Member Info for redwineday

Run S4,

It must be soothing balm for SMS (SP) battered ego though, mixing with the smooth and the suave as well as some MAGA nutters in the snow and putting behind him for a few hours the stress and strains of running a mega £125m FT Small Cap company.

I'd love to know what his travel and expenses budget is

Gruv

I do agree that some of the numbers, i.e. billion barrels here, billion barrels there are OTT. There is a sea to cross before any of this comes to fruition however if one looks at SP today and even applies a moderate valuation on monetisation of Eco's various assets, then only one of them would multiply the SP, 2 or more and your looking at 5x from here.

Personally I doubt whether we would ever see £2 a share as if more than one of its assets are in FID territory then I see a takeover by Navitas as likely. The valuation and acceptability of a bid by management would be of course be based the deal Navitas proposed. But I can imagine a cash and equity deal at some point in the future allowing Gil to cash out at a level above his WA price today and leaving some further stake in the upside as the fields come into production.

Whoever bought those shares paid £100k more for them than the price in the market. Even if it took several days for the order to be filled the buyer was still will to ay lots more to secure the stake. At 0.6% of the company it could push the buyer to issue a TR1. Looks to me like Canaccord are on the phones.

Insider dealing on AIM! Who would have thought?

I’m shocked I tell you shocked!!

Very bullish signal

Lets take a step back and trying look at eco as a whole.

Orinduick - appraisal plan submitted - result awaited

3b/4b - SA legal quagmire is slowly being resolved. Shell would not have invested in block 2 if they did not believe things would get better in the regard. FWIW I don't see 3b/4b being in the same category as 5/6/7. More likely gas condensate led production can encourage the green brigade to FO as it replaces domestic coal. I think 3b/4b is more about Total getting the consultation process right.

Block 1. Could be the jewel in the crown IMHO. Analogue to 3b/4b. Higher gas content suports domestic transition etc and we will have 20% remaining if Navitas farm in.

Namibia - Farm out WIP and option value not valued in SP

Falklands still misty in terms of any corporate action however still the option value is not in SP

My logic for what's its worth is with the Navitas news Eco are now no longer just a hope and pray stock, they have a number of assets which can be "company makers" in play and all subject to news flow over the coming year that can cause the SP to multi bag.

I'm sure there will be much volatility along the way but ask yourself are none of the above going to happen? Unlikely and even 1 or 2 of them will happen then we are in a different ballpark in terms of the SP.

I'm with you 1pencil. It reads to me like a distinct acknowledgment that what he predicted in billing models is not happening, at least so far.

This could be a reason we don't see much in the way of client wins insofar as they are selling something no one is yet ready to buy.

On the upside I am happy to see exec level departures. This says to me he is walking the talk on margin improvement by getting the cost ratio down. 75-65% would deliver 70m gross improvement on stable revenue.

The Guyana Govt will either sanction the appraisal well or they won't. Their objective is to get the money out of the ground asap and if they have a credible player with the balance sheet strength to deliver, which they have in Navitas, why would they reject? Anyway we should know in 60 days or sooner. For the Cretaceous you are correct' they will have to relinquish and royally pay more however i'd rather have that being given away and an appraisal well than what they had before Navitas appeared. The SP today assumes they will get to drill. The SA assets or even the options are not even valued in today's SP.

If and when they get approval for the appraisal well Eco will have moved from being an undervalued options platform at 7p to an options platform with hard assets worth xxx million and a partner with deep pockets who make drilling commitments.

Good news here is the appraisal proposal has been submitted and they are now discussing with Navitas. This confirms to me that Navitas intend to drill. That means that part of the licence is frozen until the govt agree or reject the appraisal well pan.

The "reconfiguration" means relinquishment of acreage outside of the tertiary discoveries. However Eco may end up with a smaller total acreage but a 100% success rate on what they keep. This makes the block a "pure play" on development rather than a high-risk exploration gamble.

Https://digiday.com/marketing/worried-about-getting-caught-out-sir-martin-sorrell-on-why-cmos-are-not-ready-to-pay-for-outcome-based-agencies/

According to my understanding. If Eco have applied for an extension and are in dialogue with the govt then there would be no news until it was wrapped one way or another. On the other hand if the licence lapsed today then not only would Eco be obliged to issue an RNS but the govt would also make an announcement. So I take no news as an indication that the terms of the extension are still be negotiated and news could still be days or weeks away.

Happened again yesterday. 200k worth of trades reported this morning timed after the bell yesterday afternoon at above the UT price. Maker of it what you will but again looks to me like continued stake building

Maybe they can hit their forecasts?

Let's face it. S4 trails all of its competitors on any kind oof valuation metric you care to look at, so why? One has to assume their is a discount applied for the lack of stability in their forecasting and a Sorrell discount relating to the golden share and his own profile. What was a positive at S4's launch is now a deadweight. Unless he can articulate something different to what has happened for the last 3 years (which he shows no sign of doing) the we are adrift hoping something will turn up. Depressing...

Hereandnow

I think you are on the right track with "Would not be at all surprised to see JHI fold into ECO.". This would unlock 17.5% of Canje for Eco and really propelling them as a player in Guyana.

As per terms of the licence theTertiary discovery wells are already "protected" for Eco if the licence lapses.

Yep, definitely some stake building going on. Fits my theory of Canaccord letting their clients in at a lower price.

Re WTE: With Kaieteur dead & Canje dormant and their stake Eco worth 500k today, then market cap assumes a value of £123m to JHI based on the Falklands licence? Eco placed a value of $52m when their bid was accepted by JHI and both the Guyana assets were more attractive than they are today.

Either WTE is overvalued or ECO is way undervalued. Of course both things can be true at the same time!

Personally I don't see Eco bidding forJHI again. Maybe between them and Navitas they can farm in at a relatively low cost with Eco paying in shares which should be far higher on news flow in H1.

Back to normal over the last couple of days. I should really switch off for a year but I expect I'll come back in a year's time and SMS will be still be on you tube blabbering about WPP/Omnicom and we will still be at 20p. Being an S4 shareholder is exceptionally tedious in many different respects.

Hannam had Eco at £2.95 in 2019 post the heavy sour RNS. SP at the time of writing it was 50p and was before all the Orange basin assets appeared.

Interesting reading around the heavy oil topic and valuations.

https://www.ecooilandgas.com/wp-content/uploads/2019/11/20-11-19_ECO_10_20191120_technicals_on_heavy_oil_Hannam.pdf