The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
23:48
chrisev1 - here's an idea for you. When you see "olderwiser" is the author of a post, just swap in your mind his username for "magpie5" and read the content, taking it at face value. Open your intellectual curiosity to reading the information contained in his posts; interrogating the content; investigating the veracity of the information; following the subsequent conclusions and acknowledging there is always more to learn from sector veterans.
On the presumption you're not a dentist, chrisev1, your conduct on this forum suggests you'd fancy undertaking your own root canal treatment! C'mon man, away from this forum you will surely have recognised many occasions in your life when you were in the presence of an expert in a specific field? An expert who made you realise your knowledge of the subject matter was amateurish in comparison?
Think, chrisev1, think. How many times has a listed company had to publish a slide pack and a "further transparency" RNS within a few days of the initial announcement? olderwiser spotted something didn't add up within a couple of hours of the SMD-B results. And if you don't think his analysis didn't prompt a veritable tsunami of questions to 88E management from shareholders around the world then you're being wilfully naïve.
Please stop abusing olderwiser and others. It's contemptible behaviour. Just because you don't like him relaying facts which challenge, and in many cases demolish, your poor understanding of the 88E investment case does not make him the bad guy. I continue to be amazed at the vitriol displayed towards him when your anger ought to be directed chiefly at Dave Wall, Erik Opstad and the previous board members, and secondly at the current bosses for trying to spin like whirling dervishes the disappointing data from the two flow tests at Hickory-1.
Https://twitter.com/88EnergyLtd/status/1781158508148437292?t=lv4T20JORZzvgVD7twZ3HQ&s=19
And there it is, ladies and gentlemen, the switch of narrative to Namibia.
*Opinion* - 88E has drilled its final well in Alaska as operator.
I can only imagine the avalanche of requests for greater transparency around the flow tests which must have overwhelmed 88E management to compel the company to issue this latest clarification.
IMO, 88E continues to gild the lily by describing the flow tests as "successful". Ambiguous at best? Underwhelming is what I'd go with.
The market is rightfully concerned about the implications of the flow tests and the company's cash position once the. Hickory-1 bills are paid.
This RNS offers no succor to shareholders on either front. You know what's coming.
20:05
Redirons - whipping up a campaign to report me and others like me is deeply unethical. I have not breached any of the lse rules. I don't abuse anyone. I don't disseminate false or misleading information - ever. I provide citations and links to source documents. Any calculations I post, I show my working. I am honest and ethical.
Just because you do not enjoy reading my content does not make it untruthful. You have no reason whatsoever to report me except that you're down on your investment in 88E and upset with my content. How can you possibly think it ethical to ban me when you have not identified a single instance where I have broker the lse rules.
If Admin do indeed investigate your supposed report about me, why don't you refer them to a post of mine which has been dishonest or untruthful or inaccurate? You won't be able to because I have only posted facts and shown all my working on calculations.
If you make an accusation, you have to have evidence. You have none. Fact.
Here's an idea. Why don't you volunteer to collate questions from forum members and promise to contact the company seeking answers on their behalf?
No-one forced you to buy 88E shares, did they Redirons? It's past time you took responsibility for your own investment decisions. Instead of lashing out at folk who clearly have done hundreds of hours more research than you have, how about asking pertinent questions of 88E management to answer your concerns.
19:01
For the record, Brombarb is 100% wrong. For the umpteenth time. I seek price discovery....no more, no less.
That said, what a fascinating post.
"....were we to go broke or at least have to decide between Alaska and Namibia...."
My oh my...I wonder if the sentence above is the equivalent of Brom admitting, several months after the fact of course, to selling into the social media, US OTC punter inspired spikes of 2021 and/or 2022.
Brom is a capable fellow and admits to having clear communications lines with 88E management. If he disagreed with my Longhorn calculations posted earlier this afternoon, he would have fact-checked me.
To remind the forum of Brom's ability to be transparent when he chooses: "“I too have my doubts about some of our projects, Longhorn has been a slow burn despite the relatively high POO , when first announced Jan 2022 the wells were producing 300BOE per day, despite plenty of investment in workovers we are not producing much more today and nothing like the projections of 1300 BOE given as a medium term target.” – Brombarb on lse; 30/1/24 @ 16:58
I'm also certain that if Brom or any of the other prolific posters disagreed with my cash calculations, which in turn led me to question 88E's solvency, he would have rebutted my numbers.
Direct question for you, Brom. After that post at 18:13, you deserve it. Do you agree that if Burgundy doesn't pay 88E some cash before the end of June then, all else being equal, the company will be in danger of going insolvent? Therefore, do you anticipate 88E will have to source fresh equity capital imminently?
Oh, nearly forgot. You never did get back to the forum with the answer to whether Erik Opstad is still employed/retained by 88E? If not, why not?
I'm sure the forum looks forward to your response.
05:59
Taximan - your post timed at 05:59 is correct.
"Munnie, Dr Stephen Staley holds 14,342,717 shares, and all directors have share options outstanding."
The trouble is that he's the only 88E employee who has invested a single Aussie dollar to buy 88E shares. There are other very concerning signs that 88E insiders are not remotely aligned with 88E shareholders.
For example, MD Ashley Gilbert elected to take his first bonus in cash rather than shares. He then sold £200k worth of performance rights in early 2023. Worryingly, after Hickory-1 had been drilled and logged, cuttings analysed, etc in 2023, a further 84m performance rights were sold in early 2024 prior to flow testing activities commencing. Reading the Annual Report it is difficult to construct a scenario where Ashley Gilbert wasn't the seller or one of the sellers.
Standing back and looking objectively at Ashley Gilbert's decisions since joining 88E, it hardly paints a picture of confidence in 88E's assets or investment case, does it? And the BoD has hardly enforced a remuneration structure which ensures the executive team is financially aligned with external shareholders. Not good.
Something else really struck me at the time of the rights issue in August '23 and the November '23 fundraise. Dr Staley invested £4757 in the rights issue but no-one else associated with 88E invested a single dollar at 0.31p per share. Worse was to follow in the December fundraise. Not a single employee or director thought 88E was worth investing in when the new shares were priced at only 0.23p.
During my investment banking career I mostly dealt with instos rather than PIs. During fundraising roadshows for SMID cap corporates, there was rarely a meeting where the fund manager didn't enquire if management was supporting the fundraise and if so, what was the amount of their intended investment.
I wonder whether forum members will look back on 88E insiders' personal investment decisions and wonder if they should have paid more attention to the message being sent?
18:20
Stockraiser - that's odd, you didn't mention you wished one word answers when you posed the questions directly to me. Rude or just forgetful?
That's all very well Scot, but what prompts your strong reaction today? Q1 Report
Did you find this mornings RNS negative? Yep - see my posts on cash and insolvency.
Do you really think 88E are bust? Will be by end of June unless Burgundy ponies up (they won't IMO) or the company raises fresh equity capital.
Can you see any positives? Superficially, I quite like the look of Leonis but I am not armed with sufficient info to make a definitive judgement. Other Alaskan assets are stranded or low quality. Texas is lame and underperforming massively. Namibia - too early to say, they haven't even shot the 2D seismic yet.
TIA SR
17:51
Thanks Goldwater, very thoughtful of you. In turn, I am very worried about your inability to do very simple maths. I'm sure a forum member will gladly volunteer to set up a Go Fund Me campaign to pay for a maths tutor for you. Best.
Go on then, amuse the forum. Why would PANR merge with 88E? Can't wait to read that thesis. Too many folk watching "Wolf of Wall St" and "Billions" on this forum, not enough reading of RNSs!
07:43
Hi Ramboraven - yes, you are correct that 88E management's new strategy is to seek a farm in partner(s) for their Alaskan assets, including Phoenix. But you have misunderstood the content of the Q1 Report if you have come away thinking they're seeking a a farm in ***rather*** than a capital raise full stop.
I accept the 88E BoD may have decided to transition away from Alaska to focus on Namibia and they now no longer wish to apply any large amounts of capital to their Alaskan assets ("Rather than a capital raise to fund [Phoenix]") in the future. My calculations suggest that once 88E pays its Alaskan bills for this season's operations, 88E the company will have run out of cash entirely. Thus my strongly held judgement 88E will have to raise fresh capital at a steep discount in very short order. Hope that makes sense.
17:34
Hi again Stockraiser - ok, your question is in earnest. Best idea, IMO, is to click on my username and you can read my reaction to the recent flow test results and the implications for 88E as an investment. It's also worth clicking on olderwiser's username and reading his posts.
If you wish a comprehensive picture of what I have researched and analysed then keep going back a few weeks. My message has been entirely consistent. Best.
17:09
Hi Stockraiser - your question suggests you may not be a regular reader of this forum? If that's the case, you will be unaware I have, literally and repeatedly, been begging forum members to google "Dmax" and "updip/downdip". I have urged them to apply that knowledge to 88E and PANR. I repeatedly urged them to look at the depth of burial of the stacked reservoirs in 88E's downdip acreage v's PANR's updip acreage.
If they didn't fancy educating themselves about the geology of the asset 88E had directed US$30m of investment towards in 2023/24, I provided a comparative analysis of 88E and its direct listed peer, PANR. At various times and mathematically irrationally, a downdip, lower classification 88E barrel in the ground has been valued by the equity market at a 25% - 200% premium to an updip, higher classification PANR barrel in the ground.
Astonishingly, an 88E shareholder can today sell their 16.3p per 88E barrel shares and buy PANR's 14.1p per barrel shares. I fully admit to being amazed at this situation!
Oh, and before 88E began its flow test operations this season I warned the forum using very clear language that 88E would be running out of cash after it paid its bills in Alaska.
[I fully appreciate that your post, if read through the lens of sarcasm, could be a rather humorous post. All the same, I've chosen to take it at face value!]
09:27
Fact check for Sharebel? False, big lie, massive lie.
As pointed out correctly by Tuffers, this post contains two huge lies. Sharebel states that 88E has made two "COMMERCIAL OIL DISCOVERIES".
This is a lie. Read the RNSs which describe the flow test results. Read the slide pack. Read the Q1 Report. At no point does 88E state that they assess the discoveries as being "commercial".
Buy/sell/hold 88Ebut please do not base your decisions on the content in this post timed at 09:27 today.
Sharebel goes on to allege his usual fantasy about market makers conspiring to damage 88E. Made up conspiratorial nonsense.
16:39
Fact check for Sharebel? Falsehoods, and lots of them.
1) Cost cutting. The COO is departing on 29/4/24 so some action has occurred. Sharebel - what do you calculate is 88E's G&A, listing costs plus annual lease fees? Do you agree that these costs are the bare minimum required to keep 88E listed and active? What is your assumption for 88E's annual dividend from Longhorn. What is your assumption of 88E's future investment commitments if it is to execute its currently declared strategy (Longhorn wells and Namibian investment)? Are the cost-cutting measures sufficient such that the Longhorn dividend covers the costs of keeping the company going?
2) "and have now got a strong balance sheet." That is clearly made up gibberish. Look at the facts published today. Management's own guidance suggests 88E will run out of cash by the end of June. How you can describe 88E as having a "strong balance sheet" is beyond me, and I hope everyone else on this forum.
3) The data received from the flow tests of the Alaskan discoveries are indeed transformative. But not in the way you describe. The flow test results will result in 88E effectively withdrawing from Alaska as an operator. They're already prepping shareholders for this by referring to farm outs and 88E retaining W.I. v's continuing to be the operator.
4) You frequently accuse some forum members of spreading "FUD". Oddly, you never appear to quote example of this FUD, proving evidence these posters' content is demonstrably untrue/inaccurate/made up nonsense. It's about time you quit the angry shouting and bullying and started providing evidence to back up your allegations. Hint - I predict crickets.........
16:30
Taximan57 - I realise that's what you understand but it's not the complete picture, I'm afraid. I've done this this type of work since 1994. A company facing the cash difficulties 88E is currently facing can ask its shareholders for permission to restructure the company. Yes, the rules you quote are the day-to-day rules of the ASX and what companies can do with their share structure. I submit to you that 88E needs more serious surgery than you imagine. I submit they will need more radical restructuring than is permitted by the ASX rules you refer to. Any proposed restructuring will, of course, require shareholder approval but by that stage there are normally very limited options available if the company is to remain active and/or listed.
I know you don't attach any worth to my input, Taximan57. You haven't even bothered to thank me or even acknowledge the work I undertook to explain how 88E is affected by Longhorn's performance and how to calculate a boe and its revenue. So why don't you ask Brom or some of the other prolific posters if the content above is factual?
16:13
Fact check for Sharebel - there is no Aussie-based boiler room scam. Speaking personally, I am not employed by any individual or corporate entity. You'll have to ask other posters if they fit your fantasy.
88E's mkt cap has reduced sharply because the flow test results were disappointing *and* many shareholders have calculated that the company will effectively run out of money by the time it pays the bills for this winter's operations at Hickory-1. Shareholders have been confronted by the scientific data and have voted with the sell button.
There is no grand conspiracy with market makers stealing from you. There are more sellers (by volume of shares) than buyers (by volume of investment size). Plain and simple. Forum members would do well to quit the conspiracy theories and acknowledge the situation 88E finds itself in.
As John Maynard Keynes is often credited with saying: “When the facts change, I change my mind. What do you do, sir?"
The facts of the 88E investment case have changed radically. The sellers have changed their minds. What do you do, forum members?
16:07
Goldwater - you do realise that your figures take no account of the activity and costs required to actually get the oil out of the ground, treated and then transported via TAPS to market? I mean, are you being serious here? Do you expect the well not to cost a penny? Do you expect 88E will be gifted the steel pipes for free? Do you expect the drilling, fracking and production contractors to work for free? Do you expect the State of Alaska to give 88E a free pass on paying the state their share of royalties and taxes?
C'mon Goldwater, you cannot possibly believe your calculations are in any way realistic?
14:42
Goldwater - that is by some considerable margin the most ignorant post I have read on this forum. Forum members - buy/sell/hold 88E but please do not base any decisions on the "calculations" posted by Goldwater @14:42.
70 Bopd x 6=420 Bopd = 100 Dollar a barrel [70bopd was a peak rate, yoiu cannot rely on this figure for production or revenue modelling. The ambiguous, at best, data from Hickory-1 suggests a Long Term Production Test (LTPT) of each reservoir is required before you can make extrapolations like 70x6.]
42,000 Dollar a day.x 365 = 25 million Dollar a year. [Ok, your POO is inaccurate. When analysts model future wells, they normally use the forward curve. You should use $70-$80 or thereabouts but hey-ho. But let's continue with your fantastical 420bopd and your $100 POO, ok? $42k per day or $25m per year, you say? That is ridiculous, completely ignorant. Putting aside for now the capex required to build pads, drill the wells, treat the oil/gas/water, etc, etc what about the opex required to maintain the operation? What about the royalties to the State of Alaska? What about the local taxes? Jeepers creepers.]
If 12 time = 50 million Doller a year output. [same as above but larger dollop of fantasy.]
All - please ignore Goldwater's post. Made up drivel.
15:41
Victorcalin - can't come up with any intellectually-based content so let's abuse another poster. Yep, that'll do it.
How about forgetting the abuse and come up with a cogent solution for the bind 88E finds itself in?
15:38
Fact check for Killerpidgeon? False. I have no short position in 88E.
Now then, Killerpidgeon, do you think Burgundy will pay US$3.625m to 88E by the end of June'24? Do you agree that, on the current formal company guidance, the company will be insolvent by the end of June'24?
If you answer yes to the questions above, or even if you are concerned the above may be correct....why on earth would you buy 88E shares today? It is still overvalued v's its direct peer and it's running out of money. A steeply discounted fundraise is, IMHO, going to be required in short order.
If you don't think 88E are in immediate trouble, what's your solution? I'm all ears.