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Hearing that the deal of 80% is just about done. Expect rns this week or later next week. When it lands it adds significant value to the company instantly.
Have to assume now some kind of debt/equity deal with Orion which would essentially wipe out any value for existing shareholders. Anyone now selling even at this price are probably wise. Always an outside chance that Orion funding gets agreed, but the issue will be at what cost. Orion can essentially now do whatever they want as management have no control in the company anymore.
Have to consider any news on Columbus FDP is likely to follow the Chrysaor takeover of the Lomond platform as operator. Highly likely a deal has already been struck for Columbus. So in summary we can expect cash build to move towards $42m by year end. Cash build into next year circa $10m a quarter. All of course tax free. Columbus FDP will confirm 2019 expected production to come online. Rowallan drill could confirm 20-60mboe net to Serica. A discovery of this size would be exceptionally well received by the market. Added to this the company have other significant licences yet to be explored. The market cap really is cheap.
The company had $160m in tax shelter at end 2016. This essentially means they can make $160m profit before paying tax. It means no tax will be paid from the Erskine profits for years. It will also be used for any profit made from another acquisition and or Columbus. Again it not priced in.
Natural gas price up again today now above 43p. Remember 50% of Erskine output is gas ! To convert gas to boe you multiple by 60 and then adjust from £ to $.....means Erskine is pumping out a lot of cash again at these prices.
Bought these today - can't see why the SP is so low. Notice Trader_007 on twitter is buying which is a good sign as he reads the market timing very well and does a lot or research. Also pointed out that 40% of the sales are Rhodium and Palladium, which has been strong all year. As he pointed out the cash in bank will soon be the same as the market cap. Results soon could well move the SP back into the 12 to 14p area.
I've added twice this week including today. Both times the buy has shown as a sell. For anyone new to RENE worth looking at the latest presentation on the website. Points to note are the phase 2 trials on stroke therapy - results in some people are described as 'life changing'. Also no side effects or safety issues noted. Worth also looking at the slide that shows potential peak revenues. The stroke thereby alone show peak revenues at $1.1 to 3.9 billion. Risk is clearly attached to any biotech like RENE, but a successful phase 2 already in place and move to phase 3, and company fully funded show risk/reward firmly in our favour. The upside here is outstanding and anyone with a reasonable holding (1m shares or more) could be in for life changing sums of money.
Very good news today particularly on phase 3 trials about to commence in US and Europe for stroke therapy. Successful phase 3 and then company will look to get approvals and licences. If/when this happens then the market will wake up to the huge potential here. I have a friend who is a consultant who works in this field of stem cell therepy who describes it as the next major medical breakthrough. Very pleased I have a large holding here at this price.
I notice Mumford (Cavendish Asset Management) has bought into the placing and sees upside if 3-4 times current SP. Mumford has a solid 25 year track record and is well regarded. If NOP can get 1000bod out of Canada at the low production costs the cash generation would be significant. The current SP is very low with the new dundingbin place. I notice a few of the decent traders on twitter are now talking about NOP.
In the last quarterly update the cash costs for production were $404 so a basket price of $800 or above means significant profit. In the last update the company also said it had significantly reduced general admin and other overheads.
Nice to see this move
The seller has to clear before we get a major re-rate. Once this overhang clears it will go. Some very astute traders / investors have large holding in SLP - look at some of the big names on Twitter who have holdings.
There really is limited to no downside here. If the company can meet its targeted 800bopd then they will be making a healthy profit as we know at current 400bopd they are breakeven. With cash coming in they can then put more effort into Italy - which we know has huge potential and is a very nice joint venture with Shell. Would like to see an RNS saying they have got to 800bopd as then this will become hugely undervalued. Would suggest any buyer watch level 2 action or do a direct market access trade to pick up any stock close to the bid price. I've added more over the past few weeks getting a few shares using DMA.
Hard to say what JPR is worth but to put it in perspective Trinity Mirror bought out the rest of local world rating the market cap at £150m. JPR's local paper business is of equal size. If JPR can offload some parts of the business they they can do a deal on the bond holders and significantly reduce the debt. The online business and websites they own that are now making circa £40m per year in revenue alone would be worth millions in the open market. If they can reduce the bonds I could then see a very viable business or more likely a takeover. The downside risk is now minimal for anyone buying, with upside stronger. I have been buying for two weeks as any good news will push the SP up considerably.
Good RNS today. Best bit was the very low operational cost for anything over 400bpd. If they can ramp up to 600+ bpd then this looks very exciting. With no debt and cash coming in this company is now undervalued. However a lot of confidence has evaporated over the last couple of years so the board need to get out and start doing some PR to get some investor confidence. I agree news on Italy is needed and could be the catalyst for a share price re-rate.
Very interesting update today. Very good to see oil output on the rise and what looks like a lot more to come. Have to now assume at some point NOP will move into a profit situation and become cash generative. Looks like market cap is now more than accounted for with current assets in Canada and Italy is thrown in for free. Any further good news should be the catalyst for SP rise.
We now have a good revenue stream so looking at the numbers Canada more than covers the market cap alone and so Italy is thrown in for free
Micky do agree it's very tough for NOP. However even if they couldn't survive we have to assume the current assets would be worth at least the current market cap so downside looks negligible to me ?
It's a very good feeling to see oil flowing again and cash coming in. Looks like at even this low oil price they can keep the business running. Italy looks extremely promising - if you total up the potential millions of barrels it's an enormous cash number. It's also good to be working with Shell on this one as they will have the contacts to keep things moving with the government. Overall don't expect any major lift up in SP, but if oil price recovers and Italy progresses we could see a lot of upside. My view now is there is little downside and lots of upside. KB is clearly a good leader of this company.
Have a good Xmas Mickey - I think NOP will have a much better 2016 with the funding now in place.