Member Info for Penguins

Ocelot,

earlier you posted:-

'It's one of the few shares that hasn't rebounded since the first lockdown.'

I'm guessing in your view the lack of a rebound in UKOG's SP didn't have anything to do with the fact that despite trying to hide it eventually (June 30) UKOG had to admit that HH-2z failed (no 720 to 1080bopd), and then in October OGA went and released figures that showed that HH-1 was producing about 24% water in June (March 2021 about 32%) and eventually showed the more than 300bopd UKOG said HH-1 had started at had become just over 100bopd (March 2021) - although UKOG have been less than forthcoming since March 2020 about what HH-1 was currently producing despite their previous eagerness to RNS selected flow rates.

Presumably the reason that the SP has recovered is because of the lack of information rather than UKOG saying anything meaningful about the Turkish adventure. Imagination, belief and hope being far better drivers of a share that depends on sentiment rather than facts.

.....says Ian posting on a Sunday posting an unoriginal post about other posters posting on a Sunday..

btw - same here got things to do and socialise later.

Wizard,

yawn - I won't waste time writing anything - here's what Rodders said after a SS interview in 2018:-

These are soundbites from an interview with SS made by Rodders74 in November 2018, long enough ago to know what happened to all the 'expectations':-

'Loads of great positives. Some SS quotes as follows:

1. "Fortunately the wells are not expensive"
2. "Plenty in the piggy bank to not need to tap up the market"
3. "The orientation of the HH well is not optimal to recover the oil at the best rates." So next well they drill will be at a more optimal angle.
4. "The rates we are looking at, the Portland and the Kim.... conservative.... £20million revenue a year.... pretty decent change.... planning further drills and wells at HH"
5. "This is very real, it is not conceptual. people have seen the tankers coming out of site each day"
6. "I mentioned value.... what do we mean by the asset value of an oil and gas field.... how much oil can you get out to the surface and how quickly can you get it out..... these tests at HH give us the metrics, in terms that we know, how much a well can produce, and how much it can sustain..... what volumes of oil can you get out..... Net Present value, we get some very healthy numbers"
7. "£150 to £200 million in the Portland alone"
8. "For each Kim well lokking at £15 to £20 million per well, multiple wells per pad. HH is just one pad, data shows our concept... laterally extensive across the wield. replicate HH at multiple sites."
9. "each site at £100 million" (for the Kim)
10. "IoW.... 127 million barrels of OIP... 4 times that in place at HH (portland), big chunk of value if we get that working"
11. "The train has just left the station, the journey will be in 2019, putting HH into production...
12. "its not like we will be shutting up production now, we will be producing oil and producing money"
13. In asnwer to; Will production be increasingly used to fund exploration? "it doesnt' take you too many wells at £20 million sales that means you can build a piggy bank that means you dont need to tap up the market"'

Same old same old - just substitute Turkey, Basur-3 or Mardin as appropriate.

Tollesbury,

Thanks for apologising, I can misread posts as well.

Wizard,

Page 68 of 78 of the Annual Report and Accounts 2020, 16/4/21

'The Directors determined that the net present value of the HH-1 well was £4.78 million'

I'm not going to find every time UKOG have promised a CPR - here's a couple:-

RNS 11/9/19
'It is planned to commission a new Competent Persons Report to establish the Company's net Reserves following completion of HH-2z production testing in the Autumn.'

RNS 18/10/18

'Following submission of the planning application, Xodus' 2018 Portland Competent Persons Report will be updated to include recoverable reserves and net present values of cash flows associated with the envisaged Portland oil field development.'

Apologies the quote was from gkb...

Tollesbury,

and you keep posting the same thing when you've been told multiple times why I 'gamble' this share.

Even in my previous post there's the reason 'rarely seen a rise for more than a short while, and has always, even that one, eventually subsided to a lower level'.

It's called trading - just holding and hoping over the past few years has not been a good strategy.

As goofy said:- 'knowing you are in a minefield gives you a better chance of getting out in once piece but the unwary or poorly researched are likely to come out badly'

And yet there's those that criticise other posters for posting their view yet say they know nothing about O&G E&P by way of explaining their objection to anyone that at least tries to dig beneath the BS put out by UKOG.

Wizard,

Although the NPV for HH appears to have been calculated properly it was done by UKOG, not an independant 3rd party. As Mirasol points out UKOG have promised a CPR a few times when a certain milestone is reached, but then not commissioning one when it is reached.

Tony,

I presume you are referring to those days when the board is swamped with posts from rampers which since the mega 2017 pump and dump, orchestrated by UKOG and SCDM, has rarely seen a rise for more than a short while, and has always, even that one, eventually subsided to a lower level as the UKOG promises and plans don't materialise.

The most recent one, based on the Turkey Adventure, still has to play out as so far all that's happened is UKOG farmed in, a site was constructed and a rig arrived and started drilling.

What matters is the final result not the lead up to it, and UKOG have remained silent about how deep the well will be, not show a subsurface map or seismic line, not given the target depth for the main target reservoir or what flow rates could be expected for this transformational appraisal well.

PI being treated like mushrooms, fed only BS, one of the few things that UKOG keep on parroting - cheap cheap rather than any details of what they expect - the question is why? Do they know so little (whilst parading the adjacent field as a producing lookalike) or is it that the range of likely outcomes isn't that great and it's better to leave it to the imagination of the enthusiasts than reveal UKOG's view?

It is odd that drilling has commenced and I would expect someone to have underwritten the estimated cost -with proved funds, presumably AME who have 0% exposure to the well cost up to $3.5mm - or $5mm for the well and seismic.

The unusual outcome may be the result of an improbable situation - imho.

I don't see that identifying the funding use as for Basur-3 makes any difference unless it was after the well was proved successful, it's just a well that may or may not be successful, Turkish money or not. UKOG will have the cash and the provider (unless it's a CLN) will have the shares and probably have sold them before the well is completed to ensure a return, they are not likely to take on drill risk - especially if they are aware of he outcomes at E Sadak.

Wizard,

The committment is according to UKOG $5mm. I suspect as oil is priced in dollars rig owners and an American Operator expect dollars, not TL which has risk.

Ocelot,

The reason a further cash raise has been expected since last year was because the well was going to be drilled last year according to the July 2020 RNS. The £2mm has been shown to be insufficient to cover the committed expenditure with less than that remaining at the end of March.
I'm not sure wrong footing the market is the smartest thing - a lot of expectation that the cash raise would be done before spud seems to have left the SP wallowing with no clarity as to how much the cash raise will be, there's also the possibility UKOG are facing difficulties getting a cash raise away with the added burden of an open offer - the market doesn't like uncertainty.

Wizard

unless you know the reward and the risk the 'risk reward' might still be terrible even with $100 oil. The amount of reward is dependant on not only success but what that success is in terms of flow rates and reserves. It's pretty clear from the interim reslts that the figures for OIP and thus recoverable resources are little more than guesstimates with more wells needed to understand how 'things' fit together, so even with success reserves may be a few drilling cycles away.

With no guidance on expected flows of Basur-3, which is touted as an appraisal well but seemingly so much uncertainty not even a depth to reservoir has been mentioned, the risk reward might still be pretty poor, I suspect many of those promoting how great this well will be won't hang around for the results, their risk reward calculation based more on hoped for SP increase prior to results than underlying assets increasing the SP after.

With a committment of $5mm (ca £3.6mm) and less than £2mm cash at end March the question has now become how long can UKOG delay a cash raise to pay for thee now drilling Basur-3 well, plus any day to day operator's cash calls, and maintain a reasonable cash cushion for unexpected (or even expected) expenditure?

You also seem to have picked up some 'ramperspeak' - 'with the weak being left behind' - it might be the sensible and well informed waited to see what happens, rather than being weak an left behind.

Tollesbury,

It was posters 'like Tollesbury', but I take your point. So sorry, I should have included accusing posters of not owning shares in the list:-

'claiming the authors are swampies, xr, nimbies, don't hold shares etc.',

But who is upset when the price goes up? I post the same regardless of which direction the SP is going, that's not being upset, it's being consistent.

I'm pleased when the SP goes up, whether it's justified based on fundamentals is not being upset it's being realistic as well as consistent.

We all have our own strategies to make money investing (or gambling) on shares, I'm guessing mine is different to yours. My posting is based on research and knowledge, if you're not interested it isn't compulsory reading, I don't advise whether to buy or sell as the SP can move in mysterious ways for no apparent reason, or sometimes P&D based on very little (like lines on charts).

For years posters like Tollesbury have claimed that posters who have a different opinion that they consider ‘negative’ are doing so not to discuss the company but to further some other agenda.

Usually the same posters who have consistently claimed that the ‘negative’ posters were wrong whilst the SP dropped to just over 0.1p from its 2017 high of about 11p, what could their agenda be – not disputing the posts but more often trying to undermine them by claiming the authors are swampies, xr, nimbies etc., perhaps they are worried that these posters are still right.

The share has now risen not because those ‘negative’ posters were wrong about the Weald but because UKOG has embarked on a project it has claimed will be worth 100s of millions of value, is irresistible, but has shown little data to justify the claims.

About the only things that UKOG has said about the Mardin (the Resan/Basur reservoir) are initial rates, which for E Sadak was misleading as to what the wells in production flow. The OIP is based on an unseen map in a complex structure which the company says needs more wells to define, and has little seismic control – so how reliable is the number quoted as if it is firm data – and then a recovery rate applied to that based for some reason on Kurdistan rates as well as E Sadak.

Why would UKOG say so little about this irresistible transformational project - that they don't have the information (why then transformational) or they don't want to tell their owners enough to come to their own view.

Wizard,

'The rubbish that you posted in your 2 posts yesterday 30.6.2021 after the publication of the companies interim results, where the company gives a objective view, removes any credibility that you may try aspire to.'

If you think the company gives an objective view perhaps you should go back and read some of the old RNS, or should it ne PR releases.

What happened to 720 to 1080bopd from HH-2z, 362 bopd from HH-1, HH-1z, 5 more wells at HH by 2021, dual completion of HH-1, billions of barrels (and according to your calculations billions of pounds). So many deliberately chosen flow rates, no mention of the massive decline rate observed in production and no mention of water production from HH-1 in last year's interims - indeed no mention at all of HH flow rates since the start of production although claims were made of increased production with a bigger pump installed in early/mid 2020 and then claims the October 2020 workover would 'further optimise oil flow', neither backed up by a release of daily production data.

Yet now of course everything they put in RNS is certain to happen, and any negativity is to be ignored - is that because disputing what UKOG say will happen has had such a poor record so far?

if it's so objective why do they not mention what is happening now (or in March) at HH. What is expected at Basur-3 if it's successful, an appraisal well of a structure with multiple drills already that they now describe as complex and needing even more wells to understand it. No mention even of expected TD, is it going to be like E Sadak - about 8000ft or is their geological and geophysical interpretation so unsure they don't want to say - yet publish OIP and expectations of recovery.

'Fool me once, shame on you; fool me twice, shame on me' yet posters keep on believing without question.

I find it odd that factual information that shareholders in UKOG should be interested in is considered negative, but then this is usually by those that think every RNS is good news and despair when the SP goes down.

I hope Basur-3 is successful, and more successful than E Sadak, but then if you depended only on UKOG and this board for information you might expect Kurdistan levels of success.

Last E Sadak well that there is information for (E Sadak 13) had a planned depth of 2600metres (+/- 200metres (over 8000 feet). Don't know if it was deviated or going deeper than the Mardin, or down dip from the crest. E Sadak-3 was over 9000ft.

Anyone remember the Gatwick gusher.

Thousands of barrels a day.

Latest HH production figures for March give an average of just under 105bopd and 50.6bwpd (water) - that's about 32.5% water cut. Last month water cut was 30.8%.

Oil production increased by about 5bopd (up 5%), water production increased by 6bwpd (up 13%). Increasing oil production seems to disproportionally increase water production.

Nobody cares at the moment but should Basur-3 fail this was UKOG's production (plus an average of less than 4bopd from their 10% of Horndean in March) 3months ago in that they describe as stabilised - but never mention how much.

From today:-

'Given the complex nature of the subsurface there are, of course, no absolute guarantees of success, but we remain confident that Basur-3 will move our understanding of the accumulation in the right direction. Due to the size of the geological structure, follow up wells will undoubtedly be required, notably in the southeastern culmination at the Resan end, before we fully understand how things fit together.'

Hmmm - first time UKOG have mentioned how complex the subsurface is, and I'm not so sure about UKOG's 'confidence'. Up to now the biggest problem for Basur was:-

14/10/2020:- 'Greatest geological uncertainty in all UKOG's appraisal projects is, therefore, the respective reservoir's ability to deliver sustained commercial rates and volumes, a typical appraisal stage uncertainty.'

23/07/20:- 'the greatest remaining technical uncertainty is whether the Mardin reservoir can deliver oil at commercial rates and volumes'

seems complexity is a bit of a problem as well. A bit late to mention it.

Looking back over RNS the concentration has been mainly on drill cost, speed of permissions, and to production if successful, how great AME are, Kurdistan Fields, and a mention in passing that E Sadak is a producing lookalike (yet no information on it's producing) and OIP figures in a complex subsurface - presumably difficult to map and recoverable resources based on E Sadak - and Kurdistan fields. Very little about the reservoir, structure and nothing about depths.

But you (and LS) may remember this (most recent) mention:-
Penguins
23 Jun 2021 23:34
'Ocelot & LS,
The oil is there, yes in the previous wells (all of them?), but unless they are drilling beside a well that has previously found oil it is quite possible to not find oil. They haven't shown any maps and the structure is probably complex, and I would imagine the seismic used for the maps isn't very good.'

Uninspiring,

Without the £2.2mm raised 'for Turkey' they would have been cash negative at the end of March.

hard to break out the figures but obviously water disposal is taking a lot of the revenue (revenue £721,000 , Costs £544,000 - both HH and Horndean). Admin expenses at £915,000 are far in excess of 'profit', and in July there's the third £550,000 to 'pay' to PW I believe (don't think it's been paid).

Geothermal closed loop looks like what you'd use to heat your house, and it sounds like the solar is to save on diesel.

Doing F-all at Horse Hill obviously helps - and reading between the lines it looks like any further work there requires success in Turkey. Didn't mention the EA permission for water injection - has it been granted?

No mention of what the stabilised flow and water production is at HH (no surprise) and no new details about Basur-3 or Resan except maybe this slightly less bullish statement:-

'Given the complex nature of the subsurface there are, of course, no absolute guarantees of success, but we remain confident that Basur-3 will move our understanding of the accumulation in the right direction. Due to the size of the geological structure, follow up wells will undoubtedly be required, notably in the southeastern culmination at the Resan end, before we fully understand how things fit together.'

Complex - yes, probably why they haven't even mentioned a TD, or any target depths even with previous wells on the geologicaal structure - how large are the error bars on the well prognosis?

Ignored the apparent delay in the expected announcement of the application area award/s (60 days from 10 Dec 2020) in fast track Turkey.

Ian12,

E Sadak-1 success was 60 bopd average at production start - less than a year later half that - success is a variable feast so no guarantees it will sigificantly fund the next well etc.

Ocelot,

1) "extensive international oil and gas connections giving access to opportunities";

2) "the depth and breadth of experience to rapidly assess such opportunities and make timely decisions".

1) Deal brought to them by Xodus who do a lot of UKOG's external technical work - I'm sure they told them they'd sent the Farm Out brochure to loads of interested parties.
2) Quick decision without the cash to fund the deal - I wonder what other opportunities they turned down?

Ibug,

Knowing where to set casing to maintain control is what a well design is for. Even at E Sadak they seem to have 'lost' wells or had to sidetrack. If they are uncertain as to how deep specific layers are, and they are problematic for drilling (large mud losses, getting stuck), then the well design will have large error bars and need careful drilling preferably with mud loggers and drill crew with experience of drilling in the region.

Although not an AME rig I would expect AME to have experienced personnel mud logging and supervising if there are uncertainties.

Ibug,

Geologists and seismic, especially if the data is poor, can be a disastrous combination with interpretation forced on the data rather than guided by it. I expect AME will be lead on that though.

Still waiting for more information about the well plan. Even with all the previous wells and the months of UKOG help is it more of a 'let's see what happens' after the 13 5/8 casing has been set rather than a firm plan?