Member Info for WetWater

Newtofo: I'll top tnbird - I agree with you 120%! Sticking around for commercial production would cost far more than the current carry by Origin and is not the stated goal of Falcon Oil. Falcon was getting into a tight spot financially and didn't want to be forced into another raise in this market environment. IMO Falcon had limited options and Origin gave them an attractive offer. For people to now suggest that Falcon's new goal is commercial production is being a little over exuberant. POQ's goal is to complete this 9 well program which as you say now falls into 2021, get an appraisal report and sell at the highest bidder. I still suspect Origin will be that suitor - we will just have to see what price they offer. That price is somewhat dependent on the next 4 wells - if we were fortunate enough to claim commerciality on the Kyalla or the Velkerri wet then we can add that to the contingent proven resources of the dry gas Velkerri. If not those two then we offset the Velkerri dry with what is likely two 6+ TCF commercial reserve wells - this is still a very attractive investment for the current Falcon stockholders. Do I see my $ 2.00 - $2.50/share - that's probably dependent on the estimated market pricing in 2021 and going forward. I'm still comfortable with this investment - even with today's .09 usd price.

Newtofo: Not that it's a certainty, but as I have stated multiple times, Origin would seem to have the inside edge to acquiring the Falcon acreage. INPEX would be nice suitor and they certainly have the budget to meet any obligations Origin might impose and they would certainly prove to be a solid partner and provide a partner in need of the gas. I still fall back to my original concerns that at some point it would be a much cleaner deal to put the Beetaloo concession back together and get rid of Falcon's undivided interest in the Beetaloo - Then Origin could easily farm-out to various entities and/or outright sell acreage positions and let Falcon accomplish their goal of selling their interest - IMO, Falcon's undivided interest is a bit of a fly in the ointment. As previously mentioned, I believe that it serves Origin's interest to proceed with haste to prove-up the Beetaloo as quickly as possible while contending with the wet/rainy seasons. Origin has divested themselves of most E&P acreage to focus on the Beetaloo concession. Any company looking to purchase the Beetaloo will be looking as gas price futures going into this coming decade - the current price weakness should not be much of a factor in attracting partners in what looks like a World Class Discovery X10. We also know that Origin has had a peak behind the curtain on the Kyalla well; that sneak peak might have played into the deal they have given Falcon.
All is well until I look at the price of Falcon in my current portfolio - sigh! I'm betting on much better days ahead; it's just getting harder to see my $2.00 target from this .095 usd price :( Break out the binoculars - I may be able to see a ship mast appearing over the horizon. GLA

Imatiredofthis: Thanks for stepping up to battle much of the nonsense being promoted on this board. Some of these guys have nothing to offer other than their constant criticism of Philip. I've decided it's best for my blood pressure to just step aside and let these 'Experts' have their rant on everything Falcon/Philip/Origin is doing wrong. It's amazing that Philip still maintains the support of the major stockholders and the board when he fails to stop the moratorium, didn't foresee a sloughing off in newly explored horizontal section, can't control covid-19 or inflationary AFEs based on newly imposed fracking regs, etc., etc. My initial disappointment with the 7.5% farm-down has now turned into an appreciation of the financial security to see this project through in these trying times. I hated that Falcon gave away some of the timing control on the project but it was something Origin obviously needed to do the deal. It is still in Origin's interests to complete this 9 well program in a timely manner as necessary - they have sold much of their Australia holdings to focus on the Beetaloo and need to prove it up as soon as possible to likely do their own Farm-outs to develop this huge acreage position. Falcon has had several roadblocks and setbacks in the Beetaloo but the important objective IMO is that they are still in the hunt and and have required funding in place to see themselves through these next 4 wells. This farm-down may or may not be Falcon's final concession is the Beetaloo project. I am still a POQ supporter and comfortable with his management of Falcon - he has traversed some rough waters for our little penny stock - congratulations to his management that we are still in the game.

After getting over the initial shock of seeing $25 million for 7.5% interest I'm of the opinion that this was a reasonable deal that should carry Falcon thru to the finish line. As has been mentioned, Falcon got about $150 million of carry for it's 7.5% interest. Initially Falcon got about a $200 million carry for 70% of their consession. The cost overruns of the Beetaloo have been pretty excessive. That along with the likely lower near term commodity pricing makes for pretty a tough environment for future raises. This keeps Falcon in the game through stage3 which is the ultimate goal. It is a little bit of a bitter pill to swallow but IMO something that was necessary.

Greenlatern: I beginning to look in the mirror and see an idot! I honestly don't understand why Falcon would give away 25% of the Beetaloo concession to Origin for $25 million. Even with that they also seemed to have given away any timeline control. Hopefully Falcon will come out with an announcement giving the stockholders their reasoning for what I interpret as selling on the cheap before the Kyalla and Velkerri wells are completed. IMO Falcon has sufficient funds to see their way through the stage2 wells so why now??

ITGuy: None of us know how the farm-out agreement is structured but from what I understand, Origin is committed to drilling the 9 well Falcon well program. COVID-19 is something beyond Origin's control so it probably stops the clock from running on the contract. However, I wouldn't expect Origin to be able to delay Falcon's farm out commitment due to a capital expenditure pause or reduction - Origin has a commitment to Falcon to drill these wells in a timely manner.

cont.......

This prefeasibility study for the Tennant Creek to Darwin Natural Gas Pipeline Corridor supports the Northern Territory Governments Vision to turn the Territory into a world-class gas production, manufacturing and services hub by 2030, through its five point plan to:

Expand the world-scale Darwin LNG export hub
Grow the Northern Territory's service and supply industry
Establish gas-based processing and manufacturing
Grow local research, innovation and training capacity
Contribute to Australia's energy security
For many, the proposed pipeline is the missing piece of the puzzle needed for the establishment of an onshore gas industry in the NT.

end

Follow Up Article Concerning Pipeline Corridor:

April 1 2020 - 10:03AM
Pipeline would 'fulfil Territory's gas vision' - Govt says
The NT Government says the development of a pipeline to transport gas from the Beetaloo Basin to Darwin is critical "to fulfil the Territory's gas vision".
Many people were surprised yesterday to learn the Government had taken the first steps to plot a route for a gas pipeline from Tennant Creek to Darwin.
According to maps provided in tender documents, the pipeline is expected to closely follow the path of the Stuart Highway through Katherine and Pine Creek.
Tenders for the work close today.
The government has responded to questions from the Katherine Times over the apparent secrecy surrounding the plans.
Details of the tender were uncovered by the Lock the Gate Alliance.
"There have been no announcements made about forthcoming gas pipeline projects in the Northern Territory," a spokeswoman for the NT Trade, Business and Innovation Department said, in explaining why the pipeline plan had caught many by surprise.
The spokeswoman said the NT Government had not yet committed direct funding for any new pipeline projects.
Costings for this pre-feasibility study for a pipeline corridor also remain in house.
"The tenders for the prefeasibility study has been advertised as Tier 3 procurement, while the project is still in the tendering phase information on tender values remain commercial in confidence."
A Tier 3 procurement ranges from $100,000 to $500,000.
This proposed pipeline would link up with the $800 million gas pipeline between Tennant Creek and Mount Isa which was opened by Jemena in 2018.
The big energy companies like Origin Energy and Santos have rushed to the Beetaloo Basin, near Daly Waters, to continue deep drilling of shale gas and confirm their expectations of a large resource.
There is a gas pipeline, the 330km McArthur River pipeline, which penetrates into the Beetaloo area but it only has limited capacity.
The NT Government spokeswoman said the pre-feasibility analysis would consider routing options, engineering, geotechnical, environmental, financial, land use and sacred site considerations involved in the creation of a new gas corridor.
"The analysis will assist in the de-risking of the corridor with a view to supporting future development and investment."
The spokeswoman said the proposed pipeline was an industry development activity "to support the development of the onshore gas industry and to maximise benefits for Territorians".
The government spokeswoman continued:

cont.......

The Chinese pipeline company Jemena would likely be the one to construct a pipeline utilizing this corridor from Tennant Creek south of the Beetaloo concession north to Darwin. My thought is that the NT government and Jemena must believe that the Beetaloo contains commercial quantities of gas to warrant the proposed construction of this corridor/pipeline. This proposed pipeline is being called the missing piece of the puzzle – is has been whispered about over the last few years as Jemena said they would provide pipeline capacity if/when the Beetaloo gas potential proved itself. This is a bit of good news while we suffer through what is now the COVID-19 delay in Origin/Falcon’s Beetaloo project. GLA

NATASHA EMECK, Political Reporter, NT News
|
March 26, 2020 4:50pm

‘**** off’: Chief Minister furious with anti-fracking campaigners for ‘spreading fear’ during coronavirus crisis
THE Chief Minister has launched a furious attack on anti-fracking campaigners for ‘spreading lies’ about FIFO workers and clogging government phone lines in the middle of the coronavirus crisis

‘**** off’: Chief Minister furious with anti-fracking campaigners for ‘spreading fear’ during coronavirus crisis
THE Chief Minister has launched a furious attack on anti-fracking campaigners for ‘spreading lies’ about FIFO workers and clogging government phone lines in the middle of the coronavirus crisis
The campaign claimed fracking has been deemed “essential” in the Territory but the NT Government said this is not true.

Instead, a spokesman from Origin said they had temporarily paused fracking activities at Beetaloo Basin due to the pandemic and scaled back to only having 45 employees on site.

But a spokesman from GetUp! said its concerns about FIFO workers were legitimate.

“Northern Lands Council and Central Lands Council have stated that they are being approached by remote communities concerned about FIFO workers on their community,” he said.

“They’ve seen these workers coming in and out of their shops.”

The Chief Minister said it made him “sick” that GetUp! was trying to “exploit people’s fear in the middle of a national crisis” for political purposes.

“To deliberately lie and scare remote communities like this is despicable and unforgivable,” he said.

“I’ve got people working round the clock to help people who have been left on the scrapheap.
“I don’t need them distracted by these bull**** scare campaigns run by a bunch of Twitter trolls.

“Our phone lines are running off the hook with people worried about their business or their job.

“We’ve got people who don’t know where their next meal is coming from.

“And because of bloody GetUp, our phone lines are clogged up with something that is based on a lie.

“They sit in their fancy office in Sydney and come up with this crap, and they have no idea about the damage they are doing to people over here.

“My message is simple: **** off. Stop diverting our resources away from saving lives to stopping your lies.”
A GetUp spokesman responded and said: “GetUp has thousands of members in the Northern Territory, and every single person who phoned in lives in the NT and was a constituent. “Michael Gunner can choose to listen to the concerns of NT residents or ignore them, but we’ll continue to elevate them.”

“Prime Minister Scott Morrison stated that mining is an essential service during the pandemic.

“However State and Territory leaders have the power to declare that mining operations are non-essential. So we’ve argued they should, and we would welcome the news.”

OrsonM: I agree that the positive news is they are preparing the rig for moving to the new location when weather conditions/roads permit. We will just have to see what waivers are granted for the fracking crew/equipment. I'm hoping Origin gets the go-ahead to begin fracking operations in April. This delay probably is not going to greatly affect the scheduling or fracking of the upcoming Velkerri well. The biggest problem I see is we will be later getting the initial 24 hour flow test and the 90 day EFTt. At this point we are in the same boat as many other companies - nothing to do but sit and wait. As all, I am hopeful that energy/exploration industry will receive 'essential' waivers sooner rather than later. C'est la vie!

Darnit: Scary scenario - seems your sky is falling.

The Covid-19 virus pandemic will pass - likely a lot fewer deaths than result annually from the flu. It will be a definite slowdown/disruption to the economy and many people will be displaced/unemployed but thing will recover. The world governments are not collapsing , currency will continue, there won't be mass rioting/starvation in streets and the world wiil return to its old ways. You need to turn off the scary hysterical news reporters and try to calm yourself down.

As far as the US shale there are tough times ahead. There will be consolidations and massive adjustments to budgets but the industry will survive. I have grown up in the oil basin and have lived through this several times - when there is no future and oil is going to zero things alway turn up and we go from a bust to a boom - it's part of the natural cycle of the oil industry. As we say out her in the PB - Dear Lord - please give us just one more boom - we promise not to **** it off the next time. The Saudis and the Russians can't afford cheap oil anymore than the US can - one/both will return to their sanity, cut production and the price will begin working its way back up. One day you will look up and there will be $70 - $80 oil.

Once again the extended moratorium is playing into our hands - we have another year+ before any appraisal package is put together. We have three more wells to drill and as we know that spells another year of operation - plenty of time for the market to begin its correction.

Chill brother - it will be another world in 12 months - the world as we know it is not ending.

GLA

Thanks Darnit - Always good to hear from the expert :^) Maybe you could contract as a consultant to Origin - save all of us Falconerrs big bucks. Sigh!!

BO: meant to add - WMB will also bounce back from this energy stock price collapse. Overall you’ll have a nice yield for the year. I have a fear of missing out on the Falcon price run-up I have been waiting on for years - maybe some day!!

BO: Good company - nice dividend yield.

In about 30 - 45 days we will have some type of preliminary announcement on the Kyalla well. Will that take Falcon 2-3% above its current depressed price - my money is on it. Good luck in WMB.

LooseorWin: You obviously haven’t lived the oil market as some of us have. Having grown up in the oil field I can attest that this is often a boom and bust industry. About the time oil is going to a hundred the rug gets jerked out from under it. Likewise when it is going to zero and will never recover it bounces back.

Today is doom and gloom - next year will be a completely new picture. We have another three wells to drill over the next year - lets see what the next year brings. IMO natural gas and LNG should hold up better than oil in this current market. Gas is still needed for electricity, heating, etc. Oil is a world commodity and price will recover as inventories decline. Russia, Saudi Arabia, and the US shale industry can’t be sustained by cheap oil - the market will adjust as the surplus inventory is worked off and the world politics settle down

The oil industry will survive this - painful as it is for this industry. Origin/Falcon will survive also. Don’t judge your Falcon investment based on your knee jerk reactions to today’s market prices.

BO: I'm told the fracking will be completed in April. We should get a 24 hr flow rate shortly thereafter. For the 90 day EFT results we are looking at July if the fracking is not completed till the end of April - don't know the planned end date for the frac.

Once again: It's amazing how people on boards such as this are as qualified or much more qualified than those actually running the companies. There appears to be so much management/geological/engineering talent being wasted on this and other chat boards.

Many on this board are rather short sighted as to the performance of Philip. I personally was very appreciative that he was at the helm when HESS tried to roll over Falcon and Philip took it upon himself to call their bluff. He took their millions of dollars in seismic and I didn't even say thank you - pretty tough negotiator who was willing to lay his balls on the line when push came to shove. He parlayed cutting HESS loose into the very impressive farmout with Origin that left up with $20 million up front and a $180 million 9 well carry with the most respected energy in Australia. Maybe POQ was overpaid for the period of the moratorium and trying to work with Origin though the new fracking regs but I expect we will see his value again when it comes time to appraise/sell Falcon's 30% interest in the Beetaloo - POQ told me he planned to get every last dollar out of this once in a lifetime deal. For anyone on this LSE board that presumptuously believes they are better equipped to carry this project through a successful conclusion please speak up and lay out your plans - I expect to hear crickets!

As Buckeye so astutely points out, nothing is going to positively affect Falcon's share price until we obtain successful results - meaning a 24 hour flow test followed by a nice EFT. Falcon is a very small oil/gas stock and like any minor oil company, results are going to drive the price. Most of us on this board understand the risk involved in the Beetaloo. Buckeye can call it mental masturbation but the 6.6 Tcf contingent resources discovery offers us hope that the Beetaloo can 'potentially' become the largest commercial shale play outside of the US. Yes - I can appreciate that those are contingent resources and not yet commercial reserves but that's why many of us are in this investment - huge upside potential. With that said I would caution everyone to keep the real risk of this exploration/appraisal program in perspective - ths money is not yet in the bank.

One additional thought - if this project is a failure then POQ's salary won't make a material difference to the price of Falcon - If this project is a success then POQ's salary won't make a material difference to the price of Falcon. Best focus on the Kyalla and Velkerri Wet horizontal tests and classify this next 18 months of POQ's salary as an immaterial cost to Falcon's 30% interest in the Beetaloo concession. Good Luck All!

Poods: I expect even you would agree that $157K for a CEO of a $200 million dollar company with this potential might be a little on the cheap side!

Nice Find BO. Is this the type of article on which you base your investment research? Looks quite reliable and accurate. Amazing in depth research!

"Is Falcon Oil & Gas Ltd. Growing?
Falcon Oil & Gas Ltd. has increased its earnings per share (EPS) by an average of 35% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 433%.
This shows that the company has improved itself over the last few years. Good news for shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Although we don't have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow."

The earning and revenue growth is a side of Falcon I didn't know about. Now I know how you come up with some of your opinions and concerns. Thanks for sharing.