Member Info for daft63

Sorry link does not work, the otc market is Over The Counter, which provides a market for 2 parties to exchange shares independant of an exchange.

https://en.m.wikipedia.org/wiki/Over-the-counter_(finance).

Angela, I believe the 10 year tax break is exclusive to Morocco, not to the SD assets. Now whilst we dont know the gas sales price, clues were given on SDX presentation in Aug, of $2.65 /mcf, which given the terms would equate to a return of $16m pa on a daily production rate of 50mmcf, if you include the 25% cost recovery clauses. Now that production rate in Morocco would return circa $136m, so nobody wants to lose Morocco but SD requires Capex and time to get reasonable returns, so exchanging it to a company which is best positioned to exploit its potential in return for instant incomes, may be of interest. But who knows!

I certainly hope you are right, I only posted the guesswork to show how it might work out. 35,000bopd would change the game especially with Poo trend.

Zan, totally agree that the timing is strange, I mentioned this and its in the mix so to speak, we will have to wait and see but its becoming clearer about how this deal could take shape, with SD, SRM and loans all coming into play, and it would show true genius if the team pull it off with no debt or dilution, using assets that that require capex to achieve an instant income. If it comes off and we still have Morocco and the 2 producers in Egypt then the rerate would be significant for us all.

Ok folks, bear with me, there was talk of the deal involving BP lending us $325m, so Ive looked at the Serica terms and come up with this, dont shout at me, because there is a lot of guesswork here, but it is calculated on similar methods to systems already devised. BP lend us $325m payable over 4 years, we pay back from revenues at 60% years 1 +2, 50% yr3, 40% yr 4, roughly. That would require the yearly revenue from the assets to equate to roughly $160 pa. Now lets assume and I repeat assume the terms are similar to NWGemsa, that would equate to an asset producing approx 20,000bopd to SDX average. So there you have it, a guesstimate of 20k bopd.

Urraca, yes they paid $375m for 10% of an unproven 30tcf field plus pro rata on expected $16 billion Capex, makes SD look attractive with its onshore qualities. But who knows what the deal involves?

Shakey I totally agree with you but also feel that clauses would be built into the deal stipulating bonus payments for both sides should either party increase threshold limits, and those may be the negotiations taking place right now. So BP gives us extra cash if SD releases more than agreed value whereas SDX pay BP if we squeeze more than estimates. Done this way is a winner for all parties concerned, attractive to both sides.

Thanks Southmead, I did mention this idea on the night of the rns, but nobody picked up on it. My instinct tells me that we didnt enter negotiations empty handed, when I look back at things PW has said, I believe we may have been in talks for some time, maybe BP waited for the drilling analysis.

Sorry for the obvious errors in spelling, not enough coffee yet!

It is of course possible that neither dilution nor debt are a required part of the deal, we may be involved in a trade off as a deposit, SD could interest BP, and post drill analysis should be in and clear. PW did talk of serious interest by majors prior to the last drilling campaign, and BP want to move more towards gas, lets not forget its potential nor its value, at approx $0.9m /bcf @$2.65/bcf with around 200bcf in the bag already. If you allow for Capex already spent here then you would have a significant deposit, which PW could deem worth trading off against instant income, which with a payback system similar to BPs Serica deal would seal the deal. Just me looking at all the possibilities, not saying its going to happen, but it would work for both parties, require no debt or dilution, and tick the box for a shareholder vote if the income from BPs assets cancels waiting for moneytising the potential. If the deal is structured this way, with no debt or dilution, then the instant reward it would give to lths and IIs whilst locking out those who maybe manipulated the SP of late, might be a lesson PW would like to teach.

J4ams, welcome back, still never forgot your post in Jan'17, quality find in my mind. So here we are still, the SP has stagnated since last you posted, but the assets have been developed without debt, and future potential earnings secured. Personally, I hope there is no placing, I dont mind giving BP 20% as security, but dont think that will occur, it is my belief that we stalled because of too many shares allotted in a short period, the freefloat was manipulated because of lack of demand. If we are to get a real rise from this deal then it needs to be based on a maximum of 250m shares, maybe give BP 46m, or the 204m we already have issued. Call me selfish, but people have had the last 18months to see potential here, even without this deal, we are about to bring in $80m+ pa, with more rises over the next 24 months, as we release the taps. To get a proper rise in SP, we secure this deal and let people scramble for shares, they had plenty of chances!

Probably best if people forget that figure, its the total figure for Gupco, so BPs share is 50%, but then you dont know that we are buying the total asset, rumour suggests onshore only. Wait and see is the best bet, you will have plenty of time to consider implications and options when the deal is known.

Shakey is so right, even Edison value it 50% up, it has continually been punished for any perceived fault, whilst failing to gain any recognition for its stellar results, look at whats been achieved since SD-1, yet the SP is lower, despite a huge POO increase. But from another perspective, our success is recognised by BP, and future increases due in incomes from Morocco and SD may be what helps secure this deal, PW is at least trying to make our success turn into shareholder value.

Quality piece, many thanks!

No matter what the deal involves, and we can guess until the cows come home, the more days that pass, the more likely a deal gets struck. Once we pass the week mark, you know the devil is in the detail, no longer an if, more a how much and when.

Southmead, I would agree with you about BP, but we are drilling with GPC, a company totally owned by EGPC, who are not only partners of BP in Gupco but also partners in their upcoming Northeast Ramadan drills, due to start in weeks. BP would have been very interested in any outcome at SRM 1.

Cosmos, as I posted last night, the clue may lay with SRM. Its strange timing that we are drilling with GPC and then next doing a deal involving EGPC, they are in effect the same company! Now whilst I said no mystic meg, a find at SRM could be the deposit SDX put upfront for the deal, we know BP and EGPC are due to start drilling North East Ramadan,I posted this last thurs, https://energyegypt.net/bp-to-drill-its-first-gulf-of-suez-exploration-well-by-october/, Now whilst SDX are not interested in offshore, BP are, its of note that we are drilling offshore with gpc, and just as that drill is concluding, striking a deal. When asking what are sdx bringing to the table, the answer may be something we had all discarded.

It is noteworthy that the timing of this deal is now, our partners in South Ramadan are Pico and GPC, 37.5% and 50% resp. BPs partners in Gupco are EGPC 50% split. EGPC and GPC are in effect one and the same. Now whilst that may mean nothing at all, I shall put it out there for the more twisted and devious minds to digest. Shakey, with all due respect, over to you!

Until we know, the guessing will continue, I have no intention of trying to" Mystic Meg" the deal, but I will say,
1. Has PW or SDX suspended the share to negotiate what may be a bad deal? Think about this, BP is still trading, there are many variables which may be applicable, but none of them involve PW or SDX coming out of this looking as Daft as me. Wait and see what happpens, then when trading begins again decide whether to bail or hold based on the facts available.
2. To say that BP is getting out of Egypt because they are bad payers is totally wrong on 2 fronts, Yes Egypt has had a historic problem with payments but the present regime has made massive improvements in this area, as our own accounts show, and hope to be clear soon. BP and many other Giants are looking to invest more in Egypt.
https://www.zawya.com/mena/en/story/UKs_BP_to_inject_2bln_into_Egypt_in_2019-SNG_125763132/
http://www.egypttoday.com/Article/3/53397/Debts-to-oil-companies-reached-1-2B-by-end-of