Mosman Oil Gas Share Price (MSMN)

Suspect permission was withdrawn in the current climate not a slammed door, just a closed until further notice type of thing. Outback social distancing, nobody within 20 miles of one another. Not something that needs pursuing until the government lifts travel restrictions anyway. Kind of lost my interest here now. Seems to be the same with a lot of others since this is the first post today when we used to be quite chatty. Hope everyone is hanging in there. The recent upswing on the market feels very temporary and I'm only doing some trading at the moment on short term stuff. I have a feeling the bottom will be in the next 2-4 weeks then I'm hoping to pile into things that will still be around in 2 years. Things like BP have shown that when people think that it's going to come back up it moves very fast. Not sure this one will though. I'll just take a peek every now and again. I have so little at play in here since the drops that it doesn't matter if I never sell.

China is slowly motoring now and use of oil must have increased. Europe is the next main area now we just need to see reduced amount of cases and deaths comsustantly before anyone can say we are going down hill. From the RNS yesterday I think the bod made the right decision to continue with Stanley and Welch production. Wonder how big are our storage facilities are? The situation in Aus with CLC it will go through an appeal etc.. There is a lot of big boys there with bigger pockets so no doubt they will support the NT government and its in there interest. The industry employs many people livelyhood.. That will be over turned in the future. Australian economy has gone down so they need support.

Hopefully USA will soon stop the oil war https://oilprice.com/Energy/Crude-Oil/Trumps-Ultimate-Weapon-To-End-The-Oil-War.html

There RNS never comes across like great news but all in all for Mosmans to continue on these wells must be very low cost, once S1 and S2 is fully in production after work over to know the bopd and if any chance they can work out the net average cost per barrel of oil. This will only give confident.

A workover has just been completed at Stanley-2 and an initial strong increase in oil flow was observed. The well will be returned to production in the next 48 hours.
The workover rig is now in the process of setting up at Stanley-1 to facilitate a workover at that well, with the objective of increasing production.

I’ve been following Mosman for several years after advising an associate on their investment here in Feb 2016 (long story) and began posting to this board following the acquisition of US assets a year or so later. I only made a small investment following the Baja alliance to have ‘skin in the game’ - I enjoyed following the Mosman story. Some LTHs here may be familiar with my posts. I’ve tried to ignore the opposing opinions and focus on the numbers.

My investment in Sept 2018 was followed by slow progress on drilling S2 (weather impacts) and by a placing in Nov so my timing was unfortunate. I wasn’t impressed by the placing comment so while others talked of buying to average down, I reduced my investment. My assessment was that the reward/risk ratio had got worse.

I reduced further following other placings, finally closing my position after the most recent placing in Feb this year.
Like some posters here I was confused by the director placing in lieu of payments. At first, I saw it as an encouraging development but after enquiry determined that the Au$120K share/warrants in lieu only accounted for a portion of the directors contracted arrangements rather than full fees for the year – I estimate 25-35%. I also wondered who these investors are buying in at the placing – it didn’t look attractive to me – and concluded that they were effectively out or getting out of the equity leaving the warrants to run.

I also concluded that the US assets have little value left in them other than as a ‘cover story’ for further placings and any significant value was in a successful outcome in Oz. However, I felt that if a JV (farm in) happened the 0.23p exercise price on the warrants and resultant dilution would significantly limit any equity rebound.

I’ve just remembered a similar investment I made (2010) in an exploration company called Altona Energy. They made a deal with a Chinese company and the share price popped from 4p to 20p over the course of 2 months. A period which covered the initial talks to closure. World economic events meant the project has never got beyond the feasibility stage. I see 8 years on the share is still listed (but hard to find) with a price of 18p. Sounds okay except repeated placings have diluted the 20p price 29/03/2010 to 0.02p today.

Back to Mosman. Today’s update has a lot of detail. I crunched the numbers and it’s easy to approximate their cash burn rate. Disappointed to see the BOD still taking 50% of their contracted fees in cash, considering the current environment.
It’s been an interesting story but for me the change in the relationship with Baja turns another chapter. It’s now only about Oz. I’ll look in occasionally.

I should add that JB has always responded to my emails. Keep it polite and you’ll get better clarity on aspects of the business from JB than you will from this board. People should take responsibility for their own investment decisions.

Good luck to all.