Member Info for Penguins

Troll,

££££££ - But most into HHDL who probably need it for future work on HH-2z so won't be paying loans back any cash for a while yet.

As for HH-2z the water ingress is near the heel so it would require a sidetrack with no certainty it wouldn't encounter the same problem elsewhere away fro HH-1 where there is a suspicion that water has started being produced anyway.

Conservative 500bopd, lets hope that isn't as wrong as previous guesses:

23/6/20: 'HH-2z will deliver over another 500bopd....could easily hit 1000+bopd after intervention and optimisation.'

23/1019, a year ago: Thanks to trolls and YA for keeping the price down. Just gave me the opportunity to pick up another 132k shares :-) By the way trades are 1.12p are currently buys!

Wizard,

UKOG just can't stop raising funds for the same things:-

May 2017: £6.5mm (+ existing cash balances) 'the drilling and extended well testing of our 100% owned Broadford Bridge-1 Kimmeridge Limestone well.'

November 2017: £10mm for ' completion of the BB-1z flow tests, the forthcoming production testing and appraisal drilling programme at Horse Hill and the drilling and testing of the Holmwood exploration prospect'

June 2018: £5.5mm for 'its portion of the Horse Hill-2 appraisal well'; leasing 3 well sites and paying for UKOG share of Holmwood well.

July 2018: £2mm - 'Together with the funds raised in June, these funds will allow UKOG to embark on its projects' current 18-month work programme.'

March 2019: £3.5mm 'UKOG and its Group Companies held sufficient cash to fund its share of the forthcoming Horse Hill-1z and Horse Hill-2 horizontal drilling programme plus (other operational stuff). Ultimately used for Magellan purchase.

August 2019: £5.5mm: Magellan (Tellurian) purchase (5mm but £3.5mm from March raise) and 'the construction of production facilities, and other surface, subsurface and regulatory activities' ....'UKOG increased 85.635% share (of HH-2z) will not be impacted by this acquisition, as existing cash funds were set aside in spring 2019....... we also remain fully funded for further capital expenditures necessary to get the field into long-term production'

December 2019: £2mm: 'used partly to accelerate long-lead time gas-utilisation, facilities and other related works necessary to bring HH-1 and HH-2z into stable long-term oil production' & shortfall of 14.4% of non paying partners

April 2020: £1.275mm: 'purchase of key surface facilities' & Installation of a gas to wire generator to power the site.

June 2020: £4.2mm: purchase kit off PW (cash £0.275mm), pay off loan (£1.925mm), Intervention (£?mm), prep for Loxley site and IOW planning.

Yes increased equity but wells funded but not drilled. Repeated raises for same thing how many times to bring HH 'into production' and in 2020 cash raised twice for PW purchase of only £0.275mm cash.

and gas to wire - just to power site!

Trollhunter

When was the 6 well site last mentioned by UKOG (2019?). HH-2z 3 1/2 months ago - and probably only because they could hardly not mention it in the interim results.

Depending on what HH-1 was producing they've just lost up to $250,000 of production plus the cost of the workover ($500,000?). Let's hope they ring fenced the cash raised for this workover in June and haven't had to dip into the Turkish raise to sub HHDL and pay their 35% direct share.

Will UKOG have the brass neck to issue an initial rate over a few hours for HH-1 (probably) with an estimate of sustainable production (probably not). Like everyone I'm hoping for an improvement over production prior to the workover as hoped for by UKOG (presuming that's what UKOG mean by optimising).

Unfortunately UKOG forgot to mention what rate they were optimising, nor any clue as to the rate they hoped to achieve so as usual 'flying blind.

I suppose being a production'company that relies on OGA monthly production figures 3 months in the past to give it's investors an idea of how their first and only operated field is performing since start up I shouldn't be surprised they don't give out useful information they surely have to hand like that. Hardly comforting as regards any announcement made when tho OGA bopd figures average considerably less than the claimed production before the FDP came into effect:-

'The Horse Hill-1 well (HH-1) continued producing at high rates of over 300 bopd almost continuously during the period'

The period being the 6 months prior to 31 March 2020, production under the FDP from HH-1 commenced during March.

Fingers crossed.

Mirasol

2 hundredths of a pound is 2p.

20's is actually 20 ten thousandth of a pound or 2 thousandths of a pound, or 20 hundredths of a penny. From current levels to the £1 party predicted in 2016 requires more than a 600 fold 'bag'!

Cynderlad,

very unlikely - firstly the kit they bought from PW was for production (28 April RNS):- 'Outright purchase of key surface facilities (e.g. stock tanks, oil and gas separator, flow lines, choke manifolds, export pumps etc.) currently expected to further reduce opex by up to $4/bbl compared to current rental costs.'

and from the 23 Joly RNS:- 'AME owns and operates drilling and workover rigs, testing and cementing units'

Basil,

No chance. They are supplying the rig and UKOG would have to organise the site, contractors - everything. It would also tend to suggest it was so bad it wasn't worth waiting for the results, after all AME are getting a getting a free carry - they can sell it to UKOG if the result is equivocal and avoid paying 50% of ay further wells.

kjk,

depends whether the workover is successful and UKOG don't do another raising, a trade not a lth (ask Tymers). As for 6 fuel (oil?) tankers a day (and I'm not sure what you mean by this:- I will go for six a day go up as we fire up') - if it's the magic 2 a day It'll be a success.

Xodus came up with 362 bopd initial stable rate in 2018 ('further HH-1 Portland vertical well optimisation could achieve a forecast sustainable initial 24/7 pumped rate of around 362 barrels of oil per day') - I suspect UKOG would be pleased with that - and it would be equivalent to 2 tankers a day 6 days a week.

The 1/10 RNS echoed those words:- 'The short intervention seeks to further optimise oil flow'

Ibug,

teach me to have a quick look at this while doing something else. I understand what you're saying now - so that low loader could be for the rig rather than just associated equipment.

oops, thanks for pointing that out.

Wizard,

nobody knows what the underlying value is as UKOG have failed to get a CPR with any reserves apart from Horndean and Avingdon (P50 111,000bbls - Final results RNS). At current OP with no OPEX thats less than 4mm, NPV probably less than£1mm.

Everything else (Loxley, Arreton, BB, Resan) is a fantasy, depending on successful drilling, development and conversion to recoverable oil (reserves). The only exception should be the 1.3mmbbls of Contingent resources at HH. NPV value if that was a P50 reserves figure (it isn't) maybe £13mm (estimate based on current OP, based on SS NPV of £15 to £18 per barrel based on $70 oil). Unfortunately reserves aren't bought at NPV because whoever buys wants to make a profit.

Ibug,

What is that a response to, if it's my post I know. Which is why I posted:-

'suggests they are demobilising equipment associated with the workover rig.'

So, what do you think? Hanging around in case they've messed up HH-1, staying to workover HH-2z or about to leave when they've cleared equipment out of the way.

Mirasol,

It depends whether the seismic is wanted before or after the well. It might be they want it for determining the subsurface target, or after the well for follow up locations if it's successful. It's quite rugged there so poor weather could stop seismic acquisition. Unfortunately the amount of information that UKOG has felt necessary to include in RNS about the Turkish venture is abysmal so we don't even know the specifics of why seismic is being acquired.

Troll

I think the S. Lyon & Sons low loader arriving empty (PW use them) suggests they are demobilising equipment associated with the workover rig.

You would hope that if they have a plan for HH-2z they at least would communicate it to their (long suffering) shareholders before embarking on it, it's only been 3 and a half months since deigning to inform the market that the Portland water issue had returned in HH-2z, delaying that notification until the interim results when they had no option but to mention it.

The hope that something is being done secretly to HH-2z is much the same as posters mentiining Kimmeridge as something UKOG are secretly working on despite UKOG no longer mentioning it in relation to HH.

Justbe,

In UKOG shares for CLN, placings, licence equity and other purchases over £70 million of shares issued at the then market price.

I made a list (4 August 2020), which at the time I thought was amounted to £60 million, when I added it up properly it was nearer £70 million, with the latest raise now definitely over £70 million.

Ocelot

Fair enough, I'd have to examine the whole deal (so I'll take your word for it) to see if it was just a sweetener or a significant part of the value of the deal. ie was there £4 billion extra paid to the shareholders (what shareholders are interested in? Perhaps mcap of shares before deal vs value of shares given in exchange, though maybe the 4 billion tax loss was already in the Premier mcap before the deal, or will it be realised in 'accelerated' time..

Par for the course - from 9 July 2018, headed 'Corporate Update: Change of AIM Trading Status'

Halfway down the page, 'PEDL 233 Licenc Update'

and you would have to read the paragraph to know that this licence (just south of Broadford Bridge) was being relinquished because:-'Both UKOG and the licence's operator, IGas Energy Enterprise Limited, concluded that the asset offered low commercial potential together with significant future drilling and production planning consent issues related to its location in the South Downs National Park.'

SRBS,

Already dissected, and btw are you spamming the board with something that can be accessed easily?

Ocelot,

Any examples of oil companies where the tax losses were effectively bought to use elsewhere in the UK oil sector? Was it £ for £? Just using them within the company (eggs Angus) is just normal practice and if UKOG ever get a CPR or any forecast of the future would be in that - first they need to make an actual 'profit' rather than a loss every year.

Northfork,

What size plant does it need, any safety concerns, appropriate or even economic for what is likely to be at best a relatively small development? It looks like an attempt to wrap a 'green' cloak round this appraaisal of essentially a good gas show about 10kms to the west. Gas is (reasonably) 'good' anyway why make these grand statements. He seems to forget he's not working for a major with funds for vanity projects (in the good times) but running a company ultimately funded by a lot of individual punters hard earned cash on the basis of UKOG's RNS, buying up billions of shares bought at mates rates to YA and others.

Surely it's time for an 'open kimono' moment with realistic assumptions for the future rather than quoting mid and max volumes with no mention of actual risk factors associated with these figures, quoting initial flows with unattained estimates of future sustainable rates, quoting OIP that will never be accessed. Can the hard reality, rather than woolly hopes, really be worse than the assumptions that the SP seems to have factored in, if it is at least gamblers would hopefully understand the odds a bit better.

It's a great disappointment that despite being passed by planning a year ago UKOG failed to finalise the planning permission for the HH development (4 additional development wells and an injector for the Portland) and failed to drill a second horizontal they had planning permission for anyway.

Then there's the minor inconvenience of drilling a well at Loxley to find out if any of the gas in place exists at the Loxley location. There have been 3 unsuccessful GB-1 appraisal attempts previously, Alfold-1, GB-2 and GB-2z. Still SS likes a challenge, using other peoples money.

Maybe those 200,000 homes will need to get their gas from elsewhere for a while yet, especially if UKOG actually make a discovery, develop it but turn it into hydrogen, the latest in the UKOG book of future plans that will probably never happen (but sounds 'green') though on past performance they'll be so confident in success they might spend millions on building the plant before testing the well.

As for HH-1, let's hope that UKOG give the usual initial rate over a few hours RNS after the well's been shut in and pressured up for a mighty spike, of course it needs to be much much more than 300bopd. I'll be putting out warnings if they do, but happily selling before reality bites. Looking forward though to what the further improvement will be 'if successful we remain confident this programme can further improve the well's oil production rate.' as we haven't been told what it will be 'further' to - luckily there's a couple of caveats in that short excerpt, 'if succesful' and 'confident' rather than certain.

Maybe I should have explained rather than just included the excerpt from their annual report.

As Tellurian had recognized the gain of the sale of Magellan 'in the current period' the UKOG share sales won't be listed as they happen in the accounts. So no clues there.

Ocelot,

perhaps more spikes might be a better description.

Ripley,

I don't understand why anybody would gamble on UKOG without a cynical viewpoint, but each to their own, perhaps lots do but keep quiet. I've sometimes been accused of whining - but why would I - nothing that's happened (except perhaps the HH-2z water issue, and even that I mentioned as an issue before it happened - post excerpt below from 2 October 2019) in the Weald has been much of a surprise.

HH1AN2

You're right G&G professionals don't choose to drill dry wells but the odds are usually against them before the bit hits the ground, but they want to drill wells and dream of beating the odds - so they will justify ignoring risks if they don't have anyone with more 'sense' pulling the financial strings who they have to justify decisions to. Unfortunately shareholders are just told after the event.

The problem with UKOG in the Weald is that there were no other paying partners to say 'hold on'. Now SS has been sold the Turkish Delight Xodus / AME and paying 100% for the privilege. Let's hope it works.

Tellurian
Looks like they 'banked' the sale of Magellan to UKOG when it happened 'The sale of Magellan Petroleum UK generated an overall gain of approximately$4.2 million, all of which has been recognized in the current period as Other income, net in our Consolidated Statements of Operations.' So won't be recorded quarterly. The 5% rule is for foreign owned entity issued shares, not the owner - but Tellurian don't bother anyway, See the TR1 earlier this year that UKOG had to do for them.

Excerpt from 2 October 2019 post:-

'There could be issues - finding a water conduit, the well ending up in a less productive zone, or unexpected variation in the reservoir. But unless any of these are catastrophic the well should flow, either with or without esp help, the truly million dollar question is how well.'

and as for positive this from 26 Sept 2019:-

'My 20 September post came to an unrisked value from quoted recoveries and NPV per barrel of between 1.5p and 3.8p per share (6.75billion shares). '

Unfortunately none of the 'quoted' recoveries have materialised, and the NPV was based on $70 per barrel.

Ocelot,

I'm waiting for something clearly positive.

But what about all those unremittingly positive posters you perhaps should question about their 'motives'?

I acknowledge my mistakes and apologise if I get something factually and if significant, opinion based.

Yet there's posters who have been claiming huge valuations, flow rates, reserves that have never materialised, and one that boasts of selling on spikes way below their predicted price everybody else should hold out for - you quietly acquiesce. Of course those who are keen to sell rather than buy (everybody with shares?) likes those posts - because to sell they need buyers drawn in on the great expectations to bail out.

as for the RNS - the NOMAD would be horrified if a non-legally obliged RNS's sole purpose was to inform and not provide a boost to the SP.

What was written was legally correct, but deceptive. The statement about UK 'projects' (Greater recoverable resources than current UK projects) is disingenuous - either they are quoting a specific and limited comparison (eg recoverable resources, gross rather than what UKOG are entitled to), or maybe UKOG had forgotten that the mid case total of recoverable resources and contingent resources (a higher threshold of proof) had a net 26.3mmbbls to UKOG in UK projects vs 21.7mmbbls net to UKOG in Turkey. If some of the 26.3mmbbls shouldn't be there perhaps they should RNS that.

It's interesting they quote recoverable oil in the range 10% to 20% in the July presentation - but say (boast?) that the calculated volume is only 13.8% for the P10 gross recoverable resources.

Yet the tabulated recoverable resources for P90, P50 and mean are 13.3%, 14.2% and 13.5% recovery respectively. The problem is these must be outputs from a monte-carlo simulation (hence the bit about arithmetic sum beneath the table, which needs such a statement as it isn't technically correct to do this for monte-carlo calculated volumes) and it's odd that the recovery rate across all calculated recoverable resources is so 'flat'. Without the full parameters used the recoverable resources are pretty meaningless.

The 13.8% recovery for the P10 is what the M-C simulation has spat out, not something they've done to be more conservative, and suggesting that the recoverable resources could be much higher when you can't mix and match between methods.

This is what is so bad about UKOG RNS they spit out figures that need far more explanation or an understanding of their limitations - but the rampers don't care, give them a big figure they'll run with it.

Troll,

If they don't put 'oil' tanker there's a reason, and it probably isn't because it's an oil tanker. Anyway why would there be an oil tanker if they are still

You've asked that before,

M answer then was 'Spikes'.....which enable some clawback, and in that reply was this gem:- 'but I wouldn't advise anyone to buy in when the price drops after a spike as UKOG has an infinite ability to drop further' .......................when fools were advising rushing in at the bargain price of ................0.19p.

and note I say - 'Maybe Resan is fantastic'. The problem is we have no way of assessing it based on what is in the public domain.

My UKOG investment is relatively small - most shares in FTSE100 for dividends and in an ISA and a SIPP (and the SIPP I'll probably never touch so an inheritance gamble).

Luckily lots of posters have a different view and draw in 'investors. I've been told how wrong I am for many years (I see '£1 party' BDI is back on twitter saying it'll rerate from 0.16p, only 0.16% of the predicted £1..... maybe this time Rodders) but events often turn out not as I expect - but worse.

I'm sure there will be posts where I'm predicting 1.5p SP for the Portland at HH on my figures - and posts responding telling me how negative I am.

Ocelot,

They have a sidetrack they could drill at HH and if they deigned to complete the conditions outstanding (Ibug keeps track - not many left though) a further 4 wells plus an injector could be added, but instead they bought 2 lots of second hand test/ production kit. But instead let's go through plannjng for another site at Loxley while not bothering to finalise the one we've already got.

Even though HH-1 was in exactly the same state before the workover as it was when the 'calculated' 362 bopd was stated as a sustainable rate from HH-1 Portland they have not released figures during 6 months of production that suggest that's been achieved.

But let's go to Turkey.

Returning to the Turkey RNS - they didn't bother to compare the OIP in Turkey to that in the UK also in a table in the final results (billions of barrels), and what happened to all those HH resources SS was happy to quote verbally (and constantly quoted on this board as gospel) that have evaporated. What was it, 30% (woohoo up 45%) of 30mmbbls (OIP expected to be increased following HH-2 finding a deeper OWC), what happened to that - aaah yes) plus 1mmbbls per Kimmeridge well?

Ripley,

The problem is that after today's RNS are we any the wiser about what production is possible from Resan yet UKOG have committed $5mm of cash that has to be raised, hopefully they won't have spent the £2mm raised already before it's cash called.

There's the E Sadak field operated by AME less than 20kms away on strike (along the same anticlinal feature) to Resan. Presumably UKOG have details rather than the initial flow rate they were happy to quote previously. 10 wells drilled on the field - yet no long term flow rates quoted. Were all 10 successful? Why was the original target at Resan a failure - structure breached, no reservoir, migration problem? They have a Xodus sales brochure for Resan - anything investors should know, there will be risks - unfortunately UKOG's record on expectations vs reality hasn't been good and the 'trust us' nature of the Turkey deal isn't as encouraging as hard data.

Maybe Resan is fantastic, but we only have UKOG's (124 billion barrels I tell ya, all the HH expectations) word for it, and even the few snippets seem to be delivered with smoke and mirrors attached.

We can be certain there's risks, why else would AME farm it out, but UKOG have a habit of only mentioning the good stuff, and go radio silent when that doesn't happen. Stating what can go wrong and what has gone wrong is part of the flow of information that UKOG should provide clearly rather than the technique of not mentioning it approach, sidestepping it and going radio silent.

Oilyblokes post is a good example:- CPR is still expected in due course....no word of anything different.'

So no new news nearly 3 months after the initial RNS.

The same ramp about fields in the far distance in the centre of the play rather than any useful information about an adjacent analogous field like Resan on the periphery of the play.

And this half truth: 'Greater recoverable resources than current UK projects'

I should hope so as recoverable resources has a lower threshold of 'proof' than Contingent Resources which some of the UKOG quoted resources are. But when I look at the table the P50 case is 26mmbbls net to UKOG and P10 46mmbbls - but of course some of the projects possibly don't count as current whereas all of the Turkish resources, 21mmbbls mean and 42mmbbls high do, for some reason. Like the 2 to 3 times flow rates quoted for a horizontal at HH (!) the recoverable is more a rule of thumb (10% and 20%) than anything derived through analysis.

I remember also being told this about IOW 20 Sept 2019:-

'UKOG's subsurface team have also recently identified a further large undrilled anticlinal structure, the Arreton East Prospect, another look-alike to the Arreton discovery and lying further to the east along the same geological trend. Initial mapping shows this feature to be many times larger than both the Arreton oil discovery and Arreton South prospect combined. Further work and potential recoverable resources will be reported in due course'

What happened to that? many times! larger than the approx 25mmbbls net to UKOG at Arreton. How the rampers loved that - although there was actually no room in the licence to the east for such a structure - it had to be outside the licence area.

So yet more 'appraisal' based on an oil show. Recoverable resources rather than Contingent resources, 100% 'share' of $5mm cost for 50% of any rewards and already delayed, and signed up to spend far more cash than they have in the bank.

Another RNS in UKOGs oeuvre of fantastic (as in 'imaginative or fanciful; remote from reality') RNS, and nothing about the (ex) flagship HH.