Member Info for Kev7722

Does this explain the suppressed SP I wonder...

Afternoon all - have been watching FARN with interest every since the phase III top line data was published... surprised by the market reaction to todays news, as the initial drop was driven by the ambiguous findings, and they've gone a long way towards clearing up that ambiguity today.

For that reason I'm in for c. 19k shares this afternoon, averaged around 106p... as usual I timed it far from perfectly, but looking forward to the ride.

There was a steady volume of buys yesterday, but I'm not reading too much into it - I'd earmarked mid/late October to start building a position here, so assume others are thinking along the same lines... there's a limited free float so it does move pretty quickly.

I'm still holding out for my sub 2p buy in... I almost had it last week - some (lucky) people may well have got in just below.

Definitely agree that past performance isn’t a guarantee of future results, but I’d also add that, ‘Those who do not learn history are doomed to repeat it.'

In this case I’d say that it’s important to look back at fact that BPC have been singing the same song for 8 years in order to temper optimism. For me this remains a high risk, potentially very long term play... a view that (unfortunately in this case) isn’t necessarily in direct relation to the amount of recoverable oil they have the rights to, or the value of that oil.

So SP has been, ‘In active negotiations with a number of interested parties’ ever since he came onboard at the start of the decade... must be exhausting all that negotiating, poor chap!

I think this is what Yakee is referring to by the way...

Final Results for the year ended 31 December 2011:
“Bahamas Petroleum Company continues to seek third-party farminees to share the costs of future exploration activities and remains in active negotiations with a number of companies.”

Interim results for the six months ended 30 June 2012:
“Opened data room for the month of May 2012 and received a number of offers to farm in to its licences - farm-out discussions remain ongoing with a number of interested parties”

Final Results for the year ended 31 December 2012:
“Discussions remain ongoing with a number of interested parties, but the basis for these discussions has benefited significantly from the renewed clarity provided by the government.”

Interim results for the six months ended 30 June 2013:
“This clarification gives BPC further impetus to focus on the ongoing farm out process and bolsters the commercial basis for discussions with a significant number of potential farm-in partners.”

Final Results for the year ended 31 December 2013:
“On each of these matters the Company was seeking an unambiguous mandate in order to ensure progress towards exploration drilling in 2015 and to underpin the commercial basis for discussions with a significant number of potential farm in partners who continue to show interest in the project.”

Interim results for the six months ended 30 June 2014:
“We continue to be engaged with a number of companies as we maintain our strict focus on identifying a funding partner.”

Final Results for the year ended 31 December 2014:
"Going forward into 2015 and beyond our primary task is clear: secure the funding for the cost of the exploration drilling, and to commence drilling. Our preference remains to secure a farm-in partner for the project. With the regulatory clarity, licence extensions, and further technical de-risking achieved during 2014 and early 2015, we are now in a position to progress this all-important task."

Interim Results for the six months to 30 June 2015:
“Farm-out discussions continue with parties for a strategic and funding partner”

Final Results for the year ended 31 December 2015:
“We continue to manage a flow of qualified parties through the data room and look forward to updating shareholders on a successful farm out transaction”

Interim results for the six months ended 30 June 2016:
“Meaningful farm-out discussions have continued with a number of suitably qualified potential partners”

Final Results for the year ended 31 December 2016:
“Farm-in discussions remain ongoing with a number of parties..."

Interim results for the six months ended 30 June 2017:
“…the Company continues to work tirelessly towards executing its long-term strategy of securing a farm-in or other financing partner such that drilling activity can commence”

*one of two shares that should read

Stops being triggered across the market today... this is now comfortably below my target price - seriously flirting with the thought of buying back in today, but it means exiting one of who shares that I think will be much higher by the end of October!

It’s a frustrating game at times

Holding up in comparison to what? It’s down over 75% since the major terminated exclusivity... that’s not deramping, that’s just a fact. Appreciate that news was why you bought in though, so you’re only looking at a 15-20% loss on that initial purchase, which is still not what ideal imo

Unless you sold those 800k early on that's not just zero cost, you've already banked a substantial profit here... well done. Getting in ahead of the crowd, having a lot of patience, and not getting too greedy when a share like this rockets - that's how LTHs make money on AIM.

FWIW I think topping up at sub-13p may turn out to be a good investment a couple of months further down the line... all people really have to go on currently is historic (and abridged) accounts - realistically TERN will be looking to sell their stake in DA for much more than they're currently valuing it at internally.

That's a fair point, I'd tend to agree that the current administration are more pro-oil...

I'd still be surprised if they actually retracted the pledge to put the decision to a referendum though - given how much of a contentious issue this seems to be in the Bahamas... I haven't been able to find anything coming from the current administration that suggests they wont ultimately hold a referendum on the issue. Unless they categorically say as much I would still attach more risk to the $100m outlay than perhaps in other geographic locations.

Apologies if this is coming across too negative, I'm trying to look at this situation through the eyes of an oil major to understand what the sticking points might be. There obviously are sticking points, or we'd all be sitting on a beach, earning twenty percent by now.

Keith - I get the case that the BG may make to their citizens if there was 'major money' for the country here but as everyone now knows (no doubt including oil majors), referendums are not always won and lost on what makes the most financial sense... or any sense at all for that matter

Could this be a significant sticking point...?

"The former Christie administration postponed a proposed referendum on whether to permit oil drilling in Bahamian waters until after exploratory wells were dug, and it was known whether commercial quantities had been discovered."

Essentially this sounds like the BG are saying, "You spend $100m drilling your exploratory well, then if you do find sufficient quantities of oil then we'll hold a referendum to decide whether or not we let you recover it"... that's an awful lot of money to ask a major to stump up against a backdrop of significant risk that, even if there is recoverable oil, drilling may not be permitted.

I mean... I literally explained why one post below :/

Wafer thin margins on the type of betting Webis are currently involved in. Also, look at the revenu growth year on year - it’s pretty common for companies not to deliver meaningfull profits during periods of aggressive growth. That said, I do have a feeling that the results announced next month will show a small profit...

Neptunes does make a very valid point (one I argued myself when the RNS was first published) - whatever our own interpretations of the wording the fact remains that the news wiped 70% off the market cap in an instant.

Notwithstanding shareholder sentiment, fact that this will have an adverse impact on the company’s ability to raise further capital suggests that they would have done everything possible to spin the news in a positive light. The SP now suggests that the overwhelming majority view is that we are a bit closer to a deal than we were a year ago, but nowhere near as close as we were a couple of months ago...

Ollie, personally I’d be holding some of these at c. 1p for the same reason I was holding then at c.1p earlier in the year - a high chance that they’ll plod along at that level for years, a small chance they’ll become worthless and an even smaller chance that they’ll 20-bag.

For me thats the reality here now - ultimately worth a gamble, but I do firmly believe that it’s a gamble I’ll be able to take at 1.1p rather than 1.5p... if I’m wrong then i appreciate that I may miss out on a significant portion of any gain, I just don’t think I am wrong

Ravenspass, I don't disagree with anything that you're saying but it is worth noting that with parimutuel betting you are always going to be talking about wafer-thin margins. In other words you wouldn't look at Webis, look at a highstreet bookmaker and say that this is cheap based on turnover alone.

Of course, Webis used to have bettheinternet... I wouldn't be surprised if Webis were looking to diversify into the online casino/bookmaker market now that the rules are being relaxed over the pond

Exactly that Bongabob - I understand the 'exclusive nature of the agreement' line, but for me no news at simply doesn't cut it... the reality is that the nature of the sticking points in the negotiation are entirely price sensitive. For example - if they had an offer and felt they could do better then allowing the SP to crash whilst hiding behind the fact they couldn't talk about the major would be verging on criminal.

I don't see how taking a view that this is overpriced is unreasonable to be honest... back in April the market valued this around the 1p mark (a bit less funding, a few less shares).

The potential upside was still there, but the consensus was that this had very much been kicked into the long grass. If you felt that we were essentially back to where we were pre-exclusivity then c. 1p still seems like a fair price, given the small chance of a huge (life changing) upside and the expectation that it may be a wait of several years for that to happen.

I'm in a similar position myself now, I gave it until the AGM incase the RNS needed clarification, then sold out at c. 1.8p. Still gutted for everyone that this didn't come good, but I wont be buying back in until this either drops below 1.1p or there is positive news re. the EA.

Same here - sold the vast majority of my shares for just over 3.2p a couple of months back, fully expecting the gradual SP decline that has since taken place.

Personally I'll be buying back in by mid/late-October as there may be a rise going into the results, and with the lack of news between May and now I don't want to be out when they are published, as I suspect that there has been a lot of activity happening behind the scenes that they will want to talk about at that point.