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Back from a nice little break in CA. Can't believe how expensive it is now !! Need our Casper to start delivering the 'shareholder value' they've been promising for 18 years!
As has been stated MANY times, there's a lot on the go that could finally improve the NAV considerably and create that shareholder value that is long overdue.
23 Financials will be out in June and we're going to see profitability BUT liabilities increasing due to increasing loans. Now is the time to turn that tide and reverse the dilutive process by generating cash. The next few months should see inflows from various sources.
Firstly the B8 contract. The licence approval could be imminent and if so, we can expect to see loan repaid and the first revenues from existing production, to be followed by the testing on the 2 new deeps and hopefully some success at long last.
Next to the CE. A couple of links below show that Abay well is going to happen and hopefully that means the CE is still the preferred drilling solution. If so there's $10m+ coming our way and probably more as the drilling time allocated is probably too optimistic so I'd be expecting more than the 10m profit.
https://emea01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fqazmonitor.com%2Fnews%2F2916%2Fhow-kazakhstan-revamps-its-subsurface-management-in-2024%3Famp%3D1&data=05%7C02%7C%7C15e84f1eb9ac4fdedf9208dc6d86acfe%7C84df9e7fe9f640afb435aaaaaaaaaaaa%7C1%7C0%7C638505672400548442%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C0%7C%7C%7C&sdata=t57PmwrWRXu625JRAQn7%2FV%2FiSnmHt0oFIehSwyeFibg%3D&reserved=0
https://interfax.com/newsroom/top-stories/101875/
Both recent publications and stating that Abay exploration still planned. Will success at Abay mean more work for CE or will Casper trade cash for a small % of the bigger projects ?
Next the shallows sale ? They've announced the possible interest in the shallows yet they're completing 803 before applying for a production licence on an acreage ie the BNG deeps that has produced zero to date. Yes, all wells bar A8 have flowed but could any future sale include the deeps ? Either way, there could be a significant injection of cash, my concern would be whether it's more than the NAV. The big question, are Casper capable of delivering deep success ? I'm not convinced and maybe their success will come from buying and flipping assets for a considerable profit ?
Other sources of cash ? increased production of course and who knows, 803, Block 8 or any other deep like A5 would obviously transform the landscape but that's not immediate.
Our new Camel acreage at WS. The oil is allegedly seeping to the surface and it will take little time to drill a well and if successful, cash inflows could happen far sooner than at MJF. Infrastructure far better too and less transportation costs improving profitability.
If they do generate cash then it gives them the opportunity to grant a special divi or
Contd
If they do generate cash then it gives them the opportunity to grant a special divi or who knows, they may go into share buy back mode.
Next few months will be defining for Caspian. We're getting to the conclusion stage on many assets and plenty of news in the coming days, weeks and months. Time to start generating cash to reduce those liabilities and if they do sell BNG shallows or even the deeps, what do they do with the cash ? I suspect that they buy more assets, easier targets (allegedly) like WS where hopefully their skills snd capabilities are a match for the asset to be drilled.
SP @ 3.4p ? regardless of success, the sp will run again as peeps talk it up as news nears. Hopefully this time the hype will be met with positive news that finally strengthens the foundations. If they do deliver success, you can expect to see ridiculous hype here, long overdue for those invested for years :)
West Shalva, is to repay the concert party what they lost on the sale of the Caspian Explorer.
$15m, $10m in stock held in the accounts of the UAE company and $5m as a cash bonus to spend in the UAE on Golf.
25Sq K of camel and an old seeping well of water and oil that the previous owner didn't plug and abandon correctly.
The rest of it looks very decent at the moment.
SmartyP1,
Since the MJF for sale news was RNS'd I've been thinking about the 'what if they decided to buy back shares option' having a huge cash pile from the MJF sale plus CE dosh.
If they do get any where near $200m for both MJF shallow structures they could easily buy back say 1 billion shares for $50m at 4p per share today, though by the time that happened the share price would most likely be in the double digits range with what's going on in the short term, so probably a lot less shares would be bought back by then if they took that option.
My guess it once they've finished with 801/A6 Deep Wells (this year?) the MJF dosh will mostly be used for their BNG appraisal program and Block 8/ WS drilling campaigns and possible mineral mining/ wind projects as indicated.
I hope an appraisal program fast tracks a merger or take over.
What's also interesting is CASP haven't done a new CPR for the shallows in 8 years? so how many 1P/2P Reserves do they have now - the date room is open so may be the buyer could have a 'potential' guess?
WHI have 1P/2P Reserves at $8 pboo when CASP were getting $16 pboo for local sales, they are getting $33 pboo today and can now sell the shallow oil internationally with 70k lifts per months, giving them more than $33 pboo.
I'm thinking my $200m guestimate for both shallows could be too conservative.
If a sale goes through for the shallows we'll get to know what KO is asking for 1P/2P Reserves per barrel.
would the give us an idea of what the BNG deeps
......A new deep CPR next year would then give us an idea of what the BNG deeps 1P/2P Reserves are worth to boot.
Somm,
I don’t believe we get anywhere near $200m for the shallows but happy to be proved wrong. Applying for a production licence on the deeps when there’s nothing flowing as far as we know. A5 flaring ? if that we’ll actually flows then it’s a game changer but I have not read that a side-track is underway ?
I do believe they generate cash over the next few months from CE and some drilling success at 155, B8 loan repayments and maybe production? Share buy backs are certainly a possibility as are the acquisitio. Of new assets but hopefully not all from the Oraziman portfolio !
It was good to see extension of options and new award for Shin. Strike price too low but will be good to see them exercise the option.
If they don’t succeed at the BNG deeps, the whole acreage could be sold or maybe partnered with somebody who has the skills. Post salt drilling is obviously not easy and if there’s continued failure, sell it all to someone who can or get someone in who can and share the spoils.
Been here too long and the next 3 months is hopefully going to tell me all I need to know, hopefully it’s the right news .
Market well bid currently at 800 v 200k on the ask.
Next news ? B8 licence agreement maybe ? CE cash ? Or 155. 803 probably still pre salt and who knows, maybe a surprise re MJF sale .
What? Caspian Exporer isnt sold is it?
SmartyP1,
Could you please explain what price pboo you have for 40m 1P/P2 Reserves and explain how you come up with that $ pboo? with new wells/ Dolomite that could be higher now.
I've done $5 pboo calc's, WHI have said $8 pboo, WHI have said shallows are worth 8p - that's also over $200m.
They are now getting $33+ pboo not $16 and can export the shallow oil for a higher price.
It's so annoying when someone says 'oh I don't think that they will get X....' without even trying to back their comments up or even understand what they're saying....
Block 8 was pumping 800 bopd down from 110 bopd (now stopped until license renewed) and was valued between $100m-$400m.
BTW.
The A8 Deep Well did flow 120 bopd form one of the three intervals, but was deemed uncommercial.
The A5 Deep Wells rig (G40) was onsite 6 weeks ago, as I've said they haven't included individual spuds taking place for sometime, they've only been letting is know in a full Op's Update if a spud has taken place, the 155 Shallow Horizontal Well for example when it was at 1,000m - by my calc's this well should come in nearer month end.
Somm,
I can do the math re valuation but I believe that it’s a depleting asset that they’re struggling to develop as horizontal approach is obviously failing. As you’ve stated, no CPR for ages and hopefully that’s rectified come some production success in the near term. Our CC has also stated that indicative offers were significantly in excess of carry value of c $50m so I’m reading between the lines and I don’t see it being x 4 but as I say, happy to be proved wrong . I’d also have expected to see the sp fly if investors believed that were to be the case .
The CE is probably giving them exposure to bigger players and bigger projects and maybe these offers are coming from larger organisations. If that were to be the case I’d expect them to want more than MJF so I suspect it’s not the bigger boys showing interest.
Lets play, whose sold a few and whose loaded up ...
Being out on an A5 drill, Caspian Explorer contract and a MJF sale, that could be a mistake ...
Certainly not a time to be selling and as far as I can see over the last couple of weeks the action is buying do who’s selling ? Today is 99% buys, even the initial trades early doors are buys. Regardless of drilling success, this next few months should see a cash injection and definitely needed as the 23 accounts re liabilities will demonstrate. So will move north from here BUT we need to see solid news that improves NAV and get new buyers into the game.
SmartyP1,
No doubt the Reserves will have dropped over time, however the shallow structures size will have widened with further out wells and Dolomite structure.
CASP indicated there were more than one interested party in the negotiates, if there are multiple bids (I remember Cove Energy bids between Shell/ PPTEP were fun to watch) being tabled the price per barrel may not be so much of importance as to the replacing of the bidders Reserves - Potential Reserves and having a foot hold to bid on the deeps later.
Three of the worlds top ten oil companies are around the corner......
Somm,
I believe interest will be coming from smaller players, those who are probably struggling to get production licence as opposed to the bigger boys who won’t have that issue. If any sake extends outside of the shallows then yep, could be bigger players with more money and more capability to exploit the opportunity. I’d welcome a larger partner to get involved in the deeps and share the spoils as currently we have zippo, better to get a lesser % now as opposed to continuing to feed the money pit. If KO got the right price for any asset owned, he’d be mad not to dispose of it.
Re any CPR, we are well overdue an updated version so hopefully that will happen come drilling success in the near term.
SmartyP1,
The production license is owned by CASP's trading company, it won't be included with the shallows sale, however if someone does buy the shallows they will most likely use CASP's trading company to sell the oil.
The Majors that are involved in Tengiz, that could be in the fray for the MJF shallows, will have the knowledge of how to crack the deeps so I wouldn't rule a Major out, plus the big boys will have got their foot in the door for when KO is ready for a deep sale.
Don't forget CASP will have spent around $70m thus far developing the shallows so to accept $100m as you suggest is unlikely, imo.
To rephrase - the trading license won't be sold with the shallows.
WABU, no I think you have got the wrong end of the stick, CE hasn't been sold ..........Caspian Explorer:- Prosperity Petroleum, a UAE registered holding company for the CE, All cost written down in previous financial statements so that its carrying value now $1.7m, Originally bought for $25m, issue of 160,256,410 shares (Then 12p per share) Awaiting contract details/dates 2024 contract with ENI net profit $15m
Re the CE,
Planned drilling is for 62 days * $150k per day = $9,300,000 plus a 15 day possible delay is factored in = total $11,550,000.
So very unlikely to get anywhere near $15 million, especially if drilling is faster than expected.
If they’re using caspian drill crew then I wouldn’t bet on it getting drilled on time!!!
There was obviously a seller in many today as the market changed mid afternoon and the do should’ve eased north with 1m buys and no sells. Buyers and sellers, that’s what makes a market but it would be nice to see the action in the double figure range. I believe that may be coming soon ;)
Badge,
Any idea which new they put on the boat?
Bear in mind with the artificial jack up island the boat is going to sit on and drill 2504 m through the middle of, this is the same as an onshore mjf type drill...
Starts in under two months.
7uck me, we are going to have some summer here.
A5 to report then onto A7.
Boat.
Mjf 155 well to report.
South yelemes 806 to report, then 2 further drills on S Y.
Block 8 relicensed
Sell shallow field.
Double figures - easily.
Which crew ...
Summer drills cont ..
802 to be farmed out ?
803 to drill
Shhhhh, I'm still accumulating.....