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Good to see the American market picking up at last.
I also note that further sales have been made into the geothermal sector - which interestingly is now described as "a key market for Enteq".
NTQ could at some point be in a sweet spot given:
- $8.1m net cash against a £12m m/cap
- potentially combining rising ROW sales with a revived American market
- increasing geothermal sector sales
- and in particular, if the "gamechanger" SABER tool picks up traction - note that the "recent product launch resulted in a significant level of enquiries for further technical information":
https://www.investegate.co.uk/enteq-upstream-plc--ntq-/rns/trading-statement/202104080700027379U/
A series of small moves upwards here, and now NTQ are at the highest since a year ago.
NTQ have put the recent news on their web site, with a couple of interesting little additions....
Https://www.enteq.com/news-media/2021/03/enteq-launches-saber-tool-rotary-steerable-system/
Firstly, "Enteq expects the SABER Tool to be commercial during 2021"
And a further quote from the new Product Director:
"For directional drilling, it’s like what Dyson did for the vacuum cleaner, or the step change from tricone to PDC drill bits.”
Since the news, but little Impact on Sp..
RNS re the RSS project - great to see it progress smoothly into next stage field trials. As the CEO says, a "game changer" for NTQ no less.....
Https://uk.advfn.com/stock-market/london/enteq-upstream-NTQ/share-news/Enteq-Upstream-PLC-Launch-of-a-new-Directional-Dri/84468728
"Launch of a new Directional Drilling System - the SABER Tool
Enteq, the energy technology company, is pleased to announce the launch of its disruptive alternative to traditional rotary steerable systems (RSS) ; the SABER Tool (Steer-At-Bit Enteq Rotary Tool). The SABER tool, an evolution of the concept proven and tested by Shell and then licensed to Enteq, is now ready for next stage field trials.
The SABER tool uses internally directed pressure differentials to steer from the drill bit face, delivering true "at-bit" geosteering. This mechanically simple design also removes the need for traditional pistons and pads that are susceptible to reliability issues - an approach which can create a smoother and more precise wellbore with easy to manage directional control. SABER will offer a robust, reliable, simple and cost effective directional drilling alternative to current RSS options.
Enteq licensed the designs and intellectual property from Shell in September 2019, following successful initial trials, before assembling a technical team with more than 150 years combined RSS and directional drilling design experience, mostly based in the UK.
The global RSS market is estimated at $1.8 bn for 2021 and the initial version of the SABER tool will be able to compete in approximately 40% of this market. Source: The Insight Partners Analysis.
Further information can be obtained from https://www.enteq.com/products/rotary-steerable-system-srss/
Andrew Law, Enteq's Commercial Director, commented:
"Enteq's independent status, established engineering expertise and history as a trusted company with reliable downhole products, make us the ideal candidate to enter and disrupt the RSS space. With our expert engineering team and access to market, I am confident that the SABER Tool will be a great success."
Martin Perry, Enteq's CEO, commented:
" The directional drilling market today is dominated by RSS designs supplied by a small group of companies which have been largely unchallenged. However, efficiency of directional drilling is becoming increasingly imperative. It is essential to control costs, minimise downtime and maximise reliability and drilling speeds in order to remain competitive and reduce the impact of drilling. The SABER tool will prove to be a more accurate, agile and cost-effective alternative to existing RSS offerings. This product introduction should be a game changer for Enteq in terms of the market size which will be addressed and through the disruptive nature of the technology."
Per today's RNS Miton have been buying heavily again - they now own 11.73m shares here, or over 17%, so a big vote of confidence in an £11m m/cap company.
https://www.investegate.co.uk/enteq-upstream-plc--ntq-/rns/holding-s--in-company/202102251144033729Q/
Up we go
Encouraged
Uncouraged by my recent research a very likely oil price recovery I'm in.
Miton increased again, and now have over 6% with 4.1m shares:
Https://www.investegate.co.uk/enteq-upstream-plc--ntq-/rns/holding-s--in-company/202011231421282127G/
The directors have also now bought 664,000 shares since the interims.
And the oil price is rising in (early!) anticipation of the global economy restarting given the successes in vaccines.
Hopefully a baseline has now been established here. NTQ will undoubtedly be trading steadily at best for a little while, but not far off the entire m/cap is backed by the well-managed cash pile, and the IP and tech is in for free. The large potential upside remains in place.
The £8.7m m/cap is well backed up by $8.8m of well-managed cash, so the tiny EV means the core business, patents etc are in for almost nothing.
The interims were as expected given the huge rig count fall in the USA, partly offset by good international sales in China, Saudi etc.
Good to see two directors putting decent amounts of cash in at these levels in the last day post-interims. I would have said there's unlikely to be much short-term excitement, but actually the oil price may recover a fair bit on good COVID news - plus NTQ have said that:
"the expectation of a medium-to-long term supply contract being awarded to our (Saudi) partner. The outcome of the accreditation is expected to be known before the end of March 2021."
NTQ remains one to put in the bottom drawer and wait for potentially large upside on in particular Shell's SRSS technology and other new products.
They conclude:
"Valuation
The current market capitalisation of £9.05mln (US$11.6mln) compares with the current net cash position of US$8.8mln. This implies that the market is valuing the existing business and the opportunity set at US$2.8mln. We believe that based on current products plus the Rotary Steerable system, and with further expansion in overseas markets, the company could produce revenues in excess of US$20mln by 2024. We argue that the current share price does not reflect this."
Also worth noting:
"Given the comfortable balance sheet position, the company is maintaining its willingness to make focussed investments in new product development.The biggest project is the Rotary Steerable Drilling system that is under development. This project, together with other new product lines, will give Enteq an addressable market of US$2bn per year, compared with US$100mln for the current core technology offerings. The AGM statement indicates that a prototype deployment is scheduled for 2021, and we continue to expect that first revenues from this system will be realised during FY March 2022."
Frustrating! After donkey's years in this I finally lost patience and sold out in July.
One reason being the main reason I was still holding was the geothermal aspect and it now never seems to get even a mention. I haven't yet watched the full presentation, but in just the first seconds I see Perry mentioning geothermal. ! The way it goes...
Bouncing back nicely. The presentation referred to by elbarracuda below is here and is well worth watching:
Https://www.youtube.com/watch?v=yVF6YKqVon8
Watched a positive presentation by the Chairman earlier via the above website.
Confirmed my optimism for a good rise in price going forward
Great to see a second director buying shares on the open market, with this one almost doubling his holding.
Incidentally, Investec's Buy note at 15.5p post-results retains their 44p target price:
https://www.investegate.co.uk/enteq-upstream-plc--ntq-/rns/director-pdmr-shareholding/202008201006477112W/
Here's the RNS re the FD's buy of 75,000 shares in late July which wasn't posted here previously:
https://www.investegate.co.uk/enteq-upstream-plc--ntq-/rns/director-pdmr-shareholding/202007311027427693U/
Very nice $0.9m contract win from a new international customer in Saudi Arabia - and for NTQ's new XXH product:
Https://uk.advfn.com/stock-market/london/enteq-upstream-NTQ/share-news/Enteq-Upstream-PLC-Contract-Award/83088982
This sentence in the RNS bodes well:
"Future opportunities are anticipated for Enteq's technology partner equipment and new product releases."
The results to 31st March are as already signalled, with $3.1m EBITDA, up from $2.5m EBITDA last year.
NTQ have $10.2m net cash, against the £9.3m m/cap.
The amount of non-US revenues has ballooned from $1m up to $3.2m and gives NTQ greater variety of customer protection than before.
They've taken the opportunity to kitchen sink everything in one hit of write-offs, which should leave a clean Balance Sheet going forward.
NTQ have the advantage of having extremely capable management who've been through all this before. They've already successfully navigated previous oil price collapses and preserved (and from memory actually increased!) the cash pile through it. Judging by the extensive job and wage cuts already implemented in March they'll likely be able to do the same this time.
The current environment is obviously incredibly difficult. If the share price slips back again around the lows then I will probably pick up more ready for the inevitable upturn at some point, or progress on the Shell license agreement.
Great to see Miton increasing to over 4% today with 2.73m shares (they seem to be on a bit of a spree at present - they've also just bought into REAT, another of my holdings):
https://www.investegate.co.uk/enteq-upstream-plc--ntq-/rns/holding-s--in-company/202006111717447310P/
If they've cleared out any sellers then the share price could get interesting given the low free float:
Major Shareholders
Canaccord Genuity Group 8,800,000 13.4
Directors & Employees 7,264,696 11.1
Allianz 6,150,000 9.4
Soros Fund Management 4,953,818 7.6
Octopus Investments 2,919,000 4.5
Investec Securities 2,897,923 4.4
Hargreaves Lansdown 2,535,101 3.9
Church House Investments 2,449,150 3.7
Premier Miton Asset Management 2,434,012 3.7
Killik Asset Management 2,091,747 3.2
Columbia Threadneedle Investments 2,008,642 3.1
That list represents 68% of the shares in issue.
This share taught me a bitter lesson: cash more than market cap doesn't mean anything! It was way over the market cap in March 14 when I first bought, and I couldn't believe my luck. It had to be a winner!
It wasn't, has remained within touching distance of the cash reserve all the time, and has lost me a load of money. Crazily, I still hold. Normally I wouldn't now touch anything oil related, but this has skills in geothermal energy drilling as well, and is the only way into that that I know. I want that to come good and so still hold. That's about the worst of reasons. Martin Perry also came with a good history, and I think he has done a good job through a few difficult years for the oil market. Never raised more money, or diluted, that I can remember. Over 6 tough years that's pretty good. They've guarded that nest egg for the right time, right from the very beginning. Without it they would have been in trouble. As it is, they'll survive this.
was always going to pop up on folks radar at some point ..it’s very cheap down here and has tidy cash level
Totally off the radar this one but at these levels it’s a steal
it’s a steal at these prices - still more cash in the bank thank mkt cap ..expecting volume to pick up here and this will move quick I expect