Member Info for HopefulDave

JJAL. I honestly hope D14 never invests here.

JJAL - you don’t invest for the past, you invest for the future.

Recognizing what has happened in the past is important, but if a company had made multiple millions in the past, but had no new projects, or no forward looking projections, you’d sell and get the hell out of there?

Investing is about the future, whilst understanding the past.

It seems some people can’t grasp one of the other or either

Diamond I have already stated we would, if no other source of income happens, need money, I just debate when that need would arise. I’ve said ED was a tad of a disaster, financially in terms of what it could have been, and with the Renegade situation. But it’s done now. People have gone, new faces are in, we have new projects. You seem to think we would place now at a rock bottom price for £2-3m to “set us up for next year” I don’t. They had a need for that money immediately before. We don’t have an immediate need for that amount of money right now. We need working capital for 12 months, but it doesn’t need to be in the bank now. Revenue is soon to be inbound from East Denver (and yes I know that won’t keep lights on forever) But Kansas is capable of very quick revenue generation once online, and by online I mean means of taking nitrogen from the well heads to the market, as we already have a well capable of producing 2581MCF/d on the site. Development in Kansas does not need to take much longer, or much money. I’m no longer convinced we will be processing it ourselves, which massively reduces the cost burden on ourselves to commercialize it. I’m convinced they will do a deal to sell it commercially and in bulk to somewhere nearby, all the stars align to that. You are yet to offer a single thought on anything related to it, or why in your opinion it won’t produce revenue or by when, or enough to fund ongoing operations? You are full of yourself with old ED costs and projections, but offer nothing on Kansas. You are constantly bringing up how much ED costs and the returns which is all in the past, yet fail to acknowledge anything possible positive in the future? We could get significant revenue anytime soon from Kansas, yet you insist we would raise the money required to see us through the entire financial year now, alongside any additional revenue from ED. This implies you see zero revenue from Kansas in the next 12 months - Why? Do you think we need to spend a lot of money to develop Kansas before we see a return? I just wonder why you insist we need to raise £2-3m now to cover us for 12 months into the future, alongside ED revenue and zero revenue from Kansas. And please, I don’t mean repeat yourself and discuss your perceived breakdown of the costs from previous years, I mean why you refuse to calculate any benefit from Kansas into our costs and revenue projections for the next 12 months at all. None whatsoever? Why? Is it simply because a couple of Kansas wells could fund us for the entire year?

Funny you should mention that D14. Now who would provide a tiny £2-3m to someone with a monster resource like Kansas? A bank with an offtake agreement in place. A customer, maybe one with billions and billions of $) see my link. A Royalty holder for a % of it. You know. We don’t actually have to process it ourselves..... And more to the point. If you don’t need to process it, and someone’s paying you $5-10 for it.... Isn’t that, oh now what’s the word, urm on the tip of my tongue, oh yes. Revenue, that’s it. Revenue and oh working capital.... Now if you have that urm revenue thing, then you don’t need £2-3m either. Hmmm.

BH. It’s another long hold for me. All depends how they finance the overspend. But still it will be a FTSE 100 company soon enough. It’s Q1 2019 next quarter. 2 years later the shaft will be sunk and they will hit first Poly. How much MCAP then? Can still see 40-50p on the cards post ST2. And once the $3bn bank commitment letters are in I would expect some crazy volatility. If they do another royalty deal, completion finance etc and no more shares Issued (or kept to 200-300m to royalty partner) or something like that then into 50-60 easy next year. The bod are heavily incentivized to get it into the FTSE100. It’s going to produce billions in revenue and exports every year. Next year it will be funded and start churning through $3.4-$3.6bn spend. People don’t get the sheer size and scale of it, the biggest knocker and blocker of if at all, now wants to now mine 3Mtpa of Polyhalite itself! Strange that huh? They just don’t like the fact we have a better new shiny mine capable of 20Mtpa on it’s way and (although costing a small fortune) a shiny new tunnel to transport it through rather than a rickety old railway line on the edge of a cliff! Anyway enough about them on here..

They could probably consume all of it!

Black hopper. - That’s where SXX comes in! However. They won’t be able to provide enough Poly4 to feed the world. I still see the nitrogen being used by the fertilizer industry, it’s huge and if anyone has googled my “all about the Koch” (well ok maybe just) “Koch” and Kansas you can see how much that one company uses producing in the area. Not saying there aren’t other uses still. Plenty of other commercial uses for Nitrogen, but when you have someone who’s making that fertilizer on a super epic industrial scale nearby, how much nitrogen do you think they need? I think when the company stated exploring other options to market it, as an end user they must be one of them, but not the only one in the area...

The presentation from the AGM says it’s in Jefferson...

Noodle. Indeed. That’s what the website states.

It was also the same statement in the initial discovery, upon the flowrate of the one well...

Look at that flow rate, and the nitrogen consumed in the last two tests, you’d get 45 identical applications in both basins (so 45 each, 90 applications from that one well, per year)

Since then we’ve increased our acreage by a further 700+ acres (to the 1500+) number.

How many wells would we put on there, and how many DTU applications would we need to discount, before it took off regardless of the nitrogen supply?

And I’m not ramping DTU - Just stating, surely if 90 applications had been carried out, and you’d achieved, or proved it does what it needs to do, it would then get adopted without the nitrogen being supplied cheaper?

Meanwhile back at the ranch (so to speak) you have all those acres with all that nitrogen, and very hungry constant consumers of nitrogen throughout the state..

Surely once 90 applications has been done either it works and everyone up for it regardless of the nitrogen cost?

So rather than only supply it when there are DTU applications on the go, and the fact it could supply a significant revenue stream by itself, surely we’d look to achieve constant, steady and decent revenue?

We must be able to drill more wells, or re-complete some more on the extended acreage, and hopefully more wells on the initial 800 acres, and with big consumers of Nitrogen locally, just seems rather strange not to look at those markets?

The RNS states we were looking at marketing it to other industries not just oil and gas, and we gained more acreage.

So that’s where I’m coming from, plus in the Nitrogen video http://highlandsnr.com/nitrogen-film/ 2 mins in... I mean. Interesting to put a whole section in about that right?

Maybe it’s cause I’m Hopeful Dick (c) D14 but perhaps it really is all about the Koch? (And yes it safe to google that)

For Highlands, we have the possibility of re-injection of gasses into the reservoir to improve oil recovery, and not flare gas. (So availability of gas pipeline / or processing facilities / issues with WD might not be an issue) If grandfathered then we would be OK with WD so less impact to us again. Our ED Wells wouldn’t be impacted. Fortunately we aren’t a one trick pony, and up until WD, the actual O&G assets in Colorado are not exposed. Kansas is in Kansas, and Nitrogen (imho) will almost certainly end up in the agricultural industry as there are very very large processing facilities and industry in the area. - A slight clue in the nitrogen video perhaps..... And Helios is Helios. The much (recently talked about for the water play) Powder River Basin is in Monatana and Wyoming. And I’d imagine with the acreage we have there (Helios) we’d be able to find a few remote enough spots to drill *if* similar legislation was passed there. So it’s by no means a show stopper for Highlands, but it would certainly shake up the O&G industry for a bit. It’s a good job we have multiple spinning plates huh?

Some other things on the agenda.. A vote to Increase taxes for funding schools who already have a shortfall. (Despite the money they get from the oil and gas royalties...) Nicely highlights increasing taxes as a possibility if revenues drop (or claims against the state go up) not just for the high earners but businesses (which will pass on their costs to everyone else) A proposition to compensate property ( and therefore also lease owners) should legislation devalue their property (such as prevent them from being able to gain income from their oil and gas wells, amongst other things) This would effectively extend laws that allow claims against the state of Colarado and/or local townships that pass said legislation (including prop 112..) or put other restrictions later that should they lose income / their property becomes devalued as their mineral rights effectively become worthless... they can claim compensation. At this point they would be entitled to compensation. - Not just restricted to oil and gas - this is a wide ranging law, but would now also capture losses associated with proposition 112 as well. A clever one this. I would imagine that will pass as most property owners would want that. The implication of that passing and 112 passing however is a double edged sword so hopefully will make people vote against 112 and for the extended property rights. And the naughty proposition 112 itself. Clearly, some argue that with the already established spacing units and dsu’s etc ,but not yet drilling, there is already future income guaranteed, but anything that isn’t grandfathered would not be. However as we all know, somethings are viable becasuse a pipeline can be put in, or would be economical if you do plot a and plot b, and maybe if plot b doesn’t happen neither will plot a... So how many projects / drill sites that can’t then go ahead, or don’t become viable as a result of others not being viable? Perhaps an entire processing facility that would have come online somewhere may now be in jeopardy of not happening. Lots of other jobs etc associated around the supply chain, not to mention hotels / motels / stores / bars / food outlets, construction the list goes on. Needless to say. Most politicians, and their equivalent chambers of commerce etc all oppose 112. The vote of course goes to everyone, not just the politicians. Green V Greed..?

Things are moving and moving fast!!!!!

At least I’m consistent if the sp is dropping or rising....

Look out for low flying flip flops.

The sp is frustrating but the ridiculous assumption they have done nothing and anyone can do what they are doing, I mean comments like that are rather silly are they not?

Your next post is much better, and perfectly sums up the point I’m making.

It takes time to deliver ALL the components required, but the point is that piece of work is a huge part of it, it’s not “anyone can do it” and it’s a major milestone.

To constantly belittle the big achievements that are being made is baffling.

On your own post you sum it up perfectly, but then not appear to get the main point!

If WD has progressed with that much planning, and it’s not the main focus of the company right now...how many pieces of the puzzle have we solved in Kansas?

Maybe just maybe we will find out in an RNS soon the massive progress made there, not forgetting unlike WD, a future play, Kansas already has a well that can produce huge quanties of nitrogen....

“Anyone can buy land!” !!!!!!! “What have they achieved?”

Seriously!!

Do you have any idea what work goes into looking for the land and planning the drills?

Did you think the oil and gas game was like the Beverly hillbillies and a random bullet hits the ground and oil comes out and all of a sudden everyone is rich

You must have no idea of the knowledge required to understand and plan this?

You need to understand real estate law for starters, and then the planet brained scientific knowledge required to plan the locations of the drills based on all the studies carried out, and the understanding of the well formations / reservoir pressures, untold surface and under the surface studies and tests and countless hours computer modeling possible scenarios flows etc?

They have planned up to 104 drills, not on the back of a fag packet, complex designs to extract the most oil and gas perceived possible and to drain the reservoir as efficiently as possible.

If you still don’t think that is not achieving something for a small oil and gas company... wow. Simply wow.

I honestly cannot believe you posted that, and someone liked it!

I should think so Fad! Onestraightguy1 - I don’t discount the issuing of further shares, I just hope that it is done in a collaborative manner with partners. Kansas - Nitrogen offtake partner / infrastructure providing partner or even a full partner in terms of coming on board for X % of the Nitrogen play itself could equal development capital for it (if we can’t sort ourselves / scale it rapidly) and no shares issued or a mixture of receiving cash with some shares also going in the other direction. Can you imagine a collaboration with an existing distributer of air products perhaps, or maybe a tie in to provide a large agricultural supplier with large volumes of nitrogen? We already have a good working relationship it seems with True, ConocoPhillips and Halliburton’s but none are strategically invested with us. Having a huge fertilizer company, specialist gas provider, or any one of a number of oil and gas companies taking a stake in us to partner in Kansas (or later WD) would give us additional capital up front and also open the eyes of a lot of investors. Whilst people are banging on about “previous” for share placings they haven’t mentioned the fact that Highlands has twice issued shares in the past with East Denver. Once to Renegade as part of the lease payment for section 15/16, and I believe we also issued some for payment to some of the original work carried out on that site. So it is not beyond the realms of possibility that should we need to fund some of these projects that we could not do it in mutually beneficial share transactions? Baring in mind that one well (the one we have already) could provide enough Nitrogen to provide 45 of each of the last two DTU application tests we carried out (I.e 90 DTU annually from that one well) and we have 800 acres with that well on it plus now 700+ more. A partner would still leave more than enough nitrogen to sell on “excess” outside of DTU. Also, the company isn’t stupid. If more money could be realized selling the nitrogen directly elsewhere than they could make from DTU + nitrogen then they would sell the nitrogen for the higher price, at least at first.. Back to WD, lease information will be interesting. I’d be surprised if we were expanding much more there but you never know. 104 wells is huge, and depending on the carried working interest, reversion back in, and possibly even royalty revenue should be enough to excite investors who don’t understand the nitrogen significance! For those saying nothing is happening. See the size of WD and the fact they have identified 104 wells is a staggering piece of work. Now imagine what’s been happening in Kansas and what could come from that..

Possibly referring to the fact everyone jumped on the 75,000 repeated sells but nobody has mentioned the multiple 7x,xxx buys taking it back up to 14.5 from 13.x ?

Jof, depending on where these are we may not need to have them “heard” at the hearings themselves. It will depend on the lease we have. The permitting process was expected to be smoother than our previous ones, obviously due to the fact the leases our ours etc. We may be able to move forward without hearings. (But still having engineering review / other safety sign offs etc)

I think it will depend on the land we have. We still don’t know if it’s state or private which may also change the process.

Just have to wait and see the permits appear and then see where they are / what they are etc.

Noodle I forget the exact percentage but it is something stupid like 80-90% of Colarado is off limits if they pass it. It would therefore stop many billions of dollars from going to the state, and to the mineral rights owners (Ironically many of the people who live near the developments) It would destroy a vast number of jobs both directly in O&G and in the supply chain. I’m not suggesting Colarado would become an abandoned “coal mining town” but it would have a devasting impact to the economy. Furthermore “grandfathering” is common practice and stops retrospective actions hence filing before the vote date is the practice most companies are doing. I’ve no doubt more and more green regulation bits and bobs will come along, in time, and ironically why the water play is interesting. People ***** and moan about injection wells a lot with fraking. But they can’t afford to just stop development outright it really would leave a devastingly large hole in both the state (and therefore the Colarado population will need to pay more taxes to cover the shortfall) and those that benefit directly and indirectly from O&G would suffer a double whammy with less income. Some people / local communities that have moved in to oil and gas territoriy and have no lease / rights may vote agaisnst having them nearby, and no “perceived direct benefits” of developments. So the “not on my doorstep” campaigners face a double edged sword, as they are still hugely benefitting by lower taxes and excellent schooling. Have the oil and gas revenue and money providing lower taxes, hundreds of millions of dollars every year going directly to the schools they send their kids to. Or back the vote. For all those not living directly near developments, they are basically voting to keep their taxes low, and their schools funded... always seems to be how most people vote put themselves first. It’s not something that is being pushed by Democrats or Republicans effectively, in fact most key political figures on both sides want to leave it as it is and let the COGCC plan and permit accordingly, as is with the 500 - 1000 ruling in place. That’s how I see it anyway. As for the leases. Yes it will be very interesting to get more information on them, I’m intrigued as to the direct ownership aspect. Interesting how you question an option for a future operator to maybe have paid something for this upfront. Distinctly possible. Yet others so blatantly refuse to see how similar things couldn’t be in play in Kansas / partnerships with money up front..

It’s like I said. They have been busy. Very busy. And whilst it might not be reflected in the SP. they have been quietly going about their business acquiring the land and drawing up all the permits ready for submission. Just like they have been increasing Kansas acreage and busy busy behind the scenes talking commercials as well. You don’t think for a minute that they have just been grabbing land and working out where the drills will go without also talking to the financial people do you? That would make no sense. But you can see the extent of their hard work coming together now. SP is painful I agree. But the fundamentals keep on improving. Again. They said they would look to permit this in 2018 with drilling in 2019. It’s 2018. - ooo look permits being submitted.... They have a plan and they are working with it.