Member Info for Helpful

https://www.*************.com/views/40794/red-rock-update-getting-there-buy-to-double

https://twitter.com/RRR_RedRock/status/1091402323564343298?s=19

Oh and that PQE have their finger out.

Probably waiting on the next news which is likely to be the FH deal. Court hearing was supposed to be first week Feb do we might hear Tuesday/Wednesday. Then maybe confirmation that we are on site at Austin.

https://www.moneyweb.co.za/mineweb/sas-commodity-of-the-year-goes-to-manganese/

$55 done, $56 next. At $65 WTI we will be looking pretty good. Rising WTI reduces the break even production figure.

DYOR

Well let's see. The rumours coming out of PQE are pretty positive.

Well £165k of it came through me. I know where the rest came from. Most of the holders will be holding till the SP is higher.

The time to look at selling would be after Austin is sorted and online, ZR is sorted and online, FH is sold and we have CPR's out on Austin and ZR. I am reliably informed that for those size of assets the CPR would be about $15k pop: so not big money.

The CPR would place a value on the reserves and permit debt-funding. It isn't rocket science. NB note that SS from UKOG said the other day that reserves was a big thing. He reckoned that a barrel of oil in the ground was valued at £15/£18 for reserves/debt funding purposes. So how much is at Austin and how much at ZR. I was told months back (not by the company) that if the company could spend around $1mil at ZR it could probably prove up around 1mil barrels of EUR. I don't know what the figure would be now but maybe 400k EUR.

The assets are fine, the company just needs to be able to prove that. I would suspect that would be around late April/May time. Once they can put the production figures and the CPRs in the public domain we should be a lot higher.

Both Bensh and Thom Board have done this before and know how it works. On top of the zones we are dealing with now at ZR and Austin there are other zones that have not been touched. The decision would be, does the CPR just deal with the existing zones or the pristine zones too?

If the company wants to look at the Eagle Ford at Austin does it need to shoot some seismic? It probably would do.

If you were going to promote the drilling packages in the Eagle Ford into the tax market the seismic and a CPR on the Eagle Ford would be helpful.

So it may be that there are two rounds of CPRs, the second one at Austin after some seismic has been shot around September/October time.

None of this is rocket science; it is what should have been happening over the last three years.

So unless you need the cash (the guys who have come in don't) why would you sell right now? Around 1.2p September time will be just fine and that is without PQE.

IMHO

DYOR

https://twitter.com/RRR_RedRock/status/1090909168201072640?s=19

Looks like we are about to go blue.

https://twitter.com/AEI/status/1090659686897147904?s=19

Up another 7.69%.
https://www.bloomberg.com/quote/PBR:CN

http://pararesourcesinc.com/projects/gold-road/

Most of the newly issued ones won't be getting churned any time soon. The ones settling creditors etc might but that is the minority.

$54

Bit a cock-up.

It looks to me that a deal will be done with the other side in the court case.

I don't know but I expect that they will pay over to some cash to us and we get an over-ride/NRI to close the deal. I haven't seen the papers so I don't know the detail of the dispute.

Variously it has been suggested that the issue is access to the lease(s) or use of equipment belonging to the previous operator or whatever. Regardless, we have spent money on new equipment and contractors to refurbish the wells and bring them on line.

If it gets sorted then the issue arises what do we do about the vendors? As I understand it Longview were the vendors and presumably we have some recourse against them.

It is a shame, if FH had worked out and the court case hadn't arisen, we wouldn't have gotten into the mess we were in.

I am told that this sort of thing is pretty standard in the US, people go to court a lot over oil & gas disputes.

I am sure Paolo is more than capable of dealing with this and it will be like water off a duck's back.

However, looking at FH it is a more difficult field than ZR or Austin plus you have the travelling time back and forwards. Going forward operations need to be more localised rather than having assets spread out all over the place.

DYOR

I have been asked a couple of questions about the carried forward losses and what the company can do with them.

One of the things that Paolo's firm does is package up oil & gas drills for US Based investors. They are very famiiar with it; the process, the structuring, the tax treatment, the legals and so on.

So in the US tax payers get advantageous tax treatments for investing in oil & gas drills. Consequently, there are lots of private investors looking to invest in wells. Typically what they do is invest via a partnership and hold maybe 5% of a well. All the accounting and reporting is done for them and they just pocket the tax reliefs and the income.

We tried to do that at Shoats Creek with GCW on LM20 and supposedly we were going to let them farm into other wells at SC in due course.

What these investors don't want to do is any thinking or doing: they just want to hand over the investment monies and sit back. Towards the end of the tax year there is a bit of charge in the US to spend the money on drills to get the relief. If the investors don't manage to get the money spent the opportunity for tax relief is lost.

So between now and the end of the year there is the opportunity to package up new drills at Austin or ZR sell them on at "promoted" prices to third parties. We can also look to pick up assets specifically to package up in this way. Because of the tax relief and the urgency the investors are not as price sensitive as they might otherwise be.

One of the things we can do is package up some of the losses to go with the participation rights. We can't use them in the near term but third parties can.

If it were to work out we might end up with say a 20%/30% NRI in a portfolio of wells where the work has been paid for by third parties (the private investors).

This would in effect place a monetary value on the carried forward losses of maybe $10mil.

We would also benefit from a price abitrage on any new fields. Ideally what we would want is large acreage with existing wells to be worked over with our own funds and a large new drill portfolio. In the presentation published by the company it mentions the Eagle Ford shale. It may be that we do a bit of work in a couple of months to identify drill locations in the Eagle Ford and "promote" them in the manner above.

If you look at the various RNSs on ZR, one thing is clear, there are a lot of identified drill locations at ZR. There is no reason why the above might be done with ZR.

The two keys are the promotion package and the operational capablility. It looks to me that we have both of those now. Towards the end of the year it might be an idea to pick up acreage with the specific intention of promoting drill packages for 2020.

If you go on-line you will see information about this activity all over the place.

DYOR

https://m.londonstockexchange.com/exchange/mobile/news/detail/13671461.html

Hey, ex-wives Para currently up 21%. Surely that is not in the script? Looks RRR can take a profit and let the warrants ride.

I did warn you....

DYOR

https://twitter.com/pauljohnson9691/status/1090271188012527617?s=19