Member Info for sasa43

Maybe the more 'astute' potential investors I alluded to a couple of days ago have had a good look at this and have decided to get on board while it's still so overtly cheap, even now? The appeal is self - evident to those who bother to look at what's in store, post all the recent good news....sasa.

Yep, D220 - another positive news item to hand; 'tis looking good as we roll up to the y/e - sasa.

Agree that, chinch - that this is still very cheap (if the prospective stats are anything to go by) despite the sp having trebled over the past twelve months, is a 'given', imv.

I suspect that observers / potential investors tend to be put off by the performance so far rather than concentrating on the re-rating being extended over the medium term, now we're where we are...

Bearing that in mind, the sp might languish for a couple of weeks but as end Nov. approaches, I'd expect interest to pick up again for the reasons us LTH's all know. The astute 'newbies' would do well, therefore, to exploit this lull while the opportunity exists, I'd say but that's just my take at this juncture - sasa.

Wonder what the 'optimisation' of the flow rate will involve once the re-commissioning is completed?

Hitherto, the flow rate was equiv. to 3k bls of oil per day (when it was partially choked) and then down to 2400 bls per day, prior to suspension. Ergo, we might well be able to achieve 4k + bls per day henceforth with a clear pipe and at considerably higher prices today, too.

That prospect and the inflow of funds due upon completion of the BKR deal with BP and the higher sharing element from Total's BK arrangement on the same terms, bodes well for December's cash flows to Serica with Rowallan's 'spud' getting underway then, too - should be a really good start to the New Year for us, all being well - sasa.

Positively, Investor - some decent income into our coffers, at last, pre the BKR 'cashcade' commencing in early December - gotta be a spur to the sp from here, despite the present mkt lethargy overall...sasa.

Hi bangrak - haven't seen any brokers' EPS projections, post the BKR revenue sharing deal yet, so your info on the consensus of 54p ps is helpful to know; which brokers comprised the collation, please?

My 'guesstimate' was around 50p ps which I posted on here recently. I see your 41p ps calc. anticipates SQZ selling on a prospective 9 or 10 x multiple looking further out; I've been a bit more conservative in that respect, assuming a pros p/e of 5 or so initially, being AIM and all that but, either way, the sp should be a lot higher by then than we see now. ATB - sasa.

Quite right, RELLIM - the operative date for the BKR deal with BP has been put back to Nov. 30th - my mistake.

As you say, though, it doesn't alter the cash infusion from it to Serica, being back dated to Jan1st, which will be considerable and agree all your other pointers, too.

Interesting post from bangrak about the brokers' consensus on eps being some 54p, albeit on somewhat higher prices than he's employing, with his assessment being 41p EPS odd. Haven't seen such reports myself, so my 'guesstimate' of 50p ps, therefore, seems to be about mid - range, which is handy to know....sasa.

Don't quite understand your question here, Shares_T_B... The BKR deal has already been given the 'go ahead' with it being operative from Nov 1st with the cash due to SQZ being backdated to Jan1st this year (similarly in respect of the recently announced BK majority interests acquired from Total on the same terms) - all that is known and thus is in the price currently.

We await confirmation shortly that Erskine is back up and running and the Rowallan 'spud' is underway in December.

Suggest you view the Serica website for the details and scroll back through recent posts on here to be more 'au fait' with peeps' views on things. As for future valuations of Serica, that depends on many variables, of course but if it all goes well for them, a higher sp looks very likely to me over time.

Just my take right now (nothing like DYOR on this) but hope that helps, meanwhile - sasa.

Hi Chaiselongue - welcome...

Serica now has the 'go ahead' from the US licence authority to utilise American equipment as operator of the BKR assets acquired from BP, w.e.f next month when the deal will be officially signed off by both parties. The licence BP had as operator will be extended to SQZ for one year, subject to certain 'i's' being dotted and 't's being crossed for it to continue after that - Serica doesn't envisage that being a problem at that time.

When Trump\s additional sanctions against Iran kick in, that might lead to a squeeze in the oil price, as might any retaliation by Saudi Arabia over any ostracism / sanctions levied on them over the murder of Mr Kashoggi in their Turkish Consulate recently, so I don't see any reason for any meaningful sp pull back around that time.

On the contrary, with Erskine expected to resume operations shortly, the BKR cash due to Serica from Jan 1st this year coming in and the Rowallan 'spud' upcoming (free carry for SQZ) the sp is likely to push on from here, imv...

Anyway, DYOR, of course as it's only my take on things at this stage - sasa.

Remember why you bought into this in the first place - AMC owns a huge / valuable asset which will be increasingly in demand henceforth; if they can't monetise it, somebody else will.

The eventual price realised should be way higher than what currently prevails - if it's not so fulsome in the event, then it should still enable most of us to make a very decent profit. If it doesn't work out at all, then it just doesn't work out...

If you can't hack the waiting, then give yourself a break from it all; cut a nasty loss and spare your 'marbles' in doing so - life's too short...

Meanwhile, stop tearing each other to bits over it; it 'ain't healthy for anybody - sasa.

Hi RELLIM - it's all reasoned guesswork at this stage, as we both acknowledge but the figs henceforth look very impressive, whichever way you look at it; even a dividend is possible at some point, of course, on the eps cover afforded by my guesstimate for 2019 / 20, especially if no immediate acquisition prospect presents itself....sasa.

Hi RELLIM - I think that TCW's already alluded to the cost reduction aims for the deals; it's their 'raison detre' after all and they seem quite good at it, too.

Re: Rhum, the interesting thing here is the 50% un-drilled part of it which is reckoned to contain the major section of the field's resources (longer life, too) so with the higher % income participations looking ahead, there should be more than enough cash in hand to cover the drilling and likely further acquisitions they say they're on the look out for...

Have been trying to work out what next years figs. might look like. Largely guesswork at this point, I know but allowing for the obvious variables, higher oil / gas prices since the BKR deal was struck last year but taking the 110 BP transferred employees onto their payroll / higher admin. costs, etc., I think there's a reasonable chance that they might achieve 50p eps making the p/e around 2 or so at todays price - even for an AIM 'oily', that's dirt cheap, especially with our decent reserves in situ / throughput of 23k bls per day etc.,

Then there's the 'free carry' on Rowallan coming up and beyond that Columbus adding to the mix - an earnings multiple of 5 or more looks more appropriate to me and if Rowallan obliges commercially, perhaps 7 or 8 x?

All very exciting at this stage - sasa.

"Where are we now and what's the best / worst case scenario from here?...

Fwiw, I replied " Worst case is AMC fails to commercialise their huge deposit, even now, and we run out of money, so that's probably the end of the road or near to... If you think that's likely, then sell now.

On the other hand, the best case would be an offer for AMC close to our NPV (100p?) so a near 100% wipeout from here v a potential 2,500% odd gain if they pull it off or something approaching half that or more; even at 50p, all the LTH's would wind up with a huge profit whereas most, if not all of us, are under water as things stand.

Ergo, your choice, as always..."

Personally, it's gone very quiet of late; almost too quiet for my liking, which I regard as a good sign, possibly indicative of something seriously being under discussion - the PFS being released could well be the trigger for it or soon afterwards. That's my take right now, anyway - sasa.

Hi RELLIM - from memory, SQZ's op. costs, pre the BKR deal, were some $14 per barrel (Erskine only) but post the BP acquisition, the anticipated costs were around $21 per barrel. The expected production boost from it was around 20k bls a day (without Total's increased contribution now) so we're looking at a very sizeable cash inflow from Nov 30th.

Not sure whether Serica's $160m odd allowable tax losses brought forward would be set against this 'windfall' or utilised to defray prod. costs as an operator from Nov 30th. Either way, it'll give the bank balance a helluva boost!

The RNS confirming the deal should be an exciting read, as you say - sasa.

I think it's XD today, hobione (3p) payable 23rd Nov - according to moneyman.com, anyway - sasa.

Hi RELLIM - echo that last plus point about location, too. I'm a retired broker / fund manager after 40+ years in the mkts and thus this investment game, so we have similar longevity in that regard as well....sasa.

Hi RELLIM - we all have our failures (have had a few myself, of course) but occasionally a real 'good 'un' presents itself to offset the casualties and make the striving to succeed overall worthwhile. We have one here, I think.

With astute management (a major strength in TCW, agreed) we have the two other pre-requisites for a successful investment outcome in place, too, imv - a strong balance sheet and impressive asset backing, that's what I look for.

A T/O at some point is always a possibility; perhaps after a year's worth of sizeable income generation and the prospect of more to come to stimulate interest on that front; hence my quandary of what Serica might ultimately be worth but much more than the paltry value currently ascribed to it, that's for sure.

If / when that time comes, I'd expect management to insist on a full valuation for what we have by then / our prospective revenue stream etc., especially since gas (85% for us going forward) seems a more appealing / resilient fuel source than oil looking ahead.

I have my own thoughts on who might be interested in a much enlarged SQZ but for now, it's just good to be in it from here....sasa.

Hi RELLIM - agree your last two posts on this; full of potential, despite the more than trebling of the sp this past year.

I got into Serica after you (in 2011, I think it was, fwiw) but kept steadily adding and, like you, this is now my largest holding, too. It's difficult to gauge what the shs are really worth looking ahead, given all the opportunities henceforth but I know of no other AIM stock so 'pregnant with possibilities' today, given the undermentioned characteristics displayed, I have to say.

Good management, no debt, strong balance sheet with plenty of cash in hand (which is about to balloon considerably now) several developments afoot and other acquisitions doubtless under consideration if they sit well with the 'modus operandi' being pursued and all for a £300m mkt cap right now - quite daft currently but an opportunity, nevertheless, for late comers to get on board if they have the nous to spot a real bargain still on offer - but DYOR, as always.

Whilst there's no guarantee of success in this game, of course (black swans etc.,) this comes pretty close to it, I'd say, so GLA - sasa.

Generally agree with the progression, RELLIM - I imagine any move onto the main mkt will likely be a year or more away (as they'd want a full year's benefit from Erskine / BKR to be showing in their A/Cs beforehand) and if Rowallan proves commercial, their prospective benefits on that, too...

Have just 'Bed and ISA'd' an isolated P/A holding while things are relatively quiet at present; I expect this to move appreciably higher before too long. Haven't seen any post BKR deal research notes yet / stats / TP's etc., - sasa.

Hi Manuel - no probs - hope you're still in this one; seems it has a long way to go yet. It makes persevering with AMC so much easier! - sasa.