Member Info for InJamesweTrust

They have $350m in cash which is more than enough to keep the lights on whatever partners have planned.
Soccer, Chryasoar and others will be interested.

Gil had a good reason for raising funds at the time when he did and the partners will have been fairly open in their plans. I think Tullow have been iron clad in stating keep schtum but here's the plan.
As operator it's their gig and they will have a plan to prove up value and farm out within as quick a timeframe as possible. Mindful of the geopolitical and macro situation.

Looking at TSX cant quite believe the £1.58 equivalent figure. Seems like something must be in the offing but hard to know what.
As strong as my belief has been in what Gil and co are doing, its surprising to see the price moving with this kind of speed.
Personally, I still think there must be a trick up the sleeve this autumn. Is it the Jethro extension as alluded to on ADVFN, a punt at Rappu along with Joe or both....or something completely different.
Time will tell but what a journey so far....

Dare I say is London now starting to lead Canada in terms of price as the deeper London market begins to get a sense of the potential here.

Some thoughts on Rappu.
I dont think we will hear anything from Tullow unless they go ahead and drill into it.
The dip into cretaceous on Jethro is to give some insight I think and benchmark seismic. With a 50 day drill timeline and end Sept results I think they can go past Joe and test the Cretaceous (clearly they can keep a tight ship if you'll pardon the pun) to see how close the seismic correlates and use that info to decide if they continue drilling to test it or leave for another day.

From the Jethro results, I wonder how long the CPR takes to adjust. My (limited) understanding of such things would be that the seismic analysis is the difficult part which is complete, the difference now is what can be expected with regard to volumetric assumptions, areas to include at periphery of targets otherwise in doubt and likelihood of trap and seal formation.
To my mind this should be simpler (not easy) to plug into existing assumptions as an alternate scenario resulting in a change to potential volumes and possibly also the Chances of Success.
ECO will I dare say be keen to get this info out there but will be joined now I think by Tullow in being keen to get these revised figures understood by the wider market and potential farm in partners.

Biffa
Dont think tweets for commercially sensitive market moving info would really meet the reg requirements somehow.
Updates would be good, not do so until CMD is quite simply twattish

Sankeys/Maverick
Have mentioned before, I emailed Tullow IR and they mentioned the rig contract had given them the optoonality they need, being initially a 2 drill contract.
If it truly was just 2 drills with no options what is the harm in it being public knowledge (barring day rate)?
The foray into the Cretaceous was said to be a government requirement but we are drilling 2 or 3 years ahead of the licence requirements as Gil.has mentioned often. So, is it more just a look see to ensure this is as envisaged and reads across to Rappu or another target so they can recalibrate best CoS for a 3rd and/or 4th bite at the cherry.
Tullow has been clear it is not. Gil, even after the rig was signed said this is the first of at least 2 and.hopefully a few drills in 2019 (I think in his dec 2018 proactive interview).

So odds point to more drills bompanies have guided otherwise thus far.
Can Tullow farm out without touching the Cretaceous....

Started previous post to say,

TULLOW will want to blow the doors off at their Caputal Markets Day to make sure the potential value is recognised. They can possibly significantly reduce/wipe out debt and get a great free carry....

Wonder how much Eco can control appraisal newsflow or if it is in the gift of Tullow. Also wonder if Tullow are opening a data room for interested parties of which I dare say there are many.
Total and QP may think they are in pole position but taking Tullow down to 30 and buying Ecos share gives a major a potential 2.7bn barrels - with perhaps 40% of it considered discovery by the time Joe is drilled and appraisal worked up for Jethro and impact on channel.
Obviously other plays are derisked as oil has clearly flowed across the licence and Kumakka is right in the middle and appears huge.
So what value 2.7bn barrels to a major - Chevron were going to pay $36bn for Anadarko which had 1.5bn barrels although was producing 150k bopd. The 150k bopd over the 3-4yrs this would take to get there or beyond is maybe $8bn of that.......
May be I'm totally off beam but these seem decent competitive and the price that would be required to deal with either currently is HEAVILY discounted from that Anadarko level.

I expect Tullow will be keen to retain 25-35% with QP and Total splitting the remainder.
Free carry and some debt reduction for Tullow and straight payment for ECO if they can block TO to allow them space to move on and appraise Namibia possibly with a partner as lightly alluded to by Gil and picked up by someone on here (apols it escapes me who it was).

From a production perspective, the big costs wont start ramping up for quite some time. The thing has to be appraised first.
Now we drill Joe which lets say exceeds expectations also, Gil reckons the Jethro channel has also been significantly derisked. I reckon that is 700m barrels plus (I think it is a good bit more).
If we appraise this we have production reserves of 110-130m barrels plus 500m barrels plus still to play for.
Say we drill two or three of the big wells next year, that is another 1.7bn barrels or net to Eco another 250m barrels. That adds alot to any take out price and Total/QP have the balance sheet to look through shorty term market pessimism.
Will/would they cede control of Orinduil to Shell/BP/CNOOC or any other major (Chevron who tried to get Anadarko). Any of these players could go for a deal with Tullow/ECO combined to make them the operator and I simply cant see QP/Total allowing that to come to pass.
So, if they see the geology what is their game plan - to me it is analyse what has been found. Recalibrate seismic (Total can do this quicker than other partners and dont need to share the results) then decide how you value what is proven, likely and contingent and bid before the 2020 drilling starts.
That is what I see happening. Gil, mgmt and AOC control a fairly handy blocking stake and I dare say want to hang on to Namibia and sell only Guyana.
This might be what the advisor is appointed for, make clear bids will be considered for Guyana but with Institutions on board a full TO will be made difficult.
Namibia has the potential (and it is very much just potential) to dwarf Guyana to my mind in terms of shareholder returns.

Hallmark
Depending on how the rock has moved over time across a field then some deposits will be in Tertiary Lower or Upper and some in Cretaceous. Not every field would cover all 3 zones and indeed is most unlikely too hence why there are targets across these zones.over the licence.

The drivers now are the next drill but also the story of the Jethro results. How well does it derisk the remainder of the tertiary and how much was found volume wise that potentially rebases the CPR.
Gil said it exceeded expectations and they had penned 215m barrels.
Does that read across so they now expect Joe to be in excess of 148m barrels?
The remaining 700m barrels of Tertiary should any increased volume be extrapolated to these targets also.
Makes a big difference to the volume derisked and I wonder what the Jethro channel is referred to in the CPR if it is?
In the Andrew Scott interview just after the Total farm in when Jethro has been announced (Dec I think) Gil mentions how they can see the channels are full.
Getting this story out there demonstrates the value being unlocked and the remaining 3bn of Cretaceous to play for also.

So in terms of resource, Eco has Jethro at 220-250m barrels and the channel looks a similar size if a different shape. The channel being derisked significantly according to Tullow. Perhaps not as deep in terms of net pay. So say 60% of this and you're 400m barrels
Add Joe and your 550m so take 500m barrels as a figure.
That is 75m barrels net to ECO and the GHI/AVO and seismic are as expected so a higher degree of confidence in the remaining licence which is 525m barrels or more net to ECO.
What does that support now as a value I wonder......

The 3 most interesting aspects to me, the GHI/AVO is spot on as they've seen on their imaging and the seismic almost a perfect match. This to me bodes well across the licence not just the Tertiary.
Gil has suggested 20-25days for the 2nd well, Tullow are guiding end September. Does this give time for a dip into Rappu.....?
The reason I think they might is the other interesting snippet we've retained 60% interest in this license through to this point, we now need to consider the next steps.
On their slides, Tullow a £3bn market cap company before today (so 22x bigger than ECO) say this is a transformational opportunity for them. If it is indeed transformational for them it is bloody sensational for us.
I dare say many PIs will top slice/derisk a bit this morning and today but as it settles the news is pretty significant.
The Jethro channel looks pretty sizeable to me and a lot.like Kumaka that goes.up the slope.

I'm still catching up.on this and be very interested in Tullow conference call.
What an amazing result well done to all holders and an interesting ride still to come.

Cebo
Dont think anyone is suggesting it after the first drill.
The drill result is tough to fathom as it's been kept tighter than a ducks ass. However, the extended survey area, drilling extension notification and the ongoing activity at the same drill site are all a bit much for a dry/non-commercial hole - IMO.
Gil mentions $8 a barrel I think more in terms of $4 for discovered and 50c/$1.00 undiscovered. After Jethro that is $150m + $275m or about £1.75-2.00 at the bottom end.
If they go through Joe to get to Rappu that's 650m barrels of target and around 130m net to ECO.
The aspect I find harder to quantify is current volume assumptions in CPR which presumably are at lower end of scale but I just dont know.
For larger valuations mooted the cretaceous needs to be drilled twice successfully I'd imagine.
It could be easy give industry interest in this for market to overshoot a bit on success (and indeed failure) it usually does one way or ther other before settling.
In your experience, with production casing how many feet a day through sandstone would you expect to get?

Biffa
The SP needs no assistance from me to drop at the minute, not that anything I say would have any effect whatsoever. Astonishing to be flirting with the 30s again but good on the BoD for remaining tight lipped because they cant be arsed communicating. Suppose the only bright side is we are some way off their strike price so they have their work cut out.
Makes us pretty cheap to Kerogen and partner or BP and anyone else if the figures do look good on EPS.

Biffdog
Your post presumes the oil keeps flowing and there arent more disappointing drill results/dusters.