Member Info for rossannan

Srdoddy

I am just using 50/50 as an easy example. The point is that there may well be no oil (whether commercial or not) for the drill to encounter in the first place. It is really important to understand how probability works in these situations and what the percentages that private investors see on paper mean for them in practice. The danger is private investors trying to convince themselves and each other that their bet is a better one than it really is. Companies like BPC in effect rely on this to get their projects funded. This is why the majors generally leave the wildcatting to smaller companies, outsourcing the pain to private investors and taking their pick of the few prospects that come good.

GarryGraham

What is my strategy now other than waiting to see what happens? As I said before, negatives would obviously be the litigation continuing to hang around in some way, shape or form and BPC opting for a further helping of the death spiral funding. If neither of these things happen the share price should firm a bit, but essentially BPC is now really just for those prepared to gamble on the drill result. That is not me. And talking of gambling on the drill result, you mention the possibility of private investors losing their life savings. Just to be clear, NO ONE SHOULD BE GAMBLING THEIR LIFE SAVINGS (OR EVEN A SUBSTANTIAL PART OF THEIR LIFE SAVINGS) ON A COMPANY LIKE BPC.

GarryGraham

BPC is a fascinating case study in the good, the bad and the ugly of AIM O&G, like CERP before it, with a similar emphasis on the bad and the ugly. I have learned, and continue to learn, much that I have been able to deploy on other investments. And if P1 does not come in BPC may become oversold to the point of offering decent value, particularly if the current BoD are kicked out in the process.

Srdoddy

In other words, and they are crude (sorry) analogies, the golf balls are oil, the holes are reservoirs and if you want to take it a bit further the number of balls found in each hole will determine commerciality.

Srdoddy

“Taking your example the flipping of the coin (roll out the golf balls or not ) this would resemble us drilling or not of which we have.”

You have badly misunderstood this. The coin toss in the example determines whether or not there is oil for the drill to encounter, not whether or not BPC drills.

Srdoddy

“The depth we are drilling shall pass through several of these levels each with their own individual PoS, so with this the percentage would accumulate at each level, in comes the statement of Dead Cert of finding oil”

I can see that you have misunderstood how probability works here. You have not been helped by BPC management using a dangerously misleading phrase like “virtual dead cert” in relation to P1, but as ever the real danger with a company like BPC is not so much retail investors being misled as it is retail investors misleading themselves.

Probability is NOT cumulative here in the way that you suggest. Think of it like this. There is a putting green with four holes in it, ranging from the smallest and shallowest to the largest and deepest. I have a big bucket of golf balls. I toss a coin. Heads I roll the contents of the bucket across the putting green, tails I don’t.

You come along afterwards. There is now a 15% chance of you finding a golf ball in the smallest hole, a 20% chance of you finding one in the next largest hole, then 30% and finally 35% for the largest hole. These percentages add up to 100. Does this mean that you are certain to find a golf ball? No. For a start, my coin could have landed on tails, leaving no golf balls for you to find.

Do you see what I mean?

Proselenes

As I said there are lots of studies out there - my challenge to you is to find one even more pessimistic than my North Sea one that will reduce P1’s 35% GCoS to a 10% CCoS. Your “no infrastructure” / “middle of nowhere” argument just doesn’t wash in the era of the FPSO. Yes, the folk who have invested (and in many cases over-invested) in BPC need a reality check, but to be effective that reality check has to be credible. You can’t just pluck a percentage out of the air.

Srdoddy

You seem to have got the wrong end of the stick. The Albian and the Aptian are different horizons within the B structure.

Srdoddy

You are wrong, check out p. 12 of the 29/10 Investec Presentation.

Proselenes

“and a near 90% Chance of Comercial failure”

Can you show us your working on your “near 90%” please?

StarJump

Yes, keeping an eye on that one. Not worth the effort yet, IMO, but if the gap widens further (whether courtesy of LOAC or DDDD), I’ll certainly be making a move.

Although if the oil price slips again at the wrong time, Navitas could easily walk away.

Anyway, have a Happy New Year one and all.

pablo2

I’m not a great fan of guys in Artem’s position expressing a view on the share price - that’s our job, not his. Hopefully he is right though. It will take some time for the likes of CGH and AAZ to recover the sentiment lost through the recent conflict.

I guess one way of looking at this is as a (just) out of the money option on the oil price - high risk, high reward - with the arbitration as a side bet. Another few dollars on the oil price and it could be game on.

TRP-BPC

I’m not sure there is much to add. Further negatives would obviously be the litigation continuing to hang around in some way, shape or form and BPC opting for a further helping of the death spiral funding. If neither of these things happen the share price should firm a bit, but BPC is never going to be the trade that it could have been - it’s now really just for those prepared to gamble on the drill result (not me). As for the funding legality issue, I haven’t looked into TW’s reasons for saying that the death spiral funding is “breaking the law in the Isle of Man”.

*50,000 shares in fact

Well, FWIW I bought 5,000 shares and also topped up my SB on the back of it.

Any thoughts?

BD

There is also the prospect of a further tranche of death spiral funding. Bigmj said this a while back:

“The combined liquidity is much better for those that want to exit and the prospects riskier but more rewarding potentially for those who choose to stay.”

The problem is that this BoD have now effectively suppressed the exit price for those who bigmj envisaged would not be up for the big gamble on the drill results.