George Frangeskides, Chairman at ALBA, explains why the Pilbara Lithium option ‘was too good to miss’. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Or you could wake up one morning and it’s up 50%.
The SP goes down ... and I'm waiting on the sideline.
CAD 0.165 is too high for me.
But no catalysts in sight that could/might drive the SP higher. So, I'm going to be patient, wait, wait, and buy when it's much lower.
Maybe we should not lament the low sp. Over the years we've learned the gas is there and now we know they can get it. With new wells coming very soon it seems like a good time to buy doesn't it ? If this thing drifts lower than .15 cad I believe I will take on more.
Harford- and looks like we will be sitting on dead money for awhile. Can't even hold the current price. Pretty sad. I think 90pct of us here have to admit we have no clue when it comes to this share price. We all thought the great results would lead to a higher share price and we were all wrong.
Camelot1, I remember Schaefer's article too. It's still out there:
https://oilandgas-investments.com/2017/oil-stocks/this-country-is-caught-in-a-catch-22-with-energy/
Makes you realise how long we've been sitting on dead money here.
Cam, I think this is where too much talking has hurt confidence in what is later reported. We nailed it. But I think the market wants to see consistency before they start throwing money at the stock. Or confidence from another source. I think a private equity raise with respected investors will help. FOG has been plagued by so many set backs. Some self inflicted and some not. When I saw those numbers I thought for sure we were going to get a nice lift in stock price. I can’t really explain why that did not occur. But I still think this is the most exciting time to be in FOG. And I think confidence will build. I think 12-18 months and we will be having a different conversation. Things can change fast. If they nail these next two proper wells do you really think we will flatline? They got great numbers from a shorty. But the market cannot ignore really numbers from a proper well. Just my two cents….which is worth less today than prior to our stellar news….admittedly.
Buckeye Buff : No need for your rubbish talk , what I didn’t agree with “ Ginger Ale “ about was he was asking us bulletin board holders , when he should buy in . As regards your other remarks regarding me and Falcon . I have already said it to act the fool , wise up and grow up GLA
I can remember back in 2017...an Investment Newsletter authored by a Canadian...Keith Schaefer put out an article on Falcon. It was in response to the Amungee 1 well. The well flowed for I think 59 days at around 1million cubic feet per day. We now know that was even after the fracking was screwed up. He thought that maybe Falcon could be bought out by Origin prior to stage 2...which took the stock up in very short order to 49 cents cdn. So why now mister big shot IMATIRED OF THIS can you explain the stock performance when the result comes in at six plus this figure the stock does nothing....take your time to respond please....we can't wait to hear from you....
Odie -- one thing for sure is that we don't EVER want to have "good news again" with Falcon!! -- as I will go broke on any more good news -- sheesh
We are down 25% from the highs on absolutely stellar news on flow rates from the SSH1 well and just as soon as we have our first real confirmation of commerciality -- down down down this stock goes. My only take is that there has not been any promotion at all -- with only long term holders and no new buyers even remotely interested in a 500% return over the next 18 to 24 months. There needs to be the same as in prior years -- when lots of dog and pony shows drummed up new investment banks and new investors -- as we have none of that now.
You would think that there would be many oil and gas investment houses that would seriously want to have a piece of what the Northern Territory's Chief Minister is calling a game changer for all NT residents, but not a single one!!
I don't understand the lack of increase in SP. Somebody evidently has info that we all don't have, or so it appears. It's just frustrating watching it with the news that came out and the Q&A that POQ had. Heck, just some movement back into the .20 cent range would be a positive for most of us investors.
About me: I'm not an expert in the oil business, I do have a sizable stake in FOLGF and have a few years to hold on. Best of luck to all.
Good substantative posts Newt. Cam, I share many of your concerns. Gingerale, everything should be more positive, but Falcon's history has not been shareholder friendly. Potential dilution is a major concern. As BigOnes always said:"you can always buy Falcon cheaper." As most others speculated we should have seen a better share price move on such positive news. Regarding Healy: He never adds any substance and instantly responds to any negative Falcon commentary & has proved to be a company shill, extremely defensive of POQ. I believe there's an 'ignore' filter you can use, but I get a laugh when I see how quickly his defense appears.
Smallfish9 -- I have the same request as Oilcountry99's question below about a reasonable valuation in the next 12 to 24 months -- (knowing that there are a lot of unknown variables that can change any estimate of that valuation in the next 18 to 24 months).
Here are a couple of paragraphs from my earlier posts (in reference to POQ's old chart from 2015 and the four stages of acreage valuations. From your perspective, and given the current pricing for nat gas in Australia -- do these valuations have any current validity -- when Falcon finally has some serious buyers looking at the DATA room, like Inpex or EQT??
"If we look at JUST the one million acres in the Core deep blue area of the Beetaloo (after "production" is happening by 2026) -- and we give Falcon that same valuation of $4009 per acre for Falcon's (22.5%) 225,000 acres share of that one million acres -- we would be looking at $900,000,000 US to Falcon's side of the ledger".
"We might be looking at a larger valuation -- if a buyer wants all of Falcon's entire net 1.04 million acres -- which could move that sale to something closer to $1.5 Billion (maybe if we have a nice bidding war with more than one suitor)"?
"If we get to that "Appraisal" level by producing and selling gas from the Dark blue core area of one million acres -- then hopefully some of the major oil and gas companies will see the prospect of drilling one or two thousand wells in that Dark blue core area as being repeatable across that entire one million acres and pay up $900 million for Falcon's share of that Core area".
"There is very little chance that any major oil and gas company would put that same $4,009 per acre valuation on Falcon's remaining 800,000 acres (out of Falcon's net total of 1.04 million acres in the Beetaloo) as there won't be any production coming from those shallower areas for many years to come. That would indicate that on that same valuation chart from 2015 -- that additional 800,000 acres might be assessed at the "Undeveloped" second stage (with some flow tests, seismic logs etc. but no producing wells). That chart shows a $844 value per acre -- which could potentially increase Falcon's selling price by another $640 million -- which might be a bit of a stretch but still possible"?
All of the investors that I know of and speak to were expecting a much greater rise in the share price following the news of last week. I have said that they were great numbers and they are. In the markets when companies release good news there is generally a pretty good bump up in value of the stock. That's basic. But when "stellar" results come put and the share price basically does nothing ...then something is not right. Where should we be trading? Much higher....much higher...so why not? Is it being held back for a hedge fund to come in on the cheap or another issuance of stock to Sheffield...maybe...but again this is unfair to the rest of us who have been patient. The notion that we don't have to raise capital is not accurate in my opinion at all. The next 2 wells will cost probably $60million...and we need a minimal of $15million to fund our share. Could it also be that POQ is having discussions about a sale to someone like Inpex...maybe and that could be a reason not to raise cash. But if he chooses to press on he needs money and he knows this despite what he indicated on the Investor Meet. Even their own analysts have a price target of 4 times where we are currently and I think that is cheap. I think the BOD runs the risk of a great deal of backlash from shareholders who are feeling disenfranchised. And JF Healy grow some manners....go pull the nails out of your eyes. Maybe you need a decent meal as the offerings at the Dublin dump must get pretty boring
Smallfish9 - you clearly demonstrate a deep understanding of the play and valuation. Assuming the next 2 wells repeat the results recently announced, what do you think FO would be reasonably valued at?
falcon oil & gas (fo.v fog.l fac.f) announced that strong ip30 day flow rates have advanced the beetaloo to pilot development. the shenandoah south 1h well in ep117 achieved a commercial ip30 flow rate of 3.2 million cubic feet per day (normalised to 6.4 million cubic feet per day over 1,000 metres), significantly higher than pre-drill expectations.
flow testing of the shenandoah south 1h well will continue for the next 60 days to achieve average ip90 flow rates to better determine the well’s estimated ultimate recovery and the flow rate results are expected to be announced in april 2024. the beetaloo jv partners of falcon and tamboran resources (tbn.ax tbnrl) will now progress development plans for the proposed 40 million cubic feet per day pilot project at the shenandoah south location.
the project is expected to require six 10,000-foot development wells initially to achieve plateau production of 40 million cubic feet per day. drilling of the first of these wells is planned to commence in q2 2024 and the jv is targeting first gas in h1 2026. at the end of january 2024, falcon held ~us$5 million in cash and has the benefit of a further a$16.67 million gross (~us$2.5 million net to falcon) carry to support immediate activities.
falcon is funded to commence drilling of the initial two wells in the program and will evaluate opportunities to support funding the remaining capital commitments to reach first production, including issuance of equity and/or debt, evaluation of pre-payment for gas from the proposed pilot project and potential farm-down opportunities.'
https://*******************/subscribe?utm_source=email&utm_campaign=email-subscribe&r=tp4oz&next=https%3a%2f%2f*******************%2fp%2foilman-jims-letter-3-march-2024&utm_medium=email
S9. Thanks for the additional insight into things to come
Per acre valuation metrics are useful where:
-development is imminent
-development will capture the majority of the land base
-land acquisition is competitive (ie land sales/privately held rights
-a significant number of transactions guide the pricing
Its an interesting exercise, but the factors above combined with their dated nature affect the utility.
Developing plays are typically valued at rude 1P reserves metrics and more kindly 2P reserves levels. 2P is often cited in acquisition or divestiture. The 'tint' on the 2P value tends to be the number of legitimately developable wells relative to the 2P reserves. IE nearly fully developed lands will hold lesser 2P metrics vs very early stage developments.
Given the lack of capacity to produce in the basin at this time, Contingent Resource is the most appropriate metric. Contingent means, in this context, that the pipeline and facilities are still not available. Upon availability the volumes that are associated can be converted to a more highly valued proven reserves class.
The earliest stage measure is Prospective Reserves, this is the reasonable (2U) volume that will be recovered in the long term.
My point is that per acre pricing is really tough with this much land at this early stage, prospective/contingent resources over this much land can have a very wide spread between conventional structural plays and unconventional plays like shale.
We are entering a phase where a reasonably developable chunk of land with 17-27 TCF of 2C has been identified. The next six wells (mainly the next two) will allow the booking of said 2C and deliver this valuation.
In time a 2P or Free Cash Flow valuation metric will be appropriate l, but that is into the late 2020's and will probably still be inappropriate due to potential scale and LNG opportunity.
Ginger Ale : my apologies I did not mean to be disrespectful, and was surprised at your response. Always remember it takes a wise man to act the fool , best of luck to to you .
Healy:
I don't recall saying anything DH.
I was merely asking a question so that I would be more familiar with the financial situation so as to make a decision as to when to buy back in.
Perhaps it is you who should be on the ginger ale. Obviously what you are on goes to your head too easily.
Don't worry, I won't be posting again with abusive people like you around.
Ginger Ale: Stick with the Ginger Ale , if you have nothing to say , say nothing.
Thank you for the comprehensive reply, newtofo.
I was not aware of all the finer details of the various transactions.
I had just hoped the cash was sitting in some contingency fund or other, that might be diverted for future cash flow.
Your explanation puts that one to bed.
As cash is now so low, I suspect Mr. Sheffield will come to the rescue an buy in for additional 10% stake at a discounted price around the 10p mark. He paid 14p last time, but he may not be so generous this time.
I myself will be buying back in once this financial puzzle is resolved.
Note:
Beetaloo geology as targeted and discovered along with present known information across the organic horizon(s) for estimated and recoverable Gas in Place dictates variations in per acre value. However, the industry tends to adjust that value at the front of an estimated per acre valuation recognizing that each acre in real time will not deliver equal organic returns. So, each component (see below) can vary up and down. We should assume the posted numbers by Falcon per acre (2015 Component Estimates) are driven by ** US and international industry comparisons and stand to be valid estimates per acre for that time (Various Years pre-2015) as market values defined them. It should also be noted that current per acre values will vary based on “present” time gas market demand and current market values. So, current per acre market value for Falcon’s net acreage may in fact be higher now given the demand, need and current value at the well head driven by local and regional market demands when compared to these 9 year old components for gas acreage value. The plan was to Monetise in 2017 or 18 “based on success” per the 2015 company presentation. We now know the plan is to progress into pilot production i.e. Production From Horizontals to enhance value then monetise. HMMM!! Will it now be more valuable per acre?? Fair Question. Keep in mind that all of the basis for valuation at “Appraisal” comparison entities were each still in need of infrastructure. Perhaps not at the level of likely NT infrastructure demands but the common theme is they were not producing and had to pipe, road, permit and sale, as well!!
**$4,009 / acre1 (Appraisal)
• Statoil / Chesapeake Energy (US) Nov ‘08
• KKR / Hilcorp Resources (US)Jun ’10
• Hess / Consol (US) Oct ’11
• Aurora Oil & Gas / Eureka (AUS) Aug 12
Falcon Estimated 2015 Acreage Valuation Component by progress:
Undeveloped $844 / acre:
$844 X 1,040,000 Net Acres Falcon = $877,760,000.00 US
$877,760,000.00 / 1,044,347,425 Falcon Common Shares Issued = $0.84 US Per Share
Appraisal $4,009 / acre:
$4009.00 X 1,040,000 Net Acres Falcon = $4,169,360,000.00 US
$4,169,360,000.00 / 1,044,347,425 Falcon Common Shares Issued = $4.00 US Per Share
Production $18,489 / acre:
$18,489.00 X 1,040,000 Net Acres Falcon = $1,922,856,000.00 US
$1,922,856,000.00 / 1,044,347,425 Falcon Common Shares Issued = $18.42 US Per Share
Something to think about. Good Luck to us long time birds. I think the future is bright for us all!!
GingerAle, Falcon's full original nine well free carry from the original Origin deal ended with the SSH1.
Falcon got an extra $3 million contribution out of Tamboran's pocket on the Amungee 3H one km horizontal that H&P completed last November ($3 million out of the $6.75 million that POQ negotiated as a Tamboran extra payment towards one well in 2023 and one well in 2024 -- when POQ acccepted the revised Tamboran/Origin deal). However, the cash balance for Falcon has gone down significantly -- as Falcon still had to cover their remaining 22.5% from both the drilling costs on the Amungee 3H along with 22.5% of Tamboran's G&A overhead (which is generally a ridiculous amount of G&A).
Falcon has the remaining amount of $3.75 million Aussie added/extra contribution by Tamboran -- that can be used anytime after July of this year -- so that will help reduce Falcon's 22.5% of the next two 3 km Pilot wells . Falcon will still need to come up with another approximately $15 million for Falcon's remaining 22.5% of the next two Pilot wells -- plus 22.5% of Tamboran's ridiculous G&A.
Can someone elaborate for me?
On 28 Feb 2022, just after the placing, FOG had a cash balance of over $18M.
At year end, Dec 22, it had a cash balance of over $16M.
We don't have year end Dec 2023 results until April, but we are told recently that there is now a cash balance of $5M.
I note that expenditure on General and Administration has been in the region of $3M for the two prior years, so probably the same last year.
So can anyone tell me what the balance of about $8M was used for last year, as I thought that everything being done was on free carry up to now, with about $2M left in that pot.
RobRoy -- great article and the most encouraging part comes from the Chief Minister and the Resources Minister for the Northern Territory. There comments below bode very well for the EMP getting passed fairly soon, (and fortunately the anti-frack bunch missed the deadline of December 31st to submit any written dissensions to the full Pilot EMP). Maybe the politicians will buy a few Falcon shares and get this darn stock moving up instead of down -- sheesh.
"Northern Territory Chief Minister, Eva Lawler, said, “The Northern Territory is on the cusp of immense economic growth, and will be at the forefront of the nation’s transition to a net zero future".
“Today’s results released by Tamboran, who are also proponents of the Middle Arm Sustainable Development Precinct, paints a prosperous picture for the Territory as we strive towards a $40 billion economy by ensuring we capitalise on our world class energy resources".
“It is critical we continue to enable growth in this sector, because with growth comes a predicted 13,000 more opportunities for Territorians to work in new sectors, more reliable energy sources, lower emission production and lower power bills,” Ms Lawler said.
Northern Territory Minister for Mining, Mark Monaghan, said, “The Beetaloo Basin has globally significant Natural Gas reserves which will transform clean energy production in Australia".
“Sitting 500km south east of Darwin, are projects which will create multibillion dollar growth to our economy, and Tamboran’s 30-day flow test results is a key step in delivering on this vision".
“We will be the jurisdiction to deliver cheaper, more reliable and lower emissions gas to the rest of Australia for decades to come,” Mr Monaghan said.