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Jersey Oil & Gas PLC - Zeus Capital says Audio Note: Jersey Oil and Gas - Significant GBA farm out

Worth a listen - available on their portal this morning

DYOR

Momentum is building…

https://www.thetimes.co.uk/article/neo-energy-moves-for-old-oilfield-g6qbfjp5n

Dyor

I know it’s been posted already, but my advice is have a thorough read .. it tells you everything you need to know..

https://www.investorschronicle.co.uk/ideas/2023/04/06/jersey-oil-gas-deal-is-being-overlooked-by-investors/

This feels very positive… forget the share price today.. when this deal formally crystallises .. and management farm out their remaining target this is going to rise significantly ..

As someone said earlier, I suspect that farminee 2 is already lined up!!!!!

My suspicion is that investors of scale will get their heads around this shortly and start buying!

WTS/DYOR

In since the summer of 2019

https://masterinvestor.co.uk/evil-diaries/evil-diaries-keep-jogging-along/?mc_cid=7d833f0d18&mc_eid=83b18a1a88

https://www.investorschronicle.co.uk/ideas/2023/04/03/a-small-cap-oil-stock-that-could-double-in-value/

All are inherently positive, perhaps unsurprisingly ..

WH Ireland - short note, essentially they are repeating their conviction buy guidance and stating this vindicates their long held view on Jog and the GBA

Key messages are they expect the share price to rise a lot. The energy crisis is just starting to bite with the language ‘game on’

Zeus - Consistent with previous Arden notes and super positive but shorter than normal.

FinnCap - Very upbeat. Stating that there is always an expectation of leakage in farmout a, but the news is exciting and they consider their 660p target (which they increased in November as ‘conservative.’ Of all the 3 brokers Finn Cap have been the most conservative historically, so I would say as an indicator this is really strong language

No doubt Simon Thompson to follow and also the Evil diaries.

Lots to look forward to in the next 2-3 weeks. My money is £300-350 pre farmout .. with a potential doubling to £7 on confirmation.

The other key point we should consider is that an exclusivity period doesn’t preclude a different third party take out bid if it’s credible.

There was an interesting extract from Proactive on Friday.. stating that regardless of the emotion from big producers toward the windfall tax the facts remain that the incentive is going to force investment .. and inevitably make the GBA attractive to large existing producers..

A major capital event may yet materialise in the next few weeks if not before as the clock runs down..

Exciting times

DYOR

3x broker notes out from Zeus (already mentioned), WH Ireland and Finncap on Friday - all very positive and worth a read..

I am convinced personally that it's Ithaca.. and I suspect there were 2 x plans for Friday depending on Thursday energy day announcing a floor.

I am also expecting a note from Simon Thompson at the IC early next week!

Happy weekends

DYOR

Well that was a day! Certainly not what I was expecting!

That said, I think dgdg1 has an interesting perspective on this.

I agree Frazer that nothing has changed since the announcement, but you can imagine the sentiment shifting since then from the producers. All of the producers play the same game - negative rhetoric, reducing capital, leaving UK shores in terms of investment deployment - all in the spirit of a floor being put in, etc etc. No producer is going to want to break from that when they think they have a chance of the government conceding on the floor. Ithaca this morning was more of the same, the Captain development is near the GBA - they hint but caution in equal measure. It might have been a different story if the floor had been announced today (and they knew in advance). I suspect it may well be introduced next week with other O&G activity as per the rest of the report.

So the question is : news tomorrow? Or wait until the floor next week and push out further.. with either silence tomorrow and a short delay com.. depends if they know something re: the communication being moved to next week re: the floor.

Jog clearly think they have something, or they would have flagged by now (You cant show an empty hand on the last day and the former Ithaca team inc Les Thomas arent naive enough to get caught in that trap). The NSTA also think they have something.. I'm fairly calm about all this

Re: other company share prices. It was always going to hit the largest non funded developments the hardest.. A producer (e.g. Harbour/Serica/Ithaca) have already taken the hit on their share prices, and Jogs price relates directly to capital investment required from the producers who are holding back in an attempt to strong arm the government into introducing a floor..

Sooner or later someone will blink.. either the government introduce the floor and the Jog deal goes through or they dont, and a producer caves and decided to use the incentive now and does a deal with Jog..

Are you really surprised it's hit Jog harder share price wise !?! In my view - sit tight.. Tomorrow or shortly after - a F/O or T/O is coming..

IMHO/DYOR

News flow seems pretty quiet on the energy security day so far... any ideas on the timings, etc

Surely if you’ve got shared your preference would be a deal RNS first.. ?!? Each to their own I suppose ..

WDIK

Good detective work Varnish!

Time will tell..

IMHO

Agreed alsoppc. I can’t see Ithaca (if it’s even them) wanting to miss the opportunity to announce with their results in Thursday morning .. and then having a further update a few days later with the news .. they don’t need to reference the new government deal.. simply that they are maintaining their commitment to British Waters and farming in .. or taking out and then the government update later that day.. and it all looks ideal

The NSTA knew something in late November to extend the licence.. the Nomad waved the update from Jog through.. and JOG at only a week away from the end of Q1 still haven’t flagged they expect to be outside the timeline ..

There has to be a plan .. IMHO

Dyor

Rollo - Given JOG haven’t announced anything so far - and therefore logic says they have a deal (ahead of the outcome of energy day!) I think they may be announcing on Thursday morning with the Ithaca update . I know it’s before the actual start of the energy day (the same day) as you pointed out but if Ithaca committed anyway (then they will want to include it in their update) . You would think energy day is only going to make current terms better.. assuming of course it is Ithaca !?! The government will have consulted stakeholders on this one (after the last disaster) so I imagine the industry know what’s coming ..

Let’s see

Dyor

I’m not so sure.. this is unlikely to be a total surprise to the industry.. recently the gov will have been working this through with the NSTA and key stakeholders.. Jog should have updated earlier if they haven’t got a deal. The Reuters report has been in the market for 7 days and that alone gave them scope to RNS and can kick this into Q2 due to uncertainty - which they haven’t. It makes no sense to wait to announce the delay next week. I think they could be good to go, otherwise the silence makes no sense at all. They had a credible reason. My guess is on Thursday morning with Ithaca (ahead of the announcement that day - but with the content sealed), Friday morning or the beginning of the following week - just sneaking into Q2).

DYOR

UK government expected to offer energy companies windfall tax relief

https://on.ft.com/3z33pFp

Dyor

They would know that and have to call it early.. I dont think its them...

I think its either Harbour (waiting for the floor) or Ithaca, personally think more likely the latter

WDIK

DYOR

IMHO

You have to believe they have a deal of sorts. Otherwise they surely would have had to flag by now - its too close to the end of Q1 otherwise..

I think there are two key questions

i) When does the floor news land from the government (Reuters says end of this month). Are the farminees waiting until then, so to not fuel the 'no floor is required' rhetoric..

ii) Who else has a market update scheduled next week, beyond Ithaca? Are they waiting for this

DYOR

As I've said previously, if I was betting - which clearly I am on AIM ;-) I would have guessed this was their backup plan (and maybe why the NSTA waived through licence extension, and the Nomad the narrative)... but they were trying to strong arm someone else into a 2022 year end close out..

Who knows? Hopefully we will shortly

DYOR (and before you say it JS, no - I have no idea more than anyone else!)

Interesting, Varnish

It would also line up with the floor announcement from the government (by end of month), assuming the Reuters post was accurate last week.

DYOR