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I would be surprised, but elated if we got that much Shafqut. Even after reducing the valuation by half to account for the GG's 51% cut under the PSA = 5 x $16bn/2 = 40bn, which is equivalent to a share price of £1.80.

Avi8r - Read ODR's and spreadbetwolf's posts from earlier today :-

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=last

I didn't alter the price of the Tapis = $67.18 and the Saharan Blend = $63.38.

The current valuation should read :-

18kMMbbls oil and 202TCF (at the same recoverable rates as the figures in the CPR = 2.9kMMbbls and 140TCF) . If this is converted to oil equivalent (1TCF = 170MMbbls oil) = 2.9 + 23.8 = 26.7kMMbbls. At $60/bbl = $1602bn, therefore just 1% = $16bn ( typical buyout valuations are 1 - 3% for producing).

Shafqut - My post on page 5 of the Archive which was posted on the 27th January is copied below (the current oil price has been updated) :-

Current Valuation
As the oil price has changed and my previous calculation used the wrong figure of 26.7kMMbbls instead of 29.6kMMbbls, I have calculated a new valuation.

18kMMbbls oil and 202TCF (at the same recoverable rates as the figures in the CPR = 2.9kMMbbls and 140TCF) . If this is converted to oil equivalent (1TCF = 170MMbbls oil) = 2.9 + 26.7 = 29.6kMMbbls. At $60/bbl = $1776bn, therefore just 1% = $17.76bn ( typical buyout valuations are 1 - 3% for producing).
Costs are also relevant, which at less than $12/bbl are a quarter the costs of the BP acquisition in the Permian ($10.5bn for 4.6kMMbbls). FRR has 6.5 x as much hydrocarbons and oil that can be extracted at 4 x as much profit. It's the same Kura Basin and Maykop geology as Azerbaijan, where BP are already involved, but in Georgia it's onshore. IMHO FRR will not sell Block 12, but enter a JV, with a lump sum giving a special dividend and the future percentage of the oil giving excellent dividends for many years or even decades.
I only used $60/bbl for the oil price based upon the price of Brent, which is currently $62.29, but the low sulphur 41.5API oil in Block 12 normally commands a premium of about $5/bbl. In fact only the Algerian Sahara Blend and the Malaysia Tapis are of higher quality (see chart in the link below). Block 12 is also closer to the pipelines linked to the European Market than the Malaysian Tapis, which is currently $65.01/bbl. Algerian Sahara Blend, currently $61.46/bbl sells for less than Brent despite being of higher quality. Also relevant are the facts that production from Block 12 will last decades; world reserves of the cheaper to extract hydrocarbons are diminishing; and Zaza told us in the podcast that the majors think there is more oil and gas (zone 19 is proof that there is more). Therefore, the valuation IMHO is conservative and could well be a lot more.
https://www.energyandcapital.com/resources/brent-vs-wti-crude-oil-what-is-the-difference/17
https://oilprice.com/oil-price-charts#prices
http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=5

Posts byIivyspivey @ 13:12 and 13:13 yesterday have been added to the Archive :-

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=13

Posts by Chris572 @ 13:08; theprodigy @ 13:22; OneDayRodney1 @ 11:57; and spreadbetwolf @ 14:34 have also been added to the Archive :-

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=14

Regdik - I didn't argue against your other points only the oil production and the volumes for T45, Dino and T39 are without pumps (up to 50% more, plus Zaza stated that production from T39 would be significantly higher). I've stated many times that I think the $150m was more to do with leverage for a deal with the super majors and IMHO a deal will be forthcoming. The ability to pay the bills or a demonstration of that ability is as much about buying time as leverage in negotiations with the super majors.

regdik - IMHO FRR is currently producing in excess of 500bopd and could easily achieve 4,000bopd with the additional four wells cleaned ready for drilling.

Prior to the last drilling campaign FRR were producing 220bopd, with 75bopd of heavy crude and the remaining 145bopd light crude. T45 and Dino accounted for 35bopd, which means FRR were producing 110bopd. The court papers show that T45 was producing 95bopd after the initial 270bopd. Dino initially produced 315bopd, which is 12% more than T45, therefore I will assume a similar decline, giving a figure of 107bopd (12% more than 95bopd). The actual figure could be more, as there was a suggestion about using a different fracking fluid to sort out the problem after the decline in T45. T39 flowed at 250bopd through a 3mm hole (6/64" choke). We can assume that as the gas would be flared initially, this smaller aperture was used rather than the 529bopd with a 8/64" choke (this implies that 8 x 529 = 4232bopd is possible, but not continuously). Even at the lower rate of 250bopd, then FRR would be producing :-
250bopd (T39) + 110bopd (existing zone 9's) + 95bopd (T45) + 107bopd (Dino) = 562bopd of light crude + 75bopd of heavy crude = 637bopd minimum
The rate will be much higher after the EWT, when facilities are in place to deal with the associated gas. With four wells cleaned ready for drilling into the Eldari B, IMHO the 4,000bopd could easily be achieved.

To implement a FDP required money from a loan, JV or F/O. However, this required the removal of SH's veto, by his removal from the BOD. Now that FRR have SH removed from the BOD they can either implement a FDP or use this as leverage in negotiations with the super majors for a better price.

Four posts by erazzel have been added to the Frontera Archive :-

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=last#last

Posts by Tsbs, Taffy52, Oopsi, Symore_Bottoms, Chris572, Sycric, pophead, EkXoc and RainbowRider have been added to the Frontera Archive :-

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=last#last

Cyrox - While the UK adheres to ever stricter environmental protocols, the countries like China, Mexico and India will fill the manufacturing void. The EU has also resulted in greater emissions from the motor industry by opting for the Tri-catalytic Converter instead of the Lean Burn Engine. The latter was far more efficient. Pressure on the change in technology to occur in haste, without considering the position of global competition, will just move the pollution elsewhere and decrease manufacturing and the ability to adapt.

The UK is pushing hard for reductions in CO2 and electrification of the motor industry. Extinction Rebellion want the government to go further. Mexico has taken a backward step on reducing CO2 (see the first paragraph of the overview of the link below). Is it any wonder that the production of the Dragon Petrol Engine is to be moved to Mexico, with greater pollution than in the UK even at the current levels. The more the left pushes for greater reductions in CO2, the more jobs lost in the UK, with greater pollution in the countries filling the void.
https://climateactiontracker.org/countries/mexico/

The TRO was denied weeks ago. FRR are seeking a Preliminary Injunction and if that is declined, they can apply for a Full Injunction. If that is declined, then they can appeal.

The judge states that on the evidence he is going to award the Preliminary Injunction.
SH/O's lawyers protest arguing their case for the defence.
FRR's lawyers ask for a Full Injunction and push for discovery, as a deal has been completed with BP and money for the debt has been paid into Escrow.
SH/O's lawyers offer an OOCS for the full $56m.
FRR's lawyers decline, as FRR can now only lose the money in Escrow and the court costs.
SH/O could now lose everything, including SH's freedom.

I think that's called a Carlsburg dream!

Psts by regdik, Symore_Bottoms and Chris572 have been copied to the Frontera Archive :-

http://www.lse.co.uk/view-general-chat-thread.asp?forum=commodities-and-mining&thread=41C7D130-7E51-4344-82E7-83B697F53322&page=last

AJW - IMHO the $150m has a double purpose. First and foremost as leverage in negotiations with the super majors and secondly, if FRR don't get a realistic price, then for FD + money for the SH/O debt via Escrow. Obviously, due to the attempted smash and grab by SH/O and the court case, then timing is of the essence.

AJW - Four times as much gas in Block 12; onshore instead of offshore (up to $40/bbl to extract offshore than FRR's $12/bbl, a price that may have also dropped {see link below}); FRR also has 18 billion barrels of oil, which is sweet 41.5 API (only a few places in the world have better quality oil {see second link below}); and Block 12 is close to infrastructure that's already delivering to a ready made market. Therefore, four times as much gas x three times cheaper to extract = 12 times the price = $12bn. However, that price is without the oil; the infrastructure and market; the high recoverable levels of around 70% in Block 12 and the known geology of the Kura Basin and Maykop formation (already being extracted in Azerbaijan by BP).

https://www.energyandcapital.com/resources/brent-vs-wti-crude-oil-what-is-the-difference/17
https://oilprice.com/Energy/Energy-General/The-Next-Big-Trend-In-Offshore-Oil-Gas.html

Taffy - I've copied part of my post from the 12th February which could explain why there 'wasn't much oil revenue coming in as of November.'

The court papers show that there were problems selling the oil.There were three trainloads sold mentioned by Zaza in a podcast. GOGC auctioned 3 trainloads between the 10th September and the 22nd October. If this was FRR's oil then payment after 45 days = 27th November = 19,000t x 7.71 = 146,490bbls x $75/bb = $11m.

Timster - I was only nitpicking while eagerly awaiting Taffy's response to your post.