The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
All these blocks are in the Orange Basin and small exploration companies like Sintana Energy, Pancontinental Energy or Africa Oil benefit from this news after Total and Shell drilled the two basin opening wells and now hopefully Galp in the Orange Basin.
TRP's block is north of the Orange Basin. We need for these basins in the North like the Luederitz Basin basin opening wells firstly. And such expensive exploration wells can be drilled by oil companies with deep pockets only. TRP needs to do a farm out deal for the offshore block in Namibia. I got no idea if the lessons learned from the Orange Basin can be applied for TRP's block as well?
https://m.youtube.com/watch?v=ywgXP48903E
Https://www.businessnews.com.au/article/Gas-plant-grab-fuels-Empire-pilot-project-in-NT
I wonder if POQ has an idea for the next steps for FOG or not (and I mean not just accepting the project proposals from the operator TBN). After TBN took over "our" Origin Bettaloo asset part it was said FOG will not be sold anymore short or mid term. Does POQ work proactively for his salary or is he just waiting, doing nothing? In Australia he is not anymore in the driver's seat and in my opinion he even is not capable to do joint venture influencing there. At least I would expect that POQ shows some activities in South Africa.
There are companies that are drilling and going to produce in south africa, but not fog. why?
https://energycapitalpower.com/south-africa-natural-gas-projects-2026/
Happy to see the Pioneer guys in the Beetaloo.
https://www.proactiveinvestors.ca/companies/news/957013/tamboran-resources-to-accelerate-development-with-cootechnical-team-appointment-957013.html
There is confidence that the Pioneer guys will crack the code to get commercial gas production from the Beetaloo finaly and happy that the losers from ORG do not operate anymore in the Beetaloo (the exORG guys who left ORG and joined TBN will have a good learning curve)
Nomade
that`s what I mean.
TRP has booked prospective resources and I know no oil company that got money for exploration respectively for prospective resources from a bank.
Banks want to see proved P1 reserves which can be produced more or less 100% sure; not C1, C2, C3 or 1u, 2U, 3U. The banks are even not interested in the probabilities of the Cs and Us.
https://www.spe.org/media/filer_public/63/13/6313c8f3-d065-4b07-9f57-7f2507430780/prms2018keychanges.pdf
Hay ShareInvestment
Usually exploration wells are not financed with loans. O&G exploration wells are high risk investments and speculations based on geology. When you take the exploration wells in Africa, only 6% of the exploration wells ended as commercial discovery. Better to bet on red or black in the casino. Banks usually will not offer loans for exploration wells. For me it is a strange point that TRP tries to get a loan for this exploration wells.
Usually banks offer loans to oil and gas companies, when the oil company earns already money with oil and gas production i.e. reserve based loan
What do you think? For me it is fascinating to observe that TRP tries to get a loan for an exploration well. What will the bank do if this well is a duster?
The milk is spilled but I will keep on finger pointing at POQ who spilled the milk and overslept everything. His strategy, his negotiation skills, his passivity, his lack of knowledge what is happening in the Beetaloo, his lack of active involvement in the Beetaloo and Karoo etc. are the reasons that FOG ended up in this weak situation with the smallest share in the Beetaloo asset.
What a pathetic attempt to buy back 77.5% of the Beetaloo within 30 days. (I would be impresses if he would have been successful).
Mr Sheffield could cut some costs at FOG by offering Mr Layman POQs job. At least I assume Mr Layman probably knows Mr Sheffields private phone number.
The master position in the Beetaloo was moved from FOG/POQ to Sheffield. FOG/POQ did not fight back successfully to get a higher price for giving up the master position in this basin. POQ even had not enough negotiation skills/power to wait for the ROFR dead line to announce on the last possible day that FOG gives up the ROFR. The ROFR was the last chance to get the master position in the Beetaloo back to FOG. Obviously Sheffield is keen to get the Beetaloo master position and spent already more than $100 million for this strategy. But POQ gave up FOGs only chance ASAP after Sheffield has written him a letter only. Do you still think that POQ is acting to get the best results for FOGs share holders (except for Sheffield)?
The ROFR is spilled milk now and for the future it will be more important to watch Mr Sheffield:
First Mr Sheffield owns 38,75% of the asset. With this asset he can decide within a second if he sells it or not because he is the only owner of this 38.75 % share. But ORG will get a royality and will buy a part of the future gas production.
Sheffield controlls 8.66% of FOG which got a passive 22.5% share of the asset. For me it is still a strange move that POQ said that it is off the table to sell FOGs Beetaloo after verifying commerciality which is seen as best strategy to get a high price & early money for an E&P asset. Instead now the plan is to produce the Beetaloo and to join the sky high high investments for development, ending up in more dilution or farm out. One explanation could be that POQ with his negotiation skills has no more interested buyers or it was the decision of Mr Sheffield. One argument could be that FOG does not have the 5,5 royality nor sold already a part of the future gas production. I think POQ surrended FOG´s degree of freedom to Sheffield without getting an adequate price.
Sheffield controlls 4.19% of Empire. Empire got some assets in the neighbourhood of FOGs assets
Sheffield controlls 15.2% of TBN, the new australian operator of our Beetaloo, which owns 38.75% of the asset. For this 38.75% TBN has to pay 5.5% royality to ORG but on the other hand a part of the future gas production is already more or les sold to ORG.
It is said that Mr Sheffield will share a part of the Beetaloo with somebody else. IMO this could be the LNG companies in Darwin. The question is, which share of his many shares in the Beetaloo will be sold.
"The Northern Territory government estimates that the Beetaloo could hold more than 200,000 petajoules of gas, although not all of that would be recoverable if the projects do prove viable."
Not sure if the 200,000 PJ for the OOIP is or will be correct for the Beetaloo? Lets say perhaps 10% of this gas can be produced. Than you get 20,000 PJ or about 20,000 BCF or 20 TCF. I am hoping for more.
At the moment it looks like:
Riddle from TBN got a better relationship to the Texas bear hunter Sheffield for getting a good part of the skin than POQ from FOG who overlept to be prepared to get a better deal. And I think It is time that Mr Nelly becomes a pensioner because I cannot see what he could achieve for FOG with Mr Sheffield sitting already in Australia.
I think as well that Sheffield could have the desire to increase his share in Fog because Fog is the only company in the Beetaloo without the 5.5% royalty for ORG. Even for his own 38.75% share he will have to pay 5.5%. The conclusion could be that he wants to see a lower share price of FOG to buy cheaply. And he has the degree of freedom to sell FOG or TBN or his own share for a farmin to another player who needs gas as the companies with LNG trains (my favorite are the Japanese). Hmm when I hear from Mr POQ that the sale of FOG is off the table someone could assume he wants to keep FOG because of the royalty problem with his own share and TBN.
For beeing bypassed by Sheffield/ORG there should be consequences for POQ, because he was not able to take actions to get a better results for FOG. You cannot give away a world class asset with giant prospective resources of 140 TCF which belong to the biggest resources on this planet on the cusp of commerciality (ok this is still a little bit dodgy) just for a song. But I am afraid Mr POQ is already hiding behind Mr Sheffield and aligned executing Mr Sheffield's strategy. Which is probably good to get the Beetaloo into gas production but not the best result for long time FOG share holders.
Well, perhaps wetwater's belief does not understand what small fish understands LOL
wetwater said: "Smallfish: I don't believe you understand the consistency/extent of these table-top shale formations. These shale formation production potentials don't vary significantly from one location (pad) to adjacent areas. If these next two Amungee wells prove to be 'commercial' it is said they can help prove up the acreage between those two wells and the Tamboran wells some 30-40(?) km to the west - that is IF the Tamboran wells are commercial wells ."
And this is one argument that a standard sole risk clause is not the big achievement for FOG in a shale gas play, achieved with POQ's negotiation talent, isn't it?
The sole risk clause could make sense only when you see that the Sheffield gang is not able to crack the code of the Beetaloo shale and needs to stimulate perhaps 10 more well to get a commercial test production or cannot identify the sweet spots in the Beetaloo. In this case it can be an advantage to sit behind the fence and watch carefully before you join again. (but for such a position you need independent specialists with know how and on the ground and not necessarily a secondee from Sheffield in Ireland)
apropos: Join the real world guy.
Did POQ really think that he could organize to buy the 77.5% within 30 day?
or as you wrote: Oleo: I totally agree that 29 days is a short timeframe but I also think for what's at stake $45 million USD might not be a big hurdle for an aggressive JR oil company or independent. Heck, that kind of money is pocket change for some of the independents here in the PB. For anyone wanting exposure to the Beetaloo partnering with Falcon could be a sweet deal. For all we know it could just be a financial investment for a non-oil person/company/institution. Lots of potential for someone willing to roll the dice.
But I understand, in your case it is just a speculation of a share holder and not a question if somebody is in the real world or not.