Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
I have listened to this a few times now, it’s surreal.
I wouldn’t mind if it was at least slightly balanced and objective
IMHO :
1. They materially ignore the prospects and any value they offer, other than a light touch reference to them early on. This surely has to be at least partly counterbalanced against their play down of the Buchan recovery rate
2. They listen to a single ‘expert’ view rather than trying to find a counter view to at least balance things and give a different perspective
3. They state up front they have sold their shares on a single piece of advice from a ‘red’ expert who has made contact with them and tapped his broad peer group
4. To DU’s point they don’t reference the oil quantity
5. They ignore the carbon strategy and it’s attraction to a broader range of players/funders .
6. They don’t consider the interplay with other North Sea players and the clear benefit one of those may gain from this partnership, alongside JOG
7. They assume that their contact knows better than Schlumberger. They categorise the development as exploration risk, rather than seeing the security it offers over large scale exploration risk. They offers 35 + years certainty plus the opportunity to further explore with a degree of certainty
8. They dismiss the view of all the brokers, including WHI - who are more likely to be neutral as they are not the house broker
9. They don’t reference the recent NED appointment, nor his near faultless performance in the North Sea to date
10. Alarmingly as an opener they are not even sure if Jogs cash balance from stockopedia includes the recent raise. You don’t need to read a lot to know the answer to that.
There are a fair number of people who provide a contrasting downside view .. when it’s structured I really welcome that.. it makes me think about the choices I make and the why…. But IMV this is so biased in one direction it’s a shock show
I take some comfort in knowing that only ~ 700 people follow them…
I wonder if WHI in their comments recently around ignoring negative sentiment, knew that this was on the horizon.
As always DYOR and this is just IMHO. I know little about the industry, but I read a lot of perspectives and try to get a sense of balance from that.
GLA LTH
Have a read of WH Ireland's update today (on their portal)... they are suggesting investors ignore negative share price chatter over the summer... 'which almost certainly will be poorly informed...'
Couldn't help but smile.. I guess they also read the ramblings of the cerebrally challenged!
https://seekingalpha.com/article/4424272-decarbonisation-options-for-independent-oil-gas-companies
Good note PC01, I think you are looking spot on with the oil price FWIW. The other comment I would add is the recent appointment of Les Thomas. Is a guy with a first rate reputation and a history of success in the CNS seriously going to take a role with a business where he isn't highly confident of a successful outcome? I would think not. Whilst I have absolutely no information, I would be surprised if the 'edit' to and the formal 'publication' of a carbon policy wasn't influenced by him. In my mind this allows them to cast the funding (or other) net a lot wider..
There was always a risk that no meaningful news over a 4+ month period was going to create a drag on the price, and that's what we're seeing.
As I've said before, from my perspective I am sitting tight. Nothing has changed in the core investment thesis (beyond the dilution we all know about)..
IMHO / DYOR
This type of investment consideration can surely only add to Jogs attractiveness
Financial Times,
Methodist Church dumps Shell over ‘inadequate’ climate plans
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Attracta Mooney and Anjli Raval
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Read the full article at:
https://on.ft.com/3t5x9fg
IMHO. DYOR
I wonder if this is significantly more important than we think.. I suspect 'funding' is potentially more readily available with this approach, which might open up a number of options....
It feels like there is a slight, but definite change is language here from previous updates, or certainly the expression of it : JOG is targeting 'Net Zero' emissions from its GBA project at the start of first oil
WH Ireland have an interesting take on things this morning - where they refer to 'JOG as a major oil company disguised as a Junior. '
Clearly IMHO and DYOR, but I'm sitting tight!
All.
WH Ireland have released again this morning. Further upgrade to 622 from 586. About 6 months they are at 286. They are not the house broker(s). Article is a good read if you sign up to research tree. Fiat bit of detail. Closing quote to opening summary paragraph ‘ We believe that Jersey Oil & Gas has an exceptionally compelling outlook into 2021 and 2022.’
Some fairly high profile coverage
https://www.thetimes.co.uk/article/former-ithaca-chief-will-join-oil-firm-board-tx8987g9k
This looks good. It may just be me, but there seems a far greater certainty in the language (less caveated with ‘maybe’ and ‘if’) that MS is using in his quote. Board is set and all that... interesting few months ahead me thinks
Bullson. I share the view on short term frustration and didn't like the messaging/dilution like so many on here, but as far as I am concerned the prospects of a farm out are materially heightened by the security that the raise created. Like you I was pleased with the placing take up. All of the brokers have placed further upgrades recently and even the local papers reporting on this in print are sounding progressively more confident. The take-up on the raise and the short time horizon in which it filled felt pretty extraordinary vs. the market cap and in light of where the price has been
over the last 6-12 months. Directionally I think we're in a good place, and highs and lows aside fully expect a take out or a farm out. I struggle to get my head around why someone would opt for the latter, when they could take the lot and maximise their ROI (in other words why would you split it with JOG, when you can just buy the lot for a little bit more). The north sea licensing restriction debate surely only heightens the attractiveness of this for existing players in the locality, especially where they have oil (albeit diminishing) for the medium term. I am most definitely in and whilst I fully expect this to bump in the coming months, this was never about short term for me. As others have commented and IMHO I see this ending in a winner takes all deal in the £7.50-£10 range.
This is a better forum than recent comments suggest. Lets pick ourselves up, dust down and move on. We all have choices to make - the fundamentals to my mind haven’t changed and I’m sticking. The surprises weren’t welcome, we all agree on that. Let’s move forward and start constructive discussion.
https://www.investorschronicle.co.uk/ideas/2021/03/19/priced-to-hit-pay-dirt/
Dive Centre
Fundamentally, I agree with this. I’m sure many do. I feel frustrated that they gave two presentations shortly before the raise that indicated (on accretion per share data that they shared) that they weren’t about to raise. However, I can see that with the share price climbing (as it was at the time) it would have been tempting at that time to secure incremental funding when sentiment and momentum were both heading in a favourable direction. The leak clearly didn’t help it - but from an integrity standpoint I feel they shouldn’t have guided a value per share when they knew they seriously considering / likely to tap the market.
That said, on balance, and despite the dilution I would rather the certainty and the upside that the funding provides. The negotiation position should be vastly strengthened and allow them to be more confident. To be honourable, they now have to deliver on this. This may in turn lead to a buy out, but either way the revised position feels more secure than the management team holding out and us all panicking later in the year when the board are playing chicken with potential partners (farminee types) and no cash in the bank. So on balance I’m ok with all of this, but let’s now get on with it, with no further hiccups please.
Dick - I have an enormous amount of respect for your posts. I look forward to them, like the fact that you look at the details with absolute granularity and through a very broad, experienced and inquisitive lens offer a different perspective. It’s welcome and refreshing!
I’m about 3 years into this journey, much less so than you.
I know you are partly sending a message. I share the want to do that.
Fundamentally though the investment case hasn’t changed, it’s been diluted, rocked even - but it hasn’t changed and arguably the prospects that we all believe in are firmly intact and better financed.
In summary I don’t believe you don’t believe in this, but I get you're fed up!
Keep posting on here - the forum needs and values it - it’s gives a perspective that few others bring!
AB and co need to deliver this now! They have the assets and funding they need to deliver a very good deal, whether farm out, buy out... or other
Keep well Dick, but don’t abandon the journey! A lot of people value your opinion (including me) and for their sake I encourage you to continue posting!
All IMHO. DYOR
Substantial and incredibly detailed update available from Arden on their portal. Free to read. Worth a read... They have trimmed the target price to 750 (risked), from 800 - but if you read to the end it also shows differing valuation methods based on peer group, etc. Very worth a read and some eye-watering numbers using different methodology (£18, £25, etc).
https://research.arden-partners.com//view_repos/_155c4056-7d31-4d03-960e-ace1f2de6c16.pdf
Research Tree have released an email this morning, showing the WHI upgrade dated today. This is the 3rd upgrade in the last 12 months I believe with price targets moving from c. 280 to c. 380 to c. 480 and now to ~526. Forget the absolute numbers (we can debate them all day long and like most people on here I think they massively understate the opportunity), but it comes back to momentum which is positive and more importantly timing. I think it is highly unlikely that WHI would have confirmed a further upgrade if they were materially concerned about dilution. If nothing else, they almost certainly would have waited in this respect. Just my view, but I read the further upgrade and more importantly the timing as incrementally positive. Worth noting also that WHI, as we know, are not the house broker.
You would think that the speculation regarding imminent pause would make our assets even more attractive to existing players in the CNS!
https://www.google.co.uk/amp/s/www.telegraph.co.uk/business/2021/03/13/ministers-considering-ban-north-sea-exploration-licences/amp/
Short reference, nothing new - but interestingly no reference to the method of fundraise, to Dicks earlier point
https://www.thisismoney.co.uk/money/markets/article-9355529/SMALL-CAP-MOVERS-Avacta-leaps-test-detects-new-Covid-variant.html