Member Info for shakeypremis

We'd better hope these prospects come in.

Regarding Morocco pipeline value, if your company goes bust then you can only sell assets for firesale prices and what exactly would one with such a pipeline in Morocco at the moment as there isn't any gas nearby apart from SDX's small wells.

Sorry 2023 CAPEX forecast is US$11.2m (made up of US$1.2m PP&E and US$10m exploration expense). Hopefully there is going to be the need for huge CAPEX programmes, particularly in Morocco. BNP don't seem to think there will be in 2022 and 2023 but who knows what this company will try to do.

After looking at the latest BNP report I've now worked out why they are forecasting massive drop in revenue in 2023 and transition to negative free cash flow in 2023 onwards. They are forecasting essentially zero production in Morocco in 2023 onwards because reserves will have run out by then. South Disouq production forecast also starts declining in 2023 onwards.

This is now a seat of the pants operation. The market is valuing this company like it doesn't have a future and will continue to draw on cash as it tries and fails to find more reserves. That may or may not happen. I do expect them to find more gas in Morocco, they have a good track record there.

Each year of production in Morocco at the current rate and current gas price (which may be revised up for any new customers - not that they have the gas at the moment to really attract anyone) is worth about US$20m in post-tax free cashflow net to the company. It's hugely valuable and another year of production would transform 2023 FCF from slightly negative to about US$20m positive which would be added to the balance sheet and leave SDX with around US$40m in cash on the balance sheet by YE2023 (although that assumes that BNP's forecast for 2023 CAPEX is accurate at US$10m).

One small plus from this horrendous smash after Hanut result is that there is now more daily volume in the stock. Which of course helps liquidity. When you can't buy or sell a stock on certain days as is often the case with this stock it makes it unattractive to some.

I ask myself that every day. To be honest - I wonder why others are too who question why I am.

They have can't possibly meet the targets to be given those options so they've most likely given up on that. It still laughably states on the SDX website that they aim to become a mid tier E&P. Absolutely no chance of that.

Or they could use some of the cash they hopefully will have by end of next year for an acquisition. Of course as is customary with SDX looks like they've been too slow with that one too as we appear to be entering a new energy bull market and SDX won't be able to afford anything significant that is already producing and don't have the money to explore anything.

Much larger reserves than they have at the moment. The market needs to see that one or two bad drilling seasons can't cripple this company and essentially make it worthless. At the moment that risk is very real and has been becoming more real as time goes by without any significant drilling success.

Seemingly nothing can stop this going down.

Once again UKOG is now worth more than SDX.

Neither SDX management or the BNP analyst got back to me. I think it's unlikely management will ever email me again. I don't think they like me inquiring in to just what it is they are doing.

Look at their forecasts for freecashflow for 2023 onwards and you will see it's all negative. Their note literally says that. I am not fabricating anything. Auctus Advisors forecast something completely different and I am trying to work out why the two are coming to such different conclusions.

Very bottom of this screenshot.

https://ibb.co/nfydKv1

As I have said, I don't understand how BNP have concluded that revenue will drop by quite so much in 2023 and onwards. The realised BOE price in 2023 drops substantially in 2023 onwards and that can't be from oil price forecasts as SDX produce sod all oil. The drop in revenue is coming from the forecast drops in production and the realised price per BOE. I don't understand how they have arrived at the drop in realised BOE price in 2023 onwards.

It's actually not the CAPEX wiping out free cashflow in 2023 in BNPs note. The CAPEX is much reduced. The revenue absolutely tanks by about US$20m in 2023. I am trying to working out if it's simply the drop in production or if it's that combined with another big drop in realised BOE price in 2023. I don't see how the BOE price can be 30% lower than it is in 2022. I have tried to contact BNP and SDX management to clarify the figures show but no response so far.

In contrast the Auctus Advisors note paints a far rosier picture with free cash flow all the way up to 2025, which is the final year they have in their forward projections.

Still waiting... somebody better reply to me.

There's another note from Auctus that paints a far rosier picture, production still falling but free cashflow staying positive all the way up to 2025. Question is who is right? And also will SDX management just blow any and all operating cash flow they get?

I am still waiting for a reply from BNP/SDX management on the BNP note.

You should not assume so much. I was making a comment about where a new supply of gas (other than SDX's) might come from in order to push SDX's gas prices down. Unless, of course the imported bottled gas gets massively cheaper. No idea. There are some nat gas projects getting underway in Morocco but they won't be ready for 2023 to push down the gas price SDX receive.

LuckCounts. No idea. I have emailed management and analyst at Exane BNP who produced the report. Let's see what response I get. Egypt gas price is fixed and not moving so it can't be that if indeed there is a real change in gas prices coming. It can only be Morocco, although I don't know where that gas supply to Morocco is going to come from.

https://ibb.co/0Zrfqqf

Could it be caused by the realised price per BOE Exane are using dropping from US$23.4/boe in 2022 to US$16.4/boe in 2023? They should know that SDX's gas is fixed price so why have they modeled a drop in realised price per BOE? No clue. I will contact management, might even try to contact Exane. Let's see if anyone bothers to respond.

https://ibb.co/3zr6jP5

This is Exane BNP's model of the cash-flow statement. They are predicting an enormous US$21m drop in operating cash flow in 2023. Below is the income statement where they show where that comes from. Seems to be caused by a 7mmcf/d drop in SDX's WI gas production. Must be from the predicted decline in SD gas production? But SD doesn't generate that much in operating cash-flow, even now. They must be modelling a production decline in Morocco too? That doesn't make much sense.

https://ibb.co/8dJ951N