Member Info for tigris72poo

Northern Magic, what kind of a question is that? If they knew the oil and gas was there, they would get a rig and drill, drill, drill. They are hoping to get somebody else to take the risk and spend the $$$ to find out so they end up with a smaller interest in what might be there without risking the capital (that they don't have). Not the kind of deal I would like to enter from the SDX point of view. We have lots of cash, good CF and HIGH RETURN investment projects in Morocco and South Disouq. No need for us to pay up to prove somebody else's prospects.

If the mgmt. were not self serving, they would buy in their own stock instead of investing in other companies of dubious value

In fact why not sell all the holdings and return capital to shareholders thereby creating wealth for investors? Why not Indeed? Because the insiders would be out of a job and they would have no more opportunities for self-dealing. This management is a complete disgrace!

Question : Is the 2.5 trillion related to the seismic already available in SD or is it for the whole block? I've seen the 2.5 TCF number banded around here several times and it alarms me because it suggests unrealistic expectations on the part of some individual investors. I believe that the source of the confusion may be Slide 20 of the March 2018 Corporate Presentation posted on the website that has the following two paragraphs under the heading "ABU MADI POST DISCOVERY VOLUME POTENTIAL": "Kelvin & Ibn Yunus prospects - up to 150BCF of additional potential" and "Total volume potential could exceed 2.5 TCF (unrisked)" IMO, the potential for the SD1X, Ibn Yunus and Kelvin structures COMBINED is something in the order of 300 to 500 BCF when fully developed. That would be impressive enough because 400 BCF would be enough to sustain annual production of 150 MMCF/D for over 7 years. I think that the 2.5 TCF figure (gross and unrisked) must refer to the potential for the Abu Madi formation across our entire 1,275 square km licence. Only a tiny portion of that has been tested so far with the current drilling program. It would take many years and hundreds of millions $ to chase all the other leads and prospects. The first step in that process should be to establish what we have in this cluster and put it on production to generate CF. After that, we can test another prospect or maybe go after crude oil in 2019. Another success would go a long way towards validating the 2.5 TCF potential and will certainly attract interest from bigger parties. But that won't happen with Kelvin or with this year 's program. We have plenty on our plate with Morocco and the SD development to keep us busy for the next 12 months. All of this is my opinion and interpretation only. People will have a chance to ask PW for themselves on Friday.

GMP First Energy raised their PT to 80p today. The analysts are just trend followers IMO. Once the stock hits their PT they raise it 10p and pat themselves on the back. None of them have the vision or courage to really look ahead and take a stand. What were their targets last year when the stock was 35p ?

$8-9m free cash from SD alone! Does PW know what price they are going to get for the gas or something? Can we reverse engineer the price they are getting per mcf from those numbers? Pretty simple math using conservative assumptions: 50MMCF/D at $2.65 with maybe 65c/MCF operating expenses would generate gross revenues of US $36.5 million /yr. our 55% interest would net about $20 million. After the Egyptian taxes or government take (I am not sure of the exact fiscal terms but assume the Egyptians will get at least half of the profit) it should still leave $9 to 10 million in CF net to SDX. All IMO only and back of the envelope of course. Use your own judgment.

Look at the sells today vs buys. 220,000 vs 60,000 Why would you waste your time? For every seller there is a buyer otherwise there is no trade. Just because somebody calls it a sell or a buy makes no difference. The only thing that matters is the relationship of the current PRICE to the VALUE of the company. And the value depends on what they have now (reserves, production, prospects, cash flow, cash in the bank, management skills) and what they might develop or discover in the future. To own the stock you only have to believe that PRICE < VALUE and that VALUE will grow over time. Everything else is noise that should be ignored.

Tweedle, Excellent post because it covers all the upcoming catalysts but I will caution people not to get overexcited about point #8. I don't think it is realistic to expect SD production startup at 100MMCF/D in Q3. Much more likely to see initial rates 50 MMCF/D in late Q4. They have just ordered the 12 inch pipe. It will take a few months to be delivered and then laid in the ground and connected to the treating facility. I believe that the gas is there to produce more than 100MMCF/D in the future but things do take time. One has to be patient and have realistic expectations. Of course testing of IY, drilling of Kelvin and the appraisal wells will give us much more information about the size of the prize.

Don't confuse PRICE with VALUE.

Would you rather invest in CDN gas or Egyptian gas? The right answer is neither. If I had my rathers (and I do) I would invest in Moroccan gas. Where else can you sell gas at $9/MCF NETBACKS - equivalent to US $54/BOE) with only a 5% royalty and a 10 year tax holiday? If anyone can find me a more profitable hydrocarbon deal anywhere in the world I will eat my hat, my boots and my bow tie.

Daft63, I absolutely agree on your two primary concerns: 1. The slide on Consolidation at the end of every presentation scares the dickens out of me and is the only thing that keeps me up at night. The Circle Oil deal was a STEAL and once in a lifetime opportunity. Anything else that we do is going to dilute the upside of Morocco and South Disouq as long as our stock price is substantially undervalued. Now if we ever trade at 2x NAV or 10 x CF that's another story. 2. No concern that the company will be stolen from us. The two largest holders are not going to allow that to happen. You can bet on that. All we have to do is be disciplined and patient. Spend within our means to explore and develop the potential of our two crown jewels and we will reap the rewards.

Maestro, There is a difference between what a well can test and what it will produce on a sustained basis once put on production. I also heard PW say that SD1-X was constrained by the testing equipment and could have tested much more than 26 MMCF/D. And I expect that IY testing will surpass that level. But my GUESS is that when these wells are put on production they will be choked back to maybe 10 to 15 MMCF/D each. So 5 wells might do 50 to 75 MMCF/d or 18 to 27 BCF /yr gross. That level would require proved reserves of 100 to 150 BCF to sustain a 6 year reserve life which I think we will have by the end of this drilling campaign. This is all back of the envelope SPECULATION on my part but the numbers make some sense.

Shakeypremis, you raise a good question and I have to say that I probably appeared as overconfident as Schachter. Obviously, nobody will KNOW until a contract has been signed and the terms have been announced. However, conversations with people close to the negotiations lead me to think that the Egyptians are not eager to give us a price higher than the contractual minimum of $2.65 on the initial production. This is also what analysts appear to be factoring in at this point. Otherwise they would be raising their estimates more aggressively in my opinion. PW is trying to negotiate the best deal and I will be delighted if he gets us anything higher. Bu it is best to assume the worst and not get carried away by unrealistic expectations. I only wanted to point out that Schachter was throwing out the $4 gas number as if it were a done deal and it's not.

Schachter is way off the mark if he thinks we will get $4 /MCF in Egypt. Thhere are many reasons to like SDX but that is definitely not one of them. However, even at 50 MMCF/D and $2.65/MCF, the South Disouq development should generate US $9 to 10 million per year NET to SDX for our 55% interest. The upside comes from higher volumes which look more likely after the recent Ibn Yunus discovery. This will be even better defined after we test Ibn Yunus and drill Kelvin over the next month. Lots to be excited about here (including Morocco and Lall Mimouna potential) but not $4 Egypt gas. Sorry Mr. Bow Tie.

"at present the are making $4m free cash flow per month, lets say $50m per annum" Maestro, I think you need to check your numbers. You probably meant to say $4m GROSS CF per month. FREE CF generation this year should be minimal with all the drilling that we are doing. That is not a bad thing. The opportunity is there and the success rate the last 18 months has been remarkable. But meaningful FREE CF generation is not likely until South Disouq is on production and more Morocco customers are hooked up. That's OK with me. I am a very happy and patient shareholder. As always this is my opinion only, do your own DD.

I hope SDX does NOT buy anything. Steals like Circle Oil only come around once in a lifetime. Anything we do now is likely to dilute the South Disouq and Morocco upside potential. Every time I hear talk of consolidation I cringe. A bad deal is my greatest fear at this point.