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I don't give investment advice. 01 Dec 2023 04:22 "My conclusions are for my own information, but I will also post them here for your interest or mockery".
Here's some general, non-investment advice, though. Take a look at the Russian army - all they do is repeat the same useless and obvious tactics over and over again, never achieving anything worthwhile, their losses building up, while the whole world laughs at and despises them. My cat can see through the poor-quality FUD this sad little bunch are trying to spread, so why waste so much of your time making fools of yourselves for just for the faint hope of picking up some loose change?
Do you really think a company with the financial leverage, technical expertise and in-country clout of Afriquia Gaz would be in public discussions with PRD unless they were completely satisfied that very substantial assets were available for commercialisation? Why do you think so many people with substantial relevant industry experience, who use this bulletin board, have seven- or eight-figure shareholdings maintained over several years, which they have no intention of selling any time soon?
@WB again, same post, "rampers are those who constantly lie and pump to get a few points on a daily basis, and fleece the honest souls here - of there are any left.(sic) This is the most cynical bulletin board I am proud to have read without posting too often." 1). I see plenty of genuine investors here, I don't see any of your rampers. 2). I agree this is the most cynical bulletin board - you and your friends are the problem. 3). imho you post far too often.
At least Nigel put a smile on our faces with his creative invention of an Algerian invasion, inadequacy of Guercif City Fire Dept., unidirectional pipelines, disbelief in the existence of water tankers, and even terrorist abduction of CNG trucks...or was that alien abduction?
My reading is that a second deal cannot be finalised until the Afriqui Gaz MOU is converted into a final contract. I thought it interesting that there is a 50 mmcfgd cap for Afriqui - this is presumably an ONHYM requirement to ensure that indigenous gas is available to other Moroccan customers as well. Very significant, since it is a clear indication that ONHYM believe that more than 50 mmcfgd can be produced from Guercif - and, unlike us, they have access to all the available data.
Part 2.
🦖 Afriquia Gaz Agreement
* I am sure that this was signed a couple of weeks ago, as suggested here at the time, but announcement was delayed until there was clarity over the testing regulatory issues
* Afriquia is the leading commercial distributor of gas in Morocco. They know all the issues concerning trucking CNG around the country, and parent company Akwa has connections in high places – an excellent partner that will be of great help in securing all the necessary licences. I am sure there will be no need for additional fire engines nor anti-terrorist escorts.
* Not sure why some are confused over this - Predator IS selling at the wellhead – that's where the trucks load up with paid-for gas.
* 50 mmcfgd at a very conservative $12 per mcf gives $220 M annual sales. FDC believe that commercial risk has been greatly reduced, and assuming everything goes to plan, they have assigned just the MOU-Fan discovered assets a NPV of 64.4p per share, the Middle Sands an additional 78.3p per share. The current 9p suggests the market still thinks all this is high risk.
🦖 Drilling Programme.
*This drill positions have obviously continued to be optimised as further data is processed, hence the need for new EIAs.
* A little disappointing that there was no upfront payment associated with the GSA, and that drilling costs will come from T&T cash flow, with a consequent delay. Better than further dilution, of which there has been more than enough already.
* The reason MOU-3 shallow reservoirs were not appraised at time of drilling was not due to penny-pinching, but that the overpressured gas required the hole to be cased urgently. Not sure why the MOU-1 shallow sands were not tested at time of drilling - probably the reservoir potential was not recognised until after detailed NuTech evaluation of the logs, which was after necessary casing of the unstable borehole.
🦖 Oil
* There has been speculation about oil/condensates on the Guercif licences for years. Oil is a precursor of thermogenic gas, I am unsure if the unusually high local geothermal gradient will have left enough in a suitable state to be commercial. PRD will not be involved in oil exploitation, that is an additional bonus for an acquiror.
* Some possible confusion – the RNS states that they are looking at the potential for Jurassic source rock. This is not the same thing as the MOU-NE / Titanosaurus Jurassic carbonate reef, which is likely to be gas, not oil. There are a lot of other Jurassic strata to be investigated.
🦖 T & T
* Little information is publicly available, so I look forward to reading the Cory-Moruga CPR. I have already posted that PRD appears to have acquired quality assets very cheaply, so it is intriguing to read that this opportunity could be on the same scale as Morocco.
Part 1.
2 RNSs yesterday, then 200 posts while I was asleep. I've read through everything, good, bad, intelligent & stupid, and checked publicly-available reference material where necessary. My conclusions are for my own information, but I will also post them here for your interest or mockery. Some good stuff, some disappointing delays. I think to heap blame on PRD management is not fair, but I understand investors' frustrations. Many of the negatives (including many plainly untrue comments) have come from short-term speculators who have failed to acknowledge that they are following a high-risk strategy, and seek to blame others for their own failings, or else are seeking to drive the share price down. Clearly management credibility will have been strained by yet another delay, but I am sure they realise that they now have to deliver the goods. The assets are still there, and imo still exceptional.
🦖Rigless Testing Programme
* Obviously disappointing that there are further delays. The RNS made it clear that all was going ahead as planned, and as had been posted here two weeks ago, but the problem that occurred after mobilisation had started was not the fault of PRD management, so very unfair of so many here to claim that it is the case. Whether this was a genuine mis-communication between government departments or a malevolent 3rd-party spanner throw we will not know. Anyway, management know they have to get it right this time, and only 17 and two ½ trading days to January.
* Also a little disappointing that it appears that there will be less intervals tested – presumably this is a combination of lack of equipment as stated in the RNSs, together with time & cost saving. Management are presumably confident that they can produce more than enough gas from these horizons to fulfil initial contractual needs, and demonstrate likely overall flow rates and volumes.
🦖Licence Renewal
* There is either genuine misunderstanding or deliberate misinformation regarding licences – look at the posters involved to decide which. PRD has met all the obligations of the current licence – both financial & drilling. See pp.33 & 98 of the latest Prospectus - I see PT has very helpfully covered this in detail. The next regulatory steps would normally be to proceed to the First Extension Period, then an Exploitation Concession, for which an additional bond becomes payable. ONHYM have been very helpful in extending the Exploration Permit to give PRD more time to be ready for production – which would be the normal point at which an Exploitation Licence becomes necessary. In short - 5th February is NOT a deadline by which flow testing must be finished & reported or else PRD loses the Guercif licences.
Now, I'm really curious - this appears to be the 'wellhead' agreement referred to in the last RNS. Is that the same as, or additional to, the 'industrial' agreement mentioned there as a prerequisite for the start of flow testing ? Have 2 MOU's been signed? - Super Cérame was widely flagged as the 'industrial' customer, and it was floating around the market, from whom I consider to be well-informed sources, that this was signed over two weeks ago. Maybe it was not felt necessary to RNS this first agreement, since it was already indicated as pretty much a done deal in the previous RNS. If these rumours were true, it would be reasonable to expect that flow testing has been ongoing for some time, given that 1. everything was said to be ready to go, and 2. mention of testing is conspicuous by its absence in today's RNS. I guess Paul might let us know one day.
“It’s the nature of things that a very intelligent man working hard maybe gets three, four, five really good long-term opportunities of buying great companies at a cheap price,” he said. “It happens rarely.”
RIP, Charlie.
They don't have any money to do this yet - all this is conditional upon sale of the Egyptian assets. I am curious if they have any firm access agreements to the MEG for connecting their own pipeline. Clearly they don't have much more indigenous gas - I am also curious at what price and at what profit they think they can sell imported gas. Gas from Guercif will certainly be cheaper.
@Nick. I can see the change at the north end of the MOU-2 pad, particularly on 25th October - this appears to be independent from the changes in the surrounding landscape caused by rainfall. Assuming everything was working perfectly, it would be possible to drill 200m in a couple of days, plus a few hours each end to move the rig. I don't see an obvious sign that the rig is up, though. It would be a very nice extra to have MOU-2 completed - they did have both Purebore & Ultradrill drilling mud in the Guercif warehouse, so not impossible.
I would have thought that completing MOU-2 would be RNS-able, but with this lot, anything is possible. Guess we will find out in the next 2-3 weeks.
Part 2️⃣.
FINANCIAL
💥 Profitability
“The SLR CPR (January 2022) gives an unrisked NPV per BCF of discovered gas of US$1.99 million. This is based on a large-scale gas-to-power development using a gas price of US$9/mcf and results in a low net-back of just US$1.99/mcf.” and
“The SLR CPR gave an unrisked NPV of US$592 million for the net Best Estimate resources of 295 BCF” (CNG, for just one reservoir structure)
www.lse.co.uk/rns/PRD/drilling-and-operations-update-3dby10znl7nldot.html
and see ranges for multiple scenarios:
pp. 6 & 7, https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2021/09/19204501/PRD-Proactive-Presentation-Final-09.09.2021-1.pdf
💥 Tax environment.
“Fiscal terms in Morocco are attractive. The state royalty for gas production is only 5% and is applied after the first 10.6 BCF of net production to the operator. Corporation tax is levied at a rate of 31%. However, the Moroccan government also applies a 10-year ‘holiday’ before corporation tax is payable and any unused tax losses can be offset against the tax due.”
https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2022/03/Predator-Oil-Gas-Corporate-update-7-March-2022-1.pdf
💥 Business environment & stability.
“Not only is Morocco an important market in its own right, it is also becoming the premier commercial gateway to Africa, as well as Africa’s bridge to Europe. Africa presents the single largest growth opportunity in the world”
https://www.gov.uk/government/publications/overseas-business-risk-morocco/overseas-business-risk-morocco
💥 Regulatory.
“Oil and Gas Regulation in Morocco: one of the most attractive schemes in the world”
https://www.cliffordchance.com/content/dam/cliffordchance/briefings/2014/03/oil-and-gas-regulation-in-morocco-one-of-the-most-attractive-schemes-in-the-world.pdf
I await your response - Keith (real person. relevant qualifications, extensive industry experience, both exploration & business development. And you?)
Part 1️⃣ - re-post from September, revised.
This bulletin board provides an environment for sensible adult discussion on all matters relating to PRD. All views should be considered, but nursery school one-line posts calling other posters silly names provide nothing.
I reiterate my view that an offtake agreement, conditional upon flows from two wells, has already been signed; that flow testing of MOU-1 & -3 is underway. I have admitted I was incorrect in my view that an RNS confirming start of testing would be released two weeks ago, and have stated last week why I think this is legally unnecessary - see those posts for details. I now suggest that there will be a 'grand slam' announcement early - mid December.
I do my best to present factual information, usually referenced, and if I speculate based on that, I try to give my reasoning for doing so. I reconfirm I would be delighted to consider alternative views, if you disagree with me, please post in detail your opinions, with the reasonable proviso that you also present the facts on which you base your views, and how you have extrapolated from those facts.
In particular, I would ask you to consider:
RESOURCE
💥 Areal extent.
MOU turbidites 30+km², Ma sands extent of 58km²:
https://www.lse.co.uk/rns/PRD/completion-of-mou-3-drilling-and-logging-77nekzdof9lxnu8.html and
MOU-NE (Titanosaurus) 126km²
p.9, https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2023/05/Proactive-Presentation-18-May-2023-FINAL.pdf
💥 Porosity & permeability.
“At deposition the independent studies indicated that these sediments were likely to have 35 - 40% porosity and permeabilities between 2000 and 5000 Md. Lack of compaction and consolidation suggests that poroperm conditions would not have been significantly impacted through burial and therefore good reservoir quality would potentially be retained, as supported by the post-well NuTech log analysis.“
https://www.lse.co.uk/rns/PRD/drilling-and-operations-update-3dby10znl7nldot.html
💥 Reservoir thickness.
MOU-1 testing of 22 reservoir intervals:
https://www.lse.co.uk/rns/PRD/operations-update-covzavfrw2aj6tq.html
43m in MOU-3:
https://www.lse.co.uk/rns/PRD/completion-of-mou-3-drilling-and-logging-77nekzdof9lxnu8.html
64m in MOU-4, plus Jurassic
https://www.lse.co.uk/rns/PRD/mou-4-update-41ps08lleqbs03n.html
💥 Overpressure
Significant overpressure in Ma sands MOU-4.
https://www.lse.co.uk/rns/PRD/interim-drilling-update-mou-3-a1ahzbsju1a49lu.html
and MOU-1 - chart, right side of p.13
https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2021/09/19204501/PRD-Proactive-Presentation-Final-09.09.2021-1.pdf
💥 Flow per metre
In the Rharb basin (continuous with Guercif) reservoir sands of only 1m thickness flowed at more than 1mm cfgd, thicker reservoirs at higher flow rates per vertical metre:
https://www.reddit.com/r/PredatorOilandGasPRD/comment
CNG and petrol distribution companies in Morocco have been accused of anti-competitive activity and price gouging. They have now agreed to a consumer protection framework and paid penalties. Translated from Arabic:
"Nine hydrocarbon companies and their professional organizations managed to reach a conciliatory settlement with the Competition Council, after these companies reached on Thursday the approval of the Competition Council on reconciliation agreements that end the disputed procedures against them....
According to the reconciliation agreements, the companies concerned and their professional organization must commit to a set of commitments regarding their actions, in order to improve the competitive functioning of the hydrocarbon market in the future and to prevent the risks of compromising competition for the benefit of the consumer.
The Competition Council affirmed that the commitments made within the framework of this conciliatory procedure are of a 'mandatory nature', as the Council's services will monitor their implementation.
This involves the establishment of a conformity programme with competition law, which reflects the commitment of these companies, expressed at the highest level of responsibility within them, to respect competition rules, with the establishment of competitive risk maps within these companies and effective internal warning systems, as well as the appointment of an internal official from the managers of the enterprise to develop and monitor the conformity programme.
In order to enable the Council to ensure the competitive tracking of the markets concerned, especially with regard to the correlation between the selling prices of gas and gasoline to the public and the international prices of these refined products, the restorative undertakings provide for the preparation and transmission of a detailed situation that allows tracking the activity of supply, storage and distribution of gas and gasoline by each company separately."
https://anfapress.ma/%d8%aa%d8%b3%d9%88%d9%8a%d8%a9-%d8%b5%d9%84%d8%ad-%d8%a8%d9%8a%d9%86-%d8%b4%d8%b1%d9%83%d8%a7%d8%aa-%d8%a7%d9%84%d9%85%d8%ad%d8%b1%d9%88%d9%82%d8%a7%d8%aa-%d9%88%d9%85%d9%86%d8%b8%d9%85%d8%a7/
Jersy Oil & Gas this morning announced the sale of 30% of their Greater Buchan Area (GBA) to Serica Energy. It's interesting to compare the price / Bbl of this acquisition with the Cory Moruga deal.
JOG receive $19M, and are free carried for development - Serica pay for their own 30% of the field development plan, plus another 6% representing their share of JOG's free carry. The FDP is estimated at $850 - 950 M (this is deepwater offshore). So Serica's costs will total $325 - 361 M. Resource is 70MM Bbl, so 21MM attributable to Serica. Cost per bbl is therefore $15.5 - 17.2.
Cory Moruga is now $2M upfront (RNS 7th November) for 17M Bbl (p.11, 2022 Annual Report). The FDP requires up to 20 wells, at most $4M each. 17MM BBl for $82M is $4.8 per Bbl or less. Sounds like a good deal to me.
Shortshrift - I have read your recent posts here. It would seem to me that you are very keen to present negative information about Predator, and discredit other posters who share useful information, while signally failing to produce anything useful yourself.
I wonder why that might be?
The Cove deal was very interesting. PTTEP (Thai national energy co) won a protracted auction with a bid of $1.9 billion for the 8.5% stake in the Rovuma field owned by Cove Energy, at that time operated by majority owner Andarko. It has been mentioned by London brokers a couple of times as a model for a PRD deal (private correspondence). Cove Chairman at the time was Dr Stephen Staley.
Stephen was the first Chairman of PRD, and is still a shareholder.
So VB have increased their shareholding by 5.74%. Any ideas if this was an on-market purchase (if so why no effect on sp?), exercise of options (TR1 did not state this), or an acquisition of a stake from someone who has yet to submit their own TR1?