Member Info for Phrontist

Chartman99, not so. I have written similar in earlier posts that focus on unconventional is the wisest choice since we are a small cash limited business.

Yukon, conventional, New JV are all great ideas. And all cost money.

My last questions to DW was:

When do you think 88E will receive its first revenue from Alaska efforts?

No answer.

Phrontist

mm, stick to filing other peoples questions, you are not up to understanding them:

Focus on unconventional means lateral (horizontal) would be upgraded onto Ice 2 this summer and operational.

It would be paid for by money not spent or committed elsewhere since last summer.

Flow would happen during August

SP would likely exceed 6p, actual amount depending on flow rate and oil quality plus other well performance issues.

Knowing DW, a Capital Raise would occur in September producing funding for other three projects.

By Q4 Farm In for unconventional would be dead certain.

Phrontist

The question is, can the BoD steer us there? Usual ambitious AIM company - failure to focus on original concept. Unconventional in our case. I believe that if 88E had not let itself get involved in other activities, Ice 2 would be flowing oil this summer using existing shareholder funds. Then SP would be strong and diversity into other opportunities would be safe. Now we have confusion and conflict of priorities. IMHO the best safe route for LTH is to sell AEA for best offer. Could be several $ billion. Yes, we lose PB's dream of vast unconventional resource sale. But at least we will survive and get reasonable return. Failure by BoD to issue any significant RNS following Ice 2 problems a month ago speaks volumes. Phrontist.

Is Farm In/Out in Alaska like HRZ in Alaska, never been done before? Does anyone know of a successful or unsuccessful Farm In/Out in Alaska? Could only way forward be to sell our North Slopes interest now, we have taken it as far as 88E is able. Are all these dreams of raising money here and there just pipe dreams? Phrontist

Dear Brom,

Your regular update is great, but could you add Mkt Cap UK £

Technically, $ MEANS US$
I assume your $ is an A$ not a US$

Sorry to be pedantic but I think a little clarification here will help misinterpretation.

Phrontist

Yes, that Ice 2 question is the only one that really matters.

Rest is incidental small business activity.

About 4bbo before the last two years of additional land grabbing. Maybe 8 bbo or more.

Plus new horizontal technology is more efficient in percentage of oil extracted.

Plus these multiple (24) horizontal pipe support.

Plus multi-strand pipes per horizontal.

Plus advanced computer analysis and control of the drilling / extracting process.

Plus significantly extended underground reach per horizontal pipe.

HRZ remains The Big One, no question.

Myself, two years ago I would have stopped all expenditure and worked on Icewine 2V and 2H only, until HRZ is proven. Just IMHO.

Anyway, if we get a suitable Farm In company, HRZ will soon be flying. These large corporates, specialist consultants, advanced electronic test and monitoring equipment etc will smash this problem in no time. The BoD just needs to focus on this because time is money for shareholders.

Phrontist

Thanks mikemike.

I will buy you a pint of Fosters if opportunity arises. Founded 1888.

P

mikemike – better late than never?

Questions from Phrontist to 88E BoD. I have tried to make them specific to enable short answers.

1 Are Farm In/Out contracts between the Farmee and 88Energy or with Accumulate Energy Alaska?

2 Is it likely Farm In/Out contracts will have a Front-End payment from Farmee to us (88E, AEA, JV)?

3 Are Farm In/Out contracts likely to be signed during 2018? How many contracts are hoped for?

4 How much of our land are the Farm Out contracts likely to cover?

5 I assume contracts involve an exclusive right for Farm In company to convert to full purchase? Is a time limit put on this option?

6 Are Burgundy involved in the above negotiations, if so in what ways?

7 Is it possible, and our intention, to gain a Full Oil Production licence at Franklin Bluffs with multiple horizontal unconventional well setup? (For us or Farmee.) (Noting Alaska Gov serious need for tax revenues.)

8 Can horizontal be commissioned during the winter, what is likely timescale?

9 In what ways has our business relationship altered with Burgundy Xploration since PB’s death?

10 Are any changes thought likely in the future with our business relationship with Burgundy?

11 Clearly PB’s experience, motivation and talents have been the driving force behind 88Energy being in Alaska. Are Burgundy maintaining this driving force or are they reducing their frontline efforts to our JV in Alaska?

12 Many people believe that PB’s specific technical experience at Conoco Philips has been central to the fracking exploration efforts in Alaska. How are we compensating for the loss of his technical expertise?

13 When do you think 88E will receive its first revenue from Alaska efforts?

Note to DW and BoD – Thank you for your hard work, I have confidence in our future success.

Phrontist

I think we should realise that 88E and BXP staff are human not superhuman.

They are (presumably) following up on all strands of the 88E business.
When a new firm event occurs, they will tell us.
The events we all know about take weeks, months, who knows.

Only (ha ha, only!?!?) one Project is problematic - Icewine 2
Be assured staff are following up the next step assiduously.

One day oil will flow from Icewine 2.
IMHO this is inevitable.

If you are a short term trader, then sell and disappear to another share.
If you are LTH, patience is all. It is unhealthy to stress yourself out.

I am thinking no RNS for rest of July and most of August is possible.
Maybe progress comment on 3D Seismic computations.

To my knowledge and opinion, this is still the best share on AIM.
Very low downside now, very high upside Q4 2018 and 2019.

Phrontist

Brom, I can only surmise, based on UK time:

88E issues Information Release to ASX at 00:30

ASX release this as RNS at 01:00 coincident with Opening Market

All Aussie shareholders can trade on this information in an equal fashion.

Meanwhile, UK shareholders are asleep and LON is Closed Market.

LON Admin look in their Email prior to 08:00 and see the Information Release.
LON releases this at 08:00 coincident with Market Opening
All LON shareholders have equal opportunities to deal

Note: Any smart person on the planet can trade on any Stock Exchange to BUY on new information.
Only existing shareholders on ASX can sell on ASX
LON shareholders cannot sell their shares (early) on ASX

It works.
Equal opportunities for share owners is upheld
Equal opportunities for other people is upheld

Phrontist

Daniel, good effort.

I have never sent an Email question to DW for this reason.

Any information provided by the company leading to a possible change in share value must be part of an RNS.

The RNS is written by the Company but released through the Stock Exchange during its Open Hours.

This guarantees that all share holders have the opportunity to read the RNS (Information Release) at the same time.

After the RNS is released, the company can then also publish the Release on their own Web Site.

So, DW's hands are tied. Quite rightly so.

Phrontist

In summary:

IMHO the SP today should be at least 3p, maybe up to 4p, 5p.

A single RNS could put the SP into this range overnight.

I still think 'not owning 88E shares' will damage your wealth. )))

The BoD and BXP are smart, energetic, busy people.

They know all this stuff. It is difficult for them to make announcements (RNS's) on partial news, work in progress, multiple negotiations.

So, we have to bite the bullet and wait.
As an LTH I am fully trusting in BoD deliberations and wait with baited breath.
Many options are possible.
The massive asset value will attract all sorts of possibilities and interested parties from the global oil, energy and fund management parties.

Phrontist

mm

In a small business CEO and MD are by and large the same thing.

88E have never specified what the target is for a full Sale of our Central North Slopes asset.

Let us take a Starting Point, US$ 5billion. This is essentially buying AEA from us.

I suggest 65% is due to 88E and 35% due to BXP. (Actual may vary small amount).

65% of $5b = $3.25b

88E may wish to retain 10% of this for future development (new JV, Yukon, Perth...?)

90% of $3.5b is due to 88E shareholder by Capital Refund = $2.925b

About 5.4b shares in issue.
Refund per share = 2.925 / 5.4 x $/£ 1.32 = $0.542 x 1.32 = £0.715 = 71.5p

If this were put to shareholder vote, my guess is easy majority will say YES.

Remember, shareholders still own their shares, likely value 10p (cash and assets)

This rates as an excellent investment.

Is US$ 5b regarded as a 'fire sale'?

Surely if Icewine 2 had been successful and conventional had pulled first oil, then higher figure likely.
US$ 10b? US$ 12b?

I do not know. 88E opinions here would be interesting.

Below US$ 5b, yes that is moving towards a 'fire sale'.

US$ 1b should be easy to get IMHO.
That gives 2p share value and 14p Capital Refund

Would shareholders vote to take this? Ummm, quite possible.

Phrontist

Brom

My understanding is that the FD does not have prime responsibility for Strategic Expenditure decisions. He should be participant in Management Meetings to contribute his thoughts.

Business Strategy is the responsibility of the CEO.

Full time staff are responsible for implementing it.

Non-Exec directors are responsible for advising, discussing, analysing with CEO at BoD Level.

I think DW has done extremely well and worked very hard since joining Tangiers Oil. I have zero criticism of him and much praise.

But he is just one man. The growing diversity and complexity of what 88E is doing is beyond a single man to keep a grasp of.

With PB, it worked well. His 30 years in Texas unconventional oil industry is/was invaluable.

Without PB, this leaves DW with yet more risk to understand and assess. More people to communicate with, more decisions to make etc. Possibly reaching into areas beyond his past experience.

mm, I am not talking about a 'fire sale'.

Selling a partially de-risked land asset was always The Plan.

Should the BoD be asking us to accept more dilution and more risk when it was NOT part of the original objective.

mm, no one here needs you to tell them 'you are entitled to your opinion'.

The Rules of this BB are an LSE.co.uk issue not yours.

Phrontist

mm - drivel.

You fail to focus on shareholder value as the talking point.

Raising personality issues between BB posters is low grade and diversionary.

P

IMHO

It is time for 88Energy and Burgundy to sell the entire Project.

The company has done very well, it has been focused and efficient.

Without question a massive resource has been discovered.

But we have lost PB.

Creaming the Curve has part happened. Almost as far as we are able as little 88Energy.

Raising 15% capital per annum is far too small.

Maybe sell a significant shareholding in Accumulate Energy to CP, BP or the like.

But the words are: Sell assets NOW

Do not risk the fabulous progress we have made by over reaching our capacity to handle this enormous potential.

AIM is littered with Fallen Angels based on GREED by overstretching such small resources.

I would like to know, what does Stephen Staley think about our current position?

He came through the extraordinary Cove Energy growth situation and has direct experience of our position and opportunity now. His business knowledge seems to include major energy resources companies....etc

Phrontist

Dear Brom, I know your heart is in the right place. ))) And possibly some of your money! Ha ha.

But, your waffle means nothing.

The BoD are responsible to shareholders.

I am raising questions and want qualified answers from 88E BoD not waffle from you.

Phrontist

Brom

My understanding is Tangiers Oil started to drop that project mid 2014. And it cost money to get out.

I guess we need DW to comment here, but he joined Tangiers during 2014. And all but one of BoD also changed.

PB is The Man in relation to the companies change of focus from Tangiers to Alaska. When did DW and PB meet? That is the point when the company effectively diverted shareholder resources towards Alaska.

I think four years has now gone by and we are commencing our 5th year on unconventional oil excavation in Alaska.

How much share capital has been raised since mid-2014 to date?
How much of it remains free to spend (uncommitted)?

Oh yes, we are sitting on a very enormous Black Gold mine, no question. But serious focus is needed to avoid a calamity and gain a success.

Phrontist

DW is undoubtedly an excellent man and Director.

But we need a CEO that is hard nailed on handling monthly risk, finances, exposure, planning, contracts, targets and first revenue point.

Would Icewine 2 be operational with horizontal now if we had focused only on this HRZ based unconventional project? This is why we are here, yet it is 2018 summer time and it sits dormant with no specified action plan for its future.

And money is being committed elsewhere.

The HRZ resource was discovered years ago, there are many $ billions of the stuff waiting to be pulled. Our fundamentals are second to none. Where is the first barrel?????

Phrontist

Sorry, typo:

Unconventional reliant etc
should read:
conventional reliant etc

P