Member Info for haggis_trap

Agree - the departure of Dr Trice has been a PR disaster. Everyone knows there have been problems. However company has refused to disclose what they are, or more importantly the proposed solution. The news vacuum and uncertainty has driven the share price to record-lows.

I remain hopeful that HUR is worth closer to 20-30p than 0p.

My guess is deal will be funded 50:50 split between debt and new-equity.

Trying to guess the placing price of future RTO is impossible as current market cap (£10 million) will likely be small % of the debt (£20-100 million) depending on size of the deal. The real value will be added by purchasing multiple assets in similiar geographic location. The other way to add value is future drilling operations to extend life-time of assets purchased.

LBE were very keen to stress they are only considering UK & Norwegian assets in close proximity to existing infrastructure & pipelines. This seems sensible and maximizes potential for them to add value with minimum risk. Ultimately this company is a longer term bet that purchasing producing assets is more cost-efficient (in current low oil price environment) than taking the obvious risk of drilling new wells.

Board have done an incredible job at creating uncertainty. Handling of Dr Trices departure has been PR disaster. Everyone knows there are issues. Silence from board is deafening

Malcy and Dr Trice did seem to have good relationship...

@pauldrayton : exactly.

@munchbox54 : I am remain invested and prepared to be patient. The difference is that I am not going to unrealistically ramp the share (... because I have understanding of how the oil industry works and what a brutal environment it can be). Hopefully this will be the next RRE : It could also be the latest in long list of AIM oilers that promises big but fails to deliver. Only once the first deal is concluded will we be able to decide if it was smart business.

> companies are buying 20,000 bopd assets for peanuts out there because bigger companies are turning to longer term renewable energy

Oil price back at $50. No one is giving away 20bopd fields for free. BP and Shell might talk a good game about renewable however their core business remains oil (and global economy is addicted to it). RRE energy did an incredbile deal on buying up portfolio of older North Sea assets, however the future decommissioning costs and liability that came with them were huge.

^ BP or Shell didn't get to where they are now by simply selling off profitable assets to anyone who can raise equity.
Like yourself I remain invested here : however lets not kid ourselves it is a garunteed winning lottery ticket.
Until a deal is done its all speculation, rather than investment based on fundamentals.

Anyone who thinks this share is risk free and a guaranteed win is kidding themselves.
For now buying LBE shares is speculation that:

1) the board will be able to use their contacts to negotiate a favorable deal and negotiate equity to fund it.
2) oil price will increase in future.

Remember that someone is selling assets in the North Sea for a reason... BP or Shell don't just give away profit making oil fields. Therefore the board need to be smart to succeed and negotiate the right deal. Future share price depends on adding value - this could be via in-fill drilling to increase reserves / field life. Value could also come from buying multiple assets from different operators in the same area (adding economy of scale).

I remain invested at modest level. It is a unique opportunity to invest early in a new oil company pre-RTO. The recent silence is likely good news as it means things are happening in back-ground. Board seem to have pedigree and experience to win. RRE did spectacularly well from similar business model - but others have failed.

Lets not kids ourselves (... or others) this is a guaranteed win - lots of risk and uncertainty. Until the first deal is done the company has no real fundamentals or investment case. Good luck all! Patience and pragmatism required.

Anyone who thinks this share is risk free and a guaranteed win is kidding themselves.
For now buying LBE shares is speculation that:

1) the board will be able to use their contacts to negotiate a favorable deal and negotiate equity to fund it.
2) oil price will increase in future.

Remember that someone is selling assets in the North Sea for a reason... BP or Shell don't just give away profit making oil fields. Therefore the board need to be smart to succeed and negotiate the right deal. Future share price depends on adding value - this could be via in-fill drilling to increase reserves / field life. Value could also come from buying multiple assets from different operators in the same area (adding economy of scale).

I remain invested at modest level. It is a unique opportunity to invest early in a new oil company pre-RTO. The recent silence is likely good news as it means things are happening in back-ground. Board seem to have pedigree and experience to win. RRE did spectacularly well from similar business model - but others have failed.

Lets not kids ourselves (... or others) this is a guaranteed win - lots of risk and uncertainty. Until the first deal is done the company has no real fundamentals or investment case. Good luck all! Patience and pragmatism required.

Finally : despite recent negativity I remain convinced the problems will be resolved and company is worth something (20-30p) rather than nothing (0-4p).

The departure of Dr Trice has certainly left a stale taste in my mouth. He was the primary reason many people were invested in the company. There may have been valid reasons for his departure. However the company has not communicated these well - instead they created a news vacuum and uncertainty / speculation which could have been avoided. An absolute PR disaster.

Dr Trice at the CMD repeated a phrase which I remember : "we need to remember the potential prize here is half a billion barrels". Clearly there has been some kind of disagreement which forced him to walk - from a PR perspective surely the smart option for board would have been to keep him on as a consultant?

I am hopeful the technical report will answers lots of the questions and help complete the jigsaw :

1) More details on the "issues" encountered with 7z.
2) What the possible remedial actions are.
3) Where the company is going in future. Being sceptical the new-board may believe that shallow OWC is financially advantageous if it gets them out of drilling the commitment wells....

Either way the technical report is already written.
The recent events have been planned for many months based on its contents...

^ indeed - if they rubbish Dr Trices view / CPR & Schlumberger then they need to prove it, provide evidence, and explain what previously went wrong.

as ever the truth is perhaps likely somewhere in the middle ?

@slift : good post. An addition to your time line : 6 well was happily producing for 6 months on its own (12k bopd) with minimal water cut. The problems all started in Dec/Jan when the 7z came online and production ramped up to 20k bopd.

IMHO : company knew of these issues for a long time. Hence reason 6 well tested on its own such long period. The good news is there maybe remedial action to 7z which resolves issues. However they can only afford that if commitment well requirements from oga removed ;-)

Yup : company handling of Dr Trices departure (what ever the reason) has been a disgrace. Text book PR disaster

> WTF is a 'CEO Designate' ?

I believe it means he doesn't become CEO until 11th September.

I wonder if new-board, having driven share price into ground, will be awarded new options at start of the new financial year? Right now all involved likely in a close period until the results announced. Slowly but surely the pieces of the jigsaw make sense... Though despite skepticism remain hopeful this is forward looking appointment.

Hop along ngms27 : you will be telling us Spurs will be getting relegated next!

What does Craig David say ?

.... Though I won't be adding more no matter how low this goes. My truck is already over loaded with HUR shares

And another suffering LTH here.... Been invested since 2014. Never thought I would see the day when after 1 years continious production this would be valued at 4p. Currently the company is priced for failure. The new-board have created a perfect news vacuum by making it clear there are issues without providing proper explanation or future plans. The silence from the new CEO is now deafening.

However : I remain hopeful there is value in HUR. Even with shallower OWC the share price could / should still bounce back to 20-30p level given 12 months. Given the production level and cash being generated this seems to be massively over-sold. 17K makes Lancaster the most prolific well in UK waters.

All now depends on the technical report and its contents... I am fully expecting some bad-news (already priced in) plus remedial action.

Big balls required.

No news from board... Oddly I am taking that as good news that a deal is on the way

I wonder if board are in a closed period? Can't buy shares until after technical review released?