Member Info for Moleinahole

Hopefully we have four legs on the bottom and the drill turning at Southwark!
Bacton per last RNS is pretty much done bar the testing really. The debate is whether the last bits at Bacton can be done early or late into Jan.
I took a few extra shares yesterday on a T20 and the MM didn't want to let go of them so a rise was definitely on the cards.
There is the potential for some resistance as institutions have had so many cheap shares but while they hold on IOG shares don't normally get shaken out so once they are gone the MM have no choice but to raise.
Fair value is north of here and into strong gas pricing short to medium term downside risk to reward remains good. That to me has always been the attraction of a UK gas asset.
Very satisfying seeing the price start to respond to match the progress on the asset just before Christmas. Exciting 2022.

Peak no is not good news (but as we are already discounted is not likely to effect the short term share price as it's a longer term question) and while the explanation is that they wish to look elsewhere I was unaware that we even had a commitment date of 18th Dec for a decision. We knew it was sub optimal and it may well be the right decision. I don't know enough to draw a conclusion one way or other. They have written off an exploration campaign and the reserves that were still on the books for it. It does not effect phase 1 or 2 which is why I'm ok to see how they go about addressing the refill of the hopper but I don't know why they would relinquish rather than park it or ask to extend. It seems likely its not just not as good as other prospects but a bit more fundamental. Having lost Harvey and Redwell which were significant prospective resources we need them replacing. The southern hub looks like where they are looking to firm up in next year's exploration drills. Maybe they have no real long term plans beyond next year and hope to be bought out which I would also not rule out. Harvey was 100% IOG whereas the others are 50/50 with calE.

I think you'll find long term inmates have bought at all prices up to mid 30's. It's been a roller coaster ride and many have got off on the way down as at times it's been touch and go particularly with the LOG situation. I'll never forget doubling my holding on skipper to then experience the horror in the RNS that the oil turned to water/drilling fluid and it was in fact a heavy oil field. Trading into the original 10p placing is one of my regrets. I should have sold part and bought back it was so obvious but it's hard to break a habit I have of backing companies through thick and thin. I've even slightly increased in last month as I had some space in my trading account to increase exposure a little bit more as I have been at my limit of risk for a while.
We are still at a discount so inspite of a bit of naughtiness from the board with the communications and Harvey I'm very much looking forward to 2022. 2021 has been a good year for the company. Whether we can afford to have the gas heatng on in 2022 at home will be an issue next year for alot of families. Good for IOG and their decision to progress the development through difficult times which they will now be rewarded.

Future but if it's really marginal we have been strung along on its viability. And I think that's the point where I would share the sentiment of posters like Dunderhead at times. Whether the pattern can be inferred onto completing phase 1 in a timely manner or phase 1 ultimate value is where I draw the line and why I still think it's good risk/reward value for my 6 figure investment at an average of @ 18p.

Peak it's not about doubters when looking at the last RNS.
IOG is doing ok but.....
That is now really in large part due to the high gas price. Without that the effect of Harvey would have been much greater. Alot of the value from phase 1 has gone to institutions and CalE. That was at the expense of PI investors. The raises have funded to a large degree the exploration costs of Harvey and skipper. CalE and the bond covered phase 1. Without that the returns would be modest at best and the continued write down of reserves and assets painful.
They have been lucky on this occasion with gas pricing and need to now cash in on that as soon as possible.
We still await news on phase 1 reserves and flows particularly at Elgood. A classic example where higher flows but smaller reservoir impact will only be known after several months of production per July RNS.
The board have my broad support in what they are doing but I've been here long enough to be able to observe patterns in how they behave particularly in managing sub optimal news.
The exploration drill next year which the rig was extended for has increased in importance following the RNS. Short term the news around phase 1 is ok but I'm looking at the longer term now beyond phase 1 when talking about the RNS. The main effect of the loss of Harvey is the reserves need replacing in the Hopper. If they are not then while they will generate cash in 2022 and 2023 if you look further out it will decline quite quickly. So alot depends on the time horizon you judge the RNS on.
I invested a large amount at the time of Skipper and so this 30p area I thought was a great price then. It's derisked now going into 2022 but the pot has been shared with institutions, calE and LOG admin. Hence we own 12% of 50% of the asset as PI now. Before we had near enough 100% of 100%.
Oh where would we have been without Skipper and Harvey!? Or had Harvey come in? They are abandoning a field on paper the same size as Elgood. Harvey has been painful and protracted Peak and clearly the geology not understood when going for it. That's exploration sometimes it doesn't work out.
Let's hope gas price stay high (I think they will) and we get producing without any further issues. (I think we will). And they finish Bacton (they will). The nudge up of the share price towards where it should be in the 40p+ area on first gas continues.
We are due some luck with the drilling at Goddard and kelham in 2022. Paid for....... of course by another placing in sept 2021 giving more value just prior to phase 1 to institutions at a discount. That's my main irritation. The reduction in the pot by 'gifts' to institutions. I can live with exploration issues if they did everything possible to study the prospect and drill location. It happens. For Harvey to not be commercial at this time with higher gas and the pipeline near means it really must have been marginal or the other prospects really really good! Maybe they will try and take it back in

Aim I have been a holder here for many years now. We are used to sub optimal RNS.
That RNS significance was not the first gas date for me.
They gave up on a reserve very close to the phase 1 which was paid for by dilluting the hell out of us to bring institutional investors onboard. With hindsight it's been a disaster and getting something out of it would have softened that. It's knocked a chunk out of the reserves and I guess we may have to right down some capitalised costs. The long term question remains where will they find replacements for the hopper. They are really not good at exploration so it needs to be predrilled or abandoned fields. The southern hub looks like the focus. I hope they have more luck there than Harvey. The fact CalE have partnered means at least a second pair of eyes have looked at it. Harvey CalE left IOG with all the risk and option to come in if it worked out to get the upside. Can't see another licensing round at moment but the low carbon profile help if we do get one.
The high gas price has really saved the board here. It compensates where it's not worked out. We are due some good fortune with the drill or licensing. The phase 1 stuff has been in the bag for a long time. The gas pricing has been the good news of 2021.
Plenty to look forward to in 2022 but I didn't like that RNS.

Not the best RNS.
We already knew about the rig. But it does sound like Southwark is going to be late into production in 2022. Need to look at that.
The Bacton and reception facilities confirmed as having now missed the Q4 target and slipped over in to Q1 2022. That was always the more likely of the two scenarios but by saying weeks they have again made it hard to be precise. Not sure what else they could say but probably should have said on previous RNS that it was 2022. By not saying that they have left the impression it's very close and a working assumption of January. But not actually said that.
The Harvey part I assume means they had to decide by 19th Dec what to do. They have decided I presume to relinquish it. After Skipper that is now 2 drilling expeditions that have cost alot of money for nothing. That's disappointing as with higher gas prices getting what's left out should have been a reasonable possibility. That decision can only be validated when the other options are stood against it for capital allocation. CalE were not interested in Harvey so it's been a costly excercise on what could have been a significant reserve or producing field. Hopefully, the fields CalE have joined in on prove to be a success if that is where capital is allocated.
Not alot can be done other than grit the teeth for a bit longer.

The MM know what's coming up in next month. They have had their fun marking it down on last RNS and the previous placing at 25p. The loose shares that has created have been absorbed from what we see on the trades. They are now closing up the spread. We know the rig is back on its way again and the guidance on Q4 at a stretch remains in place. So we could be 2 to 3 weeks from first gas (optimistic view) or not much beyond that (probably more realistic)!
Next RNS should be the rig deployment. Presumably the rig was parked waiting the wind to blow through? You wouldn't want to jack it up with a previous dodgy leg and find it's not fixed in bad weather.
Come on Mm time to let it rise. Next few weeks going to be interesting.

Not needing to sell for a while now they have held and since the govt started pitching money into the LCF situation through the compensation scheme they have time to wait.
The danger they pose is in facilitating a takeover. They agreed to decline the 20p offer to buy the debt by RRE in their attempt to gain leverage for a takeover but it will be interesting how long they continue to hold.
The LOG episode was undoubtedly very damaging to IOG. It's been a money spinner however for the LOG administrators in part at my own expense hence why I don't like how it played out.

We've rehearsed this one a few times: Sentiment/trust damage to long term holders
a LOG debacle. b. Skipper debacle . c. Harvey resources way below expected numbers. d. phase 1 volumes at Elgood still unknown after drill . e. Takeover attempt of DELT and low ball takeover target from RRE aimed at leveraging the LOG debt.

B and C cost us very dearly and resulted in alot of the debt such that when we did move to develop the current phase the cash was gone and they needed recapitalising which was done by giving away alot of shares to institutions. The board have sought institutional investors and were and still have been happy to bring them in at discount. CalE while a great partner still cost us 50% of the pot. The reason we are not in the 30's now is the recent placing at 25p to fund 2022 before production (to secure the rig - how ironic to then have the issue with the rig), followed by the late pushing back the first gas date and additional unexpected issues with the Southwark Rig.

That has pinned us between the placing at 25p and the 29p area which has significance for LOG options and has been a long term resistance area.

The net effect of the above has been IOG has slipped down and under the radar. It seems to have become an institutional share with a band of long suffering stubborn/patient long term PI holders. Why its not yet attracted more retail PI interest is still odd - we seemed to have attracted a few new ones but not that many. Not enough to absorb whatever shares the MM are prepared to shift and their often wide spread and tendency to be slow to move makes it not really a trading share.

Now the counter to that is that inspite of the mistakes that have been made and problems along the way we have got to the threshold of first gas at the right time. So whilst the long term investors have been significantly diluted we have arrived at this moment of truth. When the gas is switched on final doubts about the field and concept are replaced by the facts of gas flows and revenue.
That seems to be what the market is waiting on. If LOG and the institutions hold their shares then any buying pressure will move the price quite quickly I think and upwards. With a producing asset the risks of the future exploration are at least compensated and a good hedge will provide stability. It then becomes a question of whether the business will grow organically or be bought out.

They will hedge production next year - that will be interesting to price! They will use income to pay down the bond which is where alot of the debt is in addition to LOG (we still have some cash left over - the rig is now funded for next years plan so no need for any more raises we hope) and then they can decide if the freecash is used to fund future phase and/or acquisition. I think they will continue to be conservative and want plenty of cash to keep options open.

I think they might be tempted to buy back some or all the LOG shares at some point rather than a direct dividend but there is no need to do that other than if they want them off the market for a predator. The more cash the more likely a take out becomes so 2022 will be interesting to see what they do.

Either way - I think we all agree unless something unexpected happens that stops production or massively reduces reserves we will see a cash generation machine in action next year. With IOG you never expect some of the left field events.

Hopefully see the rig going back out again soon. With base planning cases at much lower gas forward prices - it looks good just need to get the last tasks done. Based on past it will be interesting to see how the SP starts to move and what we get valued at as a producer.

I've long been of the view we should be @45p on first gas. And a rise beyond that has to be on the cards once we get visibility of actual flows/revenue and progress on future fields.

Peak as we both know long term holders take these RNS in their stride. We've seen it all over last few years. The anemic trade volume shows it's just not traded. The share register is pretty static and prepared to wait. Those who weren't bailed 3 years ago. MM have marked it down and that has created a few trades but it looks pretty even traded to me not that it matters.
It's been a hold and wait for production share and nothing has changed with that RNS. The good news for me from the RNS was more the rig repair was indeed weeks not months. So with that heading out again 2022 program back on track. Had the rig not been fixed then that would have been bad news.
The RNS has confirmed we are there or there shouts Q4 and will be back on track 2022.

So while would have been nice to be surprised with an early date it's so close as not to matter but getting the rig out again in December is good news.

Phase 1 first gas is not from Southwark though is it.

If the rig heads out early December I doubt it will be sat idle.

Phase 1 just needs the final connect tasks at Bacton. They don't seem too onerous to me from the RNS. Getting someone to certify it from a public sector authority might be a challenge but first gas will be early Jan at latest if not before as they have said.

If you listen to the recent presentation they did - the original guidance on overall time was reaffirmed but the delay on the drill was listed as weeks not months on the rig fix and there is still time to stay on schedule. So we are still in an acceptable tolerance - its better they sort it once and for all if the rig is going to get an extended run out in 2022 for IOG program. Obviously waiting on an official RNS now but I thought they were ahead of schedule on the drill before the issue with the legs occurred.

Being so close to first gas it could be we will get a first gas RNS with an update on the rig/drilling at same time - unless of course the repairs send the rig out sooner before first gas.

Next update will be one or the other! They would only need to RNS either separately if timings materially change which at moment they have not.

The little debate we could have is when first gas now. I would agree before christmas and you would think the off takers want the gas asap. I'd have a stab at guessing 2nd Week December - lets say 10th Dec for me. But I'd love to be pleasantly surprised with an earlier date. Its coming......

Watch the presentation again - they tell you what is outstanding at Bacton and also reiterate Q4 guidance. As we are now deep into Q4 with only a few weeks left of the year then I'm not sure they would want or need to set a more precise date and make a rod for their own back now in the event something left field happens.

I think we will have to wait and see how the press/media react on first gas. Its not much of a story yet - Small independent North Sea producer due to do first gas shortly. The story will be the switch on and delivery of first gas by small independent producer with low carbon intensity and also helping repair LCF losses.

But yes got to be worth 40p all day long - but like you Gator been here long enough to know thats not always what happens. So it may take a bit of time to re-rate and find higher levels. To do so needs more daily volume and continued sticky holds on the shares particularly by the bigger holders like Lombard.

Some additional news on the rig would be good but again we got some guidance on that in the presentation.

Peak when I say modest its relative!! It's better than base rates for sure but it's also not going to do anything crazy like other AIM shares can and do with starry eyed valuations and multiples. As I've said before that is a large part of its attraction to me and more so at is has recovered ground from 3 years ago as the risks have also reduced.

Score we have a disconnect at moment between share price and value. Downside risk is low and upside modest. So as an investment play from here the risks have been massively reduced from where we have come from. Applying basic business logic here is what most have done getting the abacus out to crunch the numbers. We are not enjoying anything like the returns we could have enjoyed but nonetheless the board have managed to navigate us through to this point and the pipeline with multiple hubs concept is taking shape.

Peak given the profile of the current share register and other stakeholders I don't think they are overly concerned at the share price because they know as the fields come on line it will appreciate or they will get a takeover over. It's that simple. Why it's hit this glass ceiling at the moment we have also discussed many times. I don't think they are too worried as once they are generating cash they will also be drawing large salaries. The volume here remains remarkably low and until that changes we will go sideways. A bit odd to observe when AIM is so full of non delivering companies with high premium share prices but there you are.
First gas is clearly the catalyst that should test the glass ceiling and we are closer by the day.

Peak I have pondered the lack of publicity question. I genuinely don't think they see the need to blow the trumpet. The normal reason to do that is to raise money.

They did that in sept without having blown the trumpet at all (indeed most of the dilution damage has been done with CalE 50% , LOG warrants/loans and Insititution giveaways in the past that really did hammer the long term PI holders and again all those were done without any real attempt to big it up). Gator is spot on about that. They went in sept to their chosen institutional partners. And that to me is the key - the most important stakeholders to them are the institiutions, CalE, LOG admin and the O & G authority as regulator. They got the placing swiftly away and at the discount the institutions wanted and conveniently under this 30p ceiling which we had briefly pierced. How convenient we had that little run up for them. My fervent hope is that is the last giveaway we need to do. That has then kept Noble their other key operational stakeholder happy.

Of course alot of the money we got in the past including from LOG funds has been lost in things like the Skipper and Harvey drills. Both have cost the long term PI investors very dear.

With the money in the bank - they still seemed to have plenty of the bond cash and carry money in back pocket for 2022. With the higher margins on the gas they will be generating plenty of cash into 2022. So funding is not an issue. And funding is the main reason you make alot of noise.

Then I have thought that maybe they don't want alot of noise to advance the asset a bit more to stay out of sight of predatory takeover seeking companies. But with CalE as partner maybe again they are not so worried about that and can just quietly do what they said in the presentation.

Pumping the shareprice up equally might encourage LOG to sell out possibly to another institution - just can't see them unloading in volume into the market.

However, once they start generating cash everything changes - then any disconnect between the share price and a growing cash rich balance sheet is like ringing a dinner bell for predatory companies.

Alligator I guess it depends alot on what you expect from such events! They don't really need PI investors anymore they have a growing institutional base and focus - so that they even presented at all meant it was of interest - of course they use material also available off the website they can't deliver price sensitive info and why wouldn't you use existing material. What other material would you present!

Hence my comment that the "news" bits were the rig and LOG. I actually watched all 4 presentations last night and the other 2 oilers were interesting and of the 4 IOG was by far the most cohesive presentation. As they took questions it was an opportunity to ask them whatever was on your mind - the I3E lot were getting plenty of stick in the comments and some tricky questions.

We have discussed here many times the LOG overhang and I think I've been pretty clear about my view of the recent fundraise which has also acted as a brake as well.

What do you suggest the board do at this moment in time? The rig is with Noble to sort out and the way out with LOG as I see it is to execute the current delivery and then start to accumulate cash. If the gas pricing stays strong and above the base case in 2022 and 2023 it will sort itself out. How they deal with LOG and the bond when it comes up in context of future development and cash flows is where this will come out in the wash (assuming an offer does not come in sooner which can't be ruled out). I just have a feeling now that LOG could well end up settling up with IOG at a mutually convenient time and price in 2022 involving some sort of buy back. If so that will take time.

A year ago shareprice was @11p today 29p - so we have gone in the right direction and if you crunch the numbers a higher price is most definitely justified. But there clearly remains a headwind slowing us down around 30p that will take time to sail through - which is no doubt why the number of daily trades remains thin inspite of the operational progress. I attribute that to both the sept fund raise at 25p and LOG.

Have a watch its on the channel now:

https://www.youtube.com/watch?v=h4cw7F1DOHA

The one thing that occured to me was maybe they will buy back LOG shares in future. They have mentioned share buy back before.