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Folks… let’s see what 2024 brings. We got cash available to buy assets, JV partners that have joined and keen for production ading acquisition hence they are willing to pay upto $100 million at their initial expense the for them.
We’ve got Menzies who seems to be one of the most ‘get after it’ and industrious people I’ve seen presenting on aim in the last 5 years.
The story is building month by month! We tried exploration which didn’t bear significant fruit and hasn’t been desirable with investors for a decade, particularly in old basins. We’re now moving to farm outs and free carries on exploration. We’ve got our first slither of production (personally I can’t get excited about a few hundred barrels) and now we’re in the market for more in Norway.
We’ve then got a monstrous block in SE Asia which has more potential reserves (and solid indicators that the gas is there) than most mid cap companies have! It won’t be long before a major (possibly shell) comes in,50 million is small risk with massive reward for a major and they are all looking for LNG gas assets because they make a fortune trading it around the world.
Longboat genuinely has the most potential I’ve see on AIM. I just hope it’s well managed and we don’t get snapped up by some other company that will dilute us to with an already huge market cap.
Easily a 10 bagger on a decent production deal and a >50 bagger on a find in Asia
All a matter of perspective Zengas.
Perhaps I was slightly flippant, but with a market capital of 11.28mill, just perhaps its vulnerable. Japex and Malaysia are building blocks and I was purely adding 2+2, making 5 and considering it an opportunity for Serica to have some assets outwith the UK sector and EPL.
Concur that things are happening here for LBE after 4yrs and 3 months - but a year low of 8.5p from 100 or 75p is hardly outstanding.
ZENGAS,
With respect I think I say on behalf of all shareholders who have been involved In Longboat since the IPO, everything they have done so far has been a disaster. They bottled picking up assets during the downturn and then commodity prices shot up, meaning they couldn’t do a production deal at all. Their exploration campaign was a total disaster except for Kveikje which had over 50% CoS.
The JAPEX deal is certainly encouraging but they haven’t done anything with it yet. I’m sure all holders (old and new) hope for the best but so far all that Longboat has done is erode shareholder value whilst paying themselves handsomely.
Mommur
"perhaps after 5 years the major shareholdrers here feel the same"
To be factual -
LBE listed in November 2019 with only 10m shares just slightly over 4 years ago. (4 yrs/3 mnths).
58.% (5.8m) was held by instituitions and mangement had 8.3% (830k) leaving 33% or 3.3m free float shares.
The main fundraising of 45m shares at 75p came just 2.5 years ago in June 2021 which would be 4 in 5 of the current shareholders so i don't think you could describe them as - "perhaps after 5 years the major shareholdrers here feel the same" - any more than the share price swings as in Serica.
This is supported by 46% held by institutions with 26.3m, Directors & related parties on 3.22m at 5.7% with a free float of 27m of the total 57m shares in issue.
Regardless of the share price in that time, i think they've done fairly well with the opening discoveries to date. Followed all in the last 9 months by attracting a JV venture partner in Japex (with $100m of funding available that can attract a doubling to $200m in RBL for assets), adding the initial production assets and opening up with a significant asset with over $20m spend on it in Malaysia that on it's own could offer $1b of value on a success case given the multiple prospects, DHIs and methane measurements and gas cloud similar and described as analogous to 2 other milti tcf discoveries. But i expect it to deliver a decent valuation on lesser assets such as production and the existing discoveries.
Just because their ex Faroe holds no bearing. I don't see HH as the CEO in it anywhere (apologies if mistaken). As COO he follows the CEOs decision. There's may an ex director of Tullow who have gone and set up companies (AET from SEY for eg1).
Likewise for many shareholsders there's been a number of times to exit with substantial multi baggers at various times.
GKP listed at 48p and after it's operations in Algeria under performed and hamered down in 2008 to 3-7p was a buy for me on the very promising Shaikan block in Kurdistan and finally got out at 320p 3.5 years later before it ran on to 420p and over the following few years completely crashed to 1p and a restructuring. To me it's all about an optimum time for entry/exit and not trying to extract the last penny of profit but certianly looking for a multi bagger from here on the current strategy.
Painful comparison Zengas, like Mr & Mrs Hardy I bought heavily in the 4-5p range and was a holder from even earlier (2009) for the sum of 60p and added through all the heartache downwards until 2015. Never lost faith in Mr Craven Walker and it certainly came good.
Over the same period I was a holder of Faroes Petroleum which showed great promise, but never quite reached the next level. Management (some now at Longboat) forgot about its disillusioned major shareholders who sold out to DNO.
I'm sure Mr & Mrs Hardy are just as disappointed in Serica as I and many lth are - a catalyst may be to put an offer in for Longboat - perhaps after 5 years the major shareholders here feel the same as Faroes II's. Not to good for holders here from 100p and even myself from 50p!!!
I remember it being a painfully slow burn so to speak at Sterling waiting for the asset injection which happened with the new strategy in May 21 and a rename. Could have been picked up at 8.5p Dec 19 and 14.5p in late 21 - now 41p and only the start for more acquisitions.
Likewise look at Serica 43p in March 2012 and could have been picked up in the 3p range Jan -April 2015 and at 5p to Sept that year.
90p Jan 2018. 57p 6 months later end of June.
140p range Feb 2019 - Jan 2020.
150p+ mid 2021
420p early 2022 retreating to 245p May 2022..
Averaged 240p for 2023.
Jan 2024 220p to it's current 178p.
12/6/22 - Britain's savviest investment couple are sitting on shares worth more than £80million after good news last week from Serica Energy. David and Debbie Hardy, who run a Midlands building firm, are the largest shareholders in the North Sea energy producer. Serica's shares to £2.90, sending the value of the Hardys' 10.4 per cent soaring to £82million. David, 63, and Debbie, 58, bought into the business for as little as 3p a share.
https://www.thisismoney.co.uk/money/investing/article-10907389/STOCKS-WATCH-Canny-couples-80m-oil-gusher-Serica.html
I see someone perhaps equally canny has bought and increased to 4m here or 7% up from 6% back in October.
Painfully slow burn Deeko. We've been through various oil price/demand/supply cycles with still no meaningful production and therefore constant erosion of cash. Very poor showing...
OMV seem to have gotten what they paid for the Sapura interest when the JV was formed in 2019 (9/11/18) on top of 5 years production income.
At the time Sapura had 260 mmboe 2P reserves and 2C resources. This went into the newly formed 50-50 Sapura/OMV JV ie 130 mmboe (or in gas around 0.8 TCF).
As OMVs Chairman (J Pleininger) said at the time - production trebled from 10,000 boepd at the time to around 36,000 boepd for the JV at the time of the present sale (Jan 2024) to Total Energies for $903m.
There has been significant production over the last 5 years. The large Jerun Gas field to start production later this year.
This from November 2018 -
'Sapura and OMV inked a joint venture (JV) agreement for the strategic partnership today, as a follow-up to a Heads of Agreement (HoA) signed between the two parties on Sept 12.
The deal entails OMV subscribing to 50% of the enlarged issued share capital of Sapura Upstream for US$540 million, and to repay US$350 million worth of shareholders’ loan owed by Sapura Upstream to Sapura Energy.
This marks a cash consideration of US$890 million to Sapura Energy.
OMV also agreed for an additional consideration worth US$55 million plus up to another US$30 million in contingency funds mainly linked to the resource volume in Block 30, Mexico at the time of taking the final investment decision.
Under the agreement, OMV will fully consolidate the JV company’s assets in its financial statements, which comprises 260 million barrels of oil equivalent (boe) in proven and probable (2P) and contingent (2C) reserves,
“Already right now, [the JV] has a great portfolio that is fit for growth. So what we are aiming for is to triple the production in the next two years from close to 10,000 boe/d currently to 30,000 boe/d in 2020,” said Pleininger.
https://theedgemalaysia.com/article/sapura-seals-deal-divest-50-upstream-unit-omv-ag-us975m
Looking forward to the future plans for Longboat SE... there was talk around using the same model as Longboat Norge to bring in a JV partner with deep pockets, Menzies has the credentials to attract such partners.
Slow burn here but it has the potential for something major!
So that's our new head of exploration in Malaysia just joined with a substantial track record.
Has just come from the Sapura-OMV joint venture after 5 years.
Before that over 5 years with Sapura.
Interesting that he was involved with SK310, SK408 and our own block 2C in the last decade which just never got drilled.
The Sapura-OMV JV was created in 2019 and OMV sold their 50% stake in the JV a few weeks ago for $900m.
TotalEnergies Signs an Agreement for the Acquisition of OMV’s Upstream Gas Assets in Malaysia
PARIS--(BUSINESS WIRE)--Jan. 31, 2024-- Regulatory News:
TotalEnergies (Paris:TTE) (LSE:TTE) (NYSE:TTE) has signed an agreement with OMV to acquire its 50% interest in Malaysian independent gas producer and operator SapuraOMV Upstream Sdn (SapuraOMV) for a consideration of $903 million (including the transfer of a $350 million loan granted by OMV to SapuraOMV), subject to customary closing adjustments.
SapuraOMV’s main assets are its 40% operated interest in block SK408 and 30% operated interest in block SK310, both located offshore Sarawak in Malaysia. In 2023, SapuraOMV’s operated production (100%) was about 500 Mcf/d of natural gas, feeding the Bintulu LNG plant operated by Petronas, as well as 7 kb/d of condensates. On block SK408, the development of the Jerun gas field is on track for startup in the second half of the year 2024
https://markets.ft.com/data/announce/full?dockey=600-202401310912BIZWIRE_USPRX____20240131_BW403455-1
and
'Block SK 408 contains seven discoveries from eight wells drilled. Five of the seven are understood to be commercial, and three are in the development stage – Gorek, Larak and Bakong, which have resource sizes ranging from 0.5 Tcf to 1.5 Tcf.
The jewel in the crown in Block SK 408 is the 2016 Jerun gas discovery, which contains up to 3 Tcf.'
https://sapuraenergy.com/sapura-ep-keeping-low-profile-high-rewards/
Basically that's a $900m sale of 20% in SK408 and 15% in SK310 equal to net production of around 18,000 boepd.
SK310 (B15 field) has produced about 68% of its reserves according to one energy report.
Are we talking about 1.2 - 2 tcf net sale ? There's also a small interest in a Mexican oil discovery of which they are a minority partner.
LBEs Block 2C with Kertang estimated at 9 TCF mid recoverable. Multiple other prospects and 2 are each half the size of Kertang and covered by 3D so perhaps 15 TCF and if 20% retained on farmout could mean 1.8 - 3 TCF net target.
Good news but another on the wage bill with little cash coming through the doors. Get a move on Helge...
Head of Exploration, Malaysia
https://www.linkedin.com/in/choo-matthew79?
Zilch. Disgruntled to say the least. It's now one of those shares i have to let ride in hope...
I agree. 5 years and what material success do they have to show for it?
5 years+, that's all i have to add :(
Yep it was a long time for the reversal at 4p Deeko. Have a small holding here and tempting to add, especially as outwith the UK .
Serica looking for a new CEO and oversea's holdings (hopefully) so you never know. Maybe the long term Institutional Investors won't wait for 10 years like FPM before capitulating - again who knows.
We seem to be back into a cycle of concentrating on MC at the expense of SP again, and its not only Longboat. GLA
> When is it Longboats turn?
It seems reasonable JAPEX jumped aboard because there was an opportunity and something was brewing (requiring their finance)
Let’s not forget Mommur, Serica was saddling at 10p for what felt like ages. Then low teens, then high teens. Absolutely nothing was going for a while and then BOOM… the RNS landed.
Hopefully we don’t get taken out for petty cash!
When Serica buys them with petty cash??
Well that's my JSE shares suspended due to a 28,000 boe potential acquisition (gutted really, was hoping to average down a little more). When is it Longboats turn?
Zengas, i agree that noone saw japex jv coming or the production purchase but they've been 5 years in the making so one would have expected there to be more if the company is to deliver its initial corporate strategy.
I would like to have seen 'meaningful or material' cash generation by now.
Seperately this has to be one of the biggest assets landed for a company of this size - ie Block 2A (not counting the hunt for other Asian production assets).
To have 52.5% of a 12,000 km2 block of this size with over 6,000 km2 of 3D seismic not to mention 17,500 km lines of 2D is phenomenal.
The cost to carry out that amount of seismic would run into the tens of $millions alone along with the extensive geochemistry work confirming very high concentrations of methane and low CO2. That can't be understated.
At about 17 mins into the interview James Menzies says they beleive there could be in excess of 9 TCF recoverable for Kertang.
At 18:30 he states that 'there are multiple structures surrounding Kertang that are also extremely big - it's just that they are dwarfed by this giant.'
When you refer back to the Topaz slides particularly page 6 you can see '3 main identified prospects' which includes Kertang. The two other structures are in very close proximity to Kertang with the other 2 combined having an area roughly the size of Kertang itself. All 3 are covered by 2,900 km2 of 3D seismic.
Given the analogue description to the smaller 6 TCF Kasawari field - taking into account the 3 main structures, there could well be potential for 15+ TCF recoverable here.
Retaining 10-20% post farmout would be potentially huge given a ready gas market.
Not since Cove acquired 8.5% offshore Rovuma from struggling Artumas in 2009 has there been an opportunity as big imo.
Their share price was 9p in 2009. If you were patient, Dolmens Brian Gallagher called it a speculative buy on tues 9th March 2010 and a target of 59p.
By the time Shell had bid in Feb 2012 there was an estimated 20+ tcf recoverable estimated. Shell bid $1.8b while PTTEP of Thailand pipped them with a $1.9b takeout at 240p post tax.
Coves 8.5% share of 20-30 TCF = 1.7 - 2.55 TCF.
Reataining 10-20% of block 2A for LBE could mean on the 3 prospects covered by 3D, there might be 1.5 - 3 TCF net to play for here irrespective of all other assets.
Rather than a SERICA in the making, I would suggest it is a direct comparison to Faroes Petroleum, where a number of management came from. They increased the MC fourfold, but share price increase was abysmal over the 10 year period I held 100,000. Initial offer at 100p, went to 50p, recovered and touched over 200p, fell again then sold to DNO finally for 160p.
Another comparison would be Parkmead, being a "lifestyle" company for folks who have made their money to play.
Serica painful at moment, but its not on its own with such negativity in this country re oil/gas - but just perhaps its time will come - needless to say I am a LTH holder in Serica from 60p down to 4p and up to 443p - and now languishing at the 200p mark.
So did anyone know beforehand exactly when the JAPEX JV was coming 2/5/23 - (9 months ago) ?
or the first production assets on 3/7/23 ?
Likwise nobody will know until the next announcement when the current assets under review are agreed upon and announced to the market.
Japex did not get involved for fun. They have to be mutually agreed assets and there is a sizeable pot of $100m which can effectively be doubled through debt or RBL lending. With a 5 year window and for the ability of assets to be potentially paid down in 2-3 years from the effective transaction date, we could be looking at $3-400m available in total 2 years on.
Shows that they’ve identified a possible extension of the prolific Carmen discovery in the same license as Kveikja and are working it up as a drill target.