Member Info for ShouldveSold

N.B

I don't understand why anyone feels the need on to argue on behalf of the company to convince me otherwise.
The results speak for themselves.
Success= hooray, zero disappointment.
No success= questions

Thought I would start a new topic to prevent it being deleted.

Balancing the data which indicates oil is present in abundance against exploration results that detail "Oil was once here in abundance but has evaporated away", I think is a reasonable thing to do, if considering to keep exploring.

Investing with ones heart instead of one's head never ends well. Never invest more than you can afford to lose and always DYOR & do seek investment advice from a professional.

If you have invested more than you could afford to lose, it is reasonable to post with angst & anger.
Like many I am disappointed as I am down. However could afford to lose what I invested. I don't think its appropriate to blame other posters for the company results.
I don't concern myself with how others choose to invest.

TMWSDI5S

*2018 quote*
chief executive of the Bahamas Petroleum Company, is slashing his salary from £773,000 to £270,000.
Former BP executive Potter was hired during the oil boom in October 2011 on £773,000.
However, when oil prices crashed to below $40 a barrel in 2016, he asked for 90 per cent of his salary to be deferred to shares and cash.
*end quote*

I don't know how accurate this is to current renumeration.

So the reason no company has discovered commercial oil is because "historic wells were drilled in the wrong place". Sounds like water is wet to me.
Was P#1 also drilled in the wrong place?
Isn't Doubloon Saxon in BPC's southern Donaldson licence?

I wouldn't mind BPC keep searching if each exploration well cost $1m. My position has always been "BPC does not have the funds for off-shore deep water wildcat exploration".
All I want is a return on my investment. Not a legal title for tat argument by a self elected company barrister.

The CEO is on a £1m salary?????

All that data which indicates the oil is there is great. No company has been able to find it yet because that Bahamas report said its evaporated away. So far that is proving to be accurate.
The question am I left asking myself is why BPC have chosen to be that company that continues to search when Oil Super Majors before them have tried and failed.
Feels like a need to turn left when everyone else is turning right. There are situations when that strategy works out.
I don't know if oil exploration is one of them.

Separately, the company results speak for themselves. If P#1 found commercial oil, T&T production was above 1000+bpd & rising, free cash flow was covering opex, funding capex and the company was paying a dividend. everyone on this board would be drinking champagne, praising the BOD & welcoming any objectivity.

The company being on its knees is not a direct result of me joining this site in December and asking questions, as one of two posters would have the board believe.

I read from the corporate update that BPC values their market cap around £31m but the market values it around £23m. How does that work?
I also note from that graph that they chose to leave off the Bahamas & Uruguay  licences. Is that because they add zero value or would that mean they not classed as assets just yet, but liabilities? Or are they grouped together on the end in light blue as the "Risked Upside"?

If BPC are currently generating (projecting) circa £3m profit by year end but combined capex & opex by year end will be circa £4.6m. *not including P#1 costs & legal costs*. That's a year end loss of £-1.6m EBITDA right?
Maths wasn't my strongest subject, help me out here. I'm sure there was an outstanding tax loss carrot being dangled in previous post. I'm sure someone can do the maths & give an accurate forecast.
My point being, are these the real reasons why the market values the SP where it is & not actually because of posts on this board?

The P#1 diagrams show the oil they found was " Dead Oil". I had to Google what dead oil was. It means evaporates, just like was found in the previous historical wells:
•Long Island 17,577ft Well
•Great Isaac 17,847ft Well
•Cay Sal 18906ft Well
•Doubloon Saxondale 21,740 ftWell
•Andros Island 14,583ft Well
{note the layers these wells drilled into/through}
*quote*
Overall, the well results indicate the presence of a active petroleum systems, based on the presence, especially in
the pre-mid Cretaceous sections, of oil shows of varying quality, abundant reservoirs and seals, indications of source
rocks, and hydrocarbon saturations from log interpretation.
*end quote*

Sound familiar?
The historical Wells were drilled by Gulf Oil, Chevron, Shell, Superior Oil, Tennaco & Mobil oil, all Super Majors. They all found  the same thing that BPC found; a W.P.S containing dead oil.
6 Wells drilled in Bahamian waters, all 6 classified as non commercial. All 6 found the same conditions.
Are you happy with the company decision to renew the licences for BPC to keep looking? Would you be interested in Farming In to a arceage with 6 Wells dotted around the region all finding the same thing? A cracked Bahamian shelf where the oil once was has at some point leaked away and evaporated. *these are not my words/opinion or interpretation*

What are BPC hoping to do in the Bahamas? Is this operation about one man's pride. Just so the last 10 years would be for nothing?
I'm all for BPC finding oil but not like this.

Nice to read something here which tries to inject a little fun & humour back onto this board. Its all pistols at dawn & my research is better than your research.

What would I do if was a director or CEO:
•Slim down the corporate structure by vacating the Commercial Director & Gov Relations Director positions.
•Allow the Bahamas Licences to lapse
•Focus on core assets & organic growth from existing production wells.
•Get a CPR done so the company actually has proven reserves.
•Abandon the Wells in the portfolio that arent producing enough oil to be financially viable ( unless abandonment costs are so high it doesn't make sense)
•Stop reinvesting all profits into Capex in wildcat off shore drills.
•Raising production so the company  becomes self funding. If that means less rapid accelerated push to drill new on-shore wells by waiting for ROI & each well to become profitable before drilling the next well. So be it.

All that being said, I am happy with the Saffron push to organic growth.

I do like reading how others interpret the data & their reasoning as to how they reached their conclusion. Even if I disagree with it.

Lots of realistic posts today which are candid & not wrapped in fairytale possibilities. Which is refreshing to see.
:)

I would love to know what the market cap of BPC today would be minus the Bahamas & Uruguay assets. If it would be around the pre-merger range of 16-17m or lower/higher.
I think those diversifying asset are having a negative affect on the SP and without them, it wouldn't be held back by the Capex needed maintain them. And the SP  would gradually rise with the progression of each new Saffron well & production increases across the T&T portfolio.
I do think that will happen any way but growth will be restricted because of them.
I also think if BPC chose to not renew the Bahamas licences that would of had a positive affect on the market sentiment & SP. I don't know that, but that's my feeling.

I am unsure if the Bahamas & Uruguay assets add value to the market cap or remove value from it.

The historical exploration information on the geology of the Bahamian basin/shelf is available for all to read, reference & interpret. Just Google any of the 5 historical well results.
One can choose to not read the information or choose to place little value on it because it was done with modelling and analysis of the 1960-1980s.
One can also choose to trust & have confidence that BPC know what they are doing and can, despite history repeating itself, actually find an structure which contains vast amounts of recoverable oil where the geological conditions are unique & unaffected by the historical geographical data.

I will add that finding that historial information today has now changed my sentiment towards Leo.
I believed the reason he pursued the merger with BPC is because the data on the Bahamas was impossible to resist and that it would lead to the "once in a lifetime discovery that geologists dream of.

Surely every oil company in the world is aware of the historical status of the Bahamas & exploring there has never led to a commercial find. So why would Leo derail the 3 year CERP plan on a non proven basin?

I would urge the reading of the aforementioned article as it references previous historical drilling depths multiple times deeper than P#1.
Factoring that information in to help understand & interpret the decision to abandon P#1 short of the possible TD may make more sense now. It may not.

Just to provide some balance & remain objective.
Take all of the information contained in my previous post & flip it. (Fictional)
They say the best place to find oil is where a oil has has already been found.

•The region has an abundance of historic commercial wells over an area of 124,000km2. Which have all tapped into the Bahamian basin which contains an estimated unrisked 28billion barrels of oil.

•A deep (> 6 km) well, the Doubloon Saxon 1 well, drilled in early 1986 on the Great Bahamas Bank. A W.P.S has been confirmed with the discovery of a competent seal, large structures containing commercial volumes of oil with estimated OIIP of 10billion of which 20-30%% is deemed recoverable. With estimated flow rates in the region of 100,000bpd.

The fictional scenario above is what I would consider as having a high probability of a imminent Farm In with P#1 being classified as a exploration & production well, followed by a field development plan.

I would love this fictional scenario to be the current status in the region. But the current status can be found below.

Google " Bahamas_AtvR44R (1) " and read the keyfactsenergy article. I would encourage everyone to read the entire document as it gives the real historical situation which covers the last 60 years of exploration findings in the Bahamas.

Jono I acknowledge & appreciate the nod.
I am trying to not address people directly any more as it just leads to posts being reported.

The information contained in that article is in the public domain. I am not using it as leverage to push a particular agenda. Instead I am using it to better understand the decisions being made by BPC & manage my expectations.

Make your own interpretations and even though I provided that research, do your own.

•The region is significantly underexplored with only 5 historic wells over an area of 124,000km2. All five wells encountered oil shows.
*excerpt from BPC website*

I googled the Doubloon Saxon 1986 well result. Doing the same might be informative for anyone who is interested.

•A deep (> 6 km) well, the Doubloon Saxon 1 well, drilled in early 1986 on the Great Bahamas Bank, shows evidence of massive seal failure through tectonic and post-tectonic diagenetic alteration. Seal failure occurred through a hydrodynamically induced chemical alteration of a carbonate (limestone, dolomite)-evaporite (anhydrite, halite) sequence into a carbonate (dolomite and dedolomite) sequence. Evidence for this alteration includes a thick (3.5 km) fractured dolomite sequence interbedded with dedolomites. Fracture origins include solution collapse (of original evaporites as shown by anhydrite cement on fracture surfaces) and cavernous porosity, and by tectonic fracturing (a major reverse fault penetrated with > 1 km repeat). Additional evidence includes a temperature regression and geochemical anomalies above and below the proposed altered sequence. It is concluded that massive seal failure is a contributing factor in limiting the petroleum potential of portions of the south-western Bahamas Platform.
*Doubloon Google result*

I see a correlation between the two excerpts.
5 wells historical well have been drilled in Bahamian waters. All 5 well established a W.P.S but none encountered commercial oil. Evidently the reason why the oil is not where the data says it should be is referenced in the second excerpt.

Reading yesterday's RNS that BPC will continue to spend capex by renewing the licence & seeking a Farm In partner to continue exploring in an area which was declared in 1986 as(I paraphrase)  " the Bahamas has a big crack underneath it which caused all the oil to leak away", of great concern to me.
Maybe this is why the area is under explored, because of that research.

Being as a "good competent seal was found", I'm sure some that will disagree with the Doubloon report and give hope to those who see P#1 as a success and see P#2 as having a higher CoS.

I don't know what all of those big geology words mean. I don't know if any one or any company has disproven or found evidence that contradicts the Doubloon findings. I don't know if all the oil has leaked away and collected in a B structure that people are so fond of. I don't know if the fracture runs across all 4 southern licences. But I guessing that's why BPC had to do this alone. Because the majors did not want the challenge of proving that report wrong or inconsistent.
I am using the report to manage any further expectation I have on the Bahamas licence.

Make your own interpretations and DYOR.

TMWSDI5S

Got to spend money to make money right?
I think a lot of AIM companies can't get out of that vacuum.
I would like BPC to raise production & cash generation and I would prefer those two figures determine how to proceed with diversification, not the other way round.
The previous RNS detailed they have now refocused on doing exactly that.

Continuing to diversify when one should be consolidating is about being able to make good management decisions based on what is best for the business. Is funding two off-shore diversifying projects when the company cannot fund them through current cash generation a good business decision? I won't give my opinion on that.

The "hole" was not dry because they found oil. Oil is wet. Ergo "the hole was lubed". Also the market has completely ignored the W.P.S. Google Haas !!
Industry experts & specialists will tell you how valuable it is.

TMWSDI5S

That last post although technically correct from a chartists perspective was quite negative. I am hopeful a big buyer will capitalise on the undervalued buying opportunity today so it could hit 000.8p at the close :)

From memory the lowest point in the LGO chart was 000.24p. Its never been that low since the old days. The SP may have a go at testing that resistance line this week.