George Frangeskides, Chairman at ALBA, explains why the Pilbara Lithium option ‘was too good to miss’. Watch the video here.
My guess is a crypto ETF or fund was the buyer this last week, adding KR1 to their portfolio or increasing their exposure. Buying was in size and at increasing price regardless of last week's dip in NAV. Keen eye of a well informed investor ahead of the crypto bounce. Vaccuumed up most of the liquidity for the rest of us looking to add steadily on increasing NAV. This time next dip Rodney.
Some odd dealing here the last fortnight. My rough estimate suggests NAV is down around 22% since June 5, yet the SP has risen 16% and is now almost back to NAV, which has not been the case for some time. Those 2,500 trades in particular seem a bit odd in quick succession. Why bash the ask so hard with NAV still languishing and total altcoin market cap on the verge of breaking the 28 month low. Perhaps I've missed some related news or the buyer is expecting an imminent spike in cryptos, in which case, good call. Any insight Botak? You seem to be the resident expert on KR1. It's slow and steady with this one for me. Two years and we should do very well. GLA
I've been eagerly awaiting a drill of the Orinduik Cretaceous since 2017. Time and again we've been told that drilling is just around the corner, but years have passed and still nothing. Do people realise that the Orinuik licence period lapsed last Friday and without an actual firm committment to drill there will be no three year extension and no more Orinduik.
Nothing but radio silence from Tullow. What a complete waste.
Great job Fernan. Perhaps we should also deduct current liabilities of $0.67M as at end 2021 and another $2M for Q3-Q4 G&A expenses as Gazania results won't be until Q4. Assuming $20M cost for Gazania would leave ECO with around $5.3M post drilling. I haven't seen a cost estimate as yet for the next well on Orinduik, but Jethro-1 was originially forecast to be $7.6M net to ECO although I think this figure was revised lower in the end.
https://www.investegate.co.uk/eco--atlantic--o--38-g--eco-/rns/replacement---eco-s-2019-drilling-program/201812051313125575J/
Unless Gazania comes in under budget and Orinduik is drilled PDQ then ECO looks like it will need to raise some funds ahead of Orinduik drilling. Not a huge issue, but not ideal in the current climate, hence my recommendation to farm down Gazania to preserve some of the cash pile. That said, if we are lucky at Gazania, then this is all moot. GLA
According to p117 of the latest CPR, the official COS of Gazania is 34.7% and Namaqualand is 37.1%.
https://wp-ecooilandgas-2020.s3.eu-west-2.amazonaws.com/media/2022/03/AIM2022CP-ECO-Report-final-3-22-2022.pdf
On the flip side, now that the JHI deal has fallen through, ECO won't get access to JHI's $20M odd cash pile, so if Gazania-1 is a duster there won't be much cash left. Not a nice thought given the dreadful market backdrop.
Having waited for so long, the timing of this market meltdown is incredibly frustrating. Longer term ECO should be OK, but the risks short and medium term have increased considerably IMO and I see little upside into drilling for ECO or any other drillers until market conditions improve significantly.
At least the placing for Gazania was done before JHI walked or we'd be in a right pickle.
Best course of action for Gil right now IMO would be to farm down Gazania for as close to free carry as possible to guard against things getting too bumpy.
GLA
It's good to see the rise here, but I remain cautious. Appetite for exploration and appraisal drillers seems abysmal at the moment despite the high oil and gas prices, which is both perplexing and frustrating. Same picture with small cap miners. Last 12 months has been a real grind. If only I'd bought that EFT of US listed oil producers instead of doing some careful research and getting fancy, I'd be partying at Ace's Bar already now. Catalysts look good, so hopefully the market mood turns around. This time next year Rodney.
I wish. I bought in as soon as the acquisition was announced in the 0.50s as the fundamentals were extremely compelling for an exploration drill. Unfortunately the offloading of placing shares and dire wider equity markets have stymied the SP stopping me out for a nice loss on Tuesday. Fundamentals of the drill still look excellent but rule number one in investing is always look after your capital, set your limits and act accordingly if things don't pan out as you expected despite what you might think.
Has anyone confirmed the number of barrels net to CLON at Sasanof-1? I was under the impression that as per the CLON acquisition RNS, Sasanof was 7.2 TCF gas plus 176 MMB condensate (P50), which equates to 1,376 MMBOE, and that as a 10% stakeholder CLON's share was therefore 137.6 MMBOE.
https://investegate.co.uk/clontarf-energy-plc--clon-/rns/acquisition-of-10--of-sasanof-prospect/202205090700056935K/
However, page 3 of PRM's May 12 news release states that although Sasanof is 7.2 TCF plus 176 MMB condensate (P50), the proportion net to the WG519 licence in which PRM has a 25% stake is only 4.131 TCF plus 100.4 MMB condensate (P50), which equates to 789 MMBOE (P50). This appears to be due to some of the prospect lying beyond the licence boundary as confirmed by the accompanying diagram.
https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02520989-6A1091459?access_token=83ff96335c2d45a094df02a206a39ff4
As far as I can tell it looks like CLON has also invested at the same licence level as PRM, which would mean that CLON's share of net barrels would be 78.8 MMBOE and not 137.6 MMBOE (P50). Can anyone confirm which is the correct figure?
Nevertheless, even at the lower resource size the current market cap equates to only $0.50/BOE risked (P50) which still looks cheap compared with other recent and pending drills.
I believe JHI has cash but no further drilling carry and that cash is included in the $45M Harel referred to. We will only get that once the deal has closed and ECO will have around 440M shares in issue by then.
The point is though that CLON is on such a low multiple per BOE risked that it could multi-bag BEFORE results and still only be on the same multiple as other recent and pending drills were/are on BEFORE results. Can't remember seeing such a low entry for a scheduled drill.
https://i.ibb.co/HrhwV90/CLON-Market-Cap-to-Risked-Net-Barrels-Comparison.jpg
I use $5.00/BOE in the success case for oil. Someone was using only $2.50/BOE for gas on here the other day, which would give a value of nearly 12p per share in the success case. Currently we are at less than 5% of that for a drill with 32% COS. Doesn't add up. Far too low.
Does this add up?
ECO $213.4M cap targeted 23.5 MMBOE net risked at Joe/Jethro.
CLON $15.6M cap targeting 44.0 MMBOE net risked.
Oil and gas prices are significantly higher than when Joe and Jethro were drilled, yet ECO was valued on 26 x the multiple of CLON. Doesn't add up does it.
Does this add up?
ECO $213.4M cap targeted 23.5 MMBOE net risked at Joe/Jethro.
CLON $15.6M cap targeting 44.0 MMBOE net risked.
Oil and gas prices are significantly higher than when Joe and Jethro were drilled, yet ECO was valued on 26 x the multiple of CLON. Doesn't add up does it.
Does this add up?
DELT $44.5M cap targeting 8.5 MMBOE net risked.
CLON $15.6M cap targeting 44.0 MMBOE net risked.
DELT and CLON are both gas drills in tier one jurisdictions and CLON is in the more prolific basin, yet DELT is valued on 15 x the multiple of CLON. Doesn't add up does it.
Does this add up?
TRP $9.7M cap targeting 6.0 MMBOE net risked.
CLON $15.6M cap targeting 44.0 MMBOE net risked.
TRP has a negative net current asset position, no farm out concluded and no funds to drill, but is valued on 4.5 x the multiple of CLON. Doesn't add up does it.