Member Info for Phrontist

.....for a long gentle positive run.

Phrontist

Like many LTHers, I started buying into 88E during 2015.

The plan was to confirm oily HRZ with Icewine 1 and to pull many barrels of oil with Icewine 2.

Even if Flow Rate was initially poor the SP would reflect the HRZ find across hundreds of square miles.

Then further CR on shareholders would not cause such massive dilution.

Latest RNS is suggesting possibility of Farm Out missing 2018 target.

The BoD can clearly start projects and spend money.

They are less able to focus on revenue dates. It is much of hopes than definitely.

The result of having too many balls in the air and failing to focus on one project until success.

Now shareholders are saddled with increasing monthly expenditure costs and an ever moving target for first revenue.

We should have adhered to original PB plan.

Prove unconventional.

Engage in other projects from revenue generated.

Phrontist

R666

Brent

This is quite disappointing.

Double whammy...

But now DW owes us, big time...

Expect something amazing on Farm Out....

A deserved treat for LTH era....

Phrontist

We should be aware:

The Farm Out contract for conventional will be a BIG and THOROUGH and COMPLEX document.

Because as the Farmee is concerned, it is the preamble to FINAL PURCHASE CONTRACT. Substantial elements of this are likely to be included in the Farm Out contract.

Phrontist

WAussie, I agree could be November, but disagree about February.

I think the winning Farmee will want to get planning immediately with equipment deployment on Central North Slopes early Jan 2019. Big 3D Seismic coverage of entire 500 sq miles or so. Major undertaking. They will want this completed AND analysis results completed AND planning for well deployment in early 2020. Plus having worked out well positions, road creation, arranging endless vehicles, people, equipment.

My middle son predicted 2 December (because it is his birthday....).

Phrontist

Cjml, you have good point, the ghost of Icewine 2.

But my point at the end of the post is, the conventional is undervalued with existing SP.

And unconventional (HRZ) is FREE

Phrontist

EagleCoops

I don't agree.

Of course, if UK plc was booming, there is more cash flowing around.

But our economy is quite reasonable ATM, with low unemployment.

OK, many high street shops have been hit by Internet sales taking over.

Bit Hedge funds, Investment funds, Pension funds etc still invest vast sums of money.

When I said 'new money' I mean new investors to 88E.

Much of that cash should /could move from other quoted stocks to 88E.

But, to be blunt, none of it is moving across.

There is the old saying within City of London investors - never invest in AIM.

This company's needs are above AIM levels. And ASX is hardly doing its part either.

I am sure the SP will pull up to over 4p when Farm Out contract is announced.

I have said many times, we should be registered on one of the USA Exchanges.
US investors prefer to invest in US companies.
US is on an economy roll which looks likely to be sustained over many years, at least.

88E subsidiaries are USA (Alaska) Registered companies.

Phrontist

This has probably been discussed earlier, but just my take:

New RNS late Tuesday 6 Oct, before Aus Market opened on Wed 7 Oct.
Essentially recap of conventional assets to include new finds.

New Yukon figure un-risked 90 million barrels oil.
Further work in progress, next release in 1Q 2019.

Western Blocks, no change on net to 88E of 144 mbo.
Drilling confirmed during 1Q 2019, a rapid deployment to the field.

Project Icewine conventional figure upgraded to include further analysis of 3D Seismic.
Un-risked 2,211 mbo net to 88E (2,896 incl BEX), increased by over 10%
(Major section of Central North Slopes still not 3D assessed yet (my comment))
Farm Out contract target is still before end 2018

Net total to 88E is 2,445 mbo conventional
Just below 500 mbo increased over last conventional 88E asset

Earlier today ASX:88E rose 26.3% from 1.9c to 2.4c
2.4c = 0.55 x 2.4 = 1.32p

LON:88E started today at 1.1p and is now (14:30) at 1.2p, a 9% increase.
But still 10% below the ASX figure.
Will SP close at 1.32p today, same as ASX?

IMHO, ASX:88E should have risen 50% based on the increase of conventional resources.
That would put LON:88E at 1.65p.
Still a very low figure IMHO.

I understand some people will be selling, we all need money to live.
The root problem is that not enough new money is seeing the 88E opportunity.
It is large net injection of capital that leads to significant SP rise and hold.
Any suggestions why???
At these levels the HRZ is free!!! (circa $6b of it)

Phrontist

Learningtoinvest

I thought all AIM shares were created at 1p when the company is formed.

P

I did not realise that gold prospecting still happened in Yukon Gold area.

It is small group / family type business.

Occurs in 4-month summer only.

Surface mining, not underground.

Geological clue of gold is in shale stone concentrations near or in creeks and small rivers.

They use diggers, machinery, sluices, pressured water to sift and separate.

The gold, if any, is pebble to small stone in size.

Two groups found nothing. One group found $1.5m worth.

They clean and melt it to produce 220 oz gold bars worth about $170,000 each.

They use very large diggers to wreck otherwise attractive forest and country land in search for heavy shale areas. This is a damaging process from an ecological viewpoint but no one cares.

I guess the areas damaged are minute in size compared to the vast areas in northern Alaska and Canada.

No pollution occurs. Likely vegetation and trees will regrow over 10 year to 20 year period.

There is no connection between this activity and oil exploration.

Interesting to watch but not relevant after all. Phrontist

Yukon Gold is on National Geographic channel (Sky) now.
(gold prospectors.....)

P

sbrown36

I am originally electronic and computer system designer. Then Sales Exec., manager, director. Finally CEO of computer system suppliers and mechatronic systems for military and aerospace in UK and USA mostly. Before retiring I was Lecturer and Mentor teaching maths, science, electrical and mech engineering, and business.

Over the years I see a lot of very experienced people here, with diverse skills. This BB has been fortunate IMHO. It must be the belief that Central North Slopes is going to produce vast oil from nothing. But I learn a lot from following up good comments many people here have made. I am not unusual here, just motivated to get our £££ return before death sets in! )))

Phrontist

I think DW is highly motivated to achieve great results. It seems to me that he is covering more ground than ever before. I hope the Farm Out contract is early December to give him a much deserved holiday break with family. This is a major undertaking for all members of staff, the stress is showing.

He has now suffered two losses: Brent V at 88E and Paul B at BEX.

Brent was at Tangier Oil on his own following its failure. He brought in the three remaining Exec and non-Exec Directors and did an amazing job of it. Now see where we are four years later!!! Fantastic. )))

DW (probably with BEX people) has organised Texas based sub-contract people. This is to replace what we have lost and extend it into new territory:

The Farm Out negotiating company
The oil well / geology expertise group

It seems DW is managing strategy, decision making, and resources very well, whilst keeping out of too much time consuming detail.

It is impressive to see four Projects moving forward in parallel. The 'no show' of Icewine 2 Flow Test must have put an immense strain on everyone.

Yet the problem has been side stepped brilliantly with triple-conventional strategy. And unconventional is quietly unravelling to re-surface during H1 2019, presumably (P7 Presentation).

We should not moan about the recent Rights Issue. The company has to fill financial space left by Icewine 2 postponement (NOT cancellation). All IMHO.

Phrontist

Could Farm Out contract be with one Farmee for both conventional AND unconventional?

I would say 50/50 chance.

Certainly large oil production companies would NOT like to share the a patch of land with another Farmee company.

We do not know how expert investigation of Icewine 2 situation has gone. Is it complete pending return to well and testing?

What could happen is this:

Accumulate Energy sign Farm Out contract with (Tier 1) oil production company for conventional resource on whole site. This contract includes continued negotiation and investigation (as specified) for 6 months, say. Then Farmee has choice to include an unconventional sub-contract or not proceed on unconventional.

So conventional Farmee has first choice on unconventional to be taken up by mid 2019, for example.

This would enable conventional project to proceed at a pace and give more time for unravelling of unconventional situation.

For example. I cannot see Conoco Philips signing up for conventional, and leaving unconventional open to other buyer. They, or BP, would want all or nothing, preferably all.

Phrontist

uncledazza,

I forgot to mention, plans for cafe's across the whole region, and deliveries of egg, sausage, bacon, baked beans, onions, mushrooms, thick cut bread.....workers need feeding.

I often feel that some posters on here are not fully aware of the scale of the future oil production facilities. There could be over 100 wells for conventional and unconventional, latter with up to 24 prime laterals. 1,000 workers with expertise. I cannot imagine how many delivery trucks, storage cylinders, pipelines, pumping stations, etc etc. By 2021 this will be on the scale of a military invasion of a medium size country.

Also, back office staff for administration, purchasing, coordinating site managers.

Large numbers of computer personnel trained on geological analysis and planning.

The only thing shareholder has to believe is, is that much oil actually in the Central North Slopes ground?

I believe it because PB said so. Based on his years of research and decades of experience in Texas.

SP should be 5p to 10p today, even before any more RNS's.

Phrontist

St Ant

I had a chat with DW after the last City Presentation.

We specifically discussed the Conventional Farm Out process.

From memory, he said:

88E/BEX are using a professional and experienced negotiator company based in Texas. (There are many reasons why this is a smart move.)

Around 50 companies had expressed interest (I guess starting Summer ish).

This is being wittled down to 30, then down to 5. Then final contract.

I questioned his top blue bar in the graph of P7, Presentation Doc. Why is contract signed in late 2018, but then no exploration wells until 2020? What are they doing in whole of 2019?

He replied, Tier 1 companies do (re-do) everything from scratch, in their own way, style, method. (In my industry this was also common with major companies, particularly USA based. Everything must be 'in house').

DW continued, the Tier 1 company will carry out a 3D Seismic across the entire acreage. This includes re-doing the East and West parts we have done, plus the large central area we have not done.

I assume this leads to planning out oil drilling locations, ice roads, pipelines, etc etc. A complete plan for start of first exploration wells to roll out of production wells across the region.

This in turn enables them to produce Risk Assessment, alternative / back-up plans, costing and cash flow.

88E / BEX JV are little exploration business. But I bet our Finance, Accounting and Planning Staff are overwhelmed with work. Imagine this on a Tier 1 company scale planning for 20 years. The Bidders are not just working out their bid, it is in conjunction with their execution plan.

So, our 3D work is primarily for the Bidders to have confidence in existence of oil on a commercial extraction basis. They re-do everything we have done, but 100% across entire site. And they will own their Intellectual Property with team working on it for 20+ years as the field is developed.

DW seemed to answer a question I did not dare ask. Are Tier 1 companies interested in our site?

Phrontist

Errata - 2mb should be 2bb (billion barrels)
P

The key thing in Farm Out negotiations is competitive bidding.

Hopefully Tier 1 companies are really at it to get hold of up to 500 square miles of the oiliest on-shore land going.

Many major oil production companies moved into massive profits/quarter, awash with cash and ambition.

Offering both conventional and unconventional oil resources.

Both around 2mb discovered, but strong indications of double, even quadruple, over time.

Giving 20 to 30 years of oil extraction creating stable long term business for Farmee.

In a politically and economically safe country.

At favourable tax rates and cooperative Alaska authorities for tax and employment.

With handy access to N-S roadway and oil pipeline down to Cadiz Docks and West Coast USA clients.

With production costs being much lower than half the crude oil $/barrel.

Very low risk of accidents and oil spills, and far from human and animal activity.

Great English Breakfast at Dead Horse Café...…..

Many back-up oil expert services companies in Prudhoe Bay and Dead Horse.

Great partnership of BEX / 88E to negotiate with and work with as Lease Holder...…

Phrontist

HotCopper comments are positive

There is real chance of 11% up to 2c IMHO.

P