Member Info for LONGWAIT

'Sold and sick of this share..... Made a small loss but had enough... Out for good... Way too high risk'

In recent years, I've bought in the 50's, 60's and 70's.

I honestly don't see what you're talking about.

I just had a look at Rockrose Energy, up from 600p last January to just above 1900p now, but on a price earnings ratio of just nine, and with a projected dividend yield of 4.4 percent, and market capitalisation below net cash.

The explanation for its derisory rating?

Too much water?
DSPP hasn't said anything.

Too many shares?
They have just 13 million.

No dividend?
It's 4.4 percent.

All such explanations for the derisory ratings of such companies are merely rationalizations.

I remember the negative comments here when the price fell to 65p a while ago.

It was obviously a bargain, but AIM punters insist on rubbishing a company because its shares are cheap.

Lynch still holds one of the greatest track records—an astonishing 29% annualized return from 1977 until 1990—nearly double what the S&P 500 index produced in the same period.
Underlying Lynch’s success was a sunny belief that the stock market was a place to buy excellent companies and hold them for the long term, and that its occasional stomach-churning drops were no reason to be fearful.
He believes that oil, energy services, and natural gas can provide triples. “You wouldn’t know it from the stocks, but oil is 25% higher than a year ago,” he observes. “Why have these stocks gone down? Everybody’s assuming the world’s not going to use oil for the next 20 years, or five years, or next year. The private-equity money wants out. The banks want to cut back their lending. They can’t do an initial public offering.”
https://www.barrons.com/articles/master-stockpicker-peter-lynch-if-you-only-invest-in-an-index-youll-never-beat-it-51576874071

There is also the possibility of a much higher dividend if more gas is found.

I know that even to say such a thing is considered highly heretical here, but it is reasonable to assume that SOU's prospective partner actually think there is a prospect of finding more.

I take into account the many comments insisting that there never was a deal and it was just a pack of lies to keep JP in the lifestyle to which he had become accustomed, but now that he has gone, isn't that particular theory rather difficult to sustain?

Assuming a 14.3 percent share and taking account of the recent dilution, what is your revised estimate of a possible dividend?

Also, which is the correct figure - 60 or 66 MMscf/d ?

How much of that possible $173m per annum would SOU actually receive, under the terms of the proposed deal, S/O?

How much of that would SOU actually receive, under the terms of the proposed deal, Ericnat?

Thanks for the article, Battle.

Mr Langbroek works for Davy Stockbrokers, which means he's not exactly impartial, but that doesn't mean he's necessarily wrong, either.

He may be right about the APEC deal having been a good one, but as ps and I have said, it's unlikely that a new partner would offer such a good deal, yet almost any deal would be preferable to none.

Let's hope that PVR can retain at least a 25 percent interest.

That would imply that the APEC deal, leaving PVR with 50 percent, was worth $15 per share.
Well, it could have been worth that much and more, with more oil from below, if PVR had retained its stake all through production, instead of selling its stake for a few pounds per barrel - provided the oil price didn't collapse and stay low.

It seems incredible that it is so difficult to get the oil out.

Here's a reminder of some of the twaddle posted on here recently:

' [HUR has] no revenue,no oil,huge losses year on year. Yet they a market cap of 600m. Down from 1.2 billion since June 2019. Junk share which is heading towards insolvency. Hope your losses aren't too excessive !'
(Sachs1 to JK1)

'[HUR's]latest RNS states a marked decline to only average 12,000 bopd since 20th September. That is a steep decline in such a short period. Now a reported water cut increase to 30%.'
(Argus1 to JK1)

'The way things are going it could be 20p Hurricane / 20p UKOG.'
(wizard125)

HUR will be increasing production to 20,000 bopd next month.
When do you think UKOG will achieve a rate like that?

'During the initial clean-up phase, HH-2z achieved initial rates of up to 1,087 barrels of fluids per day and oil cuts of up to 60% ... Immediately following the current HH-2z shut-in, flow lines were reconnected to HH-1 and dry Kimmeridge oil flow was resumed on 18 December at an initial half-hourly rate of 354 barrels of oil per day ("bopd") with an average daily rate of 301 bopd.'

(UKOG RNS today)

UKOG shares closed down five percent at 0.875p.

Obviously, as UKOG posters keep pointing out, HUR cannot possibly hope to compete with UKOG, either in terms of oil production or market capitalisation.

The latest estimate is 346 mmboe, i.e. 311 million barrels plus gas equivalent to 35 million barrels, although there could be the same again at lower levels.

If Barryroe were developed and LOGP retained its stake and received its share of profits from production, then total dividends over the years could amount to 100p per share, but if it were bought out then it would be for much less.

'I think the reason he went for the APEC deal was because it was a zero cost. Any other deal would have involved Providence putting up their share of the costs which they do not have because of all the waste he did over the years.'

I disagree, because any major would know that PVR couldn't put up its share of costs.
I therefore suspect that although APEC's offer may have been the only one, there was an offer from a major, leaving PVR with a smaller interest.
It may be that after the APEC debacle, the same major offered even less and it was this that caused TOR to resign.
I could be wrong, but I think this whole fiasco may have resulted from TOR accepting the wrong offer.

Yes, PS.

As I said, I think such a lousy deal may have been offered to PVR when TOR said majors had approached the company, expressing an interest in replacing APEC, and that TOR may have been unwilling to take such an inferior offer.
If SOU can do it, why can't PVR?
I also said that I wondered whether TOR turned down such an inferior offer in order to go with APEC, whose offer on the face of it was better, but wasted two years or so and has brought PVR to its knees.
The fact is that statements by TOR and PP suggest they think a deal can still be done and even if it left PVR with just 30 percent (equivalent to SOU's reduced interest), it would get things moving.

Tue 27 Oct 2015

Providence Resources (LON:PVR) is launching a farm-out of a 32% stake in the Cairn Energy operated Spanish Point project, offshore Ireland.
The AIM quoted firm currently has 58% of Spanish Point, where appraisal drilling is slated for 2017.
Spanish Point, located in Ireland’s increasingly high profile Atlantic Margin, is currently believed to host an estimated 730mln barrels of oil equivalent prospective resources.
A well in 1981 encountered a series of stacked over-pressured reservoirs at Spanish Point.
Back then, the well yielded a flow rate of 4.85mln cubic feet of gas and 925 barrels of oil per day.
Studies by Cairn have subsequently indicated that a modern well could have flows in excess of 10,000 barrels oil equivalent per day.

https://www.proactiveinvestors.com/companies/news/116683/providence-resources-launches-spanish-point-farm-out-process-116683.html

'Spanish Point was due to be drilled in 1915 but the price of gas and oil was so bad it was put on the back burner.'

I think you meant 2015, as that was when Brent fell to $28 (possibly in January 2016).

How can you explain the fact that Spanish Point hasn't been developed since oil flowed in 1981?

If there is the same amount of oil at lower levels, then you can double those figures.
It is, of course possible that the flow rate could be increased substantially.
Maybe it would be better to get profits from the oil sold than a takeover.
I can see why major shareholders have stayed put: they can see the potential.

However, even if LOGP received only £1 per barrel, that would equate to more than 5p per share, an increase of 700 percent from the present share price.

£2 per barrel would give 10p per share.

The upside is considerable, as is the downside.

I don't follow your maths at all, either, Rocklawn.

$65 is only the Gross figure.
Let's say the net figure is about $40 = £30 and the major gets 50 percent, PVR 40 percent and LOGP 10 percent.
With 346 mmboe, that would give LOGP £1.038 bn.
With 665 million shares, that's 156p per share.
But that assumes LOGP actually got paid for every barrel.
At 20,000 boe per day, it would take nearly half a century to extract it all, assuming that were possible.