Member Info for Serif

@Yanis. I understand your frustration re the acquisition, but Ftse is down 3%, oil is down almost 6%, every other of the small oilers I track to keep an eye on the market has been marked down today, so it would seem a bit odd to think EOG wasn’t caught up in that as well.

Thing is H - if there is another COVID induced oil crash and we do go below sub1p again (and it’s way to early to predict that yet as no one is yet clear about this new variant), we are now in a much better place to survive and await the revival than we were last time.

Been away for a week and on return little has actually changed. The SP is exactly where it was a week ago, but we are presumably £50-60k richer from Wressle.

Personally I am pleased that the BOD haven’t raised money in the terrible conditions of the past 2 years to pursue new ventures. Much prefer them to wait until we have the cash to do this without additional placings. Do other shareholders really wish they had gone for it? OK would be looking for them to move in Spring with the accumulated profits, but when in the past 2 years would people have welcomed a large additional placing?

OTF - as you are convinced that all Wressle income will have gone on running costs which is clearly worse than the current situation where running costs are covered by our non-Wressle production at this OP, you seem to have answered your own question.

Ryan signing a permit for this survey was bizarre considering his apparent position on “keeping it in the ground”. If he now refuses drilling permit it seems to open the Gov to a clear case for costs and compensation for PVR. It also shows that refusal to permit work on current licences cannot be a point of principle, so what defence does it leave him for refusing other requests for similar permits? Think this is a chink of light for EOG.

No idea where it leaves PVR. They have self funded a survey but have no large enough partner for Barryroe drill because no one reputable will put up money while the Gov is playing the fool with granting permits. Clearly they must have very powerful links in Gov to get someone to make Ryan sign off in the first place - but it all looks like a mess and a morass of conflicting interests within the Gov. At some point Ryan’s lofty aspirations will meet reality - quite possibly next year looking at the agenda -- and then either Ryan or his policies may not survive the political fallout.

I suspect you are right about Ryan but then he is only the current Environment Minister and these are becoming larger Gov decisions. I think he has tried to predetermine the Energy Review report by forbidding them to consider the option of exploring for more indigenous resources. Probably a big political mistake as this will seem ridiculous to many in a strategic review and he can’t now use the report to respond to the obvious question - why not? It’s just ideological, which rarely cuts it when people’s lives and livelihoods are at stake. Suspect he thinks he has a cunning plan to reveal how to square the circle of needing gas for decades but not having any secure access to it - but as Baldrick found out, others can sometimes see flaws that you may have missed!

Thought this was an interesting comment (in Greennews.ie referenced on Prd board) from Ryan - can’t wait to find out what his secure source of gas is going to be!

“Speaking before the Joint Oireachtas Committee on Climate Action (JOCCA), Minister Eamon Ryan noted that gas will be needed in the energy mix for years to come as it was essential to “cover for when there was a failure” when supplies of renewable energy falter.

However, he added that in his opinion “LNG imports will not be needed to give us that security”.

Elaborating on his position, Minister Ryan cited examples of energy terminals in northwest Europe previously expecting gas deliveries earlier this year only to have those imports re-routed to Asia as it was where the price of the fuel was notably higher.

He added that he will be making that case once a national energy security review has been completed. “

Re Morocco continued interest in exploration:
https://www.spglobal.com/platts/en/market-insights/latest-news/natural-gas/111221-morocco-to-start-downstream-division-for-domestic-oil-and-gas-projects

CFQ - agree with what you say.
It strikes me on Ireland that signing up to this new group was easy as it was their policy already. Still haven’t actually changed the policy re current licences - and it makes you wonder why not at this perfect publicity moment? Suspect doesn’t have Government support for this (plus perhaps legal considerations) and would draw too many awkward questions about where Ireland’s gas is going to come from over next 20-30 years. Have still to see their plan to manage the energy shortfall and will be interesting to see the reaction to this when people focus on the practical implications. They are hating on their own gas and imported LNG at present but making Russia your monopoly supplier for the future might seem a tad foolish!

The published volumes are small and buys clearly outweigh sells over the last couple of days, so I suspect there is a large sell being worked in the background which is dragging us down this much.

H - 18 months? What would I have predicted 18 months ago in March 2020 - zero? So much can happen in that time - new ventures, farmouts, new CEO, world crises etc - all of which are unpredictable in their impacts. But for next 6 months I would go substantially higher than today - based on revenue strength alone boosted by strong oil prices - especially if we persist shortsightedly in attacking supply while doing little to drive down demand!

@Yanis. Would love to see the SP rise like everyone else invested. I’ve just accepted that EOG aren’t a PR type organisation. So unless he’s planning a placing why would SO care whether the SP is 1.6 or 1.3 on any day when he knows there is more substantial news coming down the line shortly? Even without announcements EOG is probably making a Wressle profit of between £60-70k a week - this isn’t just a “prospect” that needs constant promotion to maintain value - its giving the company the cash it needs and we have hit lucky at a particularly fortunate moment in the OP cycle. Let real news from Wressle do the talking (cash profit could equal current MCAP just 2 years, yes there is a big disconnect at present!) and I would be happy if he did nothing else right now than work the Morocco farmout for a Christmas present!

@Yanis. There seems no volume across most of the companies in this sector at present. Our JV partners are doing no better and UJO bragging about their first million did little good to them. We have substantial news to come on Wressle - CPR, upgrade of equipment, maximum flow rates, harnessing the gas, deciding on final production rates - much better to update the market on substantial news if you want to impact the SP - otherwise it’s just a one minute wonder.

Apologies in advance but I got hints of Monty Python there! Sometimes it helps to start the day.

@Cloves. Yes there was an apparent deal with an unnamed Major on Inishkea, which collapsed with their apparent strategic withdrawal from Ireland - and I think the current players were on the Board at the time although in different roles.

Of course since then we have had 18 months of COVID and a year of terrible oil prices, so I am not sure EOG have been any more of a “dead duck” than other similar companies. In fact post Wressle success we could be more Phoenix than duck! And if we keep on banking the the profit up to Christmas before splashing out on new ventures, the SP should eventually respond accordingly.

This is what Mark Abbot says about Wressle in his latest interview at 5.50 mins - just listened to:
“Our key priority is to optimise the oil production from the Wressle oil field. We are looking to improve the gas handling and debottleneck the operations there, so that we can reach the well’s full potential and more importantly revenue production. We will also be progressing the monetarisation of the associated gas production at the site that will add a further revenue stream. And we will be looking to develop our plans for bringing the Pstone Flags reservoir, where significant additional oil and gas are present, into production in due course.”

Sounds pretty optimistic - especially the bit confirming that the gas is the current bottleneck to exploring the potential oil flow - where as he says earlier “with facilities constraints” they have already achieved “up to 884 bopd”.

That poster seems to say that they are getting their info from chats with Mark Abbot - so may hopefully be reflecting the positivity of the operator - although I doubt the operator would be claiming that a flow at half choke would necessarily be doubled if you opened the choke fully! Seems to be an enthusiastic supporter of EDR who never mentions EOG - although from what I can see we have the same upside but none of the debts!

Re lack of EOG PR - at least it’s another indicator that they are not thinking of a raise any time soon! This in any case seems an increasingly less likely IMO as the weeks slip by.

500 is not a planning constraint - or at least those that have claimed it is have never been able to provide the documentary evidence - and I have found no mention of it in any of the planning documents used in the Appeal. The traffic management plan did seem to have been calculated on the working hypothesis of 3 tankers a day, so that would be 600-700 bopd, but don’t think increasing it by a couple a day would be a planning issue to be considered by committee, if it needed any formal notification at all. Think it’s just a technical issue - if the equipment was designed to handle 500 bopd, flows at 70%plus higher than this might take it out of spec. for longer term production.

GP - I don’t think a company which takes a well development application to planning committee on Day 1 of COP26 is that sensitive to the summit!

But more seriously, I will take your word for it on the gas/oil ratio. I think we all become so cynical about the info and puff put out by AIM companies that we question it even when it is straightforward good news. Rereading the RNSs I think someone has to want to find a negative angle to unpick because otherwise the message is pretty clear. That is: Wressle successful beyond expectations, flow rates achieved of 884 on half choke which we couldn’t explore further with current equipment, phased upgrade in progress which will allow us to open choke further and identify maximum sustainable plateau for flowrate, production level to then be set for optimal well/reservoir/commercial outcomes. From what they have said I think they are very confident that high production rates can be achieved - the question is how high and how much will all the data acquired significantly upgrade the CPR figures to support higher level production over the longer term.

Personally I considered 500bopd a big success after so many other disappointments - Simon is now calling Wressle “astonishingly successful” - and if I was to guess they would probably be delighted at any production rate between 750-1000 bopd - that’s a massive increase on what was targeted - but looks to me to be a not incredible outcome from what we know so far.

Spot on GP. As said previously they may well have dropped the rate while they await upgrade - especially if it was producing more gas than they wanted without the gas to power equipment or too much oil flow for their current equipment based on a 500 bopd spec. Since they are now upgrading rather than simple waiting for the initial flow to subside and opening the choke further, they presumably believe that a sustainable flow much higher than the current bopd is achievable.

Quite how this all works out in terms of balancing the maximum possible flow rate (still unknown by anyone) with the optimal production rate for the well conditions and the management of the reservoir is the big unknown at present. What we do know is that Wressle has already far exceeded the 500 bopd expectations and is producing gas that will at least power the site which will in turn reduce costs and make whatever is produced even more profitable! I think that there is still more good news to emerge from Wressle as the upgrade is completed and all this becomes clearer over the next few weeks.