Member Info for Phrontist

What does share dilution mean?
It means, BoD raise capital by selling new issue of shares.
But have little benefit to the company and shareholders.

What is shareholder expansion?
Over the 4 years, 88E shares in issue has doubled.
Company gaining continuous developments towards becoming oil producing business.

Look at some progress gained:

Land under lease about 4 times increase.
Discovery of conventional reserves added to WIP unconventional reserves.
Total likely reserves risen from 1.2bbo approx to 4.5 bbo approx
Major technical investigation into HRZ, discovering Icewine 2 oil flow failure.
We now have answers that we can act on, hence 'Level 8 HRZ' on Charlie drill.

Major Seismic data assimilation into computer based digital models of our land mass.
Major geology / computer analysis using powerful computers and expert staff.
Creation of Data Rooms for both Conventional and Unconventional client examination.
Data Rooms are standing up to intensive examination by actual and potential FO's.
Both Data Rooms are ongoing to qualify and extend oil reserves potential for years to come.
(This is sometimes referred to as Intellectual Property which can have high $ value).

Conventional FO comits $23m to Charlie drill program in swap for conventional oil payment.
The oil payment is about 10% of our potential resources.
Much of our land has yet to be explored.

88Energy is a strong, resilient business. No debt, massive oil resorces, efficient use of money.
Moving forward step by step, learning from some hard lessons.

We are about to let Genie out of bottle.
Shareholder wishes will come true. Commercial oil flow during Q1 2020.

Phrontist DYOR

LuckCounts, do you mean billion?
Million is pocket money on Internationa Market.

Good points MILOH, as always questions about SP underperformance are always tough to fully understand.
There is a period of time between Icewine 2 oil flow failure (2018) and successful oil flow from Charlie-1 (2020).
How the SP flows between the two is tough to predict.
I felt a good choice Conv FO partner and deal would enable SP to reach 2p by around now.
Today it skulks under 0.8p.

If a couple or more of the 7 layers being drilled offer commercial quality oil and strong flow rate by early Q2 2020 then surely SP will rise to 4p or more.
Our revenue for this oil production will be 0.3 x 500m (say) x $70 (say) = $b10.50
Then less 16% oil tax, I think.
And this could be over 10 years, say.
So Charlie-1 success sort of guarantees us significant monthly revenue once production gets under way.
If we say 10 working months a year, evens over 10 years from 2021, this is $100m revenue to 88E per month.
Of course, please check my figures.
BEX will receive 10% and PMO will receive 60%, all on Area A.
BEX, PMO and 88E are sitting on significant potential business gain.
So fellas, 5 years work seems quite reasonable IMHO.
And this is only Area A of Central North Slopes conventional.
Maybe 10% of our total possible oil assets over the four projects.
Serious investors will be piling in once this picture is realised.
I think H1 2019 figures will help.
Then a nudge from positive progress statement on Yukon, HRZ and Winx.
But a committment to keep expenditure low, whether CR is planned or not.
If it helped, I would give staff months holiday in December, except for Eric Opstad (ha ha)
No, this is not practical. )))
But soon we will be wheeling the rig across 25 miles of ice road to its Charlie-1 position.
Relevant accessories, staff, etc will arrive from start of Jan.
I can almost smell the oil rising from header pipe....
This site position is result of considerable study and analysis.
I only have positive thoughts....Phrontist

Looking at the 88Energy Announcements, it seems we have not had the 2019 H1 Report yet.
This could be tomorrow with further information.
Expenditure is probably being held down for a few months at least.
The Central North Slopes Conventional drill program is funded by PMO, a first class company.
It is likely we will receive some of the $23m as Operators for Charlie-1.
Phrontist

Thanks smokin88.
HardToHandle, DW had no involvement in determining his recompence.
As events unfolded he may well have been concerned himself.
At times I have also felt angry on this topic.
But it may eventually become the situation that he had earned it...
Maybe he will turn the tables to become known as Oily Dave, I hope so.
Churchill once said, if it seems like hell, just keep going.
DW has kept going, never complained or left his post.
We all know, this is a high stakes business requiring immense personal strengths.
ATB Phrontist

Could anyone have achieved more than DW?
Everything was progressing well until Summer 2017 with Icewine 2.
At this time HRZ Unconventional was our only Project.
And it failed to Flow summer 2017.
DW must have realised all 88E's eggs were in one basket.
So, he diversified with Seismic on the same Central North Slopes land.
With Burgundy, 88E built a technical team to take over from PB.
And about 2 years later 2bbo are discovered and an FO is in place to drill Q1 2020.
Meanwhile, after some delay, external consultants examined HRZ Icewine 2.
This took a year plus a few months, it seems.
It seems likely DW realised in 2017 that 'full on' expenditure for both Conv and Unconv was too heavy.
But now we are close to FO Tender for Unconventional and Icewine 3???
Plus, the Charlie-1 drill may be able to reach HRZ layer towards end of its drill session.
Charlie-1 will be looking for 7 oil layers, in itself quite an amazing opportunity.
So, it seems that DW has our two main projects heading on track for significant results early 2020.
I am ignoring Winx and Yukon for the moment. They have both been very low costs so far.
88E and BEX have both lost senior men to illness.
For DW and staff, this must be a personal loss equal to the business loss.
Yet, DW is heading us into a most exciting and promising six months.
And imagination is not needed to see whole of 2020 looking busy.

We have only one fear.
Charlie-1 does not produce any commercial results, like Winx-1.
I always say, never shoot from the hip, you will miss target.
This was Winx-1 for us. 2020 could see Winx-2 becoming real prospect.
And some action on Yukon may reach FO Contract or Selling on our leases for $$$.
Clearly Charlie-1 is key. If successful, SP will rise and likely healthy CR.
It is important to have positive mindset.
We are invested in 88E because we believe commercial oil will happen.
And once started, many years will follow of more finds and successful drills.
I feel strongly that DW is on top of his management role and will be successful.
All IMHO Phrontist

Surely SP is only about supply & demand.
If SP goes down it is because someone is trying to sell, so need to attract buyers.
If SP goes up it is because someone is trying to buy, so need to attract sellers.
No other factors are involved.
Phrontist

Shareholders should also be mindfull of the annual weather conditions within Arctic Circle.
The winter enables work on conventional.
The summer enables work on the unconventional.

This makes it difficult to focus on just one or the other until cracked.
So, it seems the case, 88E/BEX have undertaken concurrent conventional and unconventional work in order to support year round working.
This is efficient, but pushes our cash flow to the limits.

Was expenditure on Yukon wise under these circumstances?
It has been low expense to date.
If any kind of business contract can bring in cash during Q4 2019, then Yukon is a godsend.
If not, shareholders know what will happen....CR

Phrontist

I think it is fair to say, DW himself has not been responsible for choosing any of the drill places.
And this is a big issue, a big expense.
Our failure to produce oil above ground is our only problem.
Icewine 1 location was chosen by PB.
It is nearly 12,000 ft down. The pad at Franklin Bluffs seemed to over a quality HRZ area.
Technology 'to see' that low was not available in 2015, and possibly is still not available today.
We had to start somewhere. Yet on the face of it, Icewine 1 was 100% success.
Oil dripped out of rocks from the core.

So, put Icewine 2 next to its older successful brother was easy decision.
How is it that Icewine 1 core did not reveal we were in a bitumen dominant area?
The specialists should have been brought in from late summer 2017.
Then the Icewine 2 work had a chance of being successful.
Or, a new location for Icewine 3 should have been decided on.

Winx-1 should never have been drilled.
But it was inexpensive operation.

Charlie-1 / Magaluf-1 is a new game.
My guess is, MANY people have been involved in deciding this drill placement.
Led by 88E / BEX Seismic and computer work for about 2 years.
And surely evaluated by PMO to the finest detail.

It is very true, people learn from their mistakes.
We are fortunate that our oil resources are over a wide area giving us choice.
Opportunity to compare areas to make improved decision making process.

There are 7 oil layers.
We can assume no water drenching at 3,000 to 7,000 ft this time.

Phrontist

88E is an unusual exploration company....
Started as 88E late 2014 after someone told them/us where the oil was.....
5 years and $110million later, we are still far from raising first barrel
Phrontist

What is the future for 88E in a years time?
We don't know, DW hasn't got 2020 vision...
Phrontist

I have met Bandy in London and had a 2 hour+ conversation with him.
Sugesting rinse-repeat, rinse-repeat is ridulous.
Bandy is an able and ambitious man. He wants RMP and himself to be successful.
He knows RMP alone is too small for most projects hence the Winx-1 group of 3+1
An interesting opportunity to get RMP's foot in the Alaska door....
It could have been very successful, unfortunately it failed.
If it was successful, major $$$
It was a marginal fail, due to water logged ground or something.

As regards rinse, rinse, ....this is an accusation with criminal suggestion.
No AIM or ASX Directors are so stupid to make a failure into a success for them by insider trading.
Or passing info onto relatives or mates etc.
The ASX and AIM Trading process is fully computerised.
All trades are EASY to track and investigate.
But no official investigation has been requested on ASX or AIM, as far as I know.

What is RMP's next move in Alaska?
Walk away, I doubt it.
Re-group for Winx-2? It is possible.
But new investigation 3D Seismic / computer processing is required on Western Blocks.
To see if a more appropriate drill spot could be successful.
Perhaps we should ask Derek Bandy what RMP's plans are for the next year in Alaska.
And what else the company is working on?

Phrontist

Ooops
I realise this is a different drill to Charlie-1,
should be:
I realise Charlie-1 / Malguk is a different drill to Icewine-2, etc

PB designed the Icewine 2 drill to be multifunction in respect of Vertical and Horizontal drilling.
DW reduced the cost by having only Vertical. I don't think we know these cost comparisons.
I realise this is a different drill to Charlie-1, but the point is, Drill Rigs can be designed to handle the functions requested by client.
So, PMO cost for Charlie-1 is $23million?
Normal cost for conventional vertical only is $15million (eg Winx)
So, maybe this PMO Drill has some favours built in?
Equally, there is suggestion Charlie-1 drill will look for up to 7 conventionals, will this add $8million?
Remembering, Winx was looking for 3 or 4 conventional layers.
Also note, new well is called Malguk-1 appraisal well (regional word meaning...?)
Perhaps we should Email DW for clarification on drilling to the much deeper HRZ.
My understand is, the fracking 'extras' happen after Rig is removed.
And bring in the pumps and water/chemical trucks.
Just inviting discussion. There could be a lot in this Magaluk project.
Phrontist

BeverleyBeaver
5 years from now? $5 per share accumulated (SP + Capital Dividends + Quarterly Dividents)
Known as 500 Bagger, ha ha.
Reason - we own a lot of land, BoD are farming it out bit by bit.
Many FO activity will make them rich and us rich.
Without The Big Guys taking the Big Profits.
I think this is where BoD skill lies.....
Phrontist

WAusssie, Bruce Lee movie...great stuff.
After decades, I saw a program about him recently.
And the mystery of his death. Much speculation, little fact.
But now the Medics know....I was amazed.
I sell you the answer for pint of Fosters at next Meeting?
Phrontist

Goldstinger, Note to Emma did use the magical get-out IMHO:
PS if you buy now, you cannot lose after six months....IMHO

But your comment 'cannot lose' is a bit strong by me etc. I agree with you.
I was in a hurry, it was brief. etc.
But my feeling is based on 4 years of 'intense 88E' as big learning curve.
I have never been involved in Oil & Gas Exploration before, as most of us.
We build up a lot of knowledge in our heads, read many web sites, go to many 'Presentations' with PU afterwards, reading Wiki, RNS's, etc.
I used to have regular chats with Paul B about the industry and how we (88E and BEX) fit in with our projects.
And, my conclusion is:
Great work has been done, some slip ups made, SP has failed us.
Sadly PB died and a long standing Director of 88E in Perth.
But since circa mid-2017 I think 'they' got a grip.
And more intense work went into what is happening in the field, under the ground.
This business is more than just finding a spot, then drilling a hole, and hope....
How and when will we start to make revenue, actual money from someone or for something.
Conventional FO is a first step in this vein. We ARE going to sell some oil in Q1 2020. Yes?
Then BEX and 88E will become Big Boys....with big SP.

Roll out similar for Unconventional, Yukon Gold and Western Blocks.
All are about contracts that will bring in money.
And technology people to get field work right.
We have spent circa $100m (shareholder) cash for 4.5 years with NO revenue.
But now I believe 'they' are getting a grip. Real talent is showing.
We have accumulated contacts, experience, data room 'knowledge', Seismic results, etc.
The Team are in a very strong position now.
A great deal will happy over this coming 12 months.
That brings in $$$
IMHO Phrontist

Emma, most of the 'names' on here are not humans, they are wolves, bears, foxes, scopians, mamba snakes, etc.
But you can use the online 88Energy Education Course:
http://88ewiki.wikidot.com/
Any problems with it, contact Brombard...
PS if you buy now, you cannot lose after six months....IMHO
Phrontist

There is a Chain forming.....
PB leaves CP after long successful career.
PB starts Burgundy Xploration
Burgundy does early exploration work in Alaska
Burgundy opens Alaska Door for 88Energy
88Energy opens Alaska Door for Premier Oil
XXX opens Alaska Door for Tier 1 volume Production Company (2021 onwards)
88Energy are retaining interest to secure long term % of Production Revenue
Phrontist

Bottom line now for FO Contract is:
Last 4 months of 2019 prepare road, site, array of equipment, moving of new drill rig, accomodation and admin cabins, etc.
Remembering, this new drill site is near to TAP and Highway.
(Use Franklin Bluffs pad as Base Camp??? Not sure)
Final Prep of site, drill program through 7 possible layers - Jan Feb Mar 2020
Equivelent to 7 drill rig operations.
This is about as quick as possible. EO must be having a great time in Alaska!
88E are the Operator (this is good).
How much is 88E paying in cash? $0
We pay New JV Partners out of oil sale proceeds (88E / BEX / PMO)
After long negotiation, this is simple easy to execute program.
This is a small % of our total oil asset position.
But will break the bogey by achieving oil flow on a commercial basis.
The excitement of Q1 2020 Drill Program IS WHY WE ARE HERE
So, no complaints please.
Personnally, I cannot see how shareholders could have asked for more.
Any deal with Tier 1 would dwarf us and end up paying us little $$$
Yes, a big business has higher guarantee of success at drill time.
Or does it? Check out PMO, DYOR
Phrontist (clutching his bundle of shares)