The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Good morning,
I’m no oil man but Leo showed storage tanks in the twitter pic ? is that a sign of confidence of a find or normal practise to install tanks ?
the fact he also converted his 17 m shares should have been taken as a positive .
Nice posts LGO , always like your balance realism/ viewpoints .
Bamps , really enjoy yours too and a couple others.
Only one month to go for results .
I can’t see two draw downs , near on 6 months of work on Saffron, multiple hydrocarbon shows in LC and shows in Uc and mc all leading to non commercial oil gas or condensate.
Something good surely has to come from this . Imho. Plus Leo taking up the 17m shares . Like stated here would be good if he delivered on his promise to buy in the open market too for further boost .
Hi Bamps , Do you mean eventually announced multiple pockets at Saffron of those amounts or you mean in Surinam ?
Morning Faz,
If I could I would . I would be buying loads right now. I’m skint as they come mate .
At least it appears even Schroeder’s have stopped selling ( at least for the moment , so even seems too low for them to bail now :-0 )
Morning Bamps,
Then again you mentioned in hindsight of drilling Clove and even though the COS was even higher there If by some reason it wasn’t commercial or there were problems I think I’m more than happy that they did saffron first .
I do think if saffron is a success they could still do you Clove to add extra output at minimal cost if Clice came in too.
Not long to wait now and hopefully by the end of March we will know exactly what’s going on with her from within Each layer of LC and the MC confirmation by end of March .
Has to be onwards and upwards from here surely obviously depending on coronavirus as well .
Look at it this way , China have now reported fewer new cases . So if they can contain it then other countries should be able to as well .
The Americans are working on a cure for it and are to carry out some trials .
So whilst everything is a bit doom and gloom at the moment with the oil-price , saffron Unknown’s , coronavirus . Let’s just say saffron does coming good that should give us a little rerate maybe tempered somewhat by the oil price and coronavirus . But once coronavirus is brought under control what’s the main markets rebound what’s the oil-price get back up to where it was and we should follow suit as well .
TXP had a huge re-rate after their discovery . It’s not over yet for them either .
If we get a good result at saffron I can easily see us getting to the 5 to 6p range short term for support . Then even higher in time .
Also CO2 could provide a much-needed boost as well .
And let’s see what negotiations can bring for the future of Goudron.
Much to play for that’s for sure . If I had spare funds I would be piling into this right now . I just don’t as I’m fully invested in Columbus .
Hi Bamp
I agree with that about Clove . Saffron is clear favourite for many reason mentioned .
Clove in different scenario would have been a good backup option to production cash boost.
Saffron I feel will be different kettle of fish as seems to have been the case so far .
Will we hear Re news flow as it comes or will they bundle it all and peg it all for the end of March ?
Hi Bamps, yes I agree completely with you there . Put it this way something interesting for sure is afoot with primary and particularly secondary horizan in LC And MC potential testing should LC not suffice . MC seemed even clearer and that was only from the logs with no testing . Something positive to me seems the outcome for saffron like you said no mention of Clove. What does make me think as well is the surprises so far at saffron who’s to say couldn’t be surprise replicated at Clove. Really speaking though why bother with Clove at this moment in time if saffron is going to deliver . maybe a worthwhile revisit at a later date for clove if the drill costs are around 300 to 400 K .
Even if reserves there are not huge but still add extra dollars to the coffers. We might have more clove we just won’t know until that’s investigated as well . One thing at a time though easy does it and within our means .
The plan is slowly coming together .
Afternoon All,
Imho the delays in this instance with CERP are for the good and not bad news.
The geology was tricky to say the least which is why it took much longer than the previously estimated 30-45 days.
Slowly slowly seems to have done the job with no disasters along the way because of their adopted caution during the the drill rather than go bullet-a-gate.
Next came the logs which were indicative but inconclusive on LC hence the required flow testing.
We have three areas of interest in LC alone let alone the surprise MC statement about likely commercial . We also have UC shows but later date for that one as best to focus on key productional benefit interest . Cherry pick the best in order to process and fast track the REST( of SWP. ) 12 deeper Herrera targets.
Saffron has surprised with additional layers /traps and within original planned three cruse zone.
How much by way of reserves is key. Bopd is important too for organic near term capital but not as much as the reserves as that will be the bookable amount and key fast track for deals, either , partner, booking against future production , debt equity , and other options .
Shouldn't be too long to wait now though.
HI Bmj
Wish I could say the same. I get them mostly wrong , or at least my timing too even if they turn good.
I’m hoping all that will change though with CERP.
Morning Razor , I agree with Daz, LK is yer to buy in open market .
I don’t think they are in a closed period so nothing stopping him. Let’s see if he is good to his word in person which I’m sure he will . He said he will buy, and a lot of them . Let’s see ...
Good morning all . My opinion for the low SP is solely
“The Schroders Effect . “
Two reasons they may be selling:
1. Things might have dragged far longer than they had hoped many things not coming to fruition for them starting with the 2017 slides presentation showing enormous percentage increases for each well at Goudron.
As always there will be setbacks with any plans some successes some complications . No point throwing money at a fiscally for set up with no returns only keeping nostrils above water . Not a dead duck just improved fiscal terms required . Maybe they felt frustrated as a whole with lack of SP progression .
2. Maybe a huge change in the investment direction maybe they are looking to get on the cleaner fuels bandwagon ( which electric actually isn’t , hydrogen would be the way to go ) . Electric just seems another big moneymaking scam . Much mining required for battery cells then what will be done when they expire ?
So maybe they are offloading for alternative markets . Would be interesting to have a look at their percentages invested in oil and gas companies over the last 3 to 4 years and see how many of those have decreased up to the present day.
If LC does not have 11 but for example 5MB Rec but MC has two or three Mbrec. An overall 8 MBO Rec is still no damp squib and would give us approximately £64m boost to MC. And even if not all of the 64M is incorporated overnight into the MC But 50% to give us £32 m on saffron alone . Add that to the current NAV 2.7p ( which today’s SP is now far below . Then we should reach 5-6 range ( that’s not including all of saffron in the event of a successful 8mbo combined Cruse level discoveries only taking in to account 50% ).
Reserves are key here for booking in and deal making for bringing this on tap with the different fund ranging options that would become available in the event of success .
Any surprises with reserves maybe even more let’s be optimistic and say 15 to 20 MBO rec for all Cruse combined , this would create massive interest and we would then be looking at huge trades 500,000 and no doubt into the millions coming through as well Which should suppress the pressure we are currently under from Schroders . A lot to be optimistic about right now until proven otherwise . Look how TXP have popped from 13p 12 weeks ago up to over 50 today . And even their market Still remains low with the potential they have . So just look at the potential we have as well in the event of a decent saffron discovery . This will pop in my opinion just need the complete results in . I’m not sure what the current situation is with ministerial permissions in saffron and if they are are RNSable requirement ? I’m assuming that has already been granted as they have been progressing with testing and current flow testing Of the LC tip of the pay zone sands.
AIMHO of course.
Hi Bamps
Many thanks for that and clarifications . Yes it seems old to have that NAV stated.
Thanks again must dash
Morning ,
Columbus energy 2020 corporate update:
My added key points of interest I wasn’t aware of ( not including the regularly discussed ones WF Co2 etc. )
- The mention of a dozen LOW RISK 20-400mbo. I was aware of the 12 potential targets but didn’t know they were classed as so low risk . I thought these were higher risk as deeper and unknown hence why we drilled saffron due to funds restrictions for deeper drills but also the fact that saffron is situated in a known province. ( GS words to me which looks like he’s been proved right as of yet with multiple sand shows to date.) I wonder if the drilling of saffron has given extra confidence to the dozen deeper targets hence why they are now stated as low risk . I.e migration, higher pressures, I’m wondering what the COS of these targets are? 20-30% or more ?
- Icacos I find interesting as it states missed reservoirs. A mature oilfield i’m assuming with improved tech detected the previously missed reservoirs
- South Erin I think was the one discussed where there was unexplored potential and they were quite excited about that area too.
- With regard to saffron they actually sound more confident about MC to me than they do of the inconclusive LC. Time will tell. Maybe we will get excellent results from LC and MC
- One thing I’m not so sure about they have on the chart is current core value producing assets 4.9p per share where I thought they were closer to 2.7 to2.8pps .
A nice little corporate update.
Thank you to James for a really well laid out defined clear concise presentation.
Morning all,
I was having a look at the current fundamentals of Columbus VS BPC.
Columbus currently have a market cap of 21m
We have 868 million shares in circa.
We have an SP of 2.5 .
BPC have a market cap of 58 million
They have 1.5 billion shares circa.
They have an SP of 3.6
Columbus has drilled saffron as we all know with better than expected initial shows as we found hydrocarbons in all three cruse levels . Of course we are still waiting for the results from the logs . Indications are that there must be something worthwhile there due to the money and the time spent drilling and analysing these logs And performing flow tests for confirmation .
At this conjuncture it is not a given but there is a good chance of success in my opinion . Our share price has plummeted . The only reason we have plummeted is because of the Schroders affect .
Now BPC on the other hand don’t have a consistent large institutional seller which has allowed them to rocket only on the fact that they have announced yesterday they are planning to drill .
Columbus on the other hand is much further ahead in terms of drilling and discovery . Yes BPC have a deep drill to come with potential of large discovery which would completely transform them if they hit the figures that they are talking about .
My point is when you look at the financials of Columbus we look very cheap at the moment When you look at the market And the SP .
If good news does come back from saffron there’s no way we can stay down at these levels even with consistent Schroders affect . I think new buyers will definitely be attracted on any successful result from saffron as that will further de-risk SWP .
We only have a market cap of 21m.
It won’t take much to push us back to 5p and even then the MC Will only be 42m.
That’s for example say we find 11.5 MBO as they had hoped for in LC . This will have a value to us of 88M
Even if all of that is not priced in and say take half of that and build that into the share price that will still take us up to 5p . If the full 88 and was taken into account And booked in as reserves and incorporated into the SP we would be valued at 10p
Of course that is rose tinted glasses with expecting the market-makers to Price in the Full 88m but let’s say half of that gets price then that will still in itself double the current market And share price .
It’s all to play for here . Any newbies always do your own research of course my advice just go to their website and have a good look through everything on there for our full potential . All the legacy hard work clearing Dead wood has been completed, now we are just at the starting
blocks of A potential rerate to 5p on saffron success . If CO2 and water flood comes good expect a further rerate.
And once we can move on to other factors as well with infills rejuvenations to top it up a little more and then Suriname. Als
currently echo this. I think things will come good here it’s just going to take more time .
I’m pretty certain that if Schroders had not been selling over the last year and the share price now would be a lot higher .
I remember watching MATD and how they spiked massively several times One potential alone . They had some bad results and they dropped like a stone that they had couple of good ones I think which underpinned their potential . Now on our first well at saffron so far things are looking quite Rosie of course we need confirmation from the well logs for this . But even when Leo did the first interview and mentioned that it was likely that in itself without Schroders setting would’ve pushed us quite nicely upwards and then further gains as they widened the wellbore and then confirmed hydrocarbons in all three zones . That would’ve pushed us further still Northward
Anyway enough from me just thought I would pop in as had a spare moment.
ATB
Good evening ,
I have been following the trades for quite some time around 1 1/2 years . This was about the time I noticed consistent sells in 100,000 blocks sometimes 200 250k.
On rare occasions when the share price spiked and buys increased then so did the sales . A few months ago or slightly less there were some really nice buys that went through matched by the cells mostly from Schroders .
When you have an institution on the scale of those guys once they make a decision either to top slice or sell on completely the fundamentals and potential of the company matter no more .
We are where we are currently because of the Schroders affect . Market-makers take the share price down in order to attract buyers as they were struggling a higher share price then as soon as boys start appearing that then allows traders to place an order with the market makers to off load some more matching the buys.
Because we are not yet at a fully understanding position with regards to saffron there is still uncertainty hence why there are not a wealth of buys appearing .
I wouldn’t put it past Gordon , LK & TH to potentially be approaching the institutional investors may be making them aware of what could be to come . So whilst we have Schroders offloading some at least if not all then when saffron results come out if very good might be the touchpaper we need to attract another institutional investor may be to take up the slack .
And who knows we may even have one of the big oil companies start taking a position themselves if the saffron results are much better than expected . This will be the first prong to prove that SWP and what a way to start should the logs come back positive .
I don’t know why Schroders are selling that could be a whole raft of reasons anything from personal change within their company or orders from the top, they may have run out of patience if they thought things were going to take off sooner than they have . But to be honest though it seems like their decision was already made a long time ago and are steadfast in selling despite the saffron potential . Let’s not forget as well but they still probably hold masses amount of shares from 2p so are selling out of profit and then if saffron comes in good they can then offload the other shares that they bought at higher share price.
There will be overhang from Schroders but not so much because they can’t just sell shares without the buys that’s why it’s taken so long for them to sell 8 to 16,000,000 shares over the last year and a half because we have had so many days where there were next to no buys. They can only sell when the boys allow them to .
So what could speed up the whole process is excellent news from saffron creating a raft of new entrants into Columbus allowing Schroders to drop down faster to the position of their choice .
It’s going to come very good here with Columbus even if the share price does not curre
Good morning everyone
Very nice RNS but further confirmation needed of net pay not just gross pay .
We are still in closed period after the logs results are released it would be nice to see a few direct buys as Leo alluded to before.
Schroders selling can only impact us for so long if we keep getting good news flow and stay at a low SP with the Schroders affect then I think some of the big boys will be definitely putting us on their list as a takeover target .
This won’t be quite yet of course but something has to give either there will be buying pressure which will water down the Schroders affect or if buying remain still on the ground as it has done then I’m sure we will be on the radar of a few .
It does to me look like the logs will bring some positive news we don’t need necessarily high BOPD but it’s the reserves that will be the big one for us .
Once natural depletion starts they can either use pumps or sidetrack are well but of course we have to wait for the feedback of the logs first .
Very nice RNS so far.
Good Morning Bamps,
Happy New Year to youbsbd others.
Firstly I’d like to thank you for all your input here. It is truly valued .
Secondly I agree with you about support for Peter. I know him well , he may or may not have mentioned this in person to you.
I couldn’t agree with you more about not conversing with trolls , it’s only feeding them what they want . I have mentioned many times before about ignoring them but it didn’t work .
These evils that gloat in others misery are just evil . Whatever has gone in their lives to make them so bitter and twisted still doesn’t justify that attitude. Trust me I have a 10 lifetimes worth of bad stuff gone on rolled in to mine so far as have others too but it’s not the way to go to be utters shi ts to others. It still doesn’t stop me believing positively that life will get better and that Columbus and LK GS SA TH JC and team all will deliver.
Where did you hear that about LK NY resolution ?
Anyway, thanks for your postings in here.
May 2020 be the true start of transformation that we thoroughly deserve.
Hi Peter
I could be wrong here but I think the development cost for saffron was 2.2 million .
I’m sure I read that fairly recently but my brain has been pretty fogged of late to be honest.
Afternoon All,
I had a feeling it was Schroeder’s as mentioned recently but I also agree with CCR too about others.
MMS will always keep very very low on prices when they know a massive holder wants out or reduce . I have seen this before so many times.
I think if Schroeders were not bailing the SP would be higher than at present , 4.5/5.5 region imho .
Once they give notice to MMs that they will stop ( if they choose only to reduce ) then I’m pretty sure the sp will rise a fair bit from here .
If we get excellent results from saffron and a surprise from other two Cruse levels then this will be sure to attract buyers and place us on the radar . However , I think if Schroeder’s continue selling in to the rise this will limit and cap short term rise to what it should be if they weren’t bailing ( I. E if say we thought it should rise
To 7-9p we might find it limited again if sells far outweigh buys and might be stuck in a 5-6p range .
First we need a great result on saffron.
Second Schroeder’s to stop selling and enjoy the good news and look longer term . They have been in with millions since 2p day’s so could be that they are just selling some
Of those to top slice and lessen the hit of it’s a duster where the sp would be sure to tank a little until good results from
Co2 , other license areas infills rejuvenation’s can show a great revenue stream extra bopd , plus is fiscal renegotiations can be agreed with Heritage this could all offset any bad results from
Saffron plus huge Schroeder’s offload should they continue after results .
Aimho of course .