Member Info for rossannan

IK

No, that target that LK set for Q1 meant eliminating cash burn, pure and simple. It was a strange target for him to set. I reckoned he would miss it by $400,000 but he in fact missed it by $540,000. Goudron may be turning out to be even more of tired old field than he thought. Steeldrum is certainly beginning to look like a pig in a poke.

2.3p may be about right - my gut feeling is slightly lower but I held out for that last time and therefore just missed out on the benefits of Twittergate. I then held out for 4p in the week prior to the update to open a short position and again just missed out on an easy 1p plus, this time the other way!

Yes, it looks like cash burn has promoted deepening above prospecting. So much for:

“It is anticipated that between 2-3 wells, targeting the shallower prospects, may be drilled on the licences initially at costs of around US$2-4 million per well, including wells with multiple stacked reservoir targets, with the first well potentially being drilled, subject to satisfactory technical analysis, in the first half of 2019.”

Neither is staying in the kiddies’ pool.

Garnhiem.

Is a 25% geological CoS really that great in a region like T&T? Still, it is one pretty appalling note when you compare it to how things actually panned out, so I would not set much store by any figures in it in any event. I only referred to it because it is the one discussion of the SWP CoS in percentage terms that I am aware of.

My colleague Irene’s strategy of waiting for the low 2s and then getting on board for the next pump and dump is understandable: the trick would be, as it was with the Q1 update, to get out before the dump. I still cannot see this going below 2p in the face of such strong, albeit misplaced, retail conviction. What folk on here imagine that CERP is going to snag in this “other country” over the next couple of months may well prove to be more exciting than the announced reality. Something similar could be said about that first SWP drill, so you can see where the pump and dump will likely come in. And trading really does seem to be all that CERP is good for unless Leo Koot gets a better grip on things.

trickydickie

Sorry, scratch that, I was looking at the wrong figure. 40% is their commercial CoS. Their geological CoS of 25% or indeed their total CoS of 10% may be more relevant.

trickdickie

VSA give a CoS of 40% here:

https://columbus-erp.com/wp-content/uploads/2017/06/CERP-Re-Initiation-131217.pdf

offerman

“For the bashers out there or people that have lost the will with the company give them a call and find out for yourself”

Again, what are they going to say to you other than something reassuring? It is better to judge them by what they do, comparing that to what they said they would do. And looking at Leo Koot on this basis:

1. He has misjudged Goudron: Goudron well stimulation has failed to deliver what he promised and I would suggest that Goudron WF would have had more of an impact by now if it was worthwhile.
2. The jury appears to be very much out on whether Steeldrum was worthwhile.
3. CERP’s initial foray into the SWP is not now going to be as advertised. This is galling because the SWP has been a major selling point for CERP. Leo Koot sees the management accounts and yet has seemingly been unable to read the runes and cut his losses elsewhere quickly enough to keep his powder dry enough to do the SWP properly. Stepping stones have become baby steps.
4. And talking of the management accounts, we have Twittergate. 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 punters spiked or topping up around the 4p mark? Appalling. The man who was “not your typical AIM CEO” seems to be turning into your typical AIM CEO.

The potential positive is the “other country” - sentiment in T&T oilers is through the floor on the back of T&T’s still punitive fiscal regime, so geographical diversification makes sense. But CERP is cash poor, so how are those minimum work obligations going to be funded? It all comes down to money and it’s no surprise that they’re giving none away. Accretive is as accretive does.

To any newbies looking in:

Earlier this morning offerman talked about folk “moaning all the time about the Company, Personnel running it, or holders, without even owning any shares and wanting it to fail for all the people that are invested.”

Consider the possibility that some of those with a skeptical take simply read CERP differently to those with a bullish take, have no wish for it to fail and simply want to highlight why they are skeptical. You can always phone the Company, but what are they going to do other than try to put your mind at rest? Good research is not about looking for confirmation of an already positive viewpoint - you also need to listen to the people who are telling you what you don’t want to hear.

DYOR, always - be wary of rampers like Edgein on ADVFN, for example. Check out what Edgein has posted about CERP over the last couple of years - see how it panned out over time. You may call him a ramper, but he’s not the only one. They come in all shapes and sizes. They are not in the business of giving you an objective assessment of CERP, they are in the business of encouraging you (and each other) to invest and stay invested, even to the extent of becoming dangerously over-exposed to this one AIM oiler. And they do not offer refunds.

Razorman

“Strategy of lower cost entry driven by EPI recommendation on wells to target first”

Look again and consider the possibility that it is driven by CERP’s cash burn problem, pure and simple.

LGO-fan

Fair point. LK has botched his chance to make something of the SWP sooner rather than (possibly much) later.

Setting out a clear and funded plan for the SWP would have got everyone’s attention, but he passed on the LIND Facility and missed his chance to do the cheeky one for five that I was banging on about when the share price was much higher than it is now.

The problem is that LK has been stuck in denial about the trajectory that CERP’s cash and production have been on. He should have bit that bullet long ago and entirely refocused on the SWP (because that, after all, is the story that most on here have bought into).

Where is the money coming from for adventures outside T&T?

neon

Can’t speak for LGO-fan but when the share price was significantly higher not that long ago I said: “I hope that some of the over-exposed LTHs have taken this chance to de-risk a little.” I would probably stand by that even at the current 2.95p.

LGO-fan

As I said before, there are people on here who seem to be so locked into CERP that they would, if LK dropped by to burn down their houses, thank him for encouraging them to get out more. They are unlikely to listen to you. Equally unlikely to listen to you are the folk with much shorter investment timeframes who thought that they could trade the momentum but were caught out by the update being as poor as it was. Perhaps understandably, they just want the rampathon to get back into gear so that they can exit. All the same, I think you will find an audience for your balanced view. It is easier to write off a long standing skeptic like me than it is to write off someone who wasn’t expecting an update as poor as that but is then unafraid to point out that the Emperor is underdressed.

Good luck.

MrMagoo31

That was quick. It would seem that the skeptics are not allowed counter arguments, but getting them deleted does not make them any less correct. You can fantasise about AIM oilers or you can analyse them, but fantasising about them is a risky strategy. Be careful how many eggs you put in this basket. Seriously.

LGO-fan

Interesting figures for Jan-Feb 19. Much higher than I would have expected given CERP’s abysmal Q1 production. Would be interested to have HH’s take on them as he has a good handle on what else is in that total.

LGO-fan

He is not Neil Ritson but the way in which he presents information and what he is delivering vs. investor expectations is definitely in that ballpark. He certainly needs to be told. There is a hard core on here who will try to make a silk purse out of whatever sow’s ear he throws them but if he is going to get any traction with the wider market he will need, as you suggest, to start under promising and over delivering (or even just delivering).

Garnhiem.

If you were the CEO you might have told a more consistent story over the last two years than Leo Koot, whose story really has kept changing. Stuff inevitably happens along the way but an awful lot of it seems to have happened to Leo Koot. It now looks as if CERP’s initial foray into the SWP will not be what people were expecting (and you do not need to be the CEO to work that out), but if all this is fine by you, good luck with it. Leo Koot reminds me more and more of Neil Ritson.

TWOSHEDS

Care to elaborate on how I have got this wrong?

Garnhiem.

It is not the same as what was previously planned though, is it? Deepening or sidetracking one well in an existing field in search of one putative reservoir is hardly the same as drilling, say, three stacked targets in a new field. It seems very clear that lack of cash has obliged Leo Koot to rein in his SWP ambitions for now, however you want to present this Plan B. As you know, this Plan B was already on his to do list - his substituting it for Plan A is simply making the best of a bad job.

MrMagoo31

“we know where this is all headed”

Any newbies looking in the back of the HotStockRockets tip are probably looking for a more detailed bull case than that...

Newbies - whatever else you do, DYOR!

Garnhiem.

All great in theory but CERP does not now seem to have the cash for the kind of relatively high impact SWP exploration that was originally envisaged for mid-2019 and, as you yourself have identified, Leo Koot now seems to be looking at a much less expensive (and therefore arguably much less exciting) Plan B. And he is not exactly being up front about it, the message only being accessible if you bother to read between the lines (which you did). A lot of folk are going to be pretty unhappy when they realise that 2019 is not going to be the Year of the SWP after all.