Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
17:12
Hi Brom - could you please give the forum an idea of the cost of drilling, completing, perforating, fracking and stimulating a 5000ft lateral and then place it on a Long Term Production Test (LTPT)?
My estimate is a minimum of US$25m. Naturally the figure will be higher if a permanent pad at Hickory-1 has to be constructed.
Of course, such a well would only be given the go-ahead if the data collected in the last month or so surpassed the threshold required to be considered "commercial".
Let's say the data is labelled "commercial" and a LTPT would cost US$25m. How do you anticipate 88E and its shareholders will fund that operation? Please also bear in mind 88E's commitments in Namibia (US$15m in next two years, correct?) and its various annual lease fees and G&A. I note you have previously acknowledged Texas does not cover salaries and listing fees, office rent, travel, etc. never mind contribute a single dollar to exploration activities.
The forum listens to you, Brom. How is 88E going to fund a US$25m horizontal well in Alaska?
16:51
Stas20 - that post is a shameful attack on an industry professional who has gone out of his way to inform this forum by conveying his decades of experience and expertise. I first started reading olderwiser's content about 88E on HotCopper in Oz a number of years ago. Olderwiser was an 88E shareholder at that time, solely interested in data and facts. He was, and always has been, completely disinterested in pumps *or* dumps.
Fact. I have learned heaps from olderwiser over the years. If more members of this forum had listened to olderwiser's content and adopted an open mind to the information he has conveyed, there'd be many fewer posters nursing significant, and not unexpected, losses today.
Stas20 - how dare you accuse olderwiser of nefarious conduct. Shame on you.
olderwiser has told this forum repeatedly that he is not paid to post content and nor does he have a short position in 88E. I do not doubt his word for a second, and nor should you, Stas20. How you can allege olderwiser is a "charlatan" when he has spent ***decades*** assessing O&G projects ***exactly*** like 88E's around the globe is wholly unacceptable and inappropriate.
Feel free to ask him but for the record, I am here for price discovery....no more, no less. I had published one single solitary post on this forum prior to Dave Wall formally confirming 88E and PANR shared unequal (in scale and quality) portions of the same stacked reservoirs in Alaska. At that precise moment it became an imperative for fundamental investors like me to undertake a comparative analysis. I make no apologies for this. This is ***exactly*** how professionals in the equity markets conduct analysis to arrive at fair value. I know this is correct because I started working in the markets in 1994 and did exactly this exercise 1000s of times.
Please cease these merciless and quite unfounded personal attacks on olderwiser. The brighter forum members will surely seek to ask olderwiser questions. Firstly questions of fact, and then some may wish to go further and question him on matters of interpretation and opinion.
olderwiser and I have for months, maybe years, raised the alarm about Dmax and updip/downdip and the effects on 88E's assets. It is no exaggeration to say I literally begged members of this forum to google "Dmax" and "updip/downdip". I am not an ogre, and nor do I think Rabito79 or olderwiser are.
Quit the personal attacks and stick to the facts, the data, the risk/return, the accepted industry science and thresholds, maths, truth, research, analysis.
16:49
Wet Willy - ah, I see you still haven't worked out that 88E is listed on three exchanges in three different time zones, four if you count Germany. If you haven't worked that out yet, why on earth do you think folk ought to listen to a word you say on this forum?????
16:21
No, Goldwater, 88E has ***not*** declared it has commercial oil. Please provide the forum with a source for your (factually incorrect) statement. 88E is still to analyse the data to decide if the USFS or SMD-B horizons can be considered commercial or not.
88E shareholders are today confronting the effects of Dmax on the downdip portions of already tight-ish reservoirs.
Preposterously, the market continues to value a downdip, lower classification 88E barrel in the ground at a premium to an updip, higher classification PANR barrel in the ground.
Be under no illusion, 88E will require fresh capital to keep the lights on, and they'll need it imminently. What are the odds of Burgundy defaulting on their cash commitments for this winter season's costs? They have certainly blown out after today's news confirming only 4 barrels of oil were contained in the stk tank after 16 hours of oil flow.
I will revise my 'value per barrel' and 'cash at hand' figures for 88E and revert.
09:23
BigBear2 - the gross total cost of drilling, completing, perforating, fracking, stimulating and flow-testing Hickory-1 was US$30m, spread out over two seasons.
Deduct the "double counting" of having to build an iPad and road for two seasons rather than doing it all in a oner (plus mob/demob costs, etc) and let's call it $25m,
To drill a 5000ft horizontal at that location and place it on a LTPT will cost approx $25m again. How on earth is 88E going to fund that? Texas doesn't even cover management's salaries, office and listing costs and lease payments. 88E is expecting to invest a further US$15m in Namibia over the next two years.
Where is all this capital coming from? Shareholders are looking at 50 billion shares on issue.
Please don't listen to anyone today who suggests 88E is going to be a producer in Alaska shortly (with or without a partner). It will take at least 5 years and hundreds of millions of dollars before that stage is reached. And remember that 88E's own management is yet to analyse whether the data collected in these flow tests support a declaration of commerciality or not.
My *opinion*. This data does not support the contention that 88E's downdip portion of these reservoirs is commercial. Exactly the opposite, I'm afraid.
08:50
Ddraig - what a ridiculous post.
These results have provided hard data, empirical data. Lol, I wonder if you would have posted results were inconsequential to 88E's mkt value if the oil had flowed at 10k bopd??!!
The ***facts*** are that 88E shareholders are today having to confront the effects of Dmax on an already tight-ish, downdip portion shared reservoirs.
That you seek to misdirect members of this forum is par for the course for you, Ddraig.
08:46
Hi Redbeardoil2 - I think it's best we leave that to PANR management to answer, don't you. That way. Everyone avoids unnecessary speculation about who listened to who or who didn't listen to who!
08:22
Fact check, Desmond45. Hickory-1 cost approx US$15m to drill and *another* US$14.5m to flow test.
To drill, complete, stimulate and test an horizontal well at the Hickory location will cost $25m - $30m and won't happen until next winter at the earliest.
Where is that capital going to come from? Another 20bn new shares?
To remind folk, until 88E trades at 0.2p the market is valuing 88E's barrels at a premium to a higher classification PANR barrel.
Following the Hickory-1 flow tests this absurd premium which 88E enjoys looks increasingly ludicrous.
07:53
No, cbaron, that is not the way the O&G sector works and nor is it the way the equity markets work. Price discovery is essential in establishing fair value. To have a joint owner of reservoirs obfuscate at best, cruelly spin at worst will only attract opprobrium from wider market analysts/commentators when they see intellectually bankrupt reports that these results have a positive or negative effect on PANR's numbers and investment case.
When are you going to accept that this is not a fight between shareholders, as you so naively describe it. This is about data, truth, risk/return, maths, probability, value, research.
07:40
Chicken Thighs - sadly, 88E has not hit metaphorical gold. Collecting only 4 barrels of oil over the course of 16 hours (see Appendix J) is hardly a success.
I'm afraid forum members would do well to investigate the effects of Dmax on the downdip portions of tight-ish reservoirs.
After these two flow tests, do please ask yourselves if there is *anything* in today's RNS which would justify 88E's barrels in the ground being valued at a 1% premium to an updip, higher classification barrel never mind a 25-100% premium.
If anyone disagrees, point out to the forum what paragraph or sentence in the RNS supports any such premium for an 88E barrel.
07:29
Ayecuramba - this post is a made up lie. You are attempting to draw in unsuspecting newcomers to 88E so that you can sell your shares. Why else would deliberately disseminate false and misleading information about a non-existent flow rate of 800-1000bopd.
To any newcomers, during the 16 hour period when oil was flowing to the surface, precisely 4 barrels of oil were collected in the stk tank. As you can calculate, that's nowhere near 800-1000bopd.
Don't be fooled by the lies being disseminated by disappointed folk on this forum.
01:24
Gman93 - best you head off an investigate the effects of Dmax on the downdip portions of already tight-ish reservoirs.
I repeat for the umpteenth time, it is entirely irrational for a downdip, Dmax affected, lower classification 88E barrel in the ground to be trading at a premium of 25%-100% to an updip, higher classification PANR barrel in the ground.
The market is already waking up to this. Stick tot he science, Gman93.
No, BOBHOPE, I believe in science and facts. You can toddle off and try to ensnare other folk into your web of misinformation. This forum won't be buying what you're selling. Members are too well informed.
00:47
BOBHOPE - don't you find it interesting only 4 barrels of oil were collected in the stk tank over the course of the SMD-B flow test? Add that to the 24.8 barrels collected in the SFS flow test and it's almost 30 barrels! Downdip and Dmax effect are now clear. Pity.
I see at least one liar has posted on the 88E forum that "Pantheon Directors Jay and Bob have said that there is no effective difference in reservoir Quality between Panr wells and Hickory."
Let me be a thousand per cent clear about this matter before it gains any credibility whatsoever. Jay and Bob have said no such thing. The poster was challenged by olderwiser and me to provide a citation or source for this made up fantasy and of course it's now radio silence.
However the market reacts to the second flowtest at Hickory-1, be under no illusion that PANR's base case numbers will not change by one barrel downwards. PANR used the Talitha #A data for their base case numbers and did ***not*** include the acreage south of Talitha #A towards the southern boundary with 88E in its guidance numbers.
As David Hobbs stated correctly, Hickory-1 was a free hit for PANR.
Jay and Bob have described the characteristics of the SMD-B reservoir
00:19
Before OilBcNu's lies are disseminated any further, please be aware PANR has already flow tested the SMD-B successfully.
https://www.lse.co.uk/rns/PANR/validation-of-frac-design-and-fluid-sampling-tcrx4qvdikio0t4.html
Compare the transparency of PANR's RNS with 88E's.
Happy for any forum members to identify a geologist in the world who would prefer to own the downdip, greater Dmax affected portion of a reservoir v's the updip portion.
Now that we've established the actual facts, 88E informs us the gross cost of this year's operations will be US$14.5m. Unless Longhorn has had a record-breaking Q1'24 88Ewill have no other option than to raise new capital. We'll see what the traders do tomorrow but I reckon LTHs should attempt to calculate 88E's cash at hand at the end of April as a matter of some urgency.
00:19
OilBcNu - that is an outright lie. Unless you provide a link to a source for this made up fantasy lse moderators will be approached an informed you have published false and misleading information. In case you were unaware, that is a crime.
I suggest you withdraw that post immediately.
00:05
You're kidding us, right SuperRoty? Best contact OMJ to see if he thinks as you do - bet he doesn't!!
4 stk barrels over the course of a flow test. Cripes.
24 barrels of oil collected in the stk during the USFS flow test, and now only 4 stk barrels in the SMD-B.
Once again it appears time for forum readers to investigate the effects of Dmax on downdip portions of reservoirs.
[Part 3, continued from Part 2 below]
11:25
MysticMeg - Geodes has more knowledge about geology in his little finger than I could hope to learn in a lifetime. However, he self-admittedly no longer strays into commentary on valuations or even comparative valuations of PANR and 88E. He and I used to communicate and I enjoyed reading his geological commentary very much indeed. Sadly he made *many factual errors* about the investment cases of PANR and 88E. Initially he was happy enough to correct his errors when politely pointed out but over time he bristled at the *factual* corrections and then blocked me. I *never* questioned his geological commentary, solely his errors about the investment cases. Thereafter he ceased to comment on the financial implications for each company and constrained his commentary to geological matters. *My* opinion. Geodes has stated he is hugely under water on 88E. It happens. IMHO his commentary is, understandably, tainted by his desire to dig himself out of his 88E financial hole. Why not ask him, ‘knowing what he knows now about the datasets from each company, which of 88E and PANR would he invest in today if only allowed one stock?’ Also, ask him for a data-supported justification for an 88E barrel to be valued at a premium to a PANR barrel.
[Part 2, continued from part 1 below]
08:05
Taximan57 - To arrive at a realisable value of $5-$10 per barrel, PANR will have to invest c.$120m of external capital (planned but not guaranteed to be sourced from external parties). Bearing in mind PANR has spent 14 years and hundreds of millions of dollars proving up their acreage, how much do you assess 88E will require to invest in their acreage to arrive at a similar data threshold? Let’s be generous and say it’ll require only $100m, ok? Where’s that cash going to come from? Will 88E have >100bn shares on issue by then?
Have another look at the Oil Search/Armstrong deal. Armstrong/Repsol had drilled 12 vertical wells and 7 laterals before the Oil Search was signed. The data *has* to be collected to make an asset saleable. You simplistically pluck a figure of the air, “$410m”. 88E is nowhere near achieving such a valuation. It will take years and at least $100m before sufficient data is collected to support a valuation of that order.
This type of content is wholly irresponsible. You state that folk ought not to pay any attention to the content on forums like this one. Why, therefore, do you pepper this forum with such anti-science gibberish? It would sadden me greatly to read you’re here solely to ensnare unsophisticated buyers into 88E having hoodwinked them with tales of imminent riches.
10:44
Gemstar/Midnight7 – as Midnight7 stated correctly, Mangrove’s PANR short is 1.53%. Based on the timing of their declaration to the FCA, I estimate their short is 13.8m shares. Don’t believe me? Click on the link below.
https://www.fca.org.uk/markets/short-selling/notification-disclosure-net-short-positions
Gemstar – the fact that you foolishly elected to double down later in the day and confirmed to all members of this forum your complete miscomprehension of the FCA short reports is surely a source of profound embarrassment. That you couldn’t interpret an accumulating total belies an infantile understanding of the short position. When are members of this forum going to stop publishing made up nonsense, showing not an ounce of responsibility to their fellow shareholders and forum members? Where is the shame?
[End of Part 2, see above for Part 3]
MysticMeg – see my content above about the investment made by Armstrong and PANR to move towards realisable valuations of $3.10 (Armstrong) and targeting a range of $5-$10 (PANR). I urge you to cease the deliberate misinformation.