Member Info for rossannan

Cliveas What short?

LGO-fan Who is saying that you are assuming that?

Hellraiser1 You’re not making a lot of sense. Are you on here to talk about CERP or not?

Hellraiser1 Food?

Hellraiser1 / LGO-fan If you really don�t like it you can sponsor me off the BB for a good cause: https://mydonate.bt.com/fundraisers/rossannan but you also have the option of explaining to me and the BB where you think I�ve gone wrong. You may have misunderstood what I was saying - I wasn�t saying that the CFO was wrong, just that if you want to work out the components of the calculation that produced that figure of $10K per extra dollar, and perhaps get some idea whether $10K per extra dollar would still be the figure today, the detail of the 2017 Accounts would be a good place to start. Go on, show us that abuse is not the only club that you�ve got in your bags.

LGO-fan “it was a statement from the CFO, why would that not be correct?” It’s an interesting one. Looking at the figures now rather than then and therefore assuming that CERP is producing a nice round number like 20K barrels per month, each $ on the price that CERP receives for its oil does clearly add $20K per month to gross revenues. So the CFO is saying that at least $10K per month of that extra revenue is pure additional profit, after everything. If that is the case, it should be confirmed in the detail of the 2017 accounts, in the balance between fixed costs like G&A that don’t take any of that extra revenue and things like royalties and tax that do.

http://www.cityam.com/286141/predator-oil-gas-start-environmentally-friendly-exploration?utm_source=dlvr.it&utm_medium=dvTwitter

Rugby2015 What price sensitive news are you expecting between now and early July?

Rugby2015 Not really that much extra revenue with Goudron currently only producing say 650bopd and subject to an IPSC. Good news for the SWP though.

willowpillow It could be quite something and with the BB this quiet and the chart this flat, the current share price could look like a perfect entry point in hindsight.

MrMagoo31 That is more than possible.

MrMagoo31 Realistically though, 80p means a MCAP of over �1BN and assumes that CERP is either going to acquire on the cheap or discover within its existing portfolio a properly world class asset. Anything is possible, but you have to admit that you�re running a bit of a fantasy number there.

offerman I suppose that what I�m saying is that it is entirely plausible that LK could do the deals that turn CERP into a �500M company and while that definitely won�t translate into a near 80p share price and I can�t see how it will translate into a 40-50p share price, VSA�s share price targets, though at the time just egregious ramps, seem plausible enough in this longer term context. Doesn�t mean that CERP is in any way guaranteed to become a �500M company, for all LK�s talents and good intentions, but that�s the stock market for you.

LGO-fan LK speaks about the big deal in terms of MCAP because it�s safer for him to describe its effects in those terms than in terms of the share price.

LGO-fan Can happen if the equity is raised to purchase the right asset at the right price.

offerman Yes, if LK was to shoot at a £500M+ MCAP via organic growth - the money wheel approach - Goudron well whispering, Goudron WF, Bonasse well whispering, Icacos well whispering, SWP drills each funded entirely out of available cash and then hitting the jackpot with a still organically funded deep SWP drill (e.g. Cedros), that could deliver that kind of MCAP with minimal dilution. That would take a long time though and LK was fairly clear in that interview when he was talking about material investors and a multiple of the current MCAP that he’s planning to do it a bit quicker via the right deal(s) and therefore with some (albeit accretive) dilution.

offerman It all comes down to the deals that LK does and how they are structured (it would be good to see the use of debt and/or deferred consideration etc. to minimise issuance) but LK has certainly signaled that the £500M MCAP thing is about deals as much as organic growth (though that will happen too), so issuance is clearly going to be a factor. The maximum theoretical share price for a £500M MCAP is of course just below 80p but options already exist that will further reduce that figure and, allowing for a reasonable level of issuance, the actual share price that will equate to a £500M MCAP will, I suspect, be closer to VSA’s 26p than your 40-50p. I still expect LK to do good deals though. Let’s say the big deal involves issuing twice as many shares as are now in issue and issuing them at today’s share price. That gives a theoretical MCAP of just over £100M. But if it’s a really good deal it could see an actual share price of 10p and an actual MCAP of around £200M. That is what accretive dilution looks like.

offerman One problem with the whole £500M MCAP thing is that while I believe LK is capable of delivering it in due course and I also believe that he has the right attitude to shareholder value, that does not mean that he will in the process of achieving a £500M MCAP multiply the share price by nearly 15 times to something just short of 80p. The more than occasional suggestions on here that he will seem very naive. The reality will probably be something closer to the VSA target.

J99MES I know what S4LMO and Stevie G would say to that, but one way or the other it’s getting less easy for you as time goes on. Let’s see what the new season brings. Proud of the way our boys kept fighting until the end.

offerman The run up to the SWP drills should certainly build sentiment. How exactly that plays out will depend on the details of the programme and when and how they are shared with the market, but I suspect that the SWP will lift the share price significantly long before a single drill bit has turned. Similarly, the material deal planned for this year, as well as multiplying the MCAP, should, if it is properly accretive, significantly increase the share price (although I guess that won’t so much be about sentiment as simply crunching the numbers involved).