Member Info for StarBright

The absolute number of shares in issue is irrelevant. The company could address this through a consolidation if it mattered. It doesn’t.

Beyond this, many posters fail to understand that raising equity capital is business as usual for capital hungry resources companies, and that issuing more shares does not necessarily mean dilution for existing holders. What really matters is the discount, and UKOG has shown itself capable of effecting placements with negligible (0.13% in the last instance) consequences in terms of dilution.

I agree that UKOG is likely to have to raise funds to fully commercialise its Weald licences. Multiple Octopus pads, pipelines etc are surely very expensive! The company’s statements on being “...fully funded through 2019...” etc have always contained careful wording qualifying that this funding is in respect of current projects. Large scale commercialisation probably lies outside of this definition. With good EWT results and a clear plan, new funding (in the form of debt and equity) might be raised without substantial dilution. This would be an extremely positive development for holders.

TLDR; don’t assume that capital raising equals dilution for existing holders. It doesn’t.

Agreed! We have two bites at the cherry and it doesn’t matter which layer the bopd come from. We just need to see our way clear to getting past 1500bopd for the SP to take off in the way we’re all hoping it will...

Phil - as we’ve seen in the last couple of months there can be great news announcements (tankers!, flow rates! etc) without immediate corresponding increases in SP. This has caused much wailing and gnashing of teeth on this board! The price not moving tells us that the broad market has viewed the announcements as confirmation that all is on track, that the markets implicit assumptions embedded in the price continue to hold good etc. Until there is material “new” news, I think the price will remain rangebound between 1.5-2.5p.

By comparison with industry multiples we can say that the current price factors in around £15m pa of free cashflow. That is perhaps somewhere between 1000-1500bopd in the long run, say at least 10 years. If the commercial potential is proven to be much higher we can see the upward re-rate in the SP that we’re all hoping for. Clearly I believe this is possible across UKOG’s range of assets/licences, or I wouldn’t be a holder..!

I don’t think that a declaration of commerciality for HH will - in itself - be enough to spark a sustainable re-rate for UKOG. Rather that it will be another brick in the wall of the Weald oil story.

Posts here referring to a declaration of commerciality are increasingly frequent. They also seem somewhat naive, anticipating that the inclusion of the magic word in an RNS will “...release the brakes...”, “...light the blue touchpaper...” or “...unleash the Kraken...”.

At the same time, many posters indicate their view that such a declaration is “...odds on...” or has been “...signalled clearly...”.

If a declaration of commerciality for HH is both transformative and probable, holders should remember that the market is a discounting mechanism. How much of the upside is already priced in?

I am a LTH, but I do not expect to see UKOG “multi-bag” on a single data point that has been so widely discussed, telegraphed and anticipated.

Baz - what you would receive would be driven only by the price agreed for UKOG and the number of UKOG shares you own. If you own 1m shares and the agreed price was 3p/share you’d receive £30k.

We are of course all entitled to our own opinions, but not to our own facts.

The latest RNS said: “Metered solution gas rates of around 41,000 cu ft per day were recorded through the test separator over the two maximum rate periods.”. This may be enough gas to power some sort of on-site power generation facility for the site itself, but no more than that.

Of course, more gas may yet be found.

But to accept the OP’s assertion it is necessary to believe ALL of the following:

1. Vastly more gas has been found, enough to support volume production.
2. This non-public information has been selectively disclosed to British Gas with a level of confidence sufficient for them to secure a big site near Gatwick.
3. British Gas have secure this big site near Gatwick without any public disclosure (eg through the planning application process) of their intent

As much as I would love to believe the story (I too am a LTH) that is too much of a stretch for me.

Cool story etc, but I’m afraid it’s nonsense. There is no “big gas find” at HH. The volumes reported have been incidental.

I agree.

To put some numbers on that.

SP rise since open +1.3%
Dilution impact -0.13%

As Phil7390 says, insignificant.

Go on then, show me...

I see the usual Pavlovian response to share issue here....

For those whose corporate finance knowledge is paper thin, let me work out the impact to existing holders of the new share issue announced in the RNS:

85m/5221m x .15/1.9 = 0.13%

If you own a holding of £10k, the share issue has “cost” you £13.

To be clear, anyone banging on about “dilution” is an idiot and can be safely disregarded.

Hang on CB1984. This is the parallel universe of LSE where the bid is marked down to “steal your shares”...

There are two of them...?!

Dhc is well intentioned, but posts too often with little substance and is in danger of becoming the Kim Kardashian of LSE’s UKOG share chat. Recommendations here (or likes on Twitter in KK’s case) are not an indicator of useful insight.

The “Aussie dollar conspiracy” is a prime example.

I see what you did there ;>

All the posts here saying “news is good so price should be rising” completely ignore the possibility that there was plenty of good news already in the price already.

It’s like saying “I drove faster so should have got here before you”. Yes - but you live 100 miles away and my start point was just around the corner from here....

Max, you haven’t even come close. The question is how do they allow some people “their mates” to transact at their posted prices, whilst not letting others trade on the same terms?

This given their regulatory obligation: “Where a market maker is approached by a member firm, other than a market maker in that security, it shall actively offer to buy and sell at its displayed price and in any size up to that displayed in its firm quote.”

I think I’ll stick with CaptainStanley’s earlier answer.

Posters here on this topic are trying to redecorate a whole house with just an egg cup full paint.

Not going to happen. If they RNS immaterial stuff like bringing oil well equipment to an oil well(!) they’ll create an expectation/precedent that will be impossible to manage. There’s no need for the company to “stop the guessing games” between a few schizophrenic PI’s on an internet discussion board. No need at all.

Thank you Thorpedo. Have a hat-tip for a shining example of the nuggets (occasionally) available here.