Member Info for bigguboi

Legalwolf, personally I think the flow rates & reserve update should turn start to some heads finally. If that is still not sufficient then financing should do the trick. And if that still doesn't help the share price that's okay with me too. After production begins and cash starts flowing earnings reports will ultimately force the market to discover the price of the shares.

Good points Legalwolf. Clearly there hasn't been any material progress with the would-be financiers. This is demonstrable by noting that there have been no RNS on the matter. I do still believe that we're getting there after lab results and third party audit are out of the way.

Good discussion everybody, was a pleasure to read. Have a good weekend

Jimmy, doesn't Dutch TTF benchmark price affect Moroccan gas prices directly now that the country is importing LNG that is first shipped to Spain for degasification? I would think that since they have to buy the gas in the European market now (as opposed to just taking some of the Algerian gas that used to flow through the GME pipeline to Spain) that they're paying the TTF benchmark price.

The price action has been pleasurable to watch recently. Steady growth in the chart, next resistance should be at 11.7p or so. I think we won't be under 10p anymore (although I'll be delighted if we do get there again)

"huch"
High, rather :)

It's actually insane how huch natural gas prices really are in Europe.

European Dutch TTF gas benchmark hit €227.20/MWh today. Using a EUR/USD exchange rate of 1.09, that would be $72.62/mmBtu!! Compare that to the Henry Hub price over in the USA which is below $5/mmBtu right now.

$72.62/mmBtu = $427.18/boe. That means that in oil equivalent terms, natgas sold in Europe may easily have a netback higher than the current price of crude oil in oil equivalent terms.

The current price of Brent is $123.68/bbl. $427.18/$123.68 = 3.45. European natgas is currently 3.45 times more expensive than Brent and Brent is only 13% away from its all time high price.

Henry, A2 is easy to tie into the production and the European pipeline using coventional technology. And while there may not be a customer agreement there is a market for~30MMscf/d (and much more later) natgas, that will get taken off our hands don't you worry. Chariot isn't a producer yet and because of that they are dependent on outside financing, this is as you say. But once project financing is secured Chariot will go through the motions and the first bumps in the road that always surface when a project ramps up and start producing.

After a few weeks of emotional worrying by some shareholders it looks like the long awaited price discovery is beginning to take place.

The plan is to get financed with debt and to get Anchois into production. They're in talks with entities capable of financing the project and they have secured a 40mmscf/d take-or-pay contract. Chariot is focused on getting the gas (cash) flowing. Does it need to get any more definitive than this?

Totally agree Jimmy, and even if project CAPEX goes to $400MM only $300MM is payable by Chariot, rest is Morocco. Gas prices seem to be staying high for the foreseeable future. Imo well in excess of $10/mmbtu especially now that Morocco has to buy at the European market prices

That'd be $109MM per year before interest, depreciation, amortization and the 3.5% royalty & any further CAPEX for new wells. Personally I think the gas price is likely to stay higher than $8 but I also think the CAPEX and other costs will likely be higher due to inflation. 25% of the CAPEX will be financed by Morocco though.

Thank you very much Daniel

Daniel, what I'm trying to figure out is whether GROSS production (that is, ALL of the produced oil, including not only COPL's 55% WI but also the remaining 45%) goes into satisfying the hedge, or whether it's the NET production (COPL's 55% interest or 55% of the barrels produced).

In other words: out of the GROSS production rate of 1,900bpd, do only 55% go toward the hedge, or 100% I've gotten different answers to this from elsewhere as well and I'm totally stumped now due to conflicting answers. Gross or net?

I'll use an example, please point out any mistakes or misconceptions
Asset produces 1,000bpd. Company A has a 70% WI. Company A has hedged 328,500bbl or 900bpd. Company A's share of the production only amounts to 700bpd due to the 70% WI. Therefore, company's net production is only 255,500bbl and the all production stays hedged.

Am I understanding correctly?

Noob67, thank you for walking me through this. I'm still a bit confused though so I hope you can bear with me here.
"They want X amount of barrels from COPL. We need to supply that from our share of production."
See, I'm confused by this. COPL's share of production is 55% as per working interest no? So if the asset produced 1,000bpd for example, COPL's share of that would be 550bpd, my thinking being that only the 550bpd would satisfy the hedge.

Or does working interest only relate to profits, not producer barrels? Meaning in my example the entire 1,000bpd would satisfy the hedge and COPL would just keep 55% of the profits afterward?

Noob67, Edgein.
So, COPL's hedge relates to gross production as opposed to net production? Is this always how hedges are presented, for future reference?

Doesn't COPL hold a 55% interest in their oil producing assets? That means 45% of the production goes elsewhere no? I thought the hedge was for net production?

Noob67, am I misunderstanding something in the MD&A? It says they have 384,187bbls of WTI crude fixed at $56.58.
384,187bbls / 0.55 interest ˜ 689,521bbls
689,522bbls / 365 days ˜ 1,914bbls

In other words 1,914bbl/d has been hedged at $56.58. Or am I misunderstanding something? I definitely could be mistaken here too

I believe the current oil hedge for 2022 is actually about 2,000bbl/d net though, meaning production would need to exceed 4,000bbl/d in order to get WTI price on oil sold

Let's see how she deals with the resistance coming up. Upwards and away as far as the fundamentals go but I wouldn't mind a pullback to drop a few more pounds here