Member Info for DelBoi

Busy month ahead for UOG, acquisition completion, spudding of the next well, investor evening being organised and a call Im lead to believe. UOG will be able to go into much more detail once the deal is completed. The Ash -2 results have been completely underplayed for now IMO. This result opens up exploration targets significantly larger then Ash-2 in the lightly explored AEB formation. Worth a look on pg 5 of the investor presentation. We have 9 targets ranging from 4mmboe to - 12mmboe to go after. UOG Sitting on 2.6mmboe 2P currently, makes each one of these is a company maker.

https://www.uogplc.com/wp-content/uploads/2019/07/Egyptian-opportunity-slide-deck.pdf

I spoke with CP yesterday, he’s just back from Malaysia. Quite conscious that he didn’t give out any inside information, sounds like he met with cornerstone investors and Petronas. News on assets and financing next month was the impression I got. Possibly a private to private company deal/announcement first. So something outside of Petronas I would imagine. Strategy remains on target, we are very well positioned taking advantage of our local contacts. He’s got things running in all regions now and said he didn’t travel to Malaysia for the good of his health. “It’s all in progress” You either believe him or you don’t. I for one certainly believe he’s got something big to deliver and he’s not messing around with small nice to have projects either. I expect the next piece of news, which could land any day now will kick us back into gear. GLA

No flies on bagger, he’s a top investor!

“Granted extension to close out those discussions, which we will do over the next few weeks, and hopefully we will move Jamaica forward in that timeframe.”

Anybody else pick up on this? First point raised after the Egyptian update..

It’s certainly interesting Levis, shows potential and renewed commitment to the area. United have done well positioning themselves as a producer in the western dessert IMO. Could turn out to be a hotspot for divestment in the near future with all the larger projects now turning to offshore Egypt.

https://www.google.co.uk/amp/s/mobile.reuters.com/article/amp/idUSKBN1XP1AD

https://www.egypttoday.com/Article/3/79836/Egypt-signs-9-agreements-for-oil-gas-exploration-worth-452M

Being conservative (assuming 380bbl for * Ash 2) 1500 bopd x $27 bbl x 300 days = $12,5m + $3m for Crown + current cash on the balance sheet, $3m. = $18.5m vs £21m MCap.

Potential for a 2P reserves increase and higher flow rates from ASH-2 + Italy coming online.

I really can’t see any downside form here.

Can’t ignore the cash position 1750, with funds from the crown deal incoming and production on the increase, both in Egypt and Italy, the company will be priced at cash in a matter of months. I’ve been frustrated by the past few years performance but used the 3p placing to increase my holding, I’m still adding too. The Ash result could be a game changer In Itself.

Quick comparison between SQZ back in 2017 to UOG now. Much like UOG, SQZ started off with a BP prepayment agreement back in 2017, divestment and revenue then steadily increased, as did the SP. Went from 4p 2016 to where it is today £366m MCap, 128p

“As part of the Acquisition, Serica UK has entered into product sales agreements with BP to off-take Serica's share of gas and oil production from the BKR Assets on market terms. It has also agreed to enter sales contracts for Natural Gas Liquids production on a similar basis. BP Gas Marketing Ltd ("BPGM") has also agreed to provide Serica UK with a Prepayment Facility of up to £16 million. This can be used to provide further financing flexibility to cover the cost of hedging instruments which have been purchased by Serica UK in conjunction with signing the Acquisition Agreement and, if required, the Initial Consideration”

Bernard Looney, Chief Executive, BP Upstream commented: ( This is the Irish man that’s soon to be CEO, small circles as I previously mentioned)

"This is an example of BP's Upstream strategy in action - refreshing our portfolio and focusing our activity on assets which will add most value over the long-term.

We remain committed to the North Sea and continue to invest. We expect our production there to double to around 200,000 barrels equivalent a day by 2020 through new projects like Quad 204 and Clair Ridge.”

Brian has made no secret of his intentions to grow the company, the foundations are now in IMO and the relationships forged.

SQZ - RNS 21 November 2017 - Acquisition of BP interests in the Bruce, Keith and Rhum fields in the North Sea

For anyone interested in the upside potential here, Page 5, on the attached presentation, take a look at the latest discovery at Ash-2 marked in red, we now know any associated trap integrity uncertainty is gone from this area. This opens up the entire deeper sections in the AEB interval( all market in red) Worth noting these plays are sizeably larger to the latest discovery.

https://www.uogplc.com/wp-content/uploads/2019/07/Egyptian-opportunity-slide-deck.pdf

I can’t stress enough how unusual it is for BP, a super major to be involved in this recent UOG transaction and Brian has hinted that this is only the start of this relationship.

Worth noting BP are actively divesting assets in Egypt while also expanding with new developments. SDX had a failed acquisition attempt with BP last year rumoured to be worth $500m. Could BP be lining UOG up for future deals, with reserves now on the balance sheet, I suspect so.

I’m aware of the close connection the UOG management team share with BP, at the recent industry awards UOG sat at table with senior BP executives.

Interesting note, New BP CEO is an Irish man, and UOG is one of a handful of oil companies in Ireland. Small circles I can assure you. It’s not what you know, it’s who you know.

https://www.google.co.uk/amp/s/www.irishtimes.com/business/energy-and-resources/irishman-bernard-looney-named-as-chief-executive-of-bp-1.4040044%3fmode=amp

https://twitter.com/delboiaim/status/1206717768286064640?s=21

Hi Badger, I have been looking back over past RKH RNS’s, it appears that the Al Jahraa-12, the one currently on test/or still drilling is the only well to date that has been deviated and targeting multiple zones.

RNS 7 August 2019. “The well is being drilled as a deviated hole to appraise the Abu Roash-C downdip of the Al Jahraa-3 well and in the water leg. In addition, it will further explore the potential of the Bahariya reservoirs.”

This drill appears to be quite different, certainly more complex with more targeted reservoirs then previous drills on the permit. It also suggests that there is an exploitation leg to this drill, into a number of “reservoirs”

Time will tell, but this is where I believe significant upside may come into play. Impacts of which could well be transformative for the 4 fully funded drills next year IMO.

Either way , for now, 1100 bopd is exceptional for company of our size. Value will eventually win out.

A BP technical team worked closely with UOG on this deal, 1100 is great win for investors, but what the market IMO is failing to consider, for now, is the upside potential with infrastructure already in place to increase production.

Al Jahraa-12 (formerly WI-1)
The third Al Jahraa field development well (Al Jahraa-12) of this campaign was spudded on 4 August 2019. The well is being drilled as a deviated hole to appraise the Abu Roash-C downdip of the Al Jahraa-3 well and in the water leg. In addition, it will further explore the potential of the Bahariya reservoirs. The well is anticipated to take around 55 days to drill, test and complete.

I’m keen to understand what they have uncovered down in the deeper sands. Exploration upside here could be massive IMO.

Producing 1130 bopd now with 2 further wells on flow test. Go figure..

Yeah exactly, based on lower production figures and drilling cost. Which we have now benefited from with a 35% increase in production. With additional upside from the incoming 2 wells currently on test. Which were all paid for. This is only the start, the upside potential on this licence is huge. We could conceivably be producing 3k bopd over the coming year. UOG now full cycle and cash generating.

Those figures were based off RKH 780 bopd, inc the cost of drilling , its seen a significant uplift in production since then and they still have 2 well results to come in. Potentially transformational in there own right.

£18.5m Mcap generating operating revenue of $830k a month, cashed up with a fully funded 4 well development programme and 2 wells currently on test.

Can’t get a quote to buy, MMs want 1.60p

Free Float here is shrinking fast, only 31% if you include the latest TR1. Recent sellers stock has been soaked up and I’m aware of a number PIs in with £100k + holdings.