Member Info for tonynorstrom1

Cn100,

Shares in issue is or will be nearer 190m - remember that the management have just given away +/- 80m to the note holders and themselves for virtually nothing.

No one comment at the time on the Managements justification for awarding themselves warrants - “ to put themselves in same position as the note holders”. They should have put themselves in the same boat as the shareholders and awarded themselves zippo.

Harel,

You right - it’s all guesses, however, CN100 has given a metric (enterprise value) - that may be a good indicator.

Also, I dont think a farm in will necessarily be on better terms - it all amount to the same thing - how much of the pie do we have to give away for £60m. It will be a large slice considering our current MC is only £6m.

Well that is interesting because I asked a similar question trying to figure out how I3E would be valued and where this would put existing shareholders. The response I got was that this would be considered material non-public information and hence could not be answered.

Your assumption below was inline with my thinking as a best add scenario. Let’s say this is correct then we will have somewhere in the region of 550 - 600m shares in issue. In the current environment, it’s hard to calculate a MC but looking at Premier Oil & RRE , the new entity might be worth £70 -100m initially indicate an SP of about 13p on relisting. Let’s hope they pull this off.

Is there anything of interest that your able to share?

Cn100 - did you get a reply from I3E.

Just in case you dont have his email address:

gheath@i3.energy

cn100,

Emailed Graham Heath on the 14th July and got a response from him the following day. Probably sent him about 10 emails over the past 6-8 months and he’s answered maybe 8 out of the 10.

It’s possible , but more likely a requirement to have an independent assessment for the financing. Also the purchase price is subject to adjustment based on Metrics against actual reserves etc.

Paul,

Your right - but when you have to shut in wells it also means lower production lower revenue/profit.

They may need around £10M just to cover finance charges and general expenses.

I was expecting a bigger bit on my post so I emailed I3E and got the following response:

“You’re treating the asset portfolio as if it’s all oil, which is not the case. The Gain portfolio is approximately 59% dry gas, 41% oil and liquids.”

I know you are only allowed to post positive comments on this board but here’s something that’s been puzzling me (from the GAME RNS):

Production of 11,000 bbl/day 2019
Total 2009 Production 3.3M bbl (300 days - assumption?)
Net Back $34M = $10 / bbl profit approx

Average Oil Price 2019 (WTI) = $58
Current Oil Price = $41
Average Oil Price 2020 YTD = $37

I’m not sure they mentioned OPEX figures for GAIN energy but for Toscana they said $22 / bbl roughly. You would assume something in the same ball park but probably slightly higher as the Net Back per BBL was higher.

Will they make free cash flow at $41 / bbl and if so where is the discrepancy above.

Fastfood,

Good post on funding / Toscana. I have been pondering also how existing shareholders will retain their fair share of the Company. I have emailed I3E with a couple of questions and will share if I get a response.

My thoughts were that they will try to agree a valuation with the major shareholders / investors and announce a debt / equity deal agreed for the major portion of the deal and relatively small offering for existing shareholders.

Snott,

With the greatest respect - you asked the question “what am I missing”. You posted something painting only half the picture which would be completely misleading to anyone looking at what you had posted at face value. I think I3E has suffered as a result of blatant ramping. I am a shareholder but I will call out any posts that I think are intended to deliberately mislead shareholders / potential
Shareholders. If your post was genuine then I appologize if I caused offence.

I would like to comment on your clarifications on the point you were trying to make which in my opinion as still overly optimistic:

With regards to reserves - yes I3E could potentially significantly eclipse RRE subject to successful appraisal.

With regards to production and earnings - I think you are way off the mark:

1) RRE are at 20,000 bbl / day now with funding and prospects to increase that substantially in the near to medium term.

2) I3E if they pull off the transactions will probably still be at less than 10,000 bbl / day. Take a look at Toscanas 1st Qtr production figures and you will see production down 20% over the reported 2019 figures. 2nd quarter numbers are likely to be considerably worse due to the lower oil prices. IMO Gains numbers are also likely to be significantly down on the 2019 numbers.

3) Production from the North Sea at this point does not look likely in the next year or two . So all in all , even if I3E pull it off - I think you 3 - 4 years away from eclipsing RRE if at all.

RRE have over 300m in cash and zero debts. Also 20k bbl / day production from multiple assets.

I3E have 2.4m in cash, 22m in debts and zero production. What else have you missed?

Cn100,

The 70m warrants - is that the existing ? If so are you assuming that there will be no warrants associated with the new debt?

Doorstop123,

Sorry Doorstop but I think your blowing smoke - you need to look at the reported prices / figures (Brent & WTI along with reported results). Words are cheap.

Harel,

Don’t worry if you don’t get a response - I emailed Malcy to give his thoughts on the latest I3E RNS in his Podcast - let’s see what he says.

I see that you’ve been back on the Toscana board Rallying the vote.

Doorstop,

If your right which I don’t think you are - then the the shut down wells will only come back onstream with Oil prices over $70. Since 2016 oil prices have been in the $50 - $60 range. In the 1st qtr - oil prices
Were in the $50 average range. If Toscana manage to report 2nd Qtr earnings - this will be at an Oil price of $20 -$25 range - let’s see what they report then.

Interesting read - take a look at the net back, daily average volumes. It gives you an idea of what the next 3 - 6 months might look like.

https://www.globenewswire.com/news-release/2020/06/26/2054283/0/en/Toscana-Energy-Announces-First-Quarter-2020-Results.html

Doorstop123,

Let me have a stab at that one - I think they will say something like this:

“Dear Mr Doorstop,

Thank you for you questions - there are no stupid ones. You will have noted in our recent RNS that we have a cash balance of £2.4m pounds as of the 30th May 2020. Are liabilities are:

1) Interest on the loan notes - circa £500k per quarter
2) Balance of Toscana debt payment due end of the year - circa £900k
3) G&A - circa £1M a qtr.

In addition you will have noted that we in discussions with our brokers about raising £60m in additional funds in relation with our non-binding LOI to purchase additional Canadian assets as well as general corporate expenses (our bonuses and salaries).

Further you will have noted that rather that re-purchasing shares - we have just given away 45m shares to our note holders at 0.1p each.

I’m conclusion - we don’t foresee buying back any stock in the near future, however, we do expect to be asking our existing shareholders to participate in an equity raise shortly to contribute to the G&A costs - so please keep a little money aside.

Thank you again for the question, and have a nice day.”

Bolivianbanks,

I think your back of the fag packet Calculation Is a bit optimistic in the short term. There are a lot of moving parts some of which the details are unknown at present. If you look back about a year ago - we were at about 50p, market cap of about $45m, 90m shares in issue and with the prospect of producing over 10,000 bpd oil this year and warrants that would payoff the 22m junior loan note.

Wind the clock forward one year. We will shortly have 1,000 Bpd of production, however the warrants have now been given away for virtually nothing and the share count will increase to 180m leaving us with a £22m loan note that will now need to be paid from cash flow which is currently sitting at zero. Sure there are some exiting propects that have been highlighted in the RNS but they come with a $60M funding requirement. So whilst a lot of potential - clearly a lot of work to do and still tons of risk. So putting this together - my target / estimate for the SP when we realist is a market cap of about 20m @ 190m share outstanding = 11p

Also - did any one notice that one of the longstop terms was Serenity drill in 2020 or 2021 - potential slip of 1 year. Is this due to prioritizing Canadian Assets or being behind schedule with FO / funding talks?