Member Info for Adw198

@ftsemajorgeneral / margaritas / Tenbag

You’re so stupid you don’t even hide the fact you’re running multiple accounts. Do you want me to explain why it’s so obvious so you can learn for next time?

In the meantime why doesn’t one of you “quote” who claimed the stores oil was “worthless” because I’d strongly suspect NOBODY has said that, so rather than address the valid things that have been said you have to invest a strawman to argue against who then accuse of telling lies.

Pig thick

I’ve been clear I don’t know about the phrase compartmentalised - in basic terms we don’t know if other wells will be more like H1, or (worst case) H2.

*If* it comes up as only 30bopd then in my opinion there’s a major problem here - unless there’s an explanation that gives high confidence it’s an anomaly. The phrase “in line with flow rates reported from some other wells in the basin” doesn’t suggest PCs field is wholly different.

Thorn the red flag at H2 that you don’t even see as a potential issue caused the share price to drop circa 40%. Or was that drop infact just because it was November?! Honestly who are you trying to kid here?

It prompted me to sell so unlike you claiming there are no red flags aka risks I’m able to be objective.

*If* H2 only flows 30bopd (“in line with flow rates reported from some other wells in the basin”) then you’ll be in huge trouble here. You can stick your head in the sand but sensible investors will stick that in the risk register.

Red flags are not knowing what it costs to extract, export and sell - and being reliant on the neighbours to do that. Another one being the failure to get a deal agreed at an appropriate time despite years of fore warning.

Then add the fact that so far H2 appears not to flow at anything beyond barely commercial rates - is that a one off or trend for the field?

We’re all here to make money and in the short term this is a loss making entity and will be for the medium term. Which means almost definitely a raise which will almost certainly be at a significant discount which will then lead to those insiders selling their discounted stock for an easy profit, dragging the SP down.

There’s a bullish perspective too but you just tried to imply there are no red flags. That’s either cloud cuckoo land or deliberately misrepresenting.

@harchris

Thanks for sharing that, it certainly sets out a compelling case. Do you know what production pog they used for next years projections?

I still apply some healthy scepticism to that kind of note because as we’ve spotted they don’t include exploration and I daresay they’ll be other bits of expenditure not covered. Still great, but I really don’t see such a cash surplus - would love to be wrong though!

It’s also HALF what it was this time last year when *checks notes* it was also December.

@investor

I’ve never heard anyone say the time of the year is a more important factor than dilution. And you yourself admitted the last one caught you out and crashed the price. Dismiss them at your peril. Anyone who (like me) thinks a raise is needed in 2025 just to keep the lights on, let alone fund more wells would be better to consider that more checking the calendar for what month it is.

There’s a place for both and charts and fundamentals, it’s not either / or.

@abzzba

Have you still not managed find anything I’ve said you can actually disagree with, hence the snidey snark instead? How much are you down here whilst handing out lectures about oilfields, having already been exposed by your own failed assertions? “no news is good news” really gave the game away mate!

Yes Abzzba I’m not an oilman and you’re not a successful investor - all opinions allowed.

What did I say that you disagree with though? I’m just trying to understand how many wells are planned and what the expectations are from each well. I don’t think the CURRENT output from the first 2 Herons are necessarily where they’ll end up and haven’t ever said that. If the company have quoted 19wells at 500bopd it would be good to know when that was said. Do you know if PCs wells average that?

@thorn fair summary. Dilution obviously does / will matter, I think we agree on that and perhaps just disagree on the extent to which it might impact the investment case

“Dilution has nothing to do with it”

Strong disagree. You can’t keep issuing shares and expect it to make no difference. You can’t genuinely believe that, I think you’ve just over stated your belief that at some point the business model might justify being worth more than today.

I’ve not seen 19 wells quoted, but I might have missed it - where has that come from? That would mean an average of just over 500bopd which seems high ish.

3 wells at 500bopd with minimum dilution would be a great result and justify a much higher share price. Seems to need a very happy path to get to that - eg H1 doubling from current levels, H2 producing 15times initial assessment and H3 also being a big success.

Is that the average of the PC wells?

What are expectations per well?

I can’t see the company have ever guided this?

This won’t ever be 10p again imo because of the huge dilution last year and general acknowledgement there’s another raise needed to get upto even 3 producing wells.

@thorn

Why, there’s loads of them here :)

@abzzba

Below is what he wrote / shared, which you summarised as “he picks out $35 profit per barrel with no explanation how he reaches that figure”

Beyond parody at this point!

——-

“Worth reading the 2021 progressive broker note, the fiscal regime and estimated costs are outlined.

"We are assuming that initially this crude is likely to trade at a 5% discount to the Brent crude marker. "

"The contractor is then able to recover the development and operating costs (Cost Recovery). This is capped at 40% of net revenue (after deducting the royalty and transportation costs)."

"The royalty in this PSC is 5% of gross production. The contractor share of profit oil is 60% for production less that 25,000 bbl/day. The bonuses are modest with US$0.5 million on first oil and annual bonuses (training, support and development) of a modest US$65,000 per annum. Through being a low cost onshore development, shareholders are relatively well protected against any weakening of oil prices. The fiscal regime allows the oil companies to benefit from any increase in prices. For example, at a US$50/bbl Brent price, Petro Matad sees an overall contractor take of 45%. This rises to a 50% take at a US$60/bbl price. This gives exceptional gearing to the oil price. "

"We anticipate that trucking oil to China for refining would cost approximately US$10/bbl whilst moving the oil by pipeline to the Mongolian refinery would substantially reduce these costs. However, the precise tariff on the pipeline has not been formally agreed. "

"The field economics would be improved dramatically. Operating costs at 5,000 bbl/day are estimated to be US$10 million per annum whilst increasing the production up to 9,000 bbl/day would see operating costs increase to US$15 million. This equates to a 17% decline in unit operating costs. Unit capital expenditure costs would drop from approximately US$7.60/bbl to US$5.20/bbl – representing a 31% decline. "

So 5% discount to brent, lets assume brent is trading at $70 (down from circa $72-73 today), so Matad can sell the oil for approximately $66.5/bbl.

PSC is 5% gross production, so that takes it down to circa $63/bbl.

Assume $10 to PC, that is now $53/bbl.

Assume OPEX costs higher than if they were producing at 5000bbls/day (which they will be), so $10 (likely to be higher), now we're at $43/bbl.

Contractor can claim back-costs of 40% on net revenue. So they can claim approximately $21/bbl back (0.4*53).

Contractor profit share is 60% = 0.6*(43+21) = $38.5/bbls. This is a crude calculation and may well be overly optimistic. More likely, they will get somewhere between $30-35/bbl profit given the current production levels, so lets assume $35.

$35*250 = $8750/day profit (before tax etc.), avg 30 days/month, we get profit of $262,500/month.

Take this a crude approximations, actual figures could very well be lower/higher.“

Lies on lies isn’t it. I cant work out if they’re really this stupid or just trying to trick others to give them a softer landing when they parachute out.

I think Abzzba is probably the former.

Hi Harchris

As you know I’m pretty much on the same page re you on most things here and I’m a beneficiary of some of your analysis so thanks.

I would sound a minor word of caution on the amount of profit actually making its way into the cash. Eg

“they will have already built up half the capex needs in cash by h2 2025 and will likely still be seeing $10m+ a month flowing into the accounts”

We’ve obviously got a meaty accounts payable issue to address but even after that don’t we need to deduct the costs of our exploration and acquisition activities? Whilst we’re undoubtedly generating significant free cash I don’t think it’s quite at the levels suggested there.

Thank you for taking the time (and patience) for sharing the detailed calcs @proinvestor.

I don’t think you claim them as gospel and I’m sure you’d welcome constructive feedback. But it’s lost on most here who would rather give toppy figures based on $75 revenue “minus costs”. And then act like a child when facing any feedback.

I wish you personally well, I’m sure you’ll make sensible / informed decisions however it works out.

Others can just keep repeating their fantasy figures and 35p short term price targets, rudely dismissing any other views. Hopefully they also get what they deserve

i’m not invested so don’t really have a dog in race - but i probably would love to see some of the idiots here lose even more (apologies to the handful of sensible posters but i’m sure you know what i say won’t make a difference anyway).

the company has 1 loss making well. next year they may or may not make improvements to the well to increase production from the current 200-300bopd to an unknown higher amount.

some posters are much more knowledgeable than me about what might need to be done and the likelihood of success - i don’t need to pretend to be an expert the company have told us they’re looking into it to see if they can increase it. i’ll go with that above an internet stranger like abzzba whose credibility is completely gone after his earlier assertions

the company have said similar things about h2. others here assert it’s a simple fix and our geology is exactly the same as pc’s. hmm, i call bs in that because again it’s not what the company say.

the half1 cash burn was $2.5m. that’s just standard running costs that didn’t include the drilling costs of h1, h2 or gobi. given we raised partly for renewables it’s reasonable to assume the half2 cash burn even outside of drilling will be materially higher.

so we’re losing cash every month and will continue to do so until / unless significantly more oil is produced. for now let’s just assume it’s all being sold despite the fact no deal is in place for the sale despite this being a key objective. remember everyone mocking me for saying there wasn’t a deal in place to sell? i’m a big boy i’m not bothered but just factor in the lack of acknowledgement, let alone humility. note not one of them expressed disappointment that the thing they thought was happening (actual revenue) wasn’t happening

if h1 and h2 are fixed then there might be a company to be built without significant dilution but that appears to require an exceptionally happy path and even then some cash flow issues given the changes won’t be till next spring at best.

the clowns on here who insist they are most confident are probably the ones most over exposed and thus can’t hear anything but rainbows and unicorns. we all (yes me included) sound like middle aged middle class white men in a ******* measuring context. there’s little research, fact and opinion sharing of note and today we’ve got people following others around other boards. if i was as confident as these people pretend to be about the prospects here i’d just raid whatever piggy banks i could and switch off. the panic is palpable.

Proinvestor is a class apart in terms of contribution to the board. If we assume his brilliantly set out calcs are broadly right then this is the crux

“we get profit of $262,500/month”

H1 cash burn was circa $2.5m, so MATD will need another raise just to stay afloat, let alone build a

field of producing wells.

Perfectly fine to still think (as proinvestor does) that the risk reward is still worth at these levels, but let’s have a sensible discussion around the facts and not the fanciful made up figures like £5m - £10m winter revenue, or assuming profit is at $75 per barrel.

Stas - I think (sensible) people are acknowledging it “might” be the issue but taking issue with your bolder assertion that the limited information provided “strongly suggests” it is.

I don’t know about compartmentalisation so won’t pretend to. But I think the risk Stas is articulating, even if slightly overplayed, is the single biggest risk to MATD.

*IF* H2 does indeed only produce 30bopd (like many other wells in the basin) then what are the chances of commercial success at H3 et al?

I’m not pretending to know but until clarity is provided I agree the business plan looks exposed because it’ll get harder and harder to raise money for new wells with a 1 in 2 strike rate. What *if* H3 was similar?

Let’s not forget the reserves and recoverable predictions came from H1. So when H2 doesn’t perform as expected it’s reasonable to at least consider whether they’re still valid with the new knowledge.

I’m sure I’ll be ripped for not pretending to have the answers but I maintain these are valid questions / risks and find it noteworthy there’s literally no discussion on them.

I wonder how many times on the hindsight chart the SP has hit 1.325p like it did a few weeks ago :)

I’ve never seen anyone have such a retrospective fascination and confidence in historic price action to the extent they feel comfortable enough to tell everyone else they can’t have a view here.

The irony is the guy himself didn’t buy in based on charts and is admitted he’s timed his own buys badly and is now overweight here.

Prices go up and prices go down, we get it! Is there a general trend that the peak has historically been “Spring” - yes, fair enough.

For someone so insistent he knows best there’s a distinct lack of reflection and willingness to explain the model (that he infact just copied from someone on another site).