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My thoughts post ops update were this could be finished or maybe Gil and team would come through but was neutral in the outcome.
Well am very happy now, yes a wait till drill 4q or 25/26 but wow that's a good farm-out Sub 100p on spud then could be very happy days.
All or mostly junior explorers are binary. By definition they are a bet on their acreage and the odds improved significantly on the back of yesterday's news.
I have been very critical of Gil in the past and I still think he deserves that criticism. However to be fair to him he has been keeping his head down of late and has delivered on this. Fair play.
This is now just a matter of time until the cost free spud .
JWBellamy
You're posting as I'd expect from a J Beadle if he was still alive.
We are £35m MCAP, about yo have $20m cash on balance sheet and a carry worth up to $216m from one of the largest Majors in O&G globally.
This is an exploration share, they are never going to be a producer without partners. They have that now.
Total have the benefit of their local discoveries and how the seismic looked there and will have looked to see how this is similar to Ecos acreage. They've seen enough to give Eco and Acrica Oil significant carry and become Operator of the licence. Quite how you think that isn't worth the current MCAP is frankly daft in my view.
I'll be adding significantly here (for me) over the period up to drilling results.
It’s not. Point as follows..:
Eco has a market cap of £35m and that’s not fully diluted.
You have a tiny stake in something now that is totally binary. You have no production and cash will drain. It’s not hard to see why holders are selling
What utter drivel. Have you even read anything about the resource? Clearly not....
That’s why this is dropping and holders been trying to exit since yesterday
With the market cap being what it is already, eco will need the motherload to come in to justify a higher valuation
So, ECO announces $20m cash coming its way and 2 free drills and SP ends up lower after 1 trading day. Only on the LSE. NASDAQ listing would have seen this triple...
Country is Donald Ducked...
Buy trade of 9 shares and MM drops the price by 10%!
I guess they just woke up to the fact that on TSX it dropped by 10% yesterday afternoon.
Berenberg valuation (125p) makes perfect sense and is likely based on deals such as Chevron’s proposed acquisition of Hess for 59B$, deriving $/bbl and assuming (possibly) a 1Gb net unrisked resource base in 3B/4B.
Can't help but feel Total and Qatar giving Eco the rest of the WI in Guyana at no cost, was part of this deal, unofficially.....
Eco did much the same before the 2b drill. 18p 1 year out to 45p during the drill. 50p plus post spud this time looks more than reasonable given the bigger potential in the CPR and the fact that Total are doing the drilling.
Perhaps interesting to follow Sintana Energy's share price development from summer -22 to the start of drilling in November -23. Nothing is exactly the same, of course, but it gives an interesting angle. 200% after drillstart, slowly increasing to that date. Feel free to check news under that period of time.
You might say that a farmout in Guyana would make a difference. We will see.
Did your mates at Aces bar tell you all that. Lol....
As we know the farmout was competitive with Total / QE winning. This was the best deal for Eco. They have the cash and remain with a meaningful share of the block.
The great news here is the new Operator will be Total. They have as a good, as anyone, understanding of the region and play and they have infrastructure in the area. They also have rig contracts for rigs which are / will be operating in the region.
Eco will only realize true value on firstly drilling and then finding commercial oil.
We are finally off to the races in the Orange Basin. The share price is meaningless right now for medium term holders. There is little doubt this will be multiples of today’s share price when we spud the first well.
Risk does remain. The Orange basin is little explored and the play not that that well known, never mind knowing where the sweet spot is.
Risk-reward with Eco. Not for pensions or orphans but the reward is massive.
Risk reward not so good no when looking at the market cap
As far as i can see there is no confirmation on drilling timescales, hence muted reaction so far
Find it interesting that our CEO points out the Guyana farmout, specifically, as the next big news this year.
Milestones in the form of regulatory decisions will occur continuously during the year in 3B/4B, these are events that are now in Total's hands. For ECO, we can get the upside of this, but management may concentrate on other farmouts.
Anyone, What is the last official close date for the data room in the Guyana block? Biginning of April?
12X potential opportunity. This can go huge any time. Time to buy and hold for substantial reward.💪💪💪💪💯💯💯
The cash is quite an important bit, Eco is less at the mercy of other parties in terms of activity in Orinduik.
This should hit 30p + before the drill but the time to completion and time to actual drilling is some time away yet. Good to see the team get a win.
If they're drilling major targets, 6.25% of the first drill could be much more valuable than 15% of Joe/Jethro was considered to be 3.5 years ago.
*move to clean up
As I read it. $8m cash to Eco on completion. Another $5m when the permits are granted and 6.5m on spud. MY take on the market reaction, or lack of it is drilling is at least 1 year way. Only impact here is $13m this year. Relatively immaterial to the SP, so no rush to pile in.
Also, I suspect will see AOI more to clean up its stake in ECO and that could be anything from purchase to sale in the market, both SP moving events. I would think this will happen reasonably quickly as they must have been discussing it for a while knowing that this was going to happen.
Still $20mil decent amount of cash
Correction:
Maximum transaction value is, including carry, of up to US$32.1m to Eco, which includes payments due to Eco from Africa Oil and Ricocure, not the 31 MUSD I wrote below.
Agreed, 6.25% in this huge block is also reflected the fact that ECO chose the money track; 31 million USD in stages.
The money trail strategy indicates that management sees a settlement in the Namibian blocks and or other strategic movement. ECO will now, once again, be an actor in the international arena for new projects.
ECO has, in practice, been a one-project company, another farmout lifts the company past its previous potential when it was, only - in practice, a company active in Guyana.
Also, now we benefit from Total bying into Tungsteen explorer.