BPC-UK-Investor-Magazine-VC-Presentation-20-October-2020.pdf . It states an…’end 2021 [Production] GOAL 2,500 bopd (net).’ And $15m NET revenue based on $40/b PoO and $20/b extraction costs. At $50/b PoO, I have argued in my deep dive on 21/10 4:31am this NET retained cash figure could be £12.3 annually after deducting $3m in fixed operating expenses such as payroll. Oil industry P/E ratio is x17 valuing the company (assuming Percy-1 is a duster) and $50 PoO at £200m, or 5p / share.
But will it?
New and existing investors ought to think this through as it could FULLY hedge Percy-1 being a duster and represent 4p-5p per share by end of 2021. Even if you are a planning to sell-up prior to spud, the points below may make a difference to the SP in the next few weeks, because as of today, I don’t think the markets have thought this through. Some ex-CERPers remain highly sinical. However, I take the following view made up of 5 key points:
1. The BPC BoD would have done major due dili prior to merger. They would NOT have relied on CERP BoD predictions or hype.
2. The quality of the BPC BoD and management team are not the type to get hoodwinked. Refer to their experience and successful track record. https://www.bpcplc.com/about/who-we-are/board/ and https://www.bpcplc.com/about/senior-management/ They cannot be accused of being in-experienced bozos.
3. BPC will have the cash to make this happen. CERP did not. I have already given opinions in prior posts how.
4. I see no reason to doubt the BPC BoD projections. Even if they are out by a factor of 50%, the NET cash after ALL expenses is still potentially £6m annually.
5. And WHY has a 3rd party company offered to pay for ALL Saffron 2 exploration, development and production? Are they delusional?
Bottom line: IMHO, if Percy-1 is a total duster, the SP will temporarily collapse to sub 1p, however by end of 2021 we will likely be fully hedged at the current share-price and more. If though Percy-1 is a success, ex-CERP asset revenue will add a free gourmet dessert to the epicurean feast we will all share. Always DYOR. GLA.
Starchild
https://www.lse.co.uk/profiles/starchild/
SC - so far we have only a level 1 schedule of how BPC will obtain revenue from the CERP merger assets as you have stated below. We need to see a few RNSs which take this plan to a level 2/3 schedule detailing what and when they have to do the tasks necessary with quarterly updates on progress. Only then will we see the SP reflect the progress or lack of it. I certainly would like to see some these pre-spud of P-1, so that I can assess how much of my holdings stay with the drill.
Minimil: I do not disagree with you.
It is likely a lot of ex-CERP asset news will hit from now until January, mostly December such a competent person's report and S2 update. In the meantime at just over 400 boe per day, the company is probably earning c$3m per year pro-rata and likely breaking even, or almost even (excluding capex off-course). [$20 net profit per boe x >400 x 360 days]
Starchild
https://www.lse.co.uk/profiles/starchild/
Yes great posting Star - solid, referenced information - contrast with the trolls on here who lack the technical knowledge to dispute the numbers, which have come largely from BPC. Best the trolls can come up with, collectively, is I don't believe it ! ( I loved that Victor Meldrew character but even Victor eventually passed his sell by date - haven't heard from troll 12bn on ADVFN for over 2 weeks - was it the last throw of the dice to send in LayLadyLay yesterday? ) .
Excellent posts star.
O/T - Offerman - nice to see you posting here and I hope you are keeping well; as I remember You were having a tough time recently
Starchild
At the end of the day it has to be your lookout if you have persuaded yourself (and their lookout if you persuade any newbies) that the ex-CERP assets make BPC some kind of copper-bottomed investment at these levels. You seem to have embraced the CERP story with the zeal of the convert. All I can say is that many of us who have been following the CERP/LGO/Leni story (for 10 years in my case) would urge you (and any newbies) to look more closely at the ex-CERP assets, how capital hungry they are and how much capital they have consumed to date.
FOSHO 10 yrs of trolling will take it's toll Ross..............!
but you have stamina to continue through the merger........... ;()
All the best (and that should be applauded........... :()
Said Petro............. !
I remember when our "Koot" took the reins, there was a twitter calamity regards Lenigas offering to take back the co. :()
All the best (a moment in our history that Ross highlighted when invested ............. :()
Petrodollar
One man’s bias is another man’s objectivity. They way I see it too many folk are simply swallowing whole the BPC BoD’s aspirational take on the ex-CERP assets. That is their lookout but I would urge them to do their own research.
Star - I'd like to congratulate you for all the work you've put in on this board, particularly since the merger . You've had to contend with some die hard BPC dissenters who didn't share their own BOD enthusiasm for the merger plus the invasion of CERP trolls, many of whom have their own distorted version of CERP history readily to hand!
You started out from a base where trolls and dissenters were arguing CERP assets were virtually worthless - now even worthless troll Irene is suggesting they could be worth 0.5p in loss making form, which nicely sets up the debate for their value should they produce say £15 million a year ( cue slide 21 ! )
The trolls are getting more and more desperate here - even rossannan is talking about copper bottomed CERP assets - people have to ask why are these trolls so desperate to discredit CERP assets - they don't seem to have any answer as to why the drill team on Saffron 1 were prepared to drill Saffron 2 at their expense in return for a share of production do they?
Keep up the good work Star - you're winning and they just don't like it !
Rossannan. You appear to have been traumatised over the years with CERP and take any positive projections by the BoD relating to ex-CERP assets as pie in the sky. This is your right. As a reminder, the BPC BoD is a whole new team who did due dili prior to merger. If Leo Koot was clever enough to have sold to the BPC BoD the CERP potential based on hyperbole rather than fact, he probably has almost supernatural skills. And a huge future asset to the BPC team as he could even persuade Greta Thunberg to do a JV farm-in using Exxon cash for $250m next week.
Aspir: Have we been introduced as you appear to be talking to me as a friend in need of advice? I’ve been investing in stocks and shares for 5 decades, probably when you were still taking a sh+te using a potty. You allege I am naïve, implying my posts are misleading for newbies, and furthermore provide no evidence or links to back you opinions which you state as facts.
If I repeatedly posted hype ramping cr+p such as …’ me finks in a week the SP will soar soar soar to 25p, £1 pre-spud, and £5 on Christmas day 2020 when BPC finds a trillion barrels of oil. Oh what a whopper…….’…… I think your post would be valid. However at this time, without causing offence, your post is somewhat ridiculous and therefore an irrelevance. At 11:00 this morning, you stated ………….. ‘companies with 3000bbopd, and cheap fast expension plan to 6000bbopd in a year and transformational assets are valued at less then 20m pound’…………… Please prove evidence and links proving this. And while you attempt to do so, which I doubt you can, remember BPC is a once in a generation opportunity because:
1. The mega Percy-1 opportunity. (and if successful what other middle eastern size oil-fields lie nearby)
2. The low overheads if it is a duster. BPC is NOT Tullow oil where it has thousands of staff on the payroll. It has around 40, NO debt, NO loss making rigs. Etc, etc
3. Ex-CERP asset potential which even if 50% below BoD projections by end of 2021……….. will IMHO fully hedge the bet in the event Percy-1 is a duster at current SP.
In4cedros/Petro$ and others: Thanks! .
I wish everyone well….even Rossannan and Aspir.
Starchild
https://www.lse.co.uk/profiles/starchild/
Star.............. :) you'd be surprised...........!
"Greta Thunberg to do a JV farm-in using Exxon cash for $250m next week."
we capturing CO2 atm in T&T, the little lady won't like the outcome, but the economics escape her and her team............. :()
All the best (lovely..............smile........ :()
Star, aspir copied the 3000 bbopd....... From my post, im invested in about 20 companies and follow about 40, i wont use this board to ramp my other investments but if you want more info in that regard ill be happy to provide it on the private channels.
I also remind you on my posts even though we were not introduced but that is out of respect to the research and information you provide.
We can all learn from harel (hero in my eye's)............. :()
for 1. don't trust me ever............!
for 2. don't trust a fallen prince from a far out land, offering £200m for you account no.s
for 3. don't trust harel........!
All the best (simples......... 1,2,3......... :()
I dont think we need to be upset by other posters opinion. Just accept them and move on. There are a wide range of opinions from downright cynical ( Irene, Ross ) who think BPC is a "dream company " the share price is never going to rise and its going to fall flat on its face. To many posters who are looking to take our pre-spud in the event of a rise and are doubtful of a successful drill on P1 but looking to make money pre spud, to other posters who are a lot more optimistic and see this as"a once in lifetime opportunity" . Everyone adds value with their comments and research and its good to get a wide range of opinions. One thing I would add personally is I would like someone to qualify for me the following:
1. How many barrels of oil has been produced and sold by CERP (or a different trading name) in the past 2-3 years?
2. How many barrels of oil has been produced and sold by BPC in the past 2-3 years?
3. Apart from the intangible assets of the licences what assets did BPC have prior to the CERP Acquisition as I cannot see very little in the balance sheets ? I may be missing something.
4. There are six board members according to the official website: Bill Schrader, James Smith, Simon Potter, Adrian Collins, Ross McDonald and Leo Koot. All but one of these directors is a NON- EXECUTIVE Director. The one exception being Simon Collins. Does anyone find this unusual? What personal stake or shareholding do these non-excecs have in BPC ?
5. Why are the contact numbers on the BPC website not working? Nobody has answered this yet and I am still to receive a reply that reassures me from anyone. Unless someone can prove otherwise I very much doubt anyone is working there.
6. Has anyone ever met, had discussions or seen any presentations from anyone other than Simon Potter or Eytan Uliel ? There are 18 board and senior management but it only seems to be Potter or Uliel who represent the company publicly.
Apologies Point 4 of my post at 16.24 should read Simon Potter not Simon Collins.
Harel: Shalom. I welcome a PM from you so we can discuss stuff offline in next few days as we are both serious investors.
Besties,
Starchild
https://www.lse.co.uk/profiles/starchild/
GG
I wouldn’t put me in your downright cynical category - I have 1M BPC shares and the equivalent of a further 250K BPC shares in spread bets backing the proposition that I will at least double my money on or before spud. And just because I’m not up for the high risk/high reward gamble doesn’t mean that I think BPC is a "dream company" - there is a decent chance of the gamblers winning here and a smaller chance of them hitting the jackpot. I just find the balance of risk and reward more attractive on the route that I’m taking.
Ross - Apologies - my error totally.
Starchild
Not traumatised but schooled. Schooled in the difference between predictions and aspirations. It is a really important to identify what are merely aspirations and, in particular, not to treat them as if they offer you some kind of safety net. Seriously.
GG
No worries.
SERIOUSLY rossannan you'd have to value CERP assets as NIL if you didn't think they offered ' some kind of a safety net ' - you're entitled to believe that yourself but good luck convincing readers here - if CERP assets are so awful why do the drill team for Saffron 1 want to drill Saffron2 at their expense in return for a share in production - NO PRODUCTION MEANS A SHARE OF NOTHING . Why did PRD sign up to pay the development costs of CO2 project on TI in return for share of production ? Why are Heritage offering Enhanced PSC to CERP on Goudron ? Why waste time trolling CERP when you could have 5 bagged TXP if you hadn't had a hissy fit cos the management didn't perform in accordance with Fantasy Oil & Gas Manager moves?
in4cedros - I see you haven't lost your propensity for spinning a yarn or three. I think you must have taken up a bet with someone as to how many times you can squeeze the word troll into your posts as you seem to think that saying something often enough will have people believing you know something.
Have you mentioned yet how you championed Neil's US$25m oil swap deal with BNP Paribas that took LGO to the brink of extinction when LGO broke the covenants embedded in the agreement? I remember warning you on many occasions that the deal was unsustainable but you would have none of it, that is until you started to write your version of history.
How is your book coming on by the way? You should call it 'The Trolls Guide to Trolling' or 'The Post Office Book Investment Guide " as that is another of your favourite musings. After 10 years in the making I expect it is somewhat verbose and quite likely repetitive. I hope it's a real page turner. I look forward to finding it at the top of the fiction section on Amazon and hopefully you will be asked to write a screenplay for the inevitable movie on Prime Original. Who will you get to play you? Borat might be available, or Rudy, so take your pick.
I wish you well and keep up the good work. I expect you are still miffed that Joanne Rowling thought of Harry Potter before you. Still, you have chesh who could be a boy wizard of sorts when he isn't day trading or attending to fuses, and what part will Starchild play? I expect he will be a good guy, fighting against the infamous Irene, in the battle for the final solution.
One last thing, does BPC strike oil or not in your book? Will Koot hit the 500m MC or will the good ship BPC hit an iceberg? All to be revealed in your soon to be revealed, riveting read. I expect Jeff Bezos will be in touch in due course to finalise the details of the contract. Joanne Rowling eat your heart out! ;)
Petro dollar are you still holding any Matd shares? Apologies if you have already answered and I missed it. Cheers.