Member Info for KeithOz

I would be very happy with £35 per share, quite a few of us would have made a 9-figure profit. Regrettably, this isn't going to happen. Here's an updated reworking of a previous calculation.

Titanosaurus is too large for Predator to develop, so the stated intention is to prove up and sell, or perhaps farm out a large majority to a large O & G company who would also be operator. How would such a buyer value the project, and what would PRD be likely to receive?

All professional outfits use a net present value – the value of future cash flow today. For those who are not familiar with this, a number of inputs are needed – capex, pricing, sales over time, opex, taxation; and a discount value reflecting the time value of money.

PG and analysts have previously suggested an NPV10 value of around $2M per BCF of methane. That values a P50 6TCF GIIP, @70% recoverable = 4.2TCF, at $8.2Bn without the helium, net to PRD. I am assuming a more realistic 0.5% Helium, although higher %ages can be associated with methane, eg the analogous Hugoton Field has 0.3 - 1.9%. Let's do a more detailed assessment, feeding these conservative assumptions into an NPV spreadsheet.

* P50 methane 6 TCF GIIP net to PRD.

* 0.5% helium = 30 BCF GIIP net to PRD.

* 70% recovery = 4.2 TCF recoverable, so a 23-year life at max rate 500mmcfgd, = 180 BCF per year, we will use a 20-year life. There is potential to double output per year for a 10-year life.

* $8 per mcf methane (half the current import price from Spain).

* $225 per mcf helium (current long-term ex-producer contract price $225-250).

* Methane sales - Year 2 -100 mmcfgd. Year 3 – 250. Years 4–20 – 500.

* Helium sales – Year 2 – 0.5 mmcfgd. Year 3 – 1.25. Years 4-20 – 2.5

* Opex (guess!) $1 per mcf methane, $25 per mcf helium.

* Capex (guess!) - 30 wells @ $3M = $120M; 5km main pipeline, well connection pipelines and ancillary equipment - $100M; helium separation & compression - $50M, equal expenditure over 3 years.

* Tax – 5% royalty throughout, plus 31% corporation tax after Year 10.

* Discount rate - 10% - interest rate environment is improving, but Morocco has risk.

This gives an NPV10, or what it is worth today to a buyer, of $8.5Bn with helium, $7.65Bn without. Since the buyer has to finance the project, take on execution risk, provide the staff to build & operate, and of course make a healthy profit, negotiations might fall in the range of 25-50% of NPV, depending upon a royalty or stub equity. How about if PRD receives 37.5%? - $3.2Bn. At today's GBP:USD rate of 1.25 and a fully-diluted 700M shares in issue, that would be equivalent to £3.65 per share in a P50 success case.

To get to purchase-readiness, PRD would need to drill & test 4 wells – cost around $15M. An O & G major would do their own flow assurance & FDP as part of their due diligence. $15M outlay for a potential $3.2Bn return seems like a decent risk/reward to me.

@IJWT. This is as far removed from a leveraged finance situation as you can get, and the poster was not talking about company quarterly production figures, they were demanding daily sales numbers for an individual well. Total cloud cuckoo land, especially if you have only been producing and/or selling for a small part of that period, they would be totally unrepresentative anyway.

...and it's good timing if they do so this next quarter. I just posted a chart of European natural gas prices on X, showing a steady rise all year. This is very unusual, the price chart is normally highly seasonal. It will be interesting to see the effect of termination of the Russian gas transit agreement on Jan 1st. (Russia currently supplies eastern European countries with gas by pipeline that transits Ukraine. A toll is paid to Ukraine, the contract expires in two days, Ukraine is not renewing).

https://fr.investing.com/commodities/dutch-ttf-gas-c1-futures

Paul Griffiths, Vox Markets interview October 2024:

"We only try to inform the market when we've got a plan to inform them with, and we're not just updating them every day that we walk out and look at the drill site."

We have already been informed, formally and informally, that Jacobin-1 would be producing by year-end, so no need to go into further details, and anyone thinking they are going publish "daily revenue receipts" can't read, has clearly never held a management position in any company, and very likely should not be investing in one.

We have already been informed that the presentation on 23rd January will include a full review of T & T operations - Jacobin-1, Snowcap-1 and new acquisitions. The presentation slides will be available first thing in the morning, giving investors time to ask questions about any areas that they would like covered in more detail.

Stick in a few buy orders at 10p - that should get things moving.

Erm... this deal was done in February 2018.

https://www.timesofisrael.com/egypts-president-says-country-scored-a-goal-with-israel-gas-deal/

Https://www.youtube.com/watch?v=r6dArnhe0Zo

This evening (Oz time) I said "It could also be considered reasonable not to inform the market until a stable flow rate is achieved from Jacobin-1, since an unrepresentative initial 'spurt' could constitute misleading the market."

I will reaffirm that opinion now (slightly later evening Oz time), this time replacing "Jacobin-1" with "MOU-3". Take that as you will, I don't give a monkey's rectum whether you agree or disagree that MOU-3 has already flowed gas. I suggest you listen once again carefully to the Vox Markets interview from 8m 30s to 9m 20s, just consider how you would measure gas pressure after successful perforation if there wasn't any gas to flow.

https://www.voxmarkets.co.uk/articles/q-a-with-predator-oil-gas-ceo-paul-griffiths-93b8908/

The 13th December RNS indicated that a wide range of issues were up for discussion on 23rd January, some of which would inevitably be price-sensitive and therefore require prior notification to the market. The usual procedure is to issue an RNS in the morning, with the evening's presentation attached. This would also allow for submission of questions that would clarify the presentation content - again, as referenced in the 13th December RNS.

All I am suggesting is that PRD management may believe that they are not obliged to release further details on any of the currently ongoing operations before the 23rd January. I think that there are very good reasons for the ongoing silence, others will say that it is because nothing is happening. We will see who is right by the end of the month.

* GRH has never said that there would be a Christmas day spud of MOU-5.

* If the information given to @Dickienicholls is correct, the drill arrives on 27th January.

* I cannot see any evidence of pad preparation, but since the indicated location (river flood plain) is likely to be gravel, and the location is temporary, I would expect that something could be adequately levelled within a few days.

* If PRD are using the SV-101, this would be an extension of a pre-existing and previously notified contract, so could arguably not require an RNS.

* We were also told swabbing equipment would be available 16th January. The ONHYM team have been using this kit for at least the last couple of months to remediate silted-up water wells. Paul told us this was the problem with MOU-3, so the ONHYM team should know what to do by now, although MOU-3 is considerably deeper than most water wells. The process involves injecting water at high pressure to stir up the well contents and make sure the silt is in suspension, then swabbing as normal.

* Someone better with numbers than me calculated that a 1500m column of water would exert a pressure greater than 2000psi, which is more than MOU-3 expected gas pressure. Water with suspended silt and dense barite drilling fluid would exert even more pressure, hence the problem that needs to be overcome.

* Since we were also advised of the upcoming swabbing programme, PG could consider that this does not need to be RNS'd further.

* It could also be considered reasonable not to inform the market until a stable flow rate is achieved from Jacobin-1, since an unrepresentative initial 'spurt' could constitute misleading the market.

* Thus, it could be that we may not hear anything at all until the 23rd, although of course it would be nice to know beforehand.

Since there's nothing relevant to talk about for a while, the multiple-persona keyboard warrior troll has an interesting history. The particularly unpleasant individual Aleister Crowley was very keen to prevent the Dangerous Drugs Acts of the early 1920's becoming part of English law. He conducted a letter-writing campaign to the popular press, pretending to be different medical specialists, using various pseudonyms, each bolstering the positive views on drugs of the others, who were of course all him. You can find some details and amusing extracts from these letters by Aleister Crowley in 'The great drug delusion. By a New York specialist', English Review, 1922, 34: 571-76; and 'The drug panic. By a London physician', English Review, 1922, 35: 65-70.

You will be happy to hear that he failed in his endeavours.

So OilyFred / Findme, now that you have publicly burnt your turkey, could you let us know - did you put the stuffing in from both ends, or just one? Do you hold 100k shares or 200k? Should we be doubly cautious, or just exercise the normal amount? Can we look forward to you not ever ever posting here again? Have a happy happy New Year.

@Dickie - thank you for providing that information, it's the most useful thing I've read here for at least a month. Can't believe others aren't commenting.

@Ibiza - much will depend on this point from the 13 December RNS, up for discussion on 23 January:

"Divestment strategy in the event of a successful MOU-5 Titanosaurus well".

Part 2.

RNS 08 August 2024

“An updated Independent Technical Report by Scorpion Geoscience Limited for the Jurassic MOU-5 structure gives net P50 upside Prospective Resources for gas of 5.916 TCF to the Company

There was a new requirement to move the MOU-5 well surface location 277 metres to the northwest to avoid an irrigation system and water well used by local olive tree farms.

As a result a new deviated well had to be programmed with a small amount of additional well inventory that was required to be imported and which would require customs clearance documentation.

The new location is also located in an area just east of the Moulouya River floodplain belonging to the public hydraulic domain of Oued Moulouya, Saka District, Guercif Province. A licence valid until 6 April 2025 has subsequently been granted to the Company to temporarily occupy the site for MOU-5 well operations.”

Three things are apparent.

1. Evaluation of the prospect has been ongoing all last year.

2. The areal extent, depth, and potential gas volume have all increased substantially.

3. The location of MOU-5 drill has moved from 2.7km ESE of MOU-4 (west of the Moulouya River) to 5km ESE of MOU-4 (nearest point east of the Moulouya River).

The change of location requires a deviated well which increases complexity and cost. The usual suspects have said this is due to management incompetence, I would suggest this indicates a very strong commitment that newly acquired data shows this to be the ideal drill location. The fact that it is also well outside the boundary of the prospect as originally indicated in the ITR just one year ago, would suggest that there has been a very significant change in the understanding of the structure.

Source rock studies, reprocessed seismic, and correlation of actual drilled rock from MOU-4 with the seismic data, would all be of importance. Perhaps pre-existing additional commercially sensitive data has been acquired, explaining the silence surrounding the reasons for change of location and gas volume potential, from both the company and certain prominent commentators.

I share the frustration of many here that MOU-5 has not been drilled within the announced time frames. However, there is a strong possibility that this delay is for good reason, and I am happy to wait another couple of months if the drill location is now ideal rather than sub-optimal.

Part 1.

With regard to MOU-5, @IJWT mentioned “the licence runs to 6 April 2015”. Obviously he meant 2025, and it is not the licence, it is a permit to drill in a particular location issued by the local water authority, who are responsible for that site. However, this is of rather more importance than it may at first appear. According to certain individuals here, the delays in drilling MOU-5 have been entirely due to managerial incompetence. I beg to differ, but of course readers should bear in mind that these same individuals have clearly stated that I am always wrong.

First, some patience is required to read the following excerpts from written company communications:

RNS 12 January 2023

“The Company is seeking to drill the Jurassic target, the extreme edge of which was penetrated in MOU-4 downdip from the crest of the large mapped seismic closure of 126km2.”

RNS 13 July 2023

(likely gas sands) “1139 to 1143 metres TVD MD, including the top of the Jurassic carbonates. 2 metres of likely gas reservoir with average porosity 19.9% (maximum 20.6%) and average gas saturation 56% (maximum 73%). As previously announced the culmination of the Jurassic carbonate target lies 2.6 kilometres to the southeast of the MOU-4 well location and significantly higher than at the MOU-4 well location.”

RNS 30 Aug 2023

“A field trip is being planned for the autumn to evaluate the reservoir potential of the entire interval of interest in Jurassic surface exposures to the south of the Guercif licence area. Geochemical source rock quality and maturation studies, including evidence for migrated gas, for the Jurassic section penetrated in the MOU-4 well are expected to be completed in September.”

ITR 24 January 2024 - Fig 22, p38.

“Depth map (TVDSS) for the top Jurassic porous carbonate bank play showing key seismic control lines in red along with potential location for future drilling which would seek to target preferential zones in the main Jurassic porous carbonate fairway (blue filled outline) which are also coincident with structural highs to provide the best chance of success when drilling the play. The outermost structural closure used for volumetric estimation is marked in green dotted line which measures 177km². Sealing for the Jurassic carbonate plays is provided by the overlaying shale drapes of Jurassic marine shales.”

RNS 06 June 2024

“The Titanosaurus structure covers an area of up to 187 km2 and has up to 289 metres of vertical relief. Estimates of potential gas resources for this interval are as previously defined in the Independent Technical Report ("ITR") dated 24 January 2024 by Scorpion Geoscience Limited. These are likely to be increased based on new seismic inversion modelling to evaluate a potentially thickened reservoir sequence. The MOU-5 pre-drill well location is located only 2.3 kilometres from a valve station on the Maghreb Gas Pipeline ("MGPL") to Europe.”

This board used to be filled with factual, interesting, and useful discussion. Today I read of a proposal to replace the board of directors and conduct a forensic audit. That is a cat's whisker away from an accusation of fraud, and taken in context with similar posts, is certainly defamatory and quite possibly actionable for libel. This from someone who claims to be a 'concerned' shareholder. The only people I know who push this kind of nonsense are the sort from the Tom Loserfrith stable, who are trying to make some money by shorting a volatile stock, at the expense of naive investors who believe the managed and coordinated campaign of negativity.

You should be ashamed.

MEM - if I may add my tuppence worth. A small correction - there is a small band of individuals on this website, not necessarily shareholders, calling for PG's replacement. This is of no little importance, since only shareholders get to have a say.

I have had brief contact over the last couple of days with several individuals who collectively own a lot more of this company than does PG. They would have absolutely no intention of supporting your suggestion, despite some of them (including me) not being happy with repeated delays and the purported reasons for them. There is general confidence that PG is the only person who can get the job done, albeit later than originally hoped. There is also a general belief that many of the detractors are jumping on this bandwagon as a continuation of their fight to undermine the company and perhaps buy shares at an even more bargain-basement price than the current depressed level. However, I am sure that you are a person of integrity and would not participate in such base behaviour.

Donal - the only helium found in MOU-3 was in the deepest sample. Unfortunately, no useful information - such as %age concentration - has been released, so I can only speculate. The upper methane samples were presumably solely biogenic, as can be determined by the carbon isotope ratio. If so, this would indicate that they have been kept separate from thermogenic gas lower down by a good seal. Helium rising from deep basement rocks, intruded granite, or uranium-containing volcaniclastic layers (the latter being most likely at Guercif imho) would be trapped along with any thermogenic methane beneath this seal.

Although MOU-4 is relatively shallow, it penetrated older rocks than in MOU-3, so there is a good chance that helium would be present there also, particularly since there was an excellent seal provided by a couple of hundred metres of Upper Jurassic marlstones. However, I repeat my caution that I was not impressed by the methodology outlined in the 30th September RNS, and until we are presented with an actual concentration of helium from a delineable structure, this should be seen as a theoretical volume forecast, not at all equal to a hydrocarbon volumetric model as you would see in a CPR.

I have a growing list of questions for PG!

"Morocco is painted by some on here as difficult, but others successfully operate in the country without the issues faced by PRD."

Perhaps you should check out what has been happening to the 'others', these are:

* SOU - saved from collapse by organisation owned by the royal family.

* SDX - collapsed,

* CHAR - collapse overdue.

* EML (potash) in dispute with Moroccan government.

I have worked in Morocco. It's difficult. Among the issues, lots of brown envelopes are needed, together with large tables to pass them under.