Member Info for pkwendall

JV mentioned in the Prospectus RNS on Feb 1st

"In addition to securing financing from debt and equity capital markets, the Company confirms that it is actively negotiating terms for a joint venture for the long-term development of its Wyoming assets. The Company plans to announce the detailed terms as soon as they are agreed."

"Thanks for the support chaps, but I was wrong.
COPL dont receive cash for converting bonds to shares, my bad."

That's correct, but there are no further interest payments to be made on the converted bonds, which saves COPL cash.

"Using convertible bonds, a company can issue debt at a lower interest rate because investors get the protection of a senior debt security combined with the opportunity to participate in the company’s growth if its stock price increases."

If I were a bondholder I'd be converting down here, then holding for the upside.

Thanks for this Tilburn. Very interesting. For those who don't have the time to watch this in it's entirety, watch from 54 mins. The USA is going need a lot of oil for many years to come.

https://www.youtube.com/watch?v=DXtScb_IZdg

"If you have the time, worth watching this great presentation on Geopolitics, covers the macro impacts on COPL on supply of casing, oil price, onshore US oil value etc aswell as some illuminating global insight."

Yep, can't buy! I've been trying!

"liquidity covenant (the "Liquidity Covenant") has been extended to 14 March 2023"

JV and/or RBL before the the 14th of March. Fingers crossed.

A sure sign that MMs are collecting shares for themselves, which suggests they believe that the price is going north from here. GLA

Appears that the price was dropped to fill this order.

Someone knows something

3 of 3

O&G companies enjoy quite high p/e ratios and by my analysis that's an average of factor 11.6x
However COPL will be a relatively new company. So for step 2 I'm going to suggest 8x would be more appropriate. Being conservative would give the market time to catch up given COPL will be less than half way up its development curve and growing quite quickly. So that being about right COPL should have around £266m x 8 giving us a £2.13bn MC.

Finally today COPL has roughly 280m shares in issue were told. In March next year however we also need to count the 2024's warrants. So for step 3 I'm going to suggest we use 350m as a shares in issue figure as our fundamental. In which case COPL's SP should be £2.13bn ÷ 350m which is 609p.

You may want to refine the fundamentals I've used and insert your own if you don't agree with them. Care will be needed as a substitution of any of the fundamentals will not produce a straightforward linear adjustment to the MC or SP.

Substituting $100 per brrl WTI price with $80 per brrl results in a SP of 443p. Conversely if you believe Goldman Sachs are nearer the mark at $150 per brrl that would give you a SP of 1264p

If you're considering a valuation in say 2025 don't forget to include the warrants scheduled to be released that year in your count of the number of shares in issue. Perhaps using 500m as a shares in issue figure would be more appropriate and be on the safe side.

For me the potential in COPL is nowhere near recognised yet. The Prospectus tells us that the BFSU optimises at over 7k bopd I'd a few years and runs in that steady state for many years.

As good as that is, it's tiny compared to the new FD discovery. I believe extraction could optimise in less than than four years from now and run in a steady state of production exceeding 80k bopd with the right partner in a good JV agreement. Such is the size and potential of the new FD discovery in my view and as I understand it both parties are keen to make it happen.

This is just my take as a LTH and it's AIMHO.

Good luck guys.

2 of 3

I'm not a great advocate of using an "earnings metric" valuation method but on this occasion I think it's more appropriate than DCF's for example given it's less complicated.

On the cost side I find it relatively simple to consider them in three categories. Firstly those that should be applied as % of revenue such as royalties and production tax. Then those that should be considered on an annual basis such as debt payments and G.A. And finally those such as production that are best considered on a unit cost basis i.e. $'s per brrl.

Here I just would like to point out that royalties on the private leases are around 22% whilst those on oil extracted on the Federal leases (I e. Those more than 1 mile deep such as the Frontier 1 reservoir) are around 12%. So quite a difference.

I also want to say we're looking at horizontal wells or stimulated extraction which are categorised as "special conditions" as far as production tax is concerned. That rate is currently 11.6% or thereabouts I believe.

So to get to a notional "earnings'' figure in this example we have an annual revenue of 20k x 365 x$100 to give us $730m. From that we have to subtract royalties which are $180m x 22% for BFSU + $550m x 12% for FD to give us $625m. We then have to deduct 11.6% production tax which gives us $553m.

If the new finance is as I believe around $60m at say 12% APR an annual cost of around $20m should suffice to cover its repayment. Other annual costs such as G&A should be no more than $12m. So at this stage we're at $553m less $32m giving us $521m

Production costs should be no more than $15 per brrl which is roughly $110m leaving us a basis for the assessment at this stage of $521m less $110m giving $411m.

Using an earnings metric Capex costs are excluded for the first two years in my view as they're more than likely to be covered by refinancing and in the JV.

However Federal corporate tax should be taken at 22% on $411m albeit a notional profit figure and is unlikely to be paid. It should be possible to offset development costs and others against gross profit and I'm not forgetting Atomic had a considerable allowance that could be taken forward. Nevertheless I think it would be prudent to take it at this stage. That being the case we're at $411m less $90m would give us a "notional earnings" figure of around $321m.

Just three more steps needed to calculate COPL's MC & SP. Step 1 $321m is £266m using today's currency conversion rate of 0.83.

1 of 3

I've done as much research as I possibly can and I'm reasonably confident that COPL is on the verge of entering into a JV which will effectively release the value of all of its Wyoming assets. I believe AM is in the process of finalising term sheets with an appropriate JV partner and if that's right then we should be informed of the outcome very soon now.

I also believe that there will follow an agreement to restructure the Company's finances on more favorable terms with an alternative provider. As I understand it negotiations are also at term sheet stage.Together these negotiations when concluded should have the effect of allaying cashflow concerns and releasing the Kraken on the assets! It's not unreasonable to assume both agreements bring with them cash injections.

By the start of the sage grouse nesting season in March this year I see no reason why at least three of the chosen old wells at Cole Creek shouldn't be recompleted in their unstimulated state to allow fracking to follow on during the birds nesting season.

So possibly 3 x 500 bopd post stimulation from these CC wells which should match a similar output from the BFSU given its likely still to be constrained. So collectively 3k bopd in total from the two locations hopefully resulting in 2.25k bopd net to COPL by the end of March. That should put to bed any worries or discussions about the business being a going concern.

I'll try to keep my views that follow as simple as I can and the math rounded in any calculations. So I'd like to fast forward to March 2024 now and look at that future spot production milestone given it will be the start of the birds nesting season again next year.

At that time it's not difficult to imagine COPL producing 20k bopd as its share in a progressive JV. The production being a combination of 5k bopd from the BFSU (having replaced the low pressure gas gathering facilities by then) and 15k bopd from roughly 20 horizontal wells sunk in the new Federal Deep discovery. Assuming a split between the parties of roughly 50/50 of a total production of 30k bopd that is.

If the price of WTI at that point is say $100per brrl that would give COPL an annual revenue of $730m. There's lots of Analysts that believe the oil price in fourteen months time is likely to be at least that and Goldman Sachs for example has it much higher. I've used $100 per brrl as I believe it looks reasonable in my view and as I've said to keep the math rounded.

There are NO extra shares being administered. This is simply admin getting the house in order ready for the joint venture which appears imminent.

Up to 2 Billion OIP

CC has similar geology to Sand creek - 800 million barrels extracted to date.

CC re-completions underway. Well 11-27-35n-77w is currently pumping 125-135 bbl./d of fluid, unstimulated, with gasified light oil, providing extra revenue, with more wells predicted to come on-line over the next few weeks.

No wildcat drilling - established reservoirs

Discovery is ratified by independent Ryder Scott

Low cost drilling onshore

Rapid production and Capex payback

Topside in place

Infrastructure and refinery established in mature oil region

Safe jurisdiction

CEO has skin in the game

Supportive pro oil and exploration Wyoming regime

Governor support - attendance at flaring hearing

Fast tracking of drill permits - in 3 days

Low tax and royalty

Incline curve reserves

Potential substantial additional OIP following delineation

Stacked reservoir play - multiple targets

Suitable for immediate tertiary MF recovery up to 50% of OIP

Substantial CO2 storage opportunities

CC is 100% owned by COPL - one party to deal with

COPL in discussions for Joint Venture with 'large oil company'

JV could land anytime. All still to play for. GLA

https://data.fca.org.uk/artefacts/NSM/Portal/NI-000067845/NI-000067845.pdf

Link to the prospectus

The first thing that has clearly been mis-interpreted is the “placing” of 113,589,348 shares… THERE IS NO NEW PLACING! This is for the shares that were placed in Dec 2021, April 2022, July 2022 and also includes the conversion of bonds. This has already been accounted for in the issued shares total of 277,858,812 for COPL.

Up to 2 Billion OIP

CC has similar geology to Sand creek - 800 million barrels extracted to date.

CC re-completions underway. Well 11-27-35n-77w is currently pumping 125-135 bbl./d of fluid, unstimulated, with gasified light oil, providing extra revenue, with more wells predicted to come on-line over the next few weeks.

No wildcat drilling - established reservoirs

Discovery is ratified by independent Ryder Scott

Low cost drilling onshore

Rapid production and Capex payback

Topside in place

Infrastructure and refinery established in mature oil region

Safe jurisdiction

CEO has skin in the game

Supportive pro oil and exploration Wyoming regime

Governor support - attendance at flaring hearing

Fast tracking of drill permits - in 3 days

Low tax and royalty

Incline curve reserves

Potential substantial additional OIP following delineation

Stacked reservoir play - multiple targets

Suitable for immediate tertiary MF recovery up to 50% of OIP

Substantial CO2 storage opportunities

CC is 100% owned by COPL - one party to deal with

COPL in discussions for Joint Venture with 'large oil company'

"some excellent posts by pkwendall and Tiburn this morning. I recommend everyone reads them to allay and fears instilled by the derampers"

Mostly Tilburn's excellent work. I just added a few more positives to the long list of reasons to invest in COPL.

Keep your eyes on the prize.