Member Info for Madpunter

FRR's sweet crude of 41.5 API would be to the right of Brent and WTI on the chart in the link below. In fact only the Algerian Sahara Blend and the Malaysia Tapis are of higher quality looking at the chart. Top quality oil that can be extracted for less than $12/bbl, no wonder the super majors are interested.
https://www.energyandcapital.com/resources/brent-vs-wti-crude-oil-what-is-the-difference/17

I've re-posted the link in the Frontera Archive :-
http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=2

Laks - Is this a massive hint, tweeting two week old information about ExxonMobil? ExxonMobil had their quarterly results yesterday. I wonder if the timing has any significance?
https://twitter.com/FronteraRes

Cinerama5 - Are you related to mapp?

Thanks Kalan.

Kalan - As a trader who follows this share, maybe you could comment on LordLash's post earlier.

LordLash - I've just re-posted ma5k's chart which shows the breakout :-
http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=last#last

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=2
The post referred to by StarRage.

Anyone have the Reuters or MorningStar II holdings for October?

IMHO the oil recently auctioned by the GOGC is from FRR. Zaza stated 3 trainloads of oil and there have been 3 trainloads auctioned. Just because they are listed for auction on the GOGC website doesn't mean that Trafigura isn't still conducting the sale and transportation.
List of recent auctions with the amount of light crude.
11th April 2017 for 4,500t
20th September 2017 for 4,500t
13th March 2018 for 4,500t
10th September 2018 for 5,000t
1st October 2018 for 5,000t listed on 20th September
22nd October 2018 for 9,000t listed on 13th October
http://www.gogc.ge/uploads/other/1/1185.pdf
http://www.gogc.ge/uploads/other/1/1226.pdf
http://www.gogc.ge/uploads/other/1/1260.pdf
http://www.gogc.ge/uploads/other/1/1370.pdf
http://www.gogc.ge/uploads/other/1/1379.pdf
http://www.gogc.ge/uploads/other/1/1382.pdf
Assuming that the auctions are advertised around 10 days prior to auction, then if the next train is filled at the same rate, there should have been one advertised 21 days after the 13th October = 3rd November. Prior to these three trainloads the auctions were roughly 6 months apart and FRR was selling twice each year (once in each of the half year accounts). Why would production increase from 5,000t to 9,000t. The change to productivity testing could explain the increase, where the choke could be opened allowing unrestricted flow, followed by fully closing the well. This creates a pulse allowing data measurements to be collected from the reservoir.
https://pdfs.semanticscholar.org/b4d2/d236dcd461181b957acc499f9cb4722740e6.pdf
9,000t oil = 69,390kbbls for oil of 41.5 API (7.71bbls/t)
https://www.platts.com/IM.Platts.Content/MethodologyReferences/ConversionTables/Images/CCSS1015_Energy_Industry_Conversions_LRG.pdf
If the well bore for T39 is opened up then 8 x 529bopd = 4232bopd (as 529bopd was for a choke of 8/64", although the equation is not linear as there are other variables). At a rate of over 4,000bopd + T45, Dino and the Zone 9's, even with fully closing T39 to create pulses, then there's ample time to fill the trainload.

IMHO this new tax law was to encourage O + G companies to reinvest rather than increase dividends after the rise in the POO, helping the US energy security.

If ExxonMobil were to purchase Block 12 before the end of the tax year, a year with a windfall from the rising POO, then surely the following applies.
The new tax law also permits used property to be eligible for the full expensing provision. This change may impact merger and acquisition transactions by motivating buyers to structure deals as actual or deemed asset acquisitions rather than stock acquisitions. This is accomplished by enabling the buyer to immediately deduct a significant portion of the purchase price and generate NOLs in the year of purchase to offset future taxable income.
https://www.mossadams.com/articles/2018/february/tax-law-implications-for-oil-and-gas-companies
Furthermore, any expenditure on Tangible Property can only be fully deducted until the start of 2023, after which it declines by 20% per annum. IMHO the clock is ticking.

Laks - You don't have to know anything about FRR to answer the question.
1onic- Am I that argumentative?
Perhaps if you both answer as if your directors of first a minnow and second a super major. The minnow has spent years getting to the stage of a deal, when the markets are set for a major retrace. The super major has a windfall from the rise in the POO and the tax year ends 31st December, plus in 5 years the amount that can be offset against tax as tangible property starts to diminish. Do you wait until the initial steeper part of the retrace is over or doesn't it matter as those exiting declining shares will jump on the few rising? I'm after your views based upon how the markets perform, not individual companies. It will have no bearing on my investment, but may aid future entry/exit points when the next retrace is due in another decade or more ( Hopefully were still alive and compus mentis).

Full Expensing of Tangible Property
This provision could be a significant benefit because the oil and gas industry is very capital intensive.

Tangible drilling costs, lease and well equipment, pipelines, and all other tangible personal property can be fully deducted when acquired and placed in service after September 27, 2017, and before January 1, 2023. The full deduction is phased down by 20% each year in taxable years beginning on or after January 1, 2023:

2023—80%
2024—60%
2025—40%
2026—20%
2027—0%
The new tax law also permits used property to be eligible for the full expensing provision. This change may impact merger and acquisition transactions by motivating buyers to structure deals as actual or deemed asset acquisitions rather than stock acquisitions. This is accomplished by enabling the buyer to immediately deduct a significant portion of the purchase price and generate NOLs in the year of purchase to offset future taxable income.

Barraband - If Exxon buys into Block 12 or any of it's fields, then the tangible property, drilling costs, pipelines etc can all be deducted after 27th September 2017 and before 1st January 2023, after which it reduces by 20% per year. Therefore, with the windfall of higher revenue from the rising POO, it makes sense to invest in new assets before the end of the tax year.
https://www.mossadams.com/articles/2018/february/tax-law-implications-for-oil-and-gas-companies

Posters on here have been asking about Kickmuck's post from September. It is in the Frontera Archive for reference.
http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=2

Part two :-
My understanding is that this is not complicated stuff and an explanation on Thursday next at the stockholders meeting needs to be listened to really carefully to make sure there’s no misunderstanding by retail - I understand that a sensible outcome has already presented itself and just needs working through with the lawyers. Like someone said on here, you don’t fight over an empty box."

His 2nd Post

"And on the subject of that box, which quod erat demonstrandum is not empty… A comment on the arbitration issue with the Georgia State agency & the GOGC. Here, my understanding is that the issue is not so much about the contents of the box, which is now well understood by the relevant stakeholders, but about the pace and nature of the manifestation event; the exploitation timescales and how the PSC should be interpreted regarding certain territories in the block, for example, what Frontera refer to as the Basin Edge Play. So, the Miocene horizons at Basin edge (above the gnarly Cretaceous) are now extremely relevant by extrapolation from the staggering technical success at the Miocene Taribani zones. Read the 2005 NSA report on the Sarmatian horizons (S3) at the Basin Edge areas and feed that with the Taribani work into the declaration objectives under Article 9.4© of the PSC:

There’s not a lot of seismics for Basin Edge
We now see a lot of oil in play in the Sarmatian
There’s not much time with the Study period.
How does that box get opened?
And now understand: There are many juicy boxes in Block 12!

And finally regarding the current pressure on the shareprice of FRR shares (with reverent sunlight on folks buying shares in London who have carried this work to here), as I understand it, certain commitments with regard to vendor stock are being processed, and other pre-agreed sellers are working through their deals – honestly I don’t understand the details. Also, we know that all markets have the derivatives traders like the short selling guys who play their part and spin their story. I have to say; there is a lot of BS in some of the online news websites in the UK and a lot of BS gets posted on Twitter too.
This pressure wont last forever - they’ll take their turns and we’ll get shot of them.
It sounds trite to say a little bit of patience now, but go along next week, hear what Zaza has to say at the meeting in London and try once again to get your heads around 18 billion barrels oil and 202 tcf natural gas."

Symore_Bottoms on ii reviewing Kickmuck's post :-
Thought it was important to put the current s/p movement in context by revisiting a very important post from “Kickmuck’, dated 30th Sept. that is just over a month ago, but feels a lot longer. So, over that same period, let’s whats been achieved: YA kicked in to touch with their reduced monthly payments of $64k per month; Initiated legal action against the Independent Director (only he wasn’t Independent!), signed MoU with Baker Hughes. Pending items, continuing discussions with the other Industry Major, finalising contractual terms with BH and dealing with Mr Hope. It will also be interesting if we discover if Zaza is concurrently working on a conventional lending facility.

Anyway, here is that post again and remains highly relevant:

"Well, things are progressing nicely here.

Firstly, just lets recap on the last two and a half years of technical progress in Block 12. This is a petroleum engineering story at its best – we finally figured out how to drill clean holes in this tricky geology and we got zones to flow that have baffled drillers for decades. The Soviets fooled around for so many years washing out the sands and spitting cement; this really is a classic story of how one of the worlds great under-developed regional plays gets conquered. It’s taken years for Frontera to get to this place, but then it took years to realize that the Permian in West Texas could do what it’s doing now – read, understand and see the similar story.

OK, on a very basic evidential level:
Q: Is the oil there in the Block 12 license area?
A: NSA have presented cautious oil and gas in-place estimates based on data they have audited from the Frontera drills and data they have generated themselves. We also have some Ryder Scott work. These data estimates are staggering and no one can deny this is not absolutely world class land with several great plays – based on the petroleum consultants data.

Q: Can we drill holes, work the rock and sustain a major field set of commercial flows?
A: Frontera have presented an exploitation & development methodology for a super-multi-well strategy which has excited certain parties to take an interest in Block 12 over recent years, from MND Group / VTB, through to the recently announced majors – these are the ones the market knows about…

OK, I totally agree that retail stockholders are lacking straightforward data to reassure the exploitation and development story, but if you step back (or talk to the right people) it’s now clear to see that the Block 12 geology has been capitulating like a woodchuck since 2016 and the grind of it all has been getting the deals to plug the whole thing in. It just needs a whole lot of money throwing at it now.

Next, a deal was finally nailed with mucky old Yorkville to help clean up and ready the Frontera balance sheet (announced in early June) and a little tussle subsequently developed with Yorkville (thru August and into Sept). M

pyro - IMHO a deal with Exxon is penciled in before the end of the year to capitalise on the windfall from the rising POO, as their tax year ends on the 31st December. The only delay has been due to the current economic climate (still IMHO), hence my earlier posts at 22:51 and 23:18.

PS - I'm not talking months or years until the bottom. Just days or weeks, until there's enough momentum to counter any market negativity, or to even accelerate the rise, with investors joining one of the few shares still rising.