From Zengas - showing the upside23 Feb 2018 15:45
Not surprised at stock being snapped up.
Something to think about re that possible Morocco/Tunisa asset (don't forget AEI reported some time back on UPL meeting with the Moroccons on a permit - so i think this is where the 1 TCF permit could be).
Back on 8th August 2016 from Malcys blog re Morocco gas value.
see here http://www.iii.co.uk/articles/344972/oil-man%3A-sound-energy-discovery-uk-shale-wealth-fund
"The most interesting is that they feel that this discovery is worth around �1 per share for every trillion cubic feet (TCF) on a net basis"
527m shares in issue not counting options/warrants.
8/8/16 The Company has a net effective interest of 27.5% in the Tendrara licence.
Therefore at the time, 27.5% of 1 tcf (ie 275 bcf or 45 mmboe) was worth �1/share = �527m ($725m) or $16/boe.
What UPL highlighted in their presentation -
"Onshore Morocco and Tunisia".
"Now assessing several attractive opportunities".
"Permit with in place resources of 1 TCF gas potential. Multiple low risk discoveries and prospects." They too highlight "high gas prices".
A 1 TCF (166 mmboe) permit with 70-80% recoverable would be 115 - 130 mmboe potential. If you use Sound/Malcys report - at $16/boe it would be a potential prize of $1.8- $2b (ie �1.25-�1.4 billion) for UPL. Even on a part success basis the upside would be significant for a company of UPLs size considering. They too could possibly bring in a partner ?
Prior to entering Morocco, Sound did a placing at 4.2p. They took over the Tendrara licence in 2015 that had an existing discovery. The well on a 100% basis was estimated at �6m (which they farmed down to Schlumberger). The 1st well came in, mid 2016 and the share price was 103p. (basically an appraisal of the existing discovery).
UPL M/cap at 2.5p = �11.8m. �3m cash. Funded to drill Wick at a net dry hole cost of �2.24m. which has a potential uplift of over $200m just for that.
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