Member Info for pickedpeck

Danger money may be drivel, but it would be utterly stupid to assume that JW or others like him don’t have a choice of employment and go where the most reward is. Drilling experts prepared to work crappy places earn very well as employees let alone as CEOs. As for GC, I am sure if you could come up with the cash to buy a similar stake on the open market you could displace him, as could any of us. As you say, you chose to put money into this investment, I am fairly sure when you did JW and GC were already here. I suspect you have put up a fair investment here JTD, a trip to Putumayo to inspect the assets and get a feel for the ground would cost you a fraction of your investment or potential return, have you considered it? It’s a shame the civil war is over now or you could have enjoyed an even more authentic Colombian jungle experience, but I am sure some of the local coca leaf growers could help out a bit if given advance notice. Perhaps whilst there you could share a your opinion on overpay with our field teams over a beer, they may well agree with you.

JTD - sadly it is as simple as sector sentiment. Global warming influence of carbon, plastics pollution, the trade dispute and economic downturn, shale production making the US a net exporter, even chinese economic growth rates are all factors affecting investor sentiment on oil and gas shares. The valuations of many companies look crazy cheap, PMO has paid off half a billion in debt and has the Zama discovery to play with but is barely off its lows, Hurricane has barely moved despite massive progress, and AMER peers are stagnant or regressing. In the end economics will rebalance. There is still huge global demand for oil, the lack of capex spend available will degrade offshore and expensive production fields, the energy demands of shale extraction limit its profitability at mid prices and lower, global trade will recover and so on. Sentiment always turns,

Closed periods are tricky for C level people, any negotiations that they would be privvy to that would be material to the share price effectively mean they can't buy. There are a lot less days you can buy to those you can't. I've been over a year in a company and been unable to buy, or even have relatives / friends buy!

By the way, those complaining about six figure salaries get real. Working for an oil and gas company in a frontier country which until recently featured non-work benefits like kidnapping, oil field or pipeline bombs, equipment sabotage, tropical disease and actual sniping rather than the BB variety would pay what? Director level pay for BP, that's senior manager not BoD by the way, is here https://www.glassdoor.co.uk/Salary/BP-Director-Salaries-E9011_D_KO3,11.htm , JW was doing that 20 years ago. In field engineers like him get paid a lot.

The ExxonMobil project manager I worked on a Sakhalin project with drove to work in a Ferrari, but as part of his basic training was given firearms, defensive driving, and anti-terrorism training - for a reason. If you haven't been to these sh*tty parts of the world then stop whining about what people get paid. Try Angola during the civil war, Nigeria on the delta, the lovely climate of Sakhalin or Hibernia, or the guerilla army run cocaine fields jungles of Colombia. These are not holiday destinations.

The ANH rubber stamp on the farmout enables the four blocks to be explored under the partnership. Seismic and exploratory drilling plans can now be executed. As BBN said, don't expect anything massively material from those four blocks until we get towards the end of 2020, although I think the seismic may lead OXY to bid either for the blocks or the company before that if positive.

Choppy have you read the RNS? An additional 710bopd is material and they had to announce it. They indicated the depth of net pay, the depth of the well, the sandstone layers producing. I don't think the sand porosity or API in an infill well on a field already in production would be relevant. The production is already flowing through OBA as indicated by the recent higher volumes.

If this had been a CPO5 well then it would have had to produce 3550bopd gross to have the same net production benefit to AMER (yes I know 30%, but effectively 20% post X factor and royalties plus higher prod and transport costs).

I can't believe the gloomy posts on here today. This is a drilling and production success, have you all forgotten how to be positive? This is not an end of rainbow announcement, its about run of the mill operations in an oil field providing a production uplift to the company and additional material income.

What on earth has the number of shares in issue got to do with anything? Are you saying the company should use free cash flow to buy back and cancel to reduce the Market cap rather than invest those same dollars in exploration and production investment? The number of shares is simply a means of enumerating capital entitlements. They don’t affect the market cap, ROI, EBITDA, EV or any other valuation metric. My 2.5m shares would be worth exactly the same after a 10:1 or 100:1 consolidation. The company could use the $40m or so cash at hand to fund a buy back, but then would be caught in a debt cycle like PMO and ENQ where mkt cap is slaughtered because of debt levels despite large scale production and discoveries. I would argue that a bit like the shares in Arsenal football club too few shares creates a liquidity problem. I am happy debt free (limits downside risk) and with cash funding E&P growth. The shares in issue is just a banal red herring

It’s implicit in the RNS, operations continue, not drilling. Subtle wording selection.

Yep, you’re reading it wrong. Quite a lot more blue than red this morning, but I reckon you have got into a negative mindset and can only see the red. I’d walk away from watching this for a few weeks if I was you, it’s not healthy watching the daily movements so tightly.

And it is a big IF Sol is a duster I would expect pretty much no share price reaction. Crazy I know, but I don't think many have bought in on the promise of Sol whereas I think a lot of speculative buying surrounded potential upside from Calao. The company have made no production commitments regarding the upside from Sol, no promises or over commitment. So the current price is not dependent on Sol success, it more or less factors in a duster. Having said that there is bound to be some kind of reaction if it is dry, but I would also expect a pretty positive reaction if it isn't.

They previously guided relatively low levels of third party oil steadily increasing through the rest of the year to an expected maximum of 2,000bopd. Charging $8 a barrel with costs of $3 gives them $5 a barrel net. By year end (2,000 bopd) that would be worth $10,000 per day, $300,000 a month. If that level is flat for next year it adds $3.6m to the bottom line. The 710bopd just added at Plat26 adds $42,600 a day gross at $60 a barrel. Assuming low production costs, $15?, that lands them about $11.5m p.a. net. This one infill well is worth more than three times as much as the third party oil deal unless throughput ramps up a lot.

Five months of production at 5,300 plus seven months at 6,800 would give average production of 6,175 for the year. I would assume a couple of work over outages and a bit of tailing will bring that back inside the continued guidance range of 5,000 to 6,000. The Plat 22 sidetrack may be the one to cause an increase outside the range. As they say the guidance includes zero contribution from exploration, so anything not yet drilled is upside including Sol and Indico appraisals and any of the Putumayo fields. They seem to have changed comms strategy for the better. Under promise and actually deliver on any commitment made - be literal rather than over excited. Production in the top half of the guided range would be their best ever annualised rate compared to 5,356 achieved in 2018. 5,900 would be a 10% annual increase. There is no negative in the RNS, they have drilled a successful well on time and added 710bopd to production. Exploration upside remains, as does the opportunity for increased OBA throughout, and the OXY partnership is confirmed. Good RNS.

Bigsmoke, if I knew when a bid would come I wouldn't be wasting my time posting on a BB, I would be lounging on my super yacht whilst my philanthropic minions cured World hunger Given the accelerated interest in the country, and the size and nature of the Amerisur estate, at some point there will be a take out. What the nature of that takeout might be is a different story. Try these for size: 1. OXY seismic shows huge prospects in Put blocks, they make a bid to secure the other half of them and any upside from the otger blocks. Block values post seismic 3-5 x pre seismic, so maybe a $450-500m takeout. Possibly in the next 6-12 months 2. ONGC fail to win any of the additional blocks they are bidding for, but now committed to Colombia see Amerisur as an opportunity for a quick win, securing the balance of Cpo5 and cherry picking the other blocks. This year depending on a bunch of factors 3. No sign of this yet, but an active investor starts to get hostile with a view to acquisition and break up. Asset value significantly higher than mkt cap less cash could bring this about. That would mean a break up and trade sale of assets. This would be much more likely if the share was US listed and not tight held my IIs - yes I know it doesn't feel it but it is. We would notice this happening through RNS, but not impossible 4. A major / super major wants to skip the queue and buy into Colombia as a strategic move. BP, Shell, Exxon, Sinopec all there already and sniffing. Companies with previous investments in Venezuela may shift strategy. Could happen at any time on an opportunistic basis 5. Michinoko lose patience and initiate a trade sale, they could trigger an auction as a combination of the above. 1 year to put up or shut up? Bottom line is is there are a lot of takeout options possible, and a slim chance that none will happen. Early warning signs would be the board going suspiciously quiet, a drying up of RNS which could affect the price, no director buys due to unusual closed period, disgruntled major holders firing warning shots (as they have other options), and if an active investor a load of conscious de ramping. Either way I doubt we will be having this same conversation this time next year

JP - Amerisur didn’t submit any bids though, and unless there is something really opportunistic I doubt they will counter offer. All they have done is qualify as a bidder, I would have been very surprised if they hadn’t taken that step as from the block map there are directly adjacent blocks to Amer’s estate available. We can interpret everything negatively if we try hard enough though! - Record number of bidders = more competition for cheap blocks - Record block bids = no low hanging fruit to be snapped up - Amerisur not bidding = lack of ambition And so on. On the other hand... Colombia looks set to have its economic expansion and OECD status driven ever more by an expanding community of oil and gas companies, normalising the industry and reducing government and political barriers to exploration. With more players wanting to expand in the country it means Amerisur strategy of abandoning Paraguay and not expanding into Ecuador, and also building a huge 2.5m acre land bank has been absolutely spot on.

It means there are a couple of dozen companies wanting to invest in Colombian oil exploration, in fact more than ever before as both the numbers of bidders and the blocks bid for are the highest. On top of that there are majors and super majors taking on blocks in the country. What that means for us private investors is that we are no longer really investing in a frontier country, more like a country that is in the process of becoming a major producer with significant infrastructure and reserves ramp up. Long term that will increase the value of Amerisur holdings as they are seen as lower risk and easier to exploit, and yes, make them more attractive on a market to take them out.

What drop in OBA are you referring to? Seems to be up to me. Drilling will be complete, but casing in and flow testing might not be. I think they have become more reticent about declaring results before a full flow test, why declare anything until they know more, or in fact why declare anything at all? They didn’t tell us when it was spudded, I doubt they will say anything about the P22 side track that the rig may well have moved on to now. It’s an infill well not a new field. If successful OBA flow should pick up 400-800 bopd, before falling back a few hundred barrels when P22 is re-entered and goes offline. The hard thing from the data available is how much the effect of third party oil is having. We simply may not be told about every event as this is normal operational activity and not material independently.

They maintained 5,000-6,000 production guidance for the year at the same time as saying 6,500 currently. They either expect some downtime, or some tail off over the year from the level of production post workovers. Exploration will either backfill for the tail off or add in additional production.

Don't assume production just stays flat. That is the real indicator (Indico) of the value in CPO-5 where Mariposa hasn't tailed off at all despite producing at 3,000 bopd since going online.

So AMER bounced more than PMO and ENQ today, despite both of them falling further yesterday. Not all bad, seems to suggest a bit more resilience in the holders now. Good news could be interesting if things have really got a little tighter. :)

Just a thought, $300m divided by 1.2bn shares is 20p a share more or less. Would have to come with stock too, i am not sure many would take that price just for cash.

All based on crude price, Brent down 5% today, WTI 6%. For PMO make it down 14%.

AMER is down 6.9% , but PMO and ENQ are down 12% ish each. Just a spectacular red day for the sector.