Member Info for spike501

"why I'm still scratching my head"

Stop scratching your head - its the war, there is a major sell off across the markets today, the FTSE is now down 3%, a a huge move and quality stocks across the board are being hit sharply. BP and Shell announced their specific Russian impacts earlier in the week and that was the time their share prices moved in line with that - they have no more exposures today that people don't know about since yesterday, they are simply part of the overall sell off.

I'm in Jadestone as well - almost 20,000bopd, no debt, nothing hedged it should be soaring with oil prices and that is down 5% today and 8% from the peak it hit yesterday before the markets started to turn.

In markets like this, very few people give a fig about the individual prospects of small caps, its a dash away from risk and into safety and I3E is absolutely not immune to that despite what a small number of private investors may think about the prospects for the company.

"Really scratching my head at the sp reaction here."

There is a great big bl00dy war.

BP and Shell are both down about 4% - small caps are down across the board.

"Looks like the board managed to shoot themselves in the foot again. I know it’s all about spreading the risk but the farm out seems to have produced a worse outcome than if they had just gone it alone and had a go from fcf. Oil is at such a high and yet down 7% plus so someone somewhere thinks something isn’t right"

You know there is war right? Last night one of the worlds largest nuclear power stations was shelled and relations between nuclear powers have reached their lowest point since then end of the cold war and probably since the Cuban missile crisis - did you miss that?

This drop is nothing to do with the farm out and everything to do with a risk off move across the markets.

I’ve exited for now - too much political risk here at the moment. Hopefully things improve and there may be an opportunity to re-enter even if ultimately I have to pay a little more than I sold at.

I think probably the market is currently pretty underwhelmed by the partner and the deal. Europa can only fund half of one well, they bring nothing for the long term development, its fair to say they are a partner of last resort.

As I said earlier though I don't think it matters - geo-politics is likely to completely change the way the North Sea is viewed, so a successful drill will become very interesting. Patience is the key here as Canada continues to develop.

"Think I'll pop 10k in EOG. £11m mcap for 25% of Serenity? Based on my previous post that could be worth £140m just as 3c reserves or a lot more when producing. Could quite easily 10 bag on Serenity success (apologies for rampy tone)."

Don't forget there will be substantially more funds required to get to production - EOG just have enough for the first well. There will either need to be a lot more equity issued for future costs, or a further farm down for development carry. EOG shareholders won't own the same share of serenity that they currently do come production.

I agree though they look to have a good deal so as a speculative buy its not so bad.

The fact that a dog like Europa Oil and Gas was the most advanced bidder on what is probably one of the most significant North Sea fields that is at appraisal stage with a relatively easy path to development should the well prove up shows what state the North Sea was in. The deal ultimately also reflects that as only 50% carry for 25% of the field is also pretty unimpressive.

However, clearly the geo-political situation has shifted massively back in favour of ongoing commitment to the North Sea and its likely Europa have now got a very good deal and I3E still retain 75% of a very large prospect that will suddenly look very much more attractive for development.

EBITDA - Earnings before interest, tax, depreciation and amortisation. Its basically revenue minus operating costs and especially in the oil and gas world not particularly useful as a depreciation and amortisation are generally a very significant part of financial results and statements.

NOI - Net operating income, seems very similar to EBITDA as its revenue minus the operating costs.

FCF - free cashflow flow is what it says, its the actual cash the business generates and takes into account capex spending which neither EBITDA and NOI do.

Old news unfortunately

Timelines have clearly shifted

"Am sick of MM bullshot. Alot of exchanges around the world have no market makers. Wonder what the traders there talk about?!!!"

99% of what you read or think about MMs is tosh.

Shame its taken a bit of momentum out the share price, but agree with that, even at the lower end of forecast this is throwing off a large amount of cash and Maari should close bringing additional cash and production.

Personally I'm not looking to buy more, but if I was I'd definitely be treating this as a buying opportunity.

Guidance marginally below my expectations but what will the market think?

Good to see a statement about considering returning more cash to shareholders.

"This means basics like providing timely updates on quarterly production, which by market standards is over-due"

Based in my experience of being invested in oil and mining plays, quarterly updates provided any time prior to the middle of the next quarter are timely enough, especially for the final quarter of the year which ideally will have some preliminary financial information for the year. If you look back to the half yearly operational and financial update it came 16th August, a month and a half after period end. Based on that ideally they should provide the update by the middle of next week.

A good point lower down about dividend reinvestment- think that is highly likely to make it attractive as many will just auto invest.

More progress, great to see a decent step up in the quantity of ore milled, exit rate of 32000oz per year and given the comments on further improvement in grade expected, 35,000oz for 2022 should be the minimum target - the question now is whether they can get the finance required to move beyond that amount.

Its highly unlikely they will be able to bring in a debt financed deal only, for one there is very limited working capital left in the business. The question now is at what can Advance bring to the table as non-operator - while Buffalo was still a prospect or better still proven, there would have been a market cap giving access to capital, so they could bring capital as a non-operator to support development of underinvested assets - now with a market cap of single figure digits its difficult to see what could be brought.

Best case they find an accretive deal where the existing production is debt funded and they can arrange equity financing in the background directly so it is no a desperate cashcall to bucket shops. My worry is they have missed the boat here, that was possible in the aftermath of Covid with oil prices depressed but marginal non-core fields will now be cash generative and is turning from a buyers market to a sellers market.

"How was I ramping you dick!... The only siilver lining for me is that Muscles lost money, good.."

You were ramping, providing false hope to others based upon utter nonsense. Total vulture

Steve58 - you've spent all week since the first result spouting nonsense about the potential when it was obvious to anyone with a brain this was going to be non-commercial.

Now its proven to be non-commercial you're moving on to spouting nonsense about CVN conning.

There is no con, or liability here - Advance reviewed all the data, together with an independent auditor and agreed to farm in 50% in exchange for costs of the well. It failed, sometimes it does, Seismics are not an exact art. Thats the nature of O&G exploration and development,

Let it go - there is no big conspiracy here, it was a speculative investment with a huge downside if the well didn't prove the seismics - learn from it and move on.

"The fact that they have received £20 million from us makes it all the more suspicious."

They didn't - Carnavon gave Advance half the licence in exchange for drilling the well. CVN didn't get anything out of this, they just saved their own cash on the drill.

No one is buying this - the licence will be relinquished.