Member Info for Scot126

Part 2, continued from below.

D) 88E is most definitely not "a sustainable business". That's just made up nonsense. Whatever decision any reader makes to buy, sell or hold 88E shares, please do not rely on such gibberish.

E) Ok, let's confront the intellectually moribund gobbledyg00ok spewed by so many on here. The SP went to x pence in 2022, in 2021 before that season's well was spudded so it must do the same again. Oh, we can add in the "discover oil => SP must go up megabucks!". Absolute codswallop. Not one of you has taken on this nonsense because you're all scared to point out the fallacy of such statements for fear that everyone admits this whole big game of pass the parcel won't eventuate this season. Truth is you all need naïve and credulous "first time buyers" to keep the parcel going round the circle. Proof? 88E owns a 100mmbo reservoir called Umiat. Dave Wall bought it for the cost of making an old well head safe, was it $1m or thereabouts? Sure, 88E management will make a big hullaballoo if there is proof of hydrocarbons in the Hickory-1 logs, you'll all act as if you've won the lottery.....and then the sector commentators will, just like Dave Wall and I have done when valuing the 100m barrels of *reserves* at Umiat at $1m, ask if even one barrel suggested by the Hickory-1 logs can be produced commercially. Can you imagine what Muddy Waters is going to do when they see 88E pop up on their screens? They don't believe in PANR's assets so they'll absolutely smash 88E's far smaller, poorer quality portion of the shared asset. These are shared reservoirs, folks, and its a geological fact that 88E's portion of these shared assets are downdip, have greater phasing risk and have potentially very serious implications from Dmax calculations.

F) Let's get back to the facts and fundamentals. Why would a rational investor or clever punter/gambler buy $eeenf at 22p per recoverable barrel in the ground v's $panr's 18p in the ground? Remember, the figures in the previous sentence *require* Hickory-1 to prove up *every single barrel* of the 647mmbo being targeted. Look at the geological CoS published by 88E. There's not a snowball's chance in hell that 647mmbo will be proved by this one well. The correct calculation is probably more like PANR @ 15p per recoverable barrel (upgrades already trailed for Alkaid deep, Alkaid anomaly, SFS, Kuparuk and from the new leases extending the BFF at Theta West) and 88E at 28p+ per barrel in the ground.

G) To anyone who genuinely believes 88E's *current valuation* will be underpinned by a semi-successful Hickory-1 outcome, or a fully successful outcome for that matter, the numbers categorically do not support that contention.

Don't believe me? Ask Brom and the other prolific posters on this forum and on other social media platforms. Read their content. They're relying on gee-ing up the less knowledgeable in order to take advantage of them to deliver a trading profit. Pass the parcel. Fact.
outcome

...there's no doubt about it, this forum contains some of the most warm-hearted and open-minded investors/punters on the entire planet.

Right then, back to some home truths.

A) To prove what a stand up bloke I am, I think you can all chill out about the rig arriving on time to spud Hickory-1 at the start of March. The plan for the rig is (and always was) for it to be parked in a corner of the Alkaid-2 gravel pad until 88E's pad was ready. Then the rig travels at 1.5mph down the Dalton Highway (about 15-20 miles or so) to the Hickory-1 ice pad.

B) We know Hickory-1 will be drilled and logged in March/April, agreed? Then, if warranted, 88E will return to Hickory-1 in the 23/24 winter season to conduct a flow test(s). Here's a heads up for all GLTHs. No matter how many lovely pictures are published showing beautiful hydrocarbon fluorescence colours from Hickory-1, be prepared for a massive dose of scepticism from the wider market. How come? Look at the PANR experience. The market, by and large, refuses to acknowledge flow test results from vertical pilot holes in Alaska. Some sector commentators will even accuse management of publishing fraudulent results such is their scepticism about the producibility from tight, conventional reservoirs. "But, but, but that's a PANR only problem." Er, no it's not. 88E's reservoirs are downdip of PANR's (look at the diagrams!) and 88E's reservoir characteristics are *more* challenging than PANR's (PANR's being updip, plus lower phasing risk plus lower Dmax risk). So get ready for extreme scepticism for "logs data only" from sector commentators. I forecast they'll scoff at "logs data only"....they'll then scoff that flow tests won't be executed for another 12 months....and even after any *successful* flow test results are published this time next year they'll respond with "it doesn't mean anything on a vertical test well, we need to see empirical data from a Long Term Production Test using multi-stage fracks on a long lateral. Don't believe me? Go check what the bears are saying about PANR's assets.

C) Longhorn. I continue to be amazed (and genuinely saddened) by the lack of capacity and/or genuine curiosity displayed by members of this forum. Yes, Longhorn is producing revenue but look at it on an annual basis. As a couple of posters have helpfully tried to point out, the dividend from the Longhorn jv hardly covers 88E's G&A. Sure, there are more workovers and new wells planned.....but who's going to pay for them? The 88E GLTHs! Longhorn was a clever purchase IMHO. It delivers cash to the business to pay employee salaries for the foreseeable future *even if* all of the 88E Alaskan assets turn out to be worth zero. Value of Longhorn now? I dunno.... let's say the value add from the workovers so far has doubled (I'm being generous here) the original purchase price. In the overall scheme of things, so what, big deal?

Part 1.
Part 2 continued above.

A reminder to all those complaining about the comparative analysis on 88E and PANR. As soon as Dave Wall (former MD of 88E) confirmed via RNS that 88E and PANR shared an asset in Alaska it became *imperative* for fundamental analysts to undertake comparative analysis on the two listed companies. That's exactly what equity analysts the world over have done for decades. Why should 88E and PANR be treated any differently? I 100% promise you the O&G equity analysts who follow either/both companies will have a spreadsheet on both stocks. I know this because I was one of those guys.

23:04 Hi chrisev1 - if you genuinely believe what you've written in this post then you have failed to undertake any fundamental analysis because, bluntly, there is no known dataset whereby the maths of the two investment cases supports your forecasts. None.

If on the other hand you're writing deliberately fantastical numbers without any basis in fact then you're effectively admitting to relying entirely on credulous newcomers to the 88E narrative to deliver you a profit on your trade. In fact, you've just added fuel to that fire, haven't you? Why not just admit to fellow members of this forum that you're relying on the annual, uninformed ramptastic rampathon to attract punters/newcomers who you seek to take advantage of in order to profit from their naivety/greed/lack of knowledge?

No attempt to engage on the fundamentals or maths by anyone so far. Pity. I'm sure tomorrow will beckon in some more cerebral posts.

....continued from below. Part 2.

i) PANR has still to issue guidance on the SFS and Kuparuk reservoirs, with upgrades guided to be incoming for the Alkaid anomaly and Alkaid Deep. In addition the market is yet to hear from PANR of the extent of upgrades to OIP and recoverable resources from the additional lease blocks secured in the latest state auction. Remember these blocks are thought to herald an extension to the multi-billion barrel Basin Floor Fan at Theta West. Thus the pence per recoverable barrel for PANR will be moving towards c.15p, whereas 88E's 23p per barrel calculation requires Hickory-1 to prove up every targeted barrel, with no flow test for 10 months. We all know there’s an extremely low probability of Hickory-1 proving up all 647mmbo so the 88E number is highly likely to move north of 27p per barrel in the ground.

Without question 88E enjoys higher retail exposure than PANR in the US. For those who enjoy an annual game of 'financial pass the parcel', using 88E shares as a proxy for the parcel, knock yourselves out.

For any observers who seek to anchor their judgements in empirical facts and research then there is a clear leader on all risk/return metrics. PANR is cheaper on a risk/return basis than 88E; PANR offers ***multiples of upside risk to its current SP v’s 88E’s***; PANR is literally years ahead of 88E in data retrieval, resource classification and proving up its investment case. /end

I readily acknowledge the following content will be of no interest to those uninterested in the fundamentals of the 88E investment case. In fact, those who describe themselves as punters or gamblers or “swing traders” will resist its message and abuse me, as has become the norm. Please note that not one of them will volunteer to get into the specifics of the *facts* of the two investment cases I’m about to discuss. That one observation alone should tell you all you need to know.

I also accept a clear majority of readers of this forum are punters and not investors. It’s a financial game of pass the parcel for these folks as they look to spike the credulous fantasists in order to profit themselves. I repeat, I accept this.

However, there are quite a few forum members who purport to be interested in data, facts, research and analysis. This post is written for them.

Comparative valuation of PANR and 88E.

Let's begin by stipulating 88E's Hickory-1 well confirms every single barrel of the 647 million barrel prospective mean unrisked resource (net to 88E). [It won't but we'll use this figure for the purposes of this mathematical exercise.]

88E's mkt cap is £146m and PANR's is £460m. Using PANR's guidance of 2.3bbo recoverable resource, the market is effectively valuing each PANR barrel in the ground at 20p v's 22.6p per barrel in the ground for 88E. This is madness IMHO.

And here's why:

a) PANR's portion of the shared assets is updip, 88E’s is downdip.
b) 88E's portion of the shared asset is not only downdip but has increased phasing risk and potentially serious implications from Dmax calculations.
c) PANR has intersected the stacked reservoirs across six wells on multiple occasions and has conducted flow testing on four of those six wells. 88E will not conduct its first flow test, if warranted, until the 23/24 winter season.
d) PANR has had proprietary 3D seismic data since the mid-2010s. PANR/GB invested c.$80m to shoot the largest 3D seismic study ever conducted in Alaska. OTOH, 88E licensed a pertinent 3D data package only last summer. [NB 88E has not advised its shareholders of the *total* cost of licensing this vital 3D data, only "partial" or "initial" costs have been described. Why is that?]
e) PANR has commissioned 2x IERs on Alkaid and the SMD at Talitha. They are about to appoint an Independent Expert to author an IER on Theta West and to update the Alkaid document.
f) PANR has commissioned AHS Baker Hughes to undertake VAS studies x3. 88E?
g) Schlumberger has independently validated an OIP figure of 17.8bbo for PANR. 88E?
h) PANR has been granted two Production Units by the SoA. 88E has recently applied for its first.

Part 1, continued above.

I am 100% happy to be corrected on the following "admin process" but here's what I *understand* to be the case. I spent the first 7 years of my stockbroking career in the Aussie market so I know just enough to be dangerous. The Aussies have something called CHESS (Clearing House Electronic Sub-register System) which means it is difficult (impossible?) to even have an order accepted by a broker (internet or voice broker) without your CHESS account having the requisite number of shares *already allocated and credited* at the time of the order being placed.

Yes, for existing 88E shareholders who already held stock prior to the recent fundraise and have used the last few days to rotate their "old" stock in anticipation of receiving "new" shares on 14/2/23, you could say they had the opportunity to "forward sell" their shares. But for anyone who only received 88E shares on 14/2/23 and whose share balance in 88E was nil yesterday, then today will likely mark the first opportunity to sell their stock....in Australia anyway.

Ok, a bit of market intel. I was told by a market contact whom I've known since 2003 that 90% of the funds raised by 88E come from Oz, and the remainder from the UK. I believe him. I strongly suspect Dave Wall/Inyati Capital will have a rolodex of historical supporters of 88E cash raises and will once again be making hundreds of thousands of dollars (via commissions) off the backs of loyal GLTH of 88E. But what's new, eh?! [see fundraising docs for confirmation of Inyati Capital's continuing involvement with 88E]

Can the Aussie supporters of the fundraise "forward sell" the stock they anticipate receiving on 14/2/23? I'm aware some UK brokers offer T+20 settlement, etc, etc. I guess it's possible but I must admit I don't know how long it would take an Aussie fundraise participant to dematerialise their CHESS holding and transfer it to a UK broker for settlement here in London? It *may* be possible, I just wouldn't know how. Perhaps someone like Brom, who has admitted in the past to being a participant in 88E fundraises, could let the forum know if there is any such process set up to execute such transactions? [question: the 88E stock in Oz isn't fully fungible with UK listed securities, is it? And vice versa?]

My suspicion is there will be increased Aussie volume in 88E from today onwards. Another observation? I'm not seeing the US OTC frenzy this season, not so far anyway. The usual UK "swing trading" community are busy doing their thing but they're being greeted by a great deal more cynicism by our American cousins this time around. It probably doesn't help that many of these "swing traders" (a euphemism for a bunch of trader barrow boys who haven't read an Annual Report in their lives and couldn't point to Deadhorse on a map of Alaska) have actually boasted to each other that it's time for the annual "ramp" of 88E. Shameful.

00.42
Neversatisfied - what do you mean by "BoD topping up"? If you're referring to the Performance Rights alloted to Ashley Gilbert, these have been gifted to him. He did not pay for these Performance Rights and they replace an earlier tranche of Performance Rights which dropped away, unvested.

If there was any director/management buying (with their own cash) to support this fundraise, happy to be directed towards it. TIA

chrisev1 - there's a separate ANN (equivalent to RNS in Oz) which confirms the PTD. The same ANN also describes the sequence of events and timing guidance. Hope that helps?

Many congrats to 88E and all who sail in her!

>20bn shares on issue at the end of this latest fund raise. An extraordinary figure, although not necessarily in a good way.

Have no fear, all GLTHs of 88E! There lives amongst us a cohort of gamblers who will go to their graves adamant that a stock which moves from 0.6p to 1.2p offers a better return that a stock which moves from 500p to 1000p.

But wait a minute, there's more good news. A healthy subsection of this non-mathematical cohort also believes that a stock trading at, say, 0.6p inherently has a better chance of doubling v's a 500p stock *simply because of its exceptionally low price per share*. Market cap and other fundamentals mean not a jot to this cohort, but they do all enjoy a high profile game of pass the parcel. God bless 'em and all who sail with them.

12.22 and 01.00
Redbeardoil2 - thanks for the links. I'd already watched the video and read the Unit application, thanks. Looks like you're another one who would do well to educate himself about the difference between formal guidance and the arc of possible future operations.

Let's clear this up for anyone who may have misunderstood from your earlier posts. Hickory-1 is a vertical well designed to collect data across the 6 intervals identified. There is no plan to convert Hickory-1 into a horizontal well, nor to somehow convert it into a production well.

88E may very well construct a gravel pad adjacent to the Dalton Highway in the future. There are no current plans to do so and nor is there any mention of same in the Use of Proceeds section of the fundraise. It's also probably worth noting the number of intersections PANR totted

chrisev1 - I was correcting info in posts timed at 09.37 and 09.42. We wouldn't wish this forum to become a source of misinformation now, would we?

09.37
Hickory-1 will be drilled and logged only in 2023. If merited, the company has indicated it will be flow tested in 2024.

Happy to be corrected but I have not read any guidance about 88E drilling a multi-stage frack, horizontal well. Nor have I read about permission to construct a gravel pad.

If anyone is seeking a morning chuckle, please be sure to have a read of the Aussie placing docs. Good ol' Dave Wall and Inyati Capital are involved, natch. I'll likely never know for sure but I reckon Dave Wall, with all his knowledge of the historical supporters of 88E fundraisings, will earn the largest fees payable on this deal. Funny old world.

Raising AUD$9-12m @ 0.95c Aussie. Price equates to 0.5 - 0.55p.....is that about right?

15.21
Spelling out the bleedin' obvious, Louis10 <=> Oilman Jim.

Jim - I'm not sure advertising your substack complies with the lse T&Cs? I don't *think* it does, do you?

Actually now that OMJ has alighted on this specific forum, it'll be a excellent opportunity to see his trading thesis in action. Once our southern neighbour completes the inevitable cash raise (to pay for their 75% share of the costs of Hickory-1, plus necessary working capital thereafter) good ol' Jim will urge his followers to get on board for the annual game of pass the parcel. And that's all fine, it is what it is.

However, will we be reading Jim's analysis of 88E's extra phasing risk? What about a well-researched article on Dmax? Will he volunteer his comparative analysis on the two neighbours' investment cases? Will we read an admission that 88E is already valued *on the fundamentals* far in excess of PANR? Will he reinforce to his followers the crucial message that his trading strategy concerning 88E relies almost entirely on the naïve and credulous character of the US OTC punters? Note his intention to stick around to witness "the inevitable descent to zero." Let's all ask him directly the following fiercely logical question: if he genuinely believes PANR will descend to zero pence (he doesn't), does he accept the mathematical certainty (based on geology alone) that 88E will arrive at zero pence well before PANR?

We shall see what unfolds. In the meantime, let's all request he shares his risked/unrisked model on PANR and 88E with either the readers of this forum or his other social media followers. He may or may not be capable of building such models (personally I doubt it, though I'll be happy to acknowledge his efforts if he proves me wrong) but this decades-accepted, globally-recognised sector financial model is pooh-poohed by OMJ as unworthy of his time.

Thousands of O&G experts over the last century v's OMJ? I'm going with the sector experts. NB The sector experts do not guarantee success but it's a damn sight better than playing a financial game of pass the parcel.

Final thought for now. If OMJ's thesis is so successful, why seek a pitiful income from a paid for subscription service? Or, and even more craftily, does his trading model *require OMJ himself to create* the very buying frenzy in the run up to operations that delivers *his own* trading profits? Hmmm........

21.59
Dear All - I was struck by Louis10's contributions to this forum over the last 48 hours or so. I clicked on his username and read his back catalogue of content. I'd suggest readers of this forum do the same. I wonder if many of you, actually make that all of you, will arrive at the same conclusion as I have?! Lol

Not true, Louis10. I wish he *had* limited his comments to such matters. Over the years he has made countless, evidence-less allegations about PANR, its directors, management and shareholders.

That's me said my piece. If folk wish to read his output, that's their business. /end

12.39
I profoundly disagree with your characterisation and/or interpretation of OMJ's attitude towards PANR. OMJ runs a commercial enterprise, which is of course fine. Incorrectly in my view, he appears to believe he *must* overlay his thesis on to every single AIM E&P company. His thesis relies on extreme cynicism and a resolute determination that only people of a dishonest character are drawn to managing companies in the listed E&P sector.

I have described below why I believe his thesis is fatally flawed in the instances where serious and ethical people are engaged in a serious and honest endeavour.

Why OMJ persists in believing he *must* disparage the occasional (?) Listed company which so clearly does not fit within the constraints of his thesis is beyond me. Does O€J keep a permanent scorecard visible to his followers of the stocks he disparaged which went on to reward shareholders with a magnificent return? What of the lost opportunities which his thesis cannot possibly capture.

How much more mature and realistic to simply say about those specific stocks that there are characteristics about XYZ company which means that his thesis does not apply? Instead he loses all credibility by posting intellectually unsound conspiracy-laden gobbledyg00k about some inside group needing to sell more shares. What "inside group"? What shares " still need to be sold"?

It's just pathetic. He's patently bright and writes well but I find it genuinely troubling he lacks sufficient judgement or self-reflection to admit that his trading thesis simply cannot capture the underlying characteristics and motivations behind every single stock in a sector. He may declare he follows the sector probabilities but refuses to acknowledge honest management running an honest enterprise. The maths of probability means that not every management team is dishonest and not every asset is non-commercial. Pity.

Correction required.

To the best of my knowledge I have never been blocked by OMJ on Twitter. He follows me on Twitter fyi.

Hi Baxi44 - Oilman Jim thinks PANR is nothing more than a promote. His latest conspiracy theory is something to do with an "insider group clearly needs to sell more shares". It's nonsensical.

OMJ's overarching thesis is not without merit. However, and it is a huge however, his thesis collapses entirely when faced with a listed company run by earnest and ethical directors who employ their honest endeavours and sector experience to identifying and delineating a commercial asset.

In the scenario where one believes PANR management to be honest and being willing to accept the published data about the Alaskan asset (validated by Schlumberger, Baker Hughes, Lee Keeling et al) then OMJ's whole schtick collapses in a heap.

No worries, chrisev1. Happy to correct the post timed at 08.54. Please see correction below.

Kevin - the reason 88E is not going to flow test Hickory-1 this season is because they lack the funds to do so. They were *probably* expecting/hoping for definitive (and positive) Alkaid-2 news to have been published by Nov/Dec so they could conduct a capital raise of sufficient size to fund the drilling *and flow testing* of Hickory-1 . This would also likely have seen the spud date occur earlier in the season.

Instead we have this unusual halfway house where the well will be drilled and logged but not flow tested. To answer your question about SP reaction, yes on the fundamentals any SP rise *should* be limited even if the logs look good. Bears will always be able to point to the lack of flow test until the 23/24 season. On that note, ShareGuru22, how is Hickory-1 going to be flow-tested in Q3? No ice pad until Dec so Jan '24 earliest the flow test can commence? Are you expecting the regulator to allow 88E to build a gravel pad in the meantime? Highly, highly, highly unlikely, agreed?

I see the usual suspects are doing the 88E ramptastic shuffle, pre-spud. As I say every year, it's a massive game of pass the parcel. 88E is already running miles ahead of the PANR comparative fundamentals but I acknowledge few members of this forum give two hoots about that.

Brom is gently warning the forum to expect a cash raise to fund Hickory-1. You can add scot126 to the list of posters also expecting that to happen.