Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Alongside the production update we should see some nice numbers in the quarterly Update. With production expanded by 60% and AISC below $18k I expect to see a reversal in the trend here. Hoping to hear about how the lithium pilot plant is progressing and how much longer we need to wait to see it up and running.
If tin prices can start moving up then we might just see a re-rate occurring here rather than the death by a thousand cuts that is currently happening with the sp.
Blythe Well previously flow tested at 45.5mmcfpd and doesn't need to be fractured like Southwark to get the gas to flow.
This is a straightforward development Well which is being drilled to hook up and get the gas flowing.
This will double current production and management have done this because they know they need to build shareholders confidence in them
Just shows that managing risk is a major part of investing in IOG or any AIM company for that matter.
Have been involved with IOG since early LOG days and have traded the swings ever since as this story has been a rollercoaster and I'm expecting that to continue.
Only difference is now I believe this is totally on its **** and could only get better as management deal with the geological model which obviously needs correcting.
Luckily for all concerned here Blythe is not the same as Southwark and will not require any fracturing to get it to flow plus we have the added bonus of Blythe Well previously being flow tested at 45.5mmcfpd so negates the risk of the Well besides some minor technical risk.
Management will move their focus towards phase ll and after a successful Blythe drill will be looking to regain investor confidence aswell as the wider market.
This will naturally reflect in a higher mcap and a renewed sense of security seeing as everything will be looking positive.
If you follow the fundamentals alongside the technical aspect of IOG then you will see the pattern.
Prior to drill results the sp has always climbed in anticipation of good news. The preceeding bad news has meant the climb hasn't continued and instead jumped off a cliff and all this has been exacerbated by the ii selling off.
Now it's just pi whom are controlling the book hence the constant tit for tat buy and sells but soon enough buyers will overwhelm the sellers as people hope and anticipate the drill results as positive.
So it's a case of buying the speculation and selling or derisking prior to news. As you can see with the charts IOG likes to swing so expect a 100% move prior to results and if they're good another 100%+ move is certainly on the books as this share has been battered down to this level due to the ii offloading.
Had they not thrashed the share then this would be at 10-15p as a bare minimum just on current production
News due any day relating to the Company's flagship asset The Islandmagee Gas Storage Project which management has confidence from its legal counsel that the judicial review will find in the Company's favour.
Plus MoD contract rumoured. Company is making strides in growth with revenues reiterated at £75m with 25% margin.
Let's hope they can get their act together and provide some actual remedies to resolve the issues rather than quick short term fixes. Its been one problem after another with these lot.
Nevertheless anyone buying here should do well as even with current production this should be valued higher.
Plenty of buyers waiting on the sidelines for confirmation of the drill going ahead in November. What they don't appreciate is the absolutely mega resource that it will be targeting.
AEX will have 2.5tcf net on its books once the resource is proven up.
To put that into perspective CHAR were valued at $200m on its Moroccan asset which had 2tcf. Should see this build in the run up to drill results so expecting at least 2p possibly 3p prior.
We also have the added bonus of oil and if that comes through then it should value AEX at 5p at least.
Updated Scoping Study numbers were mouthwatering with base case at $800pt. IRR was 85% and NPV10 $127m.
Now that we know the last auction price was $7000pt the numbers are going to be absolutely massive.
Based on $7000pt IRR increases to 510% and NPV10 to $1.1billion. Based on this we are undervalued.
The Capex repayment has been reduced from 2 years to 4 months. LOM was 14 years based on 80ktpa.
That's $7.8b in revenues over the next 14 years. Think that deserves an mcap of at least $500m over the next year or so
Given the significant softening in our share price over the last few months, in part as a result of delays with respect to the award of a new Site Survey Permit over the Barryroe Licence and the delay in delivery of funds due under the farm-out to APEC, the Board concluded a new equity fundraising at this time would not be in the interest of all shareholders. Accordingly, we would like to thank our Major Shareholders for their continued support and believe the terms of the Loan are attractive when compared to a number of other debt financings announced by quoted peers in the junior AIM resource sectors
LOGP is funded for WC until H2 2020. The cash balance is not £30k as cash burn is £35k per month.
On 25 June 2019, the Company secured debt funding of £150,000 from LC Capital and £150,000 from Brandon Hill Capital Limited, both existing significant shareholders in the Company
What is embarassing is your lack of research. L2 was a pilot well to ascertain the trajectory for LP02 sidetrack which would have been the producer.
L2 had an internal CoS where-as A3 has been given a 70% independently by AG Tracs.
The Serenity prospect is totally independent of Liberator results and geology. There is no doubt that there is risk of both wells coming up dry but not without recognising that they could still potentially provide a transformational result if they strike.
Serenity is up dip of The Tain Field and has much thicker sands and potentially a much larger resource than Tain.
A3 again is up dip and the sands are much thicker so we can have a reasonable expectation that they have a decent chance of striking oil given the independent CoS.
2 more rolls of the dice for 2 more potentially transformational results. At current mcap I know where I'm placing my bet
The CoS figures you have mentioned by WHI are a combination of internal CoS for wells and phase 1& 2 developments.
Gets very confusing when you have so many different drills and phase developments. The main CoS to remember for now is A3 has 70% CoS which has been independently provided by AG Tracs who completed the CPR and the 90% for L2 & 72% CoS for Serenity is an internal estimate by the BoD.
I concur with your calculations. PIRI in an excellent position now and valued significantly below NaV.
With the upcoming JOE drill I can see further upside in the buildup to results.
Posted a chart on Twitter which is super bullish across all timeframes. Expecting at least 4p here once the MM decide to close the spread
Only £260k sold when pot was worth £1m when ECO was at 70p ish...
Nav now in excess of £3m..
From the recent revised broker note it seems they are expecting the drilling schedule to change from A3 being drilled first which is an exploration well with 70% CoS to L2 being drilled first which is a development well targeting an up dip section of the reservior which in turn will not just derisk A3 further but also unlock the Senior Debt Facility.
This changes the risk profile significantly hence why someone is snapping up all the shares at this low level. The change in the drill schedule makes more sense as the L2 Well will not only unlock the Senior Debt Facility and derisk A3, it will also support the Seismic data and BoD theory that both L2 & A3 Wells lay in formations that are analogous to the Blake Field.
The L2 Development Well is targeting an up dip section of the reservior which suggests the BoD believe there is more oil there so an oil strike is nailed on its just a matter of how much is there.
Expect the next announcement of rig mobilisation to include the revised drilled schedule which has been alluded to in a recent podcast and revised broker note which has a risked valuation of 180p prior to drills results.
Fully expecting the sp to touch £2 on L2 results and £4 on A3 results and finally £6 on Serenity results. People are forgetting that Repsol was looking to take a 37% stake for $200m which valued I3E at £500m.
With a 100% interest and a successful drill program Im fully expecting the mcap to reflect the above figures unless someone here can give any reasons why on a successful drill program I3E would be worth less.
Lets not forget the Senior Debt Facility will allow I3E to fully develop Liberator from Phase I, Phase II to Serenity which is targeting 60,000bopd production.
Big, big things in motion here and Im fully expecting a buyout prior to full development because this is exactly what the BoD have a track record for and also why BP are not only involved with an offtake agreement but with a stake.
Posted the following on LOGP as the same applies here..
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The deadline for submissions is tomorrow. CNOOC were issued their Permits for the LOLAR drill within 2 weeks of their submissions deadline.
I expect the same to occur here hence why the deadline for the payment has been extended by 2 weeks. The Permit approvals will arrive first followed by the payment.
The MM are taking what shares they can from those who are nervous or unsure of the Permits being issued. I will be adding more here once Ive freed some capital from I3E. This price is an absolute gift.
The deadline for submissions is tomorrow. CNOOC were issued their Permits for the LOLAR drill within 2 weeks of their submissions deadline.
I expect the same to occur here hence why the deadline for the payment has been extended by 2 weeks. The Permit approvals will arrive first followed by the payment.
The MM are taking what shares they can from those who are nervous or unsure of the Permits being issued. I will be adding more here once Ive freed some capital from I3E. This price is an absolute gift.