Member Info for rossannan

Everyone’s take on the Report seems to reflect their existing bullish or skeptical view, VSA’s take included (VSA really are having a laugh though, you have to admit). The Report is that kind of document - folk can extrapolate what they want from it, positive or negative, to suit their arguments. I would simply argue that it is time for the larger shareholders to sit down with LK and ensure that their priorities are his priorities - LK has pretty much been given free rein so far. I think he now needs to be on a much shorter leash.

Admittedly it is hard not to put today’s fall as mainly down to the oil price, but the fact remains that before today the SP had not fallen far from where it was when WTI was in the $60s.

LGO-fan

My point is that we already have clear and stringent regulations to prevent wrongdoings - in other words, the market abuse regime. Shorting in and of itself is not wrongdoing. Or do you think that it is? If you do, name me one good company that has been brought down by shorters.

I do not need to go further than your avatar to be reminded of one bad company that was (way) over-hyped by rampers.

LGO-fan

Is the problem not people confusing shorting with market abuse? Wanting, in effect, to ban something that is already illegal? If I had set the first of my pre-Q1 update sell orders just a little lower than the 4p that I went for, it would have triggered ahead of the update and made me a nice profit (given that the update subsequently revealed production and cash burn that was even worse that I had anticipated). Zero market abuse there, just me trying (but ultimately failing) to put my money where my mouth already was.

I was hugely unimpressed by the pre-Q1 update “teaser” tweeting by CERP though. Illegal? Not as far as I am aware. Irresponsible? I would say so. They knew how disappointing that update was going to be and they must know what their shareholder base is like and that it does not take much to set a hare running. And yet they tweeted anyway. The share price chart tells the story - how many newbies were spiked on the back of the rise that that tweeting so obviously contributed to? How many already overexposed PIs topped up on the back of it?

Sundayroast

The SP has not fallen far from where it was when WTI was in the $60s. I don’t think that’s it.

rxdav

What about a petition to ban the ramping of AIM stocks? Shorting is entirely legitimate in the absence of market abuse. Banning shorting would provide a rampers’ charter (as if the BBs don’t already) and simply add to the woes of PIs on AIM.

Talking of ramping, as time goes by on here it becomes clearer and clearer how irresponsible LK’s £/$500M MCAP chat was back in the day. Maybe there should have been a law against that. How many PIs have become over exposed to this risky proposition called CERP on the back of it and are still hanging on in here in the belief that, in some way, shape or form, it is just a matter of time before it all comes good, despite the mounting evidence to the contrary?

Sundayroast

Yes, PIs want their jam today and success is hardly going to hurt the share price but if your Ortoire prospectus is accurate the SP should still be “a lot” higher, even now The market is saying something with the current share price. Maybe that it thinks that the figure of 95% is wrong or maybe that what “success” will deliver is being overvalued or maybe a bit of both. Obviously there is money to be made if the market is wrong, but, as you point out, AIM is a gamble. Maybe it is just an overhang from that last production update - it was a bit of a shocker (when you have a good look at the figures you can see that it was about a lot more than two high volume wells being down).

Sundayroast

Sundayroast

Three things that you have said today:

“1st to spud June, 95% chance of success”

“2nd to spud straight after 1st, 95% chance of success”

“If the 1st 2 exploration drills are successful then the SP will be a lot higher than it is now”

Why is the SP not already a lot higher then?

1750mk1

Have you got anything other than name-calling in your locker?

1750mk1

That doesn’t really address the points being made though. And I was buying TXP at 12p in Q1 - you are mistaken if you think this is a TRIN v TXP thing. TRIN and TXP have a number of problems in common. But Ortoire is definitely a vehicle whose tyres need a good kicking because the bull case for TXP seems to depend very heavily on it indeed.

tidd83

I think GabrielOak’s point is that TXP did not simply meet their work requirements for those blocks but significantly exceeded them. If you take the narrative that we are being offered for Ortoire 1 (gas) and Ortoire 2 (oil) it does seem strange that these low risk yet apparently transformational opportunities have been passed up in favour of what has, to some extent, felt a little bit like running to stand still elsewhere.

TXP’s current production (we will no doubt be updated at the AGM) is likely to be around 2000bopd (at best). If you look at the 14 March RNS, which stated that production from the 11 wells drilled in 2018 was then contributing an average of 993 bopd to current field estimated production, and then assume that today the figure is still at least 950bopd, you can draw a fairly depressing conclusion. Take that 950bopd from 2000bopd and you have base production of 1050bopd. Then look at the average production for the last two months of 2017 - 1435bopd - and think about how significant a proportion of the production from the 2018 wells is no longer incremental and how, over time, that proportion will likely increase as base production and their own production both decline.

These sort of realities are not confined to TXP but they are not often discussed on bulletin boards. Whether in a few short sentences or in many long paragraphs, people tend to talk their books. Positives are inevitably exaggerated and simplified. The Ortoire narrative is undoubtedly a positive. Has it been exaggerated and simplified on the bulletin boards? Time will tell, but it would be surprising (probably including to the market) if it hadn’t. More worryingly, perhaps, is the possibility that, in share promotion mode, it has been exaggerated and simplified by TXP. That is the possibility that GabrielOak seems to be floating by contrasting the Ortoire narrative that TXP is offering against the CAPEX that they have actually chosen to prioritise. Because if their Ortoire narrative is to be believed, you get a much, much bigger bang for a buck spent on Ortoire, so why exceed your MWOs elsewhere, even by a cent?

IK

Hard to say, but it sounds like yet more not so subtle expectation management. Increasingly fed up with the way that LK handles information. Twittergate was appalling. How could someone with access to the information showing that Q1 cash burn was still significant and that Q1 production was through the floor think that it was okay to put the tweets out there that saw newbies spiked around the 4p mark and already over-exposed LTHs topping up around the 4p mark?

Even VSA must be embarrassed trotting out that 21.4p price target yet again. Something more realistic would be more effective in share promotion terms.

faz7475

As I said last month, I have no interest in posting at the moment except in response to news, but why would skeptical posts on a BB stop LK from doing his thing in any way at all (whatever his thing is)?

IK

Yes, and the market gets it.

Looks like LK is regressing to the NR approach of RNSing anything and everything.

Also, his “I am confident that even a modest discovery in the SWP has the potential to transform the Company” sounds a little desperate. Do people realise just how much he has now watered down CERP’s plans and ambitions for the SWP?

At this rate I will be unsubscribing to CERP’s RNS Alerts.

Anyway, those were just a few thoughts, being in reflective mood with holidays beckoning. I may not be back in time for the “other country” announcement unless it slips into late July, but I will get the RNS Alert in any event. How that story is presented will the acid test of whether LK has learned his lesson.

LGO-fan

Agreed, the market loves under promise and over deliver for the very reason that it comes across it so rarely. It would be a very effective way of rebuilding trust here. All the 3p, 6p, 9p, 12p and £500M MCAP stuff at the start set the wrong tone and I think LK started believing his own rhetoric. This was a shame because at the same time he did seem to be getting to grips with what had gone wrong under the previous regime. The game is not over yet but, as you say, he needs to get back to basics.

A large part of the problem with Leo Koot is the way in which he presents information and the targets that he sets. He is less than transparent and he is less than realistic.

Remember the Q3 2018 update, when he could have produced a separate cash balance for the original business but masked the cash burn by giving us only a consolidated figure that included Steeldrum? After the Q4 update those of us who were interested in what was behind the mask got our calculators out and identified cash burn of over $1M during Q4. If at that point LK had been thinking about it he would not have set himself a target of eliminating that cash burn in Q1 2019 but, say, of reducing that cash burn by 50% - which he in fact did. The Q1 update could have been a win in that respect - he just needed to set a sensible target.

One thing that the Q1 2019 update tells us very clearly about production is that the decline revealed in the Q4 update was not all down to the weather, far from it. Clearly the weather had a significant effect, but LK appears to have exaggerated this, given that production was in fact lower still in Q1 (even when you allow for high grading). Production has clearly been on a downtrend for some months now. And what on earth is the point of continuing to quote production high points which are meaningless spurts in the context of the quarterly production averages? Is LK an oilman or a snake oil salesman?

Schroders and/or the Bigs and/or the ones that I can’t spell need to have a word ASAP.

HH

I seriously would not bet on it holding. Anticipation of the “other country” and SWP announcements will kick in at some point, but in the meantime there will likely be more than a few folk selling in May.