Member Info for pkwendall

The Bond Holder still has a few million left to sell by the looks of things. Once cleared we should move back up.

A little reminder. Keep your eyes on the prize. JV news still to land, and soon - IMO

1/1 Exchange with Art at 13.48 today June 27th

'We are finishing up on the gas gathering system upgrades. The well conversions are complete. Once the high pressure wellsite/facility equipment arrives over the next couple of weeks, all will be done. #COPL

1/2 Our last statement said all was on schedule and it is. The share price has nothing to do with the operations or state of our JV. It has everything to do with trading strategies of a few. No press release can change that' #COPL

No Opinion

“RE: Operations UpdateToday 07:30

I think that people were more likely expecting production to be moving up to around 1500 Bbl./d - say 45,000 bopm - even with the necessary downtime - rather than back to 1249 Bbl./d which is around 37,500 bopm.”

Peak levels were 2000 Bbl./d so production will be substantially increased.

The Bond Holders are converting as they know the JV news is close.

If you sell now, you'll be paying more to buy them back later (probably later today even)

Keep your eyes on the GGS and JV prize.

We’re one week closer

www.twitter.com/DavidBo97311069/status/1673696770482683904?s=20

[15:19, 27/06/2023]

Exchange with Art at 13.48 today 'We are finishing up on the gas gathering system upgrades. The well conversions are complete. Once the high pressure wellsite/facility equipment arrives over the next couple of weeks, all will be done. #COPL

[15:19, 27/06/2023]

Our last statement said all was on schedule and it is. The share price has nothing to do with the operations or state of our JV. It has everything to do with trading strategies of a few. No press release can change that' #COPL

My view is that some Bond holders who convert at these levels will want to keep thier shares for the considerable upside that's soon to happen. The high volume of trades we've recently seen were due to margin calls and distressed sellers.

Keep your eyes on the prize GGS and JV prize

Https://twitter.com/DavidBo97311069/status/1673696770482683904?s=20

[15:19, 27/06/2023]

Exchange with Art at 13.48 today 'We are finishing up on the gas gathering system upgrades. The well conversions are complete. Once the high pressure wellsite/facility equipment arrives over the next couple of weeks, all will be done. #COPL

[15:19, 27/06/2023]

Our last statement said all was on schedule and it is. The share price has nothing to do with the operations or state of our JV. It has everything to do with trading strategies of a few. No press release can change that' #COPL

There has been no TR-1 from James Goozee since the 9th May, so he is not the seller

www.lse.co.uk/rns/COPL/holdings-in-company-bsctv68mc5iuy2n.html

We already know who the distressed seller is, as per today's RNS. A seller who no doubt would have preferred to keep his COPL shares, but likely lost them via a margin call (Spreadex)

Reposted as there’s lots of noise on this board. Keep your eyes on the prize.

Https://twitter.com/DavidBo97311069/status/1673696770482683904?s=20

[15:19, 27/06/2023]

Exchange with Art at 13.48 today 'We are finishing up on the gas gathering system upgrades. The well conversions are complete. Once the high pressure wellsite/facility equipment arrives over the next couple of weeks, all will be done. #COPL

[15:19, 27/06/2023]

Our last statement said all was on schedule and it is. The share price has nothing to do with the operations or state of our JV. It has everything to do with trading strategies of a few. No press release can change that' #COPL

26-Jun-23 14:31:49 2.24 30,000,000 Unknown* 2.25 2.30 672.00k

'Today's' 30m has yesterday's date on it. Games afoot!

Https://twitter.com/DavidBo97311069/status/1673696770482683904?s=20

[15:19, 27/06/2023] +44 7940 356443: 1/1 Exchange with Art at 13.48 today 'We are finishing up on the gas gathering system upgrades. The well conversions are complete. Once the high pressure wellsite/facility equipment arrives over the next couple of weeks, all will be done. #COPL

[15:19, 27/06/2023] +44 7940 356443: 1/2 Our last statement said all was on schedule and it is. The share price has nothing to do with the operations or state of our JV. It has everything to do with trading strategies of a few. No press release can change that' #COPL

Sells were 2.215p, and buys were 2.25p at the time, so more likely a buy

Looks like a buy

10:07:00.000 AM

2.25p

19348350 qty

7 of 7

Oil stocks enjoy quite high p/e ratios and by analysis 16/1 - 20/1 is common, influenced mainly by how much Capex is spent on exploration and related abortive costs.

By Christmas COPL should have progressed sufficiently to gain a p/e status. For the purposes of the Appraisal I have used a p/e ratio of 8/1.

Four to five years out I believe the ratio should be at least 16/1. So this is what I've applied.

With COPL's Market Cap so low at the moment it's a natural question to ask "why then doesn't the JV Party make a bid to buy COPL outright if the fundamentals in the new discovery are so good"?

Well I imagine it's quite likely that AM would have seen that curved ball coming and defended against it in the Non Disclosure Agreement. He's nobody's fool and he comes to the table with a high level of negotiating experience and skills..

I think AM would have blocked the Party by making it a condition precedent preventing it from making any offers before the data was shown.

I'm not sure I'm right in saying this but whilst shorting a weak stock is not unusual I would say it's quite likely been overdone and coming to an end in COPL's case.

Shorting only normally lasts whilst the benefit outweighs the risk and as I see it that ratio is about to become unfavourable.

In COPL's case however there's been a slight twist. The selling may also be coming from a Bondholder. The good news if that must similarly be coming to an end soon. Here's why:-

All the bonds have a set face value of $200k and a conversion price of 6.75p. So for Bondholders to be converting and selling at the current SP they must therefore be selling at a loss. That gives every indication the seller is distressed or has some genuine reason for needing cash

There is a slight twist and that is that some but not all bonds were issued at a 20% discount. So for those bondholders one could argue their conversion price is less and more like 5.40p.

Nevertheless it doesn't alter the fact that those bonds would also be being sold at a loss. So my conclusion is that any bonds being sold at the moment must be being sold at a loss and therefore the selling is likely to end very soon

If you're short then I think you need to be careful.

As Charles Archer says "a jolt" could happen any day now.

If you're long in this then a little more patience and a good JV is needed. The NAV based on potential resources is going to be huge. Based on a NPV possibly even more. The new discovery could be as much as 2% of US production.

The added value from carbon credits is potentially enormous. Both parties will I think bring value from using to stimulate the FD wells to storage. It'll likely warrant a separate valuation when we have the information.

Please bear in mind a lot of what I've said in this post is just MHO. It will all benefit from revision once the JV details are unsealed.

GLA

6 of 7

Spot Appraisal at Christmas 2023

Revenue

$/m $/m

6m bopy @$75/brrl. 450.00

Costs.

Private Royalties. 4.35mbrrls @ $75 x 22% 71.77

Federal Royalties. 1 65mbrrls @ $75 x12.5% 15.41

State Prod Tax 6.00mbrrls @ $75 x 11.6% 52.20

G&A, Debt & Derivatives etc. 40.00

Private Leases Prod.4.35mbrrls @ $10 43.50

Federal Leases Prod. 1.65mbrrls @ $8 13.20

2024 Capex. 20.00

__________________

256.08. 450.00

(256.08)

Netback/Earnings. $193.92m

P/e of 8/1 = MC of 1551.36m & SP of $1.29/ 103p

Spot Appraisal at Optimisation

Revenue

$/m $/bn

28m bopy @$80/brrl. 2.24

Costs.

Private Royalties. 4.00mbrrls @ $80 x 22% 70.40

Federal Royalties.24.00mbrrls @ $80 x12.5% 24.00

State Prod Tax 28.00mbrrls @ $80 x 11.6% 259.84

G&A , Debt, Derivatives etc. 40.00

Private Leases Prod. 4.00mbrrls @ $7 28.00

Federal Leases Prod. 24.00mbrrls @ $7 168.00

2024 Capex. 60.00

______________

650.24 2 24

(0.65)

Netback/Earnings. $1.59bn

P/e of 16/1 = MC of $25.44 bn & SP of $21.20/ 1696p and perhaps nearer 180

5 of 7

State tax will be payable at a "special" rate given fracking will be adopted. The tax consists of mineral tax and severance tax but the overall rate is 11.6%.

It's most unlikely Federal tax will ever be paid given the value of "set-offs" brought forward from previous losses including those of Atomic. But moreover due to the Federal and any State carbon credits the JV is likely to enjoy.

Federal and State support is huge so permitting and approvals shouldn't be a problem.

For the purposes of the Appraisals I've assumed that the oil hedging due to come into place next month will be renegotiated and dealt with as it was six months ago. I've also assumed the SCF will be paid off with the cash injection from the JV Party on agreement. As I see it the banks lending criteria should be met by Christmas and the RBL brought in play. If needed at all.

Having researched the Sage Grouse and the potential disruption to production during its nesting season I no longer see it as an issue.

The Capex figure shown in the Christmas appraisal represents the finance needed to introduce more gas into the miscible flood and for further drilling etc. It does not include costs relating to the new discovery. I've assumed those will be met by the JV Party as part of his Farm-In contribution.

The Capex figure show in the JV appraisal represents COPL's proportion of the finance needed to cover all the JV's Capex costs to including but not limited to all drilling and infrastructure costs to maintain production in an optimised and steady state.

As I'm sure most of you know the price COPL received for its oil isn't quite the WTI price. However the price is relatively insignificant so I've neither discussed it nor accounted for it here. I've simply used $75/ brrl income in the Christmas appraisal and $80/brrl income in the Optimised one.

I am not a fan of using price to earnings ratios as a method of valuing stocks. P/e ratios are retrospective and should be used to compare like for like stocks on performance. I much prefer discounted cash flows. However in COPL's case there isn't sufficient information yet to apply an NPV calculation in my view. So I've resorted to using p/e ratios.

If you're thinking of "joining the dots" between the appraisals to get intermediate readings please bear in mind the connection will not be linear. More likely it will follow a logarithmic path, pretty much like a cars' acceleration to top speed.

4 of 7

The valuations based on $'s per brrl and the resulting p/e ratios should be higher than COPL's peers due to flow rates, the potential size of resource and not least of all carbon credits.

The JV will have very few abortive costs and no Federal tax payments all of which makes for a highly attractive development with high p/e ratios in financial terms.

AM will be well aware of the assets potential given all these fundamentals. Hence the resolution asking for consolidation. It should lead to wider/improved markets and along with a name change further enhance the value. 100/1 consolidation makes very little sense and 1000/1 make no sense whatsoever to me so I'm disregarding them. 10/1 maybe actioned I think if it's one of the keys to NASDAQ.

Production from the new discovery I have optimising in about four to five years time and from the fields under private leases next year. I'd like to see all LOF's reviewed to suit anticipated climate change/demand. No more than 25 years as a maximum seems a better fit and more in keeping to me.

Federal lease sales re-starting also fits the JV strategy of keeping data and a potential JV under seal under seal for now. As we know the new discovery has been kept under wraps from day one when the discovery drill was given a "tight hole" status and details have been kept under tight seal ever since. All for good reason I think.

There follows just a few notes and caveats to the appraisals that follow, some of which you will no doubt be aware of:-

The production figures in the "Optimised & Steady State" appraisal represents COPL's share in an annual production of approximately 120k bopd and 40m bopy allowing for downtime.

This in turn represents 60 - 80 horizontal wells optimising across the 51 square miles under Federal ownership. COPL envisages 150 wells at any one time across the same area according to the RNS issued last year

If all of the bonds are converted and the warrants/options exercised I have a fully diluted position of 1.2bn shares in issue. That's the figure I've used and it disregards any future buy-back.

Further details of the Derivatives I've referred to can be found in the M,D&A meeting minutes held on 31st March posted on Sedar.

Revenue from oil fields over 1 mile deep will be subject to payment of a Federal royalty which is 12.5%. Fields less than 1 mile deep will be subject to private landowners royalties which are much hlgher

at around 22%.

3 of 7

I don't want to get into carbon capture and the incentives it brings too much but I believe that it has huge potential and is a major attraction to COPL. It's difficult to put a value on it and possibly it's one of the reasons why it's taken so long for the parties to calculate the JV Party's added value.

It's quite obvious that at this early stage so much will be unknown by both parties and there will be so many variables it makes perfect sense for the "Farm- In'' to be phased. Albeit the JV Party will no doubt want as large a share as possible at the same time AM will want to protect COPL's position and hold on to as much as possible for as long as he can.

I may be wrong but as I see the JV having something like an 80/20 share mix with say a $50m to $75m cash payment by the JV Party to COPL to begin with. To me these assumptions seem reasonable but I imagine there'll also be a mechanism to increase the Partys' share at certain milestones be they production value or time. So I have assumed the share mix moves to 60/40 still in favour of COPL when production from the fields are optimised.

I needed to make an assumption to do my appraisals. If the initial share the JV Party receives is greater than assumed then the cash injection should be greater too. Therefore any changes to my assumptions shouldn't make very much difference to the assessed values.

Under the JV it's also not unreasonable to also assume there will be two drilling campaigns from the outset . First to delineate the field and establish bankable reserves and second to extract the OIP via stimulated horizontal production wells.

That said I think it's possible for the JV to complete four new wells in the FD producing 8_

-10k bopd collectively by the end of the year and that's been my assumption in the Christmas analysis I posted .

The OIP is thought to be much bigger than COPL's and Ryder Scotts assessment according to the JV Party. RS's assessment is bigger than COPL's, therefore AM's public statements on the matter are more than likely conservative. From my enquiries I see no reason to suggest recovery will be less than 50% of OIP so we're going to be looking at a recoverable quantity is roughly 1bn barrels, which by any measure is huge.

2 of 7

As we know there's a designed solution to the high pressure problems in the Shanon Unit in hand with COPL and it's minority partner CNOOC through its affiliates busily constructing a high pressure "Gas Gathering System" along with planned modifications to the inadequate surface equipment.

It's an engineering project that appears to be well thought through and being carried to me. I take comfort in that it appears I'm not the only one with that view given the States approval to flaring.

The State with the support of its own expert witnesses including engineers, environmental specialists and the like wouldn't have given COPL approval in the courts if it didn't think the remedial proposals and actions being taken by COPL were reasonable.

Without going into details and stepping through the "tie in" sequence well by well suffice to say the GGS should be complete and put into a phased operation in a matter of weeks.

So given the work going on and wearing my positive hat I see no reason why the BFSU shouldn't be producing less than 5000 bpd and 4250 bopd net to COPL by Christmas. That's my assumption in the appraisals that follow.

We also know that the Cole Creek recompletions are underway and they too should be fully operational and stimulated by Christmas too.

I think worthy of note is the very encouraging flow rate from the first of the wells. The readings were exceptional from just 61ft of perforations, unstimulated. I feel sure they would have have made both parties to the JV salivate and AM is known to regard them as "a game-changer"

So from the recompletions I have at least 1750 bopd bringing the CC and BFSU collectively to a production total of around 6000 bopd by Christmas.

Turning to the JV I'm in little doubt both parties are keen to enter into the agreement as proposed by COPL nine months ago. An approach that began with an expression of interest from the JV Party in or around September last year. AM then responded by confirming a like interest and followed that by issuing COPL's "Proposal".

From COPL's point they have the assets in terms of an OIP assessment and a relatively narrow skill set as its part. The JV Party who is said to be a big oil company on the other hand will have a much broader skill set and the added value to monetise the asset relatively quickly. I'm not just talking about cash, although that's part of it. I'm talking about resources to include drilling rigs and other equipment together with materials such as tubulars and the like.

1 of 7

COPL has undergone a number of changes since I last posted. Some good and some not so good.

We've seen a continuation of high pressure problems and paraffin wax build up at the BFSU field along with issues arising from an exceptionally inclement winter storm over a prolonged period to name but a few negatives.

But for me the most dramatic change has been the change of COPL's shareholder base. Most of the shares are now sitting in bondholders and other ii's hands. Perhaps that's a consequence of the problems mentioned above and the difficulty in raising finance. But I'm not entirely not sure.

On the other hand the link below is to an article that paints a more optimistic and positive picture. It's been posted on here before but for those of you that haven't read it, here it is again. It's written by Charles Archer. Amongst other outlets Mr Archer writes regularly on Oil Price and Share-talk.

There's just one small schoolboy error in the article where he asserts the shares are listed on the AIM market which we know is not the case. Other than that I think it's an excellent piece and well worth reading to help to gain a balanced view.

https://www.share-talk.com/copl-shares-a-brief-look-at-the-value-disconnect/

As a LTH I'm generally aligned with Mr Archers' views, in particular "And unless I’m missing something critical, the market will wake up with a jolt". I firmly believe we're about to see that happen too.

FWIW in this post I'm going to try to expand on his reasoning by suggesting where COPL's Market Cap might be at two future milestones. At least on paper that is.

The first milestone is Christmas this year. The second I've chosen is when production in all units reaches an optimised and steady state. I have that in around four to five years from now..

I've chosen Christmas as the first milestone not just because it's the financial year end, although that's part of it, but because I believe the stock will be more on an even keel by then.

At the moment the stock appears to be under abuse to the downside by trolls and shorters and perhaps not least by Bondholders. It's all making TA and trading patterns difficult to understand.

In the not too distant future I believe the volatility is most likely going to get worse. But this time to the upside. To my mind it starts with the announcement of the JV. From there the SP is likely to be very unpredictable on a daily basis and I believe we may at last see the start of the trend change some of us have been waiting for.