Member Info for tonynorstrom1

Fairdealer20,

Your comments on resident guru are pertinent and as many posters have stated - you never know the motives of anyone on this board even someone with a reputation / following like BBN. However, I do there are flaws in what you and a few others have said about BBN:

1) Who says the current SP / MC is the bottom. The current SP does not infer that Serenity and Liberator West have no value - from what we have seen they appear to have considerable value. What it does infer is that the market think that I3E / Current shareholders don't have sufficient cash to realize that value i.e, if A2 does not come in with a positive result, a further fund raising will be require or worse i.e. current shareholders will not see any return on their investment.

2) BBN mentioned something that I didn't think about before - will the additional placing at 35p go ahead with the SP at 18p - I don't know for sure but it seems unlikely. Without this funding there is a big chance the 4th drill does not go ahead, With the preliminary results on A2 below expectation - this may put development plans on hold pending further funding.

3) Who says BBN has to ride off into the Sunset without saying anything - does this person think they own the chat room. All views are welcome - particularly well thought out views. Had he gone without saying anything - many people including myself would think he was just a $10 / hour boiler room pumper.

4) What we need is A2 final results to come in considerably above expectation or an offer from RRE. Someone said previously that we were in the driving seat with Tain / Serenity - I said at the time we are not and that cash is King. RRE may wait it out for a distressed sale - Serenity is not key to their future success.

GLA

I did have there estimated cash position prior to the latest fund raise. Me an BBN had a back and forth over it - I ran a spread sheet starting with the cash balance as shown in there interim statement as of the end of June. I would need to update with the possible 4th drill and latest fund raise. There are a few assumptions the biggest one being the value of the deferred payments due to Borgland Rig. A second assumption was a payment already accounted for in the June statement which was about 3m from memory and was probably part of the estimated Drill Program Cost that I#E have published in various presentations and RNS. I will post later - supposed to be working now.

Debt position is the UKP22m of loan notes that have an 8% coupon payable quarterly.

They have additional liabilities due to deferred payments on drilling and drilling liability.

Morning BWM,

I don't think that there was enough time for the market to process the RNS properly. In my opinion, had the news been overwhelmingly positive - the reaction would have been far greater.

Rocket13 - In my opinion - the RNS was underwhelming and below expectation. I fear that spike501 might be correct.

In anycase - we will know more in 45 minutes. I hope I have to eat my hat!

Rocket13,

Did you see yesterdays price action ?? What's going to drive it to 80-100p this week? Yesterday's RNS was very underwhelming. Many have interpreted it as casting some doubt on whether A2 is a commercial find or not. One things for sure - the market will let us know what it thinks in an hour or two - i'm a little than more concerned that it might go down from yesterdays close as things stand right now. There seemed to me to be a consensus that the news would be good on this drill and so far the jury is out on what the RNS actually implies.

Humpalumps,

Traderfocus has stated his opinion with a thought process behind it - you have just posted rubbish. If you think he's wrong, please point out the error. I'm sure most of us here are eager to learn.

regards

BBN,

You mentioned that they were expecting 80 ft above the OWC - I don't recall seeing this number. However, assuming this to be right does 20ft mean that potentially the Oil in place could be potentially 1/4 of that previously estimated. Are you able to share your thoughts.

regards

Boom123,

RRE has a market cap of £220M. Using this as a benchmark - what would you estimate the market cap of I3E to be worth now. Do you have another share that would be a better benchmark to judge I3E by.

regards

Boom.Boom,

I'm not sure if I agree with that - If the situation pans out like we hope it will, then the SP should be considerably higher than the exercise price of the warrants and therefore in all probability be exercised and priced into the SP at the appropriate time.

Boom123,
Seems reasonable except @ £2 - market cap of I3E would be about £350M (Share count 176M approx.)

Compare with RRE:

Market Cap: £227M
Cash: £286M
Production: BBL 22k/day
Reserves : 84M BBL
Multi Asset (6 - I think)

Using RRE as a benchmark - what is I3E worth - maybe 50% of RRE at this stage in development assuming A2 comes in ?? Was trying to figure out why RRE is valued so low - they have a large provision for future abandonment and also high forecasted Capex to upgrade facilities.

BBN,

Money being tight was not a perceived risk - I think the evidence point to it being fact. When we spoke about funding last time, it appears neither of us had paid much attention to the interim results up to the 30th June 19 (30th Sept RNS). Looking at the Income / Cash flow statement - I3E had burnt through about UKP 8m in the 6 months up to the 30th June leaving a cash / cash equivalent balance of UKP33m ($41m) with a $41m / 94 day drilling program yet to start. Using this cash balance as a starting point and forecasting a 115 day drilling program along with additional admin and finance charges to the end of December - my calculation showed they were out of cash in December. The additional 5m raised plus warrants in the last fund raise is probably not sufficient to fund the 4th drill without the benefit of Dolphins deferred payments.

What this indicates to me is that they need to sort out the RBL or farm-out in the next couple of months or otherwise they will be looking to the shareholders again. Now I think I3E have a reasonable chance of sorting all this out and Dolphin and the Junior Lenders have indicated their confidence in I3E with additional funding / deferred payments - but in my opinion, the depressed SP is an indicator that outcome is not certain.

regards

MTSparky,

What is their strategic purpose if not to make money or reduce the risk of losing money ? Furthermore - oil price and demand are higher than they were several months back.

SupeRoty,

You have to ask yourself why are they selling - they are a professional Fund Manager after all. People on this board have mentioned de-risking. One thing I think we can say with certainty - If LO thought that I3E is sure to have a higher SP after the current drill - then they wouldn't be selling now. I think this just goes to confirm that I3E is not without risk.

Austin14 - I agree with pretty much everything you've written.

Zeusfurla - You could be right but personally I don't buy the market conspiracy theory. I think the I3E story is quite well understood and the SP is a function of the markets risked bet on the outcome.

BBN - I'm not sure how much you can read into Majid's grin - he's hardly likely to say they've dropped another clanger and raised insufficient funds to complete the drilling program and get the fields into the development phase. As for being the big brother in any negotiation - is that really the case - it seems like were in a poker hand holding a royal flush, the other guy is just about to go all in and we only have a couple of chips to play with. Otherwise a fan of your posts - informative and often a unique, calm take on matters.

What is on earth is going on with the SP - I think the concern over cash which directly ties into to the Junior Loan notes / RBL. The next drill has to be positive or things begin to look a little cloudier. We are on day 84 of the 94 day program - I was checking the weather and it seems we have gale 5 - 8 winds with moderate to rough seas. I don't know whether this is delaying the mobilisation / spud. The following was part of the Global Market Solutions write up a few days .

"I3E has re-structured terms with its drilling contractor, Dolphin Drilling. Because of the failure of the first well and the subsequent additional work required, they do not have enough cash to complete the full drill programme. Payments have been deferred until next year, and Dolphin drilling get ‘first dibs’ on future drilling programmes. Graham Heath re-assured me that part of the RBL is set aside to pay for previously incurred costs so Dolphin Drilling debts will be covered"

It seems apparent that the "considerable contingency" was not enough to cover the delays and "additional works" referred to above - I'm surprised because the money's raised was 25% more than the drill program cost including contingencies. So it seems that we don't have visibility on some of the costs involved - we do know that we have multiple deferred payments to take care of as well as an 8% coupon and admin costs.

Someone on twitter made the statement that Serenity was 4 times bigger than Tain and therefore we are in the driving seat with regards to any negotiations on a JV. Everything else being equal I would say that that would be the case - however, if our cash position is tight and other potential suitors including RRE's have plenty of cash - maybe the boot is on the other foot. This could all change if we get a farm in, otherwise its down to the next drill which has to come in. Everyone is saying that it has a very high COS - however it must come in otherwise we will have some testing times ahead.

The “oh I would like to be out of this over the weekend” brigade are here.

Why would you like to be out?

JAdam,

If successful A2 and the RBL facility is approved without any further equity raise - then I think an immediate jump to 70p or more.

Someone earlier mentioned the Cannacord Genuity valuation which was updated a day or two ago and I was surprised to see was only 80p. They are obviously pricing in some risks.

Massive Potential Upside agreed.

Low risk ? I think the market is saying different - if it was definitely worth 200p per share or whatever you think it is worth - the market would not be putting a present value of 38p per share on I3E.

xNoz,

Your post is non-sensical. Couple of comments:

1) I have not created any new account - what are you talking about?
2) I am a shareholder so I have no interest in bashing the stock - I like to challenge any comments that both overtly bearish or positive that have no / little basis.
3) My comments on broker target is factually correct - go and check it out.
4) What do you mean by balance argument - your only allowed to post bullish comments?

regards

yes some thoughts:

1) They had a target price of over 200p not so long ago so I assume they are less positive than they were.
2) Brokers targets tend to be on the high side

so in summary I would say it means nothing. I3E have to deliver on the funding.