Member Info for jimtheknow

Having been around here for a reasonable amount of time and until recently been bullish on BPC’s future I think the imminent cementing of these two companies placed an immutable ceiling on this share price and any hopes of significant multibags from here disappears. That’s not to say there isn’t any money to be made, the sp will undoubtedly climb as the drillship arrives on station, but even with an oil strike this company will not be more than a £500m market cap company based on the market cap of other peer companies in this sector who are very well established producers already.

There is nothing to suggest that’s the valuation of the combined company will be more than the sum of its parts and the only rationale logic of the merger is to allow for some security against a loan and/or a bit of asset stripping to add to the coffers and mitigate any CLN’s.

Remember to not listen to those who promise wealth and riches and fully understand yourself what you are investing in and how it compares to other similar companies. And most of all, remember to take good profit when you can and don’t let this BoD lock you in for another decade - hope kills. You may die of old age or worse waiting for this outfit to deliver, don’t let that be you - I’m being serious.

The only hope this has now of making reasonable money is if the elusive farm-in come off, which it might, but that’s your real risk/reward. People will say that a farm-in dilutes in much the same way but at asset level, however, a sugar daddy oil company is likely to have deep pockets mitigating the myriad of risks associated with frugal one well drill plan.

All that glitters is not gold, this includes the apparent prophecies seen in twinkling stars.

To lighten the mood on here and give people reason to hope...

Does anyone know what Premier Oil's original name was? And for a bonus point...
Does anyone know Premier Oil's early history?

If you know the answer to these does it sound familiar?

The sp 'SHOULD' remain virtually static other than the normal fluctuations of day-to-day life. Remember, although there is to be an increase in share capital there should also be a proportional increase in market cap due to CERP's valuation.

As for the comment earlier on 10p at spud. When we get around to spud we are likely to have near 4 billion shares in issue, if you multiply that by 10p you end up with a company of £400m. Is that a fair valuation for a company that produces several 100's of barrels of oil a day? As a comparison with producing companies: Enquest = £233m, Gulf Key Stone = £200m

Lets see if a plan to asset strip CERP in return for money towards P#1 with institutional loan(s) for the balance, hatches.

I think I’ve pretty much had enough of this BB now, with Degsy’s new incarnation posting incessantly half truths on the merits of this merger, in much the same misinformed and/or disingenuous way as was the case under the actual Degsy and Iconic facades and all the bickering and points scoring that follows this board has turned into a shambles so that’s me going for the foreseeable future.

As for BPC’s fortunes. I have no reason to believe they won’t drill P#1 and fully expect them to do so in Q1 2021. The terms and timing of this merger are bad for reasons I’ve previously explained and it is abhorrent the board attempt to insulate themselves from the increased equity proposed for merger by tabling Resolution 3, this is simply disgusting behaviour by then. It’s very difficult to believe anything they say about putting their shareholders first and listening to their shareholders when they do something like this - and then they want us to believe them about a merger being good?

Regardless of what happens with the merger the share price will increase no matter as we approach drilling, that is a given so anyone claiming the merger was a success if the sp climbs is being disingenuous. What I will say is if the sp does climb post merger as we get towards December remember this, it is likely to have been AT LEAST 30+% higher if the merger hadn’t gone through.

My view on it was this....

Eytan conducted himself well, i've got no issues in the way he came across. I 100% believe him and the company when they say P#1 is their top focus and they are ready to drill it and I feel this is strengthened enormously by the unconditional Stena rig contract - this is very good. I would love to know what he meat about schedules changing when talking about the Seadrill rig, he wasn't only talking about COVID impact here I thought.

However, I still don't see the business case for this deal at this price, at this time and it concerns me enormously why BPC have deliberately not chosen to pull out all of CERP's skeletons e.g. production, and talk about them in an open and honest way. They obviously don't trust the majority of us to understand so they have chosen to never talk about it. We must at least be trusted to be informed around this as we know if CERP were actually booming with good production and margins we simply wouldn't be able to buy them. It is because they are faltering we are able to buy them. So lets talk about this!

The problem with CERP's production is essentially two fold; it is of a very low volume and it doesn't really make money in the current climate. I accept the production volume side of it may be able to be addressed in some fashion but BPC would become at least the third operator of some of these assets in recent years and those who've gone before haven't really succeeded so what makes BPC any different? They have the ego to think they're different to those who've gone before, the oil industry is full of men like this, but it's a big unknown. Leo Koot seems a good and capable man with a lot of respect coming from his role at TAQA but his vision and influence seems to have faltered, as did Neil Ritson's before him.

As for the making money. World leaders don't even have a crystal ball on world oil price so who the hell actually knows when CERP could make good money again? No one knows. If PoO doesn't turn around then CERP will still be the same struggling company in 9 months they are now - if they aren't struggling how can we buy them? We couldn't. They then become a liability to BPC rather than a help. How long can BPC float CERP until things do turn?

BPC were on a path to drill P#1 with a finance package that even in Eytans own words is expensive, but more importantly is was known. We can know the full cost of dilution as we stand. As we stand we and based on what the company has told us we still need to go on that dilution journey but with an extra 1+ billion on top of that for CERP. Talk of Institutions getting involved post CERP on better terms than the CLN is all great but it's still a significant unknown whether they will and on what terms. They may mitigate the CLN by a percentage post merger with an II but it's not going to be by a big percentage e.g. 50% better.

We're then still left with a company with low volumes and tiny profit margin - it's an expens

Star, I forgot to ask. What is it we all need to keep an eye out for over the next 2 days?

Pete, good question. As this deal stands at almost an additional 1 billion shares issued, those being for the deal and Director options, this deal doesn’t represent good value. This is compounded further by the fact, as far as we know, BPC will still pursue the CLN and the convertible loans from the family office investor.

If we add to this there will also be a requirement to raise some funds to develop CERP, how much we don’t know, so then this is starting to sound like death spiral financing. If they don’t raise or identify the funds for CERP development before P#1 is drilled then you risk P#1 being a duster and then raising with a sp that is absolutely smashed to pieces. This is definitely death spiral financing.

I feel BPC could have got a better ratio if this deal had been done later, mitigating dilution. I would also like to know how CERP will be funded to unlock any potential it may have and where this will be focussed to achieve something like 3k or 4k bopd and then this may be worthwhile.

Can we also expect any CERP actual oil in place to be leveraged to mitigate against any of the dilution spoken about previously.

This isn’t much to ask of a company is it? Where’s the plan!

Star, you continue to undermine your credibility. You attack me and not my facts and then what makes you even less credible is you post your assumptions about a situation as if they are correct and facts - this is not the case.

Your assumptions about the companies that have disclosed positions are exactly that. Your assumption is that these are investment decisions based on the fortunes of a company, i contest that with my own assumption. I assume these investment companies are not investing in the potential of BPC or CERP but more the market anomaly and potential arbitrage situation that occurred. A sharp investment manager will have likely seized upon a win-win situation that appeared in the market and this could have been any two companies.

As for the two BoD argument I can make an assumption as well. Mine is that the CERP BoD were likely to vote for anything that marginally better than selling out at around 2p a share and BPC BoD want to ensure the gravy train continued if P#1 fails.

These are assumptions and not facts.

CERP production of 560 bopd is a fact.
18 wells to abandon in Spain is a fact.
The markets have not taken kindly to this deal and think the merged company will be stronger after as the SP has slid day after day since the announcement.

These are all verifiable facts.

Stop attacking me and pull apart my facts and people will stop skipping by your essays and might even start to read them. Stop boring people and start educating and informing people.

Star, PoC, All I post are facts and should I ever post misleading or incorrect facts I 100% expect to be pulled up in these and corrected. Do you know what, I can’t recall a time anyone has.

I would urge people to read all the 100+ pages of the document that can be found on CERP’s website outlining this deal - I have. You don’t have to get too far into that document and you’ll read about CERP’s 18 well abandoning liabilities in Spain that will be required, or CERP’s 2018 and 2019 production. Net revenues. It’s all there.

If these metrics and business making qualities were so good and compelling why have BPC never stated these?

I, like you, can make assumptions on why this deal could possibly be ok but rather than me making assumptions I want my board to tell me what the plans are.

And to make those plans more credible and to quash the apparent greed and self trimming-ness of this whole debacle they should withdraw Resolution 3 at the earliest possible opportunity. As it stands they are asking us to make assumptions and have blind faith, well that doesn’t really work when it appears they are not in the trenches with us. It just looks like snake speak with forked tongue.

That is the shameful thing in this whole process.

PoC, this share will absolutely go up as we approach drilling in December - unless the board are lying to us about being ready to drill and we don’t. I believe they will drill so no issues there from me.

Acquiring CERP puts a ceiling on any rise though and if the drill returns dust, it’ll have an almost identical result on the sp.

What’s the point in buying CERP now then?

Star, you appear in total panic that some of the posts on here might actually seriously influence the outcome of a vote and you constantly manipulate the truth to try and paint a good picture for your own benefits. What you are actually doing is reinforcing and cementing the comments I put on because all I’m doing is posting what I see as unpleasant facts people should be aware of e.g. indisputable facts like CERP’s poxy 560 bopd production, and you accuse us of deramping. You’re doing my job for me in highlighting what is bad about this deal, you’re actually agreeing with me but don’t appear to see it. It’s not deramping, it’s unpleasant facts about the deal - well done for seeing this.

As for good intentions. I point all this out because I think BPC were on a better path without this deal, at this price, at this time. So yes I am doing my bit to help others.

Now I think your intentions aren’t so good as you don’t appear to want people to speak about some of these facts, why? I’m not sure. The most plausible reason I can think is you went in heavy on CERP when it initially dipped after the announcement of the bad deal and you took advantage of a situation that occurred. My guess is you’re very much porcelain committed to this merger coming off as if it doesn’t CERP are up the creek without a paddle and 1p will look good for them if they manage to maintain that after a failed bad merger attempt.

I have never said I will not vote yes to this deal, only that on the facts that are available now this represents a bad move, or certainly a move that could be bettered at a later date - if CERP are able to survive that long?

Sugardaddy, by far and away the best post I've read in a long time.

Anyone comparing TXP share price to BPC's in all honesty doesn't really understand how or why they are investing and if they've made a good profit they should sell up, pat themselves on the back and go away and learn a bit more about company valuations and how that relates to a share price before investing again.

TXP have around 183m shares in issues with a market cap of c.100m. For BPC to be valued at 10p per share post merger and after full dilution of CLN, etc when we will have around 4 billion shares in circulation would be a company worth around £400m.

£400m for a company that only produces 560bopd is a tall ask. When BPC go to spud I think most would agree a value of around £200m - £250m would be good going, so divide that by the number od shares you think will be in circulation at the time of spud and you have your share price. 5 to 6p after a merger at spud?

Unless they have another plan for funding that mitigates further share dilution, which is what most of us want to know before voting!!!! Give us a credible plan to come in around what we expected dilution to be and some of us will vote yes.

And take Resolution 3 off the table!!!

That is a factual assessment and to do much else requires assumptions to be made based around ‘jam tomorrow’ thinking.

People can’t get upset or angry about what I’m posting as these are the facts of the deal and any proponent of the deal must like these facts and not want them hidden in the closet. Surely they must want everyone to know fundamentals like CERP production?

At the end of the day the company, and those gullible to believe without researching, are going around crowing how BPC are going to become a producer. Everyone must want to know how much they will produce the day after the deal?

Straight up question, does 560bopd get anyone salivating?

Adonis, you’re absolutely right, they have told us what the future is. The future with CERP is....

....560 barrels of oil a day for a £25m outlay.

And to anyone who thinks I’ve miss typed or missed a zero off that number - I haven’t.

CERP produce 560 bopd!!!!

And that production only makes money when oil is comfortably above $40/b.

These are the facts of the deal.

Biting the hand that feeds you is a problem, that’s why Resolution 3 and this deal stinks. How can this board claim to be in this with us when the insulate themselves from dilution by allowing themselves greater options?

They’d look a hell of a lot more credible if they hadn’t tabled Resolution 3 with this deal.

If you don't like the sermons Bhoys join a different church.

I can't believe anyone would think it is a good idea to buy into a share that is pumped to the absolute max and beyond? It just appears like shear desperation and that a company is out on its feet, which in the case of BPC at the moment it is with this merger looming, no one will (or should) touch this with a barge poll until the merger is voted down and the fear of enormous dilution dissipates.

I guess todays prices do seem like a good entry point if the merger doesn't go through it is likely to immediately return to the 3.3+p levels it was just before the announcement and then rise to around 9p when the final boxes are ticked for drilling in December.

I'd hate to think how far the sp would have slid without the relentless efforts of some propping this up.