I think it might be worth looking at the O&G Authority Report into drilling in the Moray Firth region that I have previously referenced. I should say this report is around five years old and uses data going back to 2010. That said it says,
‘ Roughly one third (34%) of the 98 segments with available pre-drill risking fall within the 21 to 30% CoS, i.e. what you would expect in such mature Basins.
However, more than a third (40%) of these segments has CoS > 31%: this highlights a trend towards over- confidence in the risking assessment. This is happening in parallel with over confidence in estimating the expected resources size.
It must also be noted that the main risk was not adequately predicted in 36 % of the cases, meaning that the prospect pre-drill analysis was not good enough. This highlights the strong need for a compulsory post well analysis in order to improve the overall exploration results.’
There is a legacy in the Moray Firth region of overconfidence leading to overestimating both the COS and the size of the resource.
BigBiteNow’s research and analysis is exemplary however what if the information that BNN is utilising is flawed?
You said, ‘ The market must therefore think that the oil is not there in commercial quantities or the funding is in question.’
The third option is that the market just doesn’t trust any information coming out of i3E any longer.
I don’t think it’s a funding issue because the SP dropped on operational failure. Unless the market thinks the failure of the pilot well indicates funding won’t be completed?
The failure of the pilot well could call into question the commerciality of Liberator but doesn’t affect Serenity. Unless you read across and decide that it’s the seismic interpretation that’s at fault.
I also think the hype around i3E took expectations to unrealistic levels. A BB myth had taken root that the pilot well had 90% COS, which it didn’t. However the expectation was there.
I think there are several factors are work driving down sentiment - BOD overconfidence, PI high expectations, uncertainty over Liberator commerciality, uncertainty around seismic interpretation and how that affects Serenity, and funding doubts.
I think success at Serenity might reverse sentiment quite rapidly.
What you and BBN are saying about the trust and sentiment here is highly relevant.
BBN has conducted extensive and in depth research into i3E. He is content with the facts and sees an excellent opportunity.
The market disagrees. I have to say I agree with BBN when he says its an extreme market reaction. It’s clear that the market does not believe that the information coming from i3E is reliable.
I’m surprised that the SP has dropped quite this much. When I saw the initial 50% drop I jumped in because it seemed overdone on a failed pilot well with two more drills to follow.
Either BBN is correct and this is a fantastic opportunity or the market is correct and i3E cannot be trusted. Given the track record of the BOD I still find it difficult to believe there’s anything disingenuous going on. If anything it must be simply overconfidence, as I’ve said before.
We’re now in a situation where a failed pilot well has led to a circa 70% drop in the SP. That appears to be madness.
Unfortunately i3E hasn’t been kind to any of us so far.
I know lots of investors are in and down. It seems sensible to stay in if that’s your situation. I’m down but currently out so I have a different perspective to most on the board.
Buying in for Serenity results looks a straightforward gamble to me. I think there could be a better opportunity post Serenity results. If we had a 100% rise we’d be at circa 35p. A 200% rise would take us to around 53p. If I were to pay 35 - 50p for the stock, with Serenity a success, that might look attractive to me. Those prices woii I LP be less than many paid before the drilling began.
Of course I could be wrong and the SP might boom to 100p, but I can’t see it.
Overall something is very disconnected from really here. Either the market has this totally wrong, or the bulls do. I can’t call that so I might let the drill bit call it for me.
Good morning BBN,
The overhang matters long term as regards understanding i3E fully diluted.
From my perspective, which is considering an entry point short term, the overhang interests me as it might affect any rise in the SP. Or might not depending on the strategy of the institutions.
Given that some posters on other social media platforms are talking of rises to the 100p or 150p level in the event of success at Serenity I want to examine that. I don’t see that happening and the overhang is one factor that might limit any rise.
What I’m thinking is could it be possible to take a position in i3E, post Serenity success, at a relatively low SP but with considerable uncertainty removed.
Clearly the market doesn’t agree with the bulls. Either this is a fantastic opportunity or something is seriously amiss. Id like to figure that out.
If you read the posts you’ll see there’s been an interesting exchange of views between myself, Sankeys and BBN regarding the overhang here.
That’s the reality. I personally don’t view it as a negative. I’d like to understand how the SP might perform in a Serenity success case. I don’t think those shouting about 100p or 150p have factored the overhang in.
I’m interested in understanding the opportunity. If you step back for one moment you’ll see. I want to get a holistic view.
I get that some if you are significantly underwater at this time but you do need to learn to control your emotions.
This board is GI anyone to discuss any issues around i3E that they want, as long as the discussion stays within LSE rules.
I would ask you all to stop playing the man. It’s tiresome and will just clog the board.
I think it might be worth addressing BBN’s point about focussing o in what could go wrong.
I don’t think that’s what we’re doing. I feel that the bull case is well known. I can also see attempts to ramp the stock on other platforms.
To my mind the SP performance in the success case might be different to the multibagger some seem to think is a certainty.
This isn’t anything ‘going wrong’ it’s simply the playing out of positions that will assert influence on the direction of the SP in a success case.
We all agree there will be a headwind of some sort but we’re not yet clear on how influential that headwind might be.
Ok, so no known shorts but speculatively perhaps there could be a hedged short.
I would also assume that in the event of default debt will take precedence over equity.
My view would be that institutions such as LO would want as much exposure as possible to any upside whilst removing as much downside risk as possible. LO are the largest institutional investor and have equity, debt and warrants? Getting a better understanding of how they have balanced their interests would be beneficial. Do we know the current position for LO? Equity circa 9%. How do the warrants and debt compare?
BBN’s point about how high above the strike price the institutions will want to achieve is worth consideration too. I would’ve though not too far above as I assume some derisking would be usual.
Thank you for the clarification.
I fully support what you are saying - it’s just normal civilised behaviour isn’t it.
Some of the comments directed at others have been utterly disgraceful.
I am totally in favour of free speech but absolutely will not tolerate offensive comments.
It seems to me that we have some posters here who don’t understand healthy debate and just can’t bring themselves to agree to disagree.
What we’re talking about here are some of the basic skills taught in the first year of university. They really should be understood by most posters in this day and age.
I hope we will be able to return to debate without personal attacks.
Just to clarify I can’t see any short positions open in excess of 0.5%
You mentioned 5% but may have meant 0.5%?
I don’t see that shorts are either gong to be driving this down or assisting me n the event of a rise.
Just catching-up with the posts.
I agree with you that this bb is for anyone who wants to talk about UJO whether they are invested or not. Also, it is for anyone who takes either a positive or a negative view of UJO. It should be a broad church.
For me this is a question of free speech and I will assert my right to post whatever comments I like regarding UJO. I will do so vigorously and persistently. I understand that might clog the board while I am doing so but I will not be cowed. I will always attempt to stay within the LSE rules although I have to admit my patience has been sorely tested at times.
There seem to be several hardcore posters who think they have a right to act as editors of the board. Anytime posts are made that they disagree with they make personal attacks on others. They seem to regard this behaviour as, ‘defending my investment.’
Attempting to corral all posters into towing the line established by a small cohort is unacceptable. It is the type of behaviour I would expect from a communist nation.
I would like now to return to discussing my investment without further harassment.
Free speech must win here.
You certainly timed that very nicely.
From my point of view it was well worth considering your argument. Having looked at it afresh I can see the EWT and CPR will likely take longer than I had been thinking. That said the Wressle planning meeting is fast approaching so that would be the first SP catalyst. Then news on Bisc might drop anytime. The EWT restarting, results and updated CPR will follow. Taken together Zi think we will have a fairly regular flow of news soon.
I reckon we have a floor in at around 0.20. Excellent considering the last placing was 0.17.
Thanks Sankeys, very interesting,
So there will likely be significant resistance in the 40-57p area.
If the institutions were selling post L01 then they would’ve been selling at a loss wouldn’t they. Set against that they took profits pre L01.
I don’t see any open short positions. If there are any then they must be insignificant?
Let me enlighten you. This was Ginger’s first contribution to the bb this evening;
‘get yourself a woman or a dog or a lobotomy or Heid Lol No it’s not debate it’s a pile of doggy poo’
I’m not minded to tolerate this kind of abusive attack.
You and TAF clearly have an agenda. You are only here to try to disrupt the board.
By your own admission you know nothing about O&G. You cannot possibly contribute anything of any worth.
You have already been banned for being naughty and you are now heading down the same path.
No you’re on the right board.
You need to learn to abide by the LSE rules, stop attacking other posters, stop making offensive comments and stop diverted the discussion off topic.
If you continue doing those things then you will get banned once again.
I suggest you familiarise yourself with those rules.