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I posted about Perth recovery rates a long time ago, but not seen it mentioned recently at all (either on the boards or by PMG) - a little reminder....
Back in 2018 PMG undertook a study through AGR to model potential fracture stimulation of the reservoirs, which concluded (at least to the extent that has been announced publicly to date) - "New GPA reservoir study concluded that stimulating the Claymore formation would result in a considerable increase in well productivity and is likely to increase the project’s oil recovery factor."
A few years earlier, Senergy estimated 24% recovery rate for Perth, when 2P was given as 41.3MMBbls. In a research note, Charles Stanley had to say about it: "For Phase 1, our economic valuation assumes a recovery rate of 24% (based on the Senergy 2P estimates). We expect the actual recovery rate to vary from this current best estimate, perhaps materially because there is quite a bit of uncertainty, in our opinion, relating to the distribution of higher quality sands within the heterogeneous Claymore reservoir. Recovery estimates for the Claymore and Scapa fields, which also produce from Claymore sands, increased over time to 40% and 56% respectively (according to the operator Talisman Energy's most recent publicly available estimates)."
The 2P figure hasn't changed to date, but if there is any validity to the carry across from Claymore and Scapa, then the recovery rate could potentially be doubled - which would be very nice....
...lots of ifs and buts!
From the 2020 Annual Report, about GPA:
"This is one of the North Sea’s largest undeveloped oil projects with three core fields that have been fully appraised. 13 wells have been drilled with an estimated 400 million barrels of oil-in-place."
Back in 2018, from the statement when PMG acquired 100% of Perth and Dolphin, one could calculate that the 2P for Perth and Dolphin was 44.8MMbbls.
They stated that Perth held 197mm oil in place, 24% of that = 47MMbbls, so roughly in line.
They also estimated that including the northern areas of GPA, total OIP was 498MMbbls - the AR now says 400MMbbls for just three already appraised fields.
Finncap's NPV uses a figure of 79.7MMboe recoverable (range 70-130MMboe) for GPA.
This seems very much at the low end, cautious approach, which is good.
Just dreaming, but if total OIP is still regarded as 498MMBbls (including more than just the three already appraised fields), and the recovery factor 24% then that's 120MMboe recoverable (+50%).
If the recovery factor actually turns out to be say 45% after stimulation, then that's 224MMboe (+181%) .
Equivalent risked current NPV, everything else being equal (which of course it isn't...!), £3.48/sh rather than £1.61/sh.
With $65/bbl rather than $55/bbl per the Finncap analysis, that makes for risked current NPV of £4.32/sh.
Unrisked £15+...
Nice to dream!
And just in case anyone is interested, whilst this is very old - 2013! (and hence a lot of things have changed ref who owns what etc), but it is very informative about the Perth field generally, what wells have been drilled etc.
Note:
"The Perth field, a sour oilfield in the UK North Sea (operated and 52.03% held by Parkmead) is the perfect example of such a hub strategy. The facilities used to produce the Perth field will be the only export route available to produce over 900mn bbls of STOOIP (STOOIP figure refers to oil in place a proportion of which would be producible) of already discovered sour crude oil. No value is ascribed to this strategic potential in our target price; however, conceptually this strategy is quite important to the Parkmead investment thesis."
and:
"We believe that the two most noteworthy fields that produced from similar sands in the same area as Perth are the Claymore and Scapa fields. In our opinion, the analysis of the performance of these fields suggests that actual ultimate recovery of oil from the Perth Field could materially outperform the expectations built into our target price."
https://www.parkmeadgroup.com/uploaded/research/Charles_Stanley_Research_21.10.2013.pdf
looks like IC advice still effecting the SP
GBX 47.90
6.21%
+2.80 Today
PMG
Apr 23, 8:01:01 AM UTC+1 · GBX · LON · Disclaimer
Luckcounts
Why waste your breath.....you are stating your thoughts are pie in the sky !
1 billion barrels will be going through GPA that's a fact !
If you're not invested here, move on, whats the point in your posts......?
LOL!! - "it is managed for the CEO who has a controlling stake. "
err...
TC owns some 26% (and a whole lot of options). His investment (prior to the farm deal) was at an average buy in price of 70p (approx £13.3m invested). For the farm deal he put more in at 50p.
Ryan Stroulger, the FD has some £250K invested at an average of £1.56/share (and options).
Struggling to see how you might think that their interests are not aligned with other shareholders...you are making yourself look silly.
If you don't fancy investing, then don't. If you want to make a reasoned and sensible post about your reasons for not investing then go ahead, it would definitely be appreciated, but your posts make no sense (as well as being libellous!).
TC pulls out a very (too!) generous salary for sure, but as ab76 says, he'd get a better return (to date at least) investing his money in an investment fund. That's not why is in Parkmead, he wants a big, big return, and GPA is the main route there - that's why they have been pulling it all together for so long.
And now they have a draft contract on the table, so could be anytime.
And in answer to the query about the land LC, another repost of a post from last year:
The asking prices for the parts they are selling are:
Lot 3 alone (150 acres, no buildings) is offers over £680K, or £4533/acre.
Lot 2 is 120 acres, no buildings - offers over £790K or £6,583/acre.
Lot 1 (811 acres, with all the buildings/sheds) - offers over £3.35m or £4,130/acre.
Quite a lot more per acre than they paid.>
As we know now, they received £4m for two parcels of land. It looks like the 120 acre Lot 2 is still for sale (link below), so what has been sold works out at approx £4,162/acre.
Whether the farmland is worth more per acre than the windswept hill very much depends on if they progress the windfarm and can get permissions - probably very much so if they can.
https://www.galbraithgroup.com/property/abn200040-land-at-glenfarquhar-auchenblae-laurencekirk-aberdeenshire-ab30-1uj
LC, to answer some of your questions (though you should be able to do that for yourself....but hey ho..)
Land prices: PMG bought Pitreadie, which was 2,320 acres, for £8.5m or £3,664 per acre. The parts they have sold went for £4,162/acre. The plot still being offered has an asking price of £6,583/acre.
If they get permission for, and go ahead with a windfarm on the part they are keeping, it will certainly be worth a lot more than they paid.
Ryan Stroulger - started with PMG in 2010, salary was £39,860 in 2013, £101K in 2020. So £250K invested is quite a sizeable sum relative to his (after tax) salary.
The loans and farm deal - you seem to have some misunderstanding with all of that - who loaned to who... and what a commercial interest rate is?
Energy Management Associates Ltd (EMAL) is a related company which transacts with several other related companies with TC & LC as directors. Their accounts are on public record, so nothing is hidden.
TC & LC personally loaned money TO both EMAL and Pitreadie farm.
Their personal loan TO EMAL is (I think) still outstanding and is some £4m+, and pays no interest (that is zero interest).
Their personal loan to Pitreadie was paid back to them in shares (at 50p/share) when the farm was bought by PMG. So to be clear, they had personally loaned the money TO the Pitreadie company, and rather than getting cash repayment when PMG bought the farm, they accepted PMG shares instead.
Then there is the £2.9m loan FROM PMG to EMAL. That is at 2.5%, which just happens to be exactly the same rate that the Bank of Scotland were charging for the bank loan to Pitreadie - so a fair commercial rate.
This is all easily accessed public information, not my opinion...
And in terms of a return for shareholders, it is probably a considerably higher rate than PMG would get for having the cash sat in a bank account...
Anyway, hopefully PMG's considerable cash will see better returns than sitting in the bank when GPA deal is announced!
ab76, just to be clear, PMG did not lend money to Mr Cross - it was lent to EMAL, and as you say gave an exclusive option blah blah, which may or may not be of any value.
The loan to EMAL was also "fully secured over assets held within Energy Management Associates Limited", rather than unsecured as LC suggests.