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Drive towards simplicity, mid cap corporate comms
Production rose in month to xx BPD
Revenue is $XX with cash on account stated
Drills planned, drill results.
Debt status - RBL drawdown in time for flexibility
JV actions are just reporting of plans - confidential status wont be the case for long term, their drill campaign will be logged with WOGCC by SWP, permits granted , drill results, prod per well all in public domain following JV secured.
Mr S,
not saying I agree with the intent, even if it was true, just an interpretation of the rebranding and his history offshore.
He should focus on Wyoming and will do im sure - last chance for glory at his age, then he should hang it up.
Mr S
Thats new I think your right , v interesting.
To me its a positive sign that the JV deal is happening and COPL are setting up the next play.
AM may be thinking of coming back to North sea given the resurgence - there was a licence bid round recently BOIL went for as u know.
https://www.lse.co.uk/rns/BOIL/uk-33rd-offshore-licensing-round-and-asset-update-zgfh6fkyodvdozr.html
AM will prob want another project once he sells the delineated Wyoming asset in say 2 years, leaving his daughter in charge of BFU with its 7000 bpd by then - then use the expected $ xxx million sale value of the discovery to secure a North sea position and develop it - he sure has the experience and obviously enjoys the offshore challenge.
This SP has indeed been HEAVILY manipulated , combined with box trading, all the games.
SP is low as there is no growth in production RNS yet , debt is high and no JV is signed yet -but that wont be the case very soon.
It doesnt make PI making statements of the fundamentals "rampers" or creating an echo chamber to evaluate what could be once the oil starts to flow - as the discovery is indeed in place, flows and a JV is in last stages of negotiation - however repeat this reality enough times and it may seem like an echo to some.
Well said Bob
Until prod rises, debt is managed and JV is signed - nothing is certain 100% so this SP is an oversold aberration not based on current value reality let alone potential , with a substantial amount of manipulation given what all know is the true worth coming - its therefore just transitionary - as all these aspects are fully in play and will come in H2 - there is no objective evidence to suggest otherwise.
Excellent research Stas.
Hopefully the JV timeframes are shorter for the JVP and COPL micro cap as opposed to two Majors partnering with each sides extensive legal team making hay.
AM is in all likelihood conducting all negotiations at point with perhaps a lawyer he knows from back in the day to assist - he knows the JVP and they know him - assuming it is Exxon - it would make sense if the Exxon team including people from the Liberia JV period as its just better business all round.
The previous Liberia JV with Exxon as operator , albeit offshore and exploration appears to have had good relations, sadly no HC but the partnership worked which is key.
https://www.proactiveinvestors.co.uk/companies/news/305298/copls-technical-team-has-earned-the-respect-of-partner-exxon-mobil-5298.html
From 4m 20s - 6min on relationship with Exxon and COPL, same tech team
"They treat us with the utmost respect......strong technical team....treat us at an equal"
"If there was a JV in the offing wouldn't production increase infrastructure be put on hold "
The JVP has no interest in nor is the BFU Shannon fn part of the JV discussions - to imply that the JV isnt in the offing due to this hypothetical correlation has no basis.
Then what Edgein said :)
Stas, agree completely, longer time on JV is indicative of deal scale and greater benefit to COPL in time.
also:
"Our Company brings considerable experience and understanding of Cole Creek, including operating the early stage enriched gas miscible EOR project at the neighboring Barron Flats Shannon Unit. This EOR experience can be directly applied to Cole Creek as they have many similar reservoir characteristics"
This SWP staff experience and analysis will have applications for other prospects in the Powder, so another aspect on deal taking time could be their greater deployed evaluation and partnering beyond this play for other areas in the basin owned by the JVP - or leaseholds they may acquire using this data. Confidential wells status works for multiple reasons.
Thank Stas
Powder is where to be - multiple stacked pays, carbon capture impervious anticline formations, established infrastructure, supportive State with low taxes.
COPL have the biggest discovery onshore USA in decades -within a 50 sq mile leasehold area - not spread over 100s of miles in separate formations or challenging terrain as in Alaska, lower cost for extraction overall.
Worth repeating these fundamentals as the market doesnt yet assign any potential value for this asset to be monetised even though its found, flows and has large oil company interest - so be it, but it is going to happen - soon now given technical due diligence completion, commercial terms discussions since April and LOI to safeguard whilst legals are finalised.
Whilst the SP is dire, BH impact caustic, the positioning is as good now as its ever been for rapid growth once COPL move from potential to actual production increase, debt management, JV signed, field delineation according to a Majors timeframe without constraints on finance, materials or team capacity - with carbon capture PR and tax breaks to offset the oil extraction cost/impact and align with Majors corporate stated goals for net zero.
The debt remains, the ability to repay it, default on terms, going concern etc in Feb has not adjusted over much in market perception - note no definitive statements made to support mcap growth by any and all means by CEO - except cash on account as of Jun 30th implies reasonable finances.
SL Debt retirement when paid off is at 8% of mcap value at that time, payable in shares or funds available - mcap being low is optimum for paying them off when funds allow.
Funds that can be enabled by RBL leverage of reserves now the GGS is working, meaning the on sale reserves have true value, profit range of production is approaching this Quarter.
Then capital repayments of RBL offset with the intended revolver facility, just interest payments for this critical early phase - releasing minimum $1m per month to spend on the field and upping production.
OR
Joint Venture funding up front.
Letter of intent is signed, on terms suitable to COPL and with their preferred partner selected for JV.
- GGS installed - production is rising but not confirmed yet as takes time
- Debt management is next on their list of stated goals
- LOI is signed - due diligence complete
- commercial terms are being finalised - soon Joint venture secured
- confidential well status and NDA will then be rescinded
We wait for true value to start to emerge - but not for much longer now.
There were a few negative posters that sometimes required response , as their falsehoods needing challenging.
Risks being identified and fully understood is useful, but made up negatives or downplay of positives without basis is quite another matter.
COPL have turned a corner now so the ammunition for the detractors has reduced, they can now be safely ignored.
GGS pipework installed and 9 top wells tied in
winter wellhead equipment installed so prod will be maintained
Production rising as MF increased
Cash on account
2 H wells look to have been drilled and prod contributing to cashflow - may be declared soon
LOI signed and JV likely imminent
This is the current reality.
Also as H wells were in the Federal Deep - CNOOC may have contributed 15% of drill cost - Unlikely they would again not take part as per the Discovery well if they had any chance of remaining in operation in the PRB - that FD 15% WI worth $millions in revenue going forward, with probable co working interest with a super Major, offsets on their partnerships elsewhere viable.
Morning Edgein
"Also there were firm plans for drilling those two horizontal wells last year, they did a chunky bookbuild and still didn't fund the GGS upgrade until this year. Bonds paid for both the Cuda acquisition and the GGS upgrade"
As you say I think it looks likely that COPL paid for these H wells and it nearly broke them in Feb, but they got them over the line it seems.
If so - indicates AM was prioritising JV positioning over BFU base production and early GGS paid for - he just did lots of cheap work arounds in the interim I recall.
The two lots of BH funding also strange around that time, why in two batches? - first for $4m maybe max what they were prepared to give to keep COPL going - then the $14.8m announced March 27th perhaps came after the two H well results , spudded in early Jan and Feb according to the APD docs logged on WOGCC by Southwestern - so drilling time and results analysis timing correlates - with obvious drill success as Frontier 1 and 2 flow, leading to the LOI with the JVP and eventual joint venture
AM sailing very close to the wind, but what a result if he can land JV and the H wells go into production as 100% owned by COPL - as in terms of instant 1000 - 3000 bpd per H well BFU is then just to pay the bills and leverage RBL from the reserves - in action now.
Afternoon Edgein
We get the usual attacks on positive opinion, even with a substantial weight of argument demonstrated, but it seems that you are the Troll Kryptonite as they have nothing to say on your factual posts demonstrating industry knowledge.
It would be beneficial if you could repost your analysis posts once news lands, as new investor interest will be substantial if there is large production growth and JV occurs with a super Major as is possible and probable , only IMHO of course...
"The company that has entered into the LOI with us is the best partner we could have of the ones we have considered. "
Meaning in all probability they had other approaches at the time as would be expected due to the scale of the discovery and were able to choose their partner based on the broad acceptance of COPL terms.
• Large company – no constraints on investment, materials, staff
• Growth strategy in the PRB through EOR, largest Carbon capture operation
• Worked with AM before – Liberia JV – they know him, he knows them
• Just bought Denbury reserves and Co2 pipeline infrastructure – 25km north of Cole Creek
https://corporate.exxonmobil.com/news/news-releases/2023/0713_exxonmobil-announces-acquisition-of-denbury
"Exxon Mobil Corporation (NYSE: XOM) today announced it has entered into a definitive agreement to acquire Denbury Inc. (NYSE: DEN), an experienced developer of carbon capture, utilization and storage (CCS) solutions and enhanced oil recovery."
So if terms offered are broadly as AM would require, what could he specify?
perhaps Funds up front following two confidential Horizontal drills of the Frontier reserves delineated by their laterals not unreasonable to assume.
- Soon BFU prod rises as expected and continues to rise towards the 7000 bpd plateau rapidly
- RBL gained as a result of entering profit range
- Senior lender debt can then be retired
Soon we see what the COPL team can do with momentum established, add SWP technical expertise and knowledge of the Wyoming asset and COPL is poised for explosive growth.
Oilexco was COPL tech staff and CEO
16c to $16 SP growth with highest number of drills p.a in the North Sea at the time is a matter of record, regardless of their fall due to world crash in 2008.
The ability remains, given funding and asset.
https://seekingalpha.com/article/65542-oilexco-well-oiled-north-sea-cash-machine
"The disciplined and methodical deployment of capital that has become the company’s trademark have got both individual and institutional investors smugly satisfied with the share price appreciation, which recently touched a high of $16.44"
Soon COPL production performance will write the RNA.
No need for spin, elaborate financing, broken promises, poor comms and forgotten targets missed without comment - just report the BFU prod monthly and operations updates.
No dependencies, must happen events, massive field problems, going concern financial bombshells, defaults on capital debt repayments - as revenue will soon be into the profit zone and growing from there.
Signs of this occurring already with updates in June and July on GGS on time and on budget, performing as expected - issue the ops update August and three times pays for all - becomes the new pattern. Going forward, add drills planned, drill results as they complete .
Then consider the RBL that is coming.
Why wasnt RBL gained to date?
Because COPL have not been producing enough to cover the capital repayments.
Why is it possible soon?
Because production is rising, the oil can be extracted at profit, the on sale of the 40 m barrel P2 reserves has true market valuation (not captured in mcap at all yet) and can be used as leverage/ act as security for the Reserves Based Lending bank selected (who will know they lend to a company soon to be in partnership with an Oil Major - COPL can wait post JV signed in any case.
Then add news flow from the JVP field delineation works to come once the JV is signed - who will have NO constraints on funding, casing and materials, drill equipment or team deployed .
The oil is found and flows.
It has gone up in 10-30% hikes per day with no news, which as balance was experienced over a longer time frame on the way down to 1.5p - just natural buoyancy finally asserting itself.
Be great to reach 5p asap before key news imo, then 30% day hikes have a substantial impact on the re rate back:
5p becomes 6.7p
6.7p = 9p
9p to 12p potential - on expectation
BFU FIELD
- Rolling support and positioning for the foundation being built and proof of concept established
-The promise of the field production growth following MF as evidenced Aug 2021 with 62k barrels in month is coming right now - in the context of the field fully banked with butane, enhanced GGS steel pipework in place, well head works completed, pipes dewaxed and a higher injection rate possible to deploy.
- Month on month prod growth and field performance stability is powerful, translates directly to revenue growth and re investment in the field towards the 7000 bopd plateau.
- This stability in turn allows RBL to be finally gained to fully leverage the BFU, Cole Creek and CUDA reserves booked, retire the Senior loan and its onerous terms for capital repayment every month of c$1m come what may, plus interest of c $400k
- RBL revolver benefits are also rolling over time as the capital payments can be offset - $1m a month that can be spent on field work and re paid later.
- Revenue increase per month = accelerated field work programme, which generates increased revenue and so momentum gained and maintained.
Thats the COPL progression coming, nothing will stop it now.
Joint venture is in addition and not a dependency.