Member Info for Phrontist

I am sure adjustments of $amounts and dates will evolve.

The point is, an oil production revenue stream is commenced.

It has to be sufficient to enable Farm Out JV's to make money for themselves.

It has to be sufficient to prove to potential Big Buyer that our conventional and unconventional are more than just a few drops in the ground. We have to prove volumes into expected production volumes/well.

Further, this company will move towards receivership if it attempts to go through rest of 2018 and all of 2019 without any revenue. Oil is revenue. )))

If 88E chooses to "cream the curve" then it has to play this game to a level that convinces larger shareholders to dive in and eventually a Big Buyer such as CP, BP, Shell and so on.

Farm Out contracts will be tough to negotiate. 88E are bound to ask (demand) pre-contract costs. Farmee company will argue risk level, own rig costs, infrastructure costs, and multi-year cash flow issue. I imagine we will get a small up-front sum, a few $millions at most.

If my figures are optimistic, it means chances of getting Farm Out company are reduced.

If less revenue comes into 88E, then we can expect shareholder call for funds.

The whole thing is a balance. 100% for sure, the 88E Finance Director has Spreadsheets with What-Ifs all over the place. This is planning and forecasting.

My dates are from page 7 Sept 2018 being used Friday.

Phrontist

Phrontist

Page 7 of September 2018 Presentation summarises timeline for the four 88E projects.

First project to produce crude oil is Western Blocks
Target is early Q2 2019 for conventional production
A fair to good rate is 1000 barrels/day
Revenue is $75 x 1000 = $75,000 / day
88E revenue is 30% = $22,500 / day = $675,000 / month
First month should be April or May 2019

Second project to produce oil is Icewine HRZ unconventional
Target is Q3 2019 for production using Farm Out
Assume two lateral pipes on production well?
Guess at 500 barrels/day
Revenue is $75 x 500 = $37,500 / day
88E revenue is 30% (complete guess) = $11,250 / day = $337,500 / month
Then 70% 88E share with BEX = $236,250 / month
First month should be August 2019

Third project to produce oil is Icewine conventional
Target is Q1 2020 for production using Farm Out
Two wells planned
A fair to good rate is 1000 barrels/day/well = 2000 b/d
Revenue is $75 x 2000 = $150,000 / day
88E revenue is 30% (complete guess) = $45,000 / day = $1,350,000 / month
Then 70% 88E share with BEX = $945,000 / month
First month should be May 2020

Fourth project to produce oil is Yukon conventional
Target is early Q2 2020 for conventional production
A fair to good rate is 1000 barrels/day
Revenue is $75 x 1000 = $75,000 / day
88E revenue is 100% = $2,250,000 / month
First month should be April or May 2020

The real shareholder benefit will be from selling Central North Slopes
If creaming the curve for all its worth, then mid-2020

IMHO, to be improved from BB inputs.)))

Phrontist

….the Expert Team have cracked Icewine 2. DW would truly be a hero. I think the whole company deservedly so.

I admit to being an optimistic soul.

Sentiment from the "masses" indicates not much bl00dy chance.

Goodnight Phrontist

EVCAM is a high technology specialist business based in Aberdeen. They have offices in all key locations across the world, including Perth, WA and Nr Anchorage, Alsaka and Houston, Texas. Plus Aberdeen in UK.

Spending time looking at this excellent web site can cause positive excitement and raised heart beat:

http://www.evcam.com/

They provide down hole electronic camera surveillance under severe pressure and temperature conditions. Speciality is fracking wells. Equipment and methods are very state-of-the-art. The digital image data is analysed to produce remarkable pictures and physical interpretations.

The web site offers over 100 videos for a wide variety of down-hole conditions and situations. The short explanations enable us to realise the vast experience that this company has built up.

Why excitement? Because you realise that these guys can discover the Icewine 2 problems.

Is EVCAM the company being used by 88E? I do not know.

Would 88E benefit using EVCAM? We could ask.

Will 88E know about EVCAM? I am 100% sure they will.

etc.

Phrontist (I feel big SP rise soon.....)

Brom

I spoke to PB about that decision. We did not discuss in depth or long analysis. He was not in favour.

Why was H dropped from first Icewine 2 drill and test of spring / Summer 2017? It was felt that V would produce oil. V not producing oil was not considered as a real possibility.

The attraction of H was more pipes and H has higher flow rate. It was not felt that if V failed then H would overcome the reason for failure.

My understanding is, we do not know why V has failed to flow. So we cannot assume that H will overcome the unknown problem. It get the impression than 'Management' believe that H will overcome the problem AND produce higher Flow rate than V.

But the original money 88E had could only do V/H and not Seismics for conventional. So, decision was made to drop H for initial Icewine 2 Flow Test. Then, assuming Flow Test went well, SP would rise significantly, and H could then be implemented easily (financially).

And meanwhile, progress on Seismic would advance our knowledge on conventional.

I cannot 'prove' this, but 88E / BEX had an unconventional aspiration and mission only from 2014. At the start conventional on the Central North Slopes was not a part of our JV Mission.

Sadly PB is not here to inform us of the full facts. And DW is not a Poster on this BB to elucidate the position.

I am not pointing fingers anywhere because Ice 2/V failing to perform Oil Flow Test was deemed to be this 50/50 statement. Based on gut feel not on detailed analysis of the sub-causes of possible failure in Summer 2017.

We have yet to discover what the reason is for failure to complete water based removal and move to oil flow.

So, no one is right, no one is wrong. Mother Nature holds the cards at this moment. And, hopefully, a small Expert Team analysing the situation.

I always remember the picture of a lump of HRZ on table. With oil oozing out and sitting in a little puddle of oil. Which means HRZ will flow oil.

So, I am ultra confident unconventional will soon produce the goods. But how, when, where etc?

Ask DW and SS on 14th.....unless prior RNS spouts out the answer.

Phrontist

Phrontist.

I see that Red Emperor Resources has dropped almost 15% today.

And, 88Energy has risen over 8%

When there is no reason. AIM merry go round.

But we may receive REAL News by end of next week. For a REAL and sustainable RISE. Towards where 88E SP should be. )))

Phrontist

This is a short guide to AIM Tax Benefits when investing in non-UK companies listed on AIM:

https://www.lseg.com/sites/default/files/content/documents/a-guide-to-aim-tax-benefits-non-uk.pdf

This is not new, issued Aug 2009, but is supposedly still current.

Worth noting this little item:

The EIS allows UK taxpayers who invest up to £500,000 pa (£500,000 for each husband and wife) in qualifying unquoted trading companies (which can include those on AIM) to obtain the following tax benefits for subscriptions in new issues of ordinary shares: • 20 per cent initial allowance on the cost of investment • no CGT on disposal. This is provided the investment is held for three years and has remained qualifying. In addition, a UK taxpayer can reinvest an unlimited amount and defer CGT arising on the sale of any other asset provided the reinvestment takes place up to one year before such gain arises or three years afterwards.

"no CGT on disposal" (held for 3 years, and qualifications need reading)
This is like having a very large ISA, maybe, DYOR

I am not sure on one key aspect of all this.

Can you own your shares as a nominee holder and still qualify?
or
Must share ownership be held directly, your name listed on companies share register?

Good time to catch up with "reading", will not be any News until late next week. )))

Phrontist

A few people were curious as to the timing of releases from the Stock Exchange and other details about RNS's.

Hope this helps:

https://www.lseg.com/areas-expertise/market-information/regulatory-news-service

Phrontist

This is good news, I look forward to hearing DW and SS with Q&A afterwards.

The share price started in a bad place at 0.95p and after peaking twice at over 2.5p, the SP has ended at little over 1.1p 12 months later. Not good progress.

No new information (of RNS level) will be given out unless an RNS is released during business hours that day, or before.

What can we hope for?

For me, progress information on the two key North Slopes activities:

conventional oil - 3D Seismic position, Farm Out negotiation position.

unconventional oil - Icewine 2 current state, Expert investigation position, Farm Out opportunities.

I hope that our SP position has improved during this 2 weeks. It will throw a more positive atmosphere over the evening session.

Phrontist

But you can't fool the Big Money Market.

Which is why we hover slightly above 1p and not well above 4p.

Simply put, this company is worth well over 4p/share, way over.

But we failed to produce 1 barrel of oil as Tangiers and we have not succeeded to produce 1 barrel of oil as 88Energy after another 4 years.

This is the strategic mistake of the BoD.

Icewine 2 failed Summer 2017.

Icewine 2 failed Summer 2018.

An Expert Team, or person or....is engaged.

A Report is expected within 5 weeks or so.

Other than that, unconventional has been sidelined.

Potential Investors will ask "what happened to 4 years of shareholders money put into unconventional?"

We need an very good answer here. We know nothing about this expert activity. Of course, I support it fully.

But why not last year?

So, those that say 1p-ish is strange, underperforming, etc.

This is the reason. BoD take note. We should have Oil Flow from Icewine 2 during 2018.

Then SP will rocket. Because that means 3b+ of unconventional is real and can be accessed.

Phrontist

No RNS (could have been H1 2018 Accounts)
Flat SP at 2.1c

Yawn. P

Desmond, thank you. And you produce interesting perspective too.
And thank you Georgel61

It is interesting, some companies could want a Farm Out contract just to do the agreed Farm Out work. If very successful they can make substantial profits by shifting many millions barrels of oil.

The term comes from Farmers who contract ploughing, planting, reaping etc on annual basis and field by field to outside labour / machinery companies.

Others may want a Farm Out Contract as Stage One of intended Stage Two Full Buy Out OPTION.

88E have said (DYOR) early stages of Farm Out negotiations have started. Giving access to 3D Seismic processed computer data is part of this (access to computer room). My view of this is that 88E are in a strong position and know it. We have assets of oil. ))) Oil in the pipeline becomes cash. Not complicated really. North Slopes can become a vast CASH MACHINE.

We have not had feedback on Icewine 2 Unconventional Expert involvement - yet.

But I got the impression from 2 August Profile Update (on 88E Announcements) that Farm Out contracts could be signed during 2018.

I think about this. Is one big contract in the offing? Conventional AND Unconventional, ALL leases. Phase 1 is Farm Out activity. Phase 2 is Buy Out terms.

Which means there is no room for smaller separate Farm Out contracts.

Presumably DW and staff are flat out ironing out details and producing documents etc etc.

They are probably working harder than ever before.

The last thing to think about DURING this process is RNS's. We must sit and wait.

I think H1 2018 Accounts will be out shortly. Ummm. Anything "in negotiation" cannot be released.

Progress on New JV field activity progress can have some releases.

Otherwise we wait. )))

Phrontist

Darkelf

You will not be surprised to hear me say, I think 88E / BEX are in a very strong position.

We are sitting on over 1b barrels of oil in both conventional and unconventional.

Combined, 4b barrels oil, recoverable.

After Farm Out de-risking and 3D Seismic mapping could double this. Noting our land lease size has increased substantially over three years, since Icewine 1 times.

There is likely to be strong interest in a part-area contract by dozens of businesses.

I am sure a few companies are interested in the entire site, which could mean buy Accumulate. But further de-risking, anyone's guess as to when (during 2019).

I think DW with his three non-executive Directors will effect the best commercial outcome possible. I have no doubt here at all.

Phrontist

Desmond

You ask: why hasn’t a major steamed in already activating a non disclosure agreement in the process?

These days all negotiations are private and non-disclosure.

A negotiation in progress is not a binding contract, so no need to report as RNS.

Many companies are likely to be "talking" to 88E / BEX every week relating to a commercial interest in the Central North Slopes oil assets.

The release of an RNS as a result of a negotiation is likely to be subject to agreement for such a release by both parties.

etc etc

What I am saying is this - no contract then no RNS.

Of course IMHO. But I have worked on contract negotiation as part of my job for donkeys years. Including selling the entire first computer network to LSE (London Stock Exchange) in 1973. Secrecy (confidentiality) is a normal and usual part of Buying and Selling.

Phrontist

Desmond

Everything everyone posts on here is In My (Humble) Opinion.

Financial Advisors cannot transact business here.

Hedge Fund cannot transact business here.

Shorting activity cannot be carried out on this BB.

In relation to 88E itself, it is the only source of FACTS, none of us are such a source.

No one here has claimed to be an employee of 88E, or is authorised by them in any way.

So, all of my posts are obviously in my opinion. )))

Phrontist

Chartman, why do you, and grandmother, think you are the only important reader here?

There are 100's, possibly 1000's, of readers. Some comment on BB but most just read, think, decide.

You will not be surprised to hear this, you are not my target audience.

P

cont.

So, here we are. Maybe it could have been one big success in 2017, but it failed. Now we have 4 chances of success in 2018. Overall risk is reduced. Eventual opportunities and greater gain are increased. But timescale for First Success has been stretched out by over a year.

Once Farm Out is announced, the past will be forgotten. 88E will be very much in demand. Continued success to SOLD will be certain.

Phrontist

Hello Darkelf

You have a point, when is D-Day?

My posts about 4 to 6 weeks ago focused on this. I was very critical of BoD regarding Icewine 2 delays.

I still am critical, but time has passed, diversification is underway, so now I obviously support success in New JV and Yukon as well.

My point was, 88E should have focused 100% on Icewine 2 from its conception following success of Icewine 1.

This means, no expenditure on anything but Icewine 2 and unconventional. We are a small business. Risk, time and money are inexplicably tied together. Clearly Icewine 2 has (had) risk. Therefore, go for it 100% until Oil Flow. Then diversify using new much higher value SP.

My understanding is that BoD took a technically simple approach to Icewine 2, assuming that it will Oil Flow in Summer 2017.

When it didn't, only next step was Soak In until Spring / Summer 2018. That failed to Oil Flow.

Now we are floundering with weak SP reducing companies opportunities to raise capital from shareholders.

How could this be avoided? IMHO by taking a more expensive 'reduced risk' approach from start of Icewine 2 Project.

This means firstly, engage top of the market expertise from the start. PB may have been that man, sadly we will never know.

And second, utilise latest electronic and electromechanical techniques, products, instrumentation. Then we could have monitored activity 2 miles down. Information gained leads to proactive approach to fixing situation.

And third, sink a horizontal pipe into Icewine 2 with much higher chance of Oil Flow.

All this in Summer 2017. Flow Rate may not have been great with short Soak In. But it could have been real giving strength to SP. Then, 2018 Summer could have improved on Flow Rate based on 9 months soak in, and knowing what we are doing.

There is still no guarantee that this approach will work. But the chances of success must have been close to 100%. This is engineering, chemistry, geology, electronics. Not magic.

As I mention before, from Icewine 1, remember that picture of HRZ rock sample laying on table. With oil dripping out of it quite freely. There is nothing wrong with HRZ.

Now 88E have an Expert (group?) working on Icewine 2 to ascertain nature of problem and route to resolution. A Report should be completed in 4 to 6 weeks time.

This will be used to assist new Farm Out partner and get Icewine 2 (or 3?) Oil Flowing.

But a year later than original expectationsand plans.

I am not pointing a nasty finger of blame at the BoD. Business requires decisions and good judgement. There is always risk, always alternative approaches. Icewine make take more effort yet, adding another year.

If so, BoD decision to focus on conventional oil routes will be deemed very wise. The 3D Project and ongoing work is looking just amazing. It seems 88E will be very successful just on conventional alone.

So, here we are. Maybe it could have been one big success in 2017, but it failed. Now we ha

What / who are Long Term Holders in 88E?

They are 88E shareholders that believe in 88E / BEX achieving the companies principle business Goal.

This is to realise oil flow on North Slopes sufficiently to attrack a high value SALE of the North Slopes leases to a major oil production company.

A stepping stone between today and a SOLD sign is Farm Out of some lease area for unconventional and conventional resource extraction.

The Farm Out should achieve production level oil flow on a sufficient scale to 'prove' conventional and unconventional oil reserves on a massive scale. The activities past, present and future should enable an accurate re-evaluation of the Central North Slopes resource level. Amount in barrels, quality of oil and optimal methods of commercial level extraction.

Movement of the SP value between today and SOLD day does not materially change the Goal, which is SOLD value.

Dealers buying and selling cause the SP to fluctuate. But what is happening is simply some dealers gain at the expense of other dealers who lose. It does not really have much to do with 88E itself or BoD business methods.

These Buyers and Sellers could equally be battling against each other on any AIM stock. This activity causes a lot of emotion and stress on this BB. It is a shame but we have to accept this is AIM.

My guess is over 90% of share ownership is held by LTH, or at least serious Medium Term Holders.

When will SOLD sign go up? My estimate is Q2 or Q3 2019.

Crude oil price will have a massive effect on the competitive demand for our asset. Global economics, hostilities, trade wars, foundation trade levels, all will determine much of our future wealth at SOLD time. My estimate is well over $100/b by then.

It can be stressful for LTHers. But if you are able to hold out the gain will be what was (sort of) "promised" in 2015/16.

Massive.

Beyond any other AIM stock. Only Insider Trading can produce similar gain. There is no insider trading here. 88E / BEX only release information through official channels (RNS) and in accordance with AIM / ASX rules. No leaks.

IMHO Phrontist

https://www.asx.com.au/about/asx-trading-calendar-2018.htm