NO TA ON THIS THREAD PLEASE - (edit) and no pointless speculations either!
I've created this thread just to park stuff in that is only tangentially-related to SOCO's interests and doesn't relate to any of the specific assets.
Catch 22
Isaac will sell when everyone's euphoric,
Everyone will be euphoric after Isaac sells.
p.s. I'M Spurticus
Snaj - There seems to be an awful lot of waffle in this post. Don't really know how to reply. Sorry.
RG - Good for you, I hope you live life to the full.
Fangorn - Readers won't tell you about my calls on Aminex since 2008 - I suspect I am right about Soco too.
Spurticus - No harm in a bit of humour... :-)
Yep, why are you here for? I am only interested in making money, not being emotionally attached.
yes I'm in the same boat as you,
my point is, you have to see their point of view, in order to understand their actions,
this is their last shot in industry, they're not going to go on investing, I imagine they'd rather back their own
company than other peoples.
So us to make a profit and move on to the next is not the same to them, this is the culmination of their lifes work, so if you for a moment imagine you are them, they might not want to sell it cheap just so the rest of us can go off and invest elsewhere. The size of their stakes has something to do with it too.
The difference between 4.50 and 6.00 could be the difference between 15M and 20 M.
I know which I'd rather have, especially if I'm earning close to a million a year while I wait. Not only that,
TGD might be the biggest thing they've ever found in which case, what a way to go out ? and maybe it can be 8.00 not 6.00 ? so 27M ??
I'm sure you can understand this, you cannot change the directors numeration or motivation, any more than you can change the deals they do, so you just have to accept it, and live with it.
what you are happy to retire on is neither here nor there, is it really ?
money is relative, the more you have the more you want,
K
I suspect Soco will be a different case when it comes to a takeover, management after all have a large stake so can be far pickier(EO management shareholdings small by comparison.) Soco also into full production mode, have a history of successes and adding value. Aminex has not been so fortunate, and has done nothing bar dilute holders into oblivion.
Truth be told, Oil E&P is a risky business and you cant win them all. Aex has been consistently unlucky to boot. Have to say I've been looking to dump them(AEX) into any decent strength for a while now but was holding on for Nyuni and Ntorya. Make or break come December with Ntorya in my view.
Two duds in the porty with Aex and AST, both been LTBH's. Fortunately they've not outweighed the successes that have been Soco, EO and NPE.
Now to work out where to invest the EO proceeds. :)
p.s I suspect people will be underwhelmed when a bid for Soco does materialise, given the financial climate and collapsing markets, but at least they wont have to sell.....unlike EO which had little in the way of cash flow.
The big difference between Soco and the likes of EO is that Soco's core assets are either in production or are close to being brought into production.
a) the risks attendant on appraisal, development and start up (and financing of each of these stages) have all been removed.
b) the risk that the price of oil will collapse before production starts has been removed
c) the assets are cash generative now with more cash generation coming on stream soon
All of which will allow an acquirer to recognise value with minimal discount
And will also allow SOCO to take a very relaxed view of the need to sell
EO has had to sell in a buyers market for fear they would find themselves in a bind where they could not finance development.
SIA can wait for the market to turn
Hi all,
Devil's advocate moment ! Let's suppose :
- there are no adverse developments re TGT 1 (to end Q4 2011);
- there are no adverse rumours/reports re drilling on TGT 2 (to end Q1 2012 ?);
- there are no material developments re Congo (to Q4 2011);
Come Q4 2011, Soco say they've recalibrated seismic on TGD and they reckon there's a 1 billion barrel OOIP down there (with 20% CoS); or, a 500 million barrel OOIP with 10% CoS.
It'll take 6 months to drill and cost USD 50 million (on the high side, but this is going to be so 'belt-and-braces' it won't be able to pee.....).
Leaving aside quibbles over numbers, do you think they should/would 'go for it' ?
Answers on a postcard, pls.
ATB
Come Q4 2011, Soco say they've recalibrated seismic on TGD and they reckon there's a 1 billion barrel OOIP down there (with 20% CoS); or, a 500 million barrel OOIP with 10% CoS.
It'll take 6 months to drill and cost USD 50 million (on the high side, but this is going to be so 'belt-and-braces' it won't be able to pee.....).
Leaving aside quibbles over numbers, do you think they should/would 'go for it' ?
1. The interpretation won't be finished before March
2. IMO they will do a deal that allows them to back into TGD in the event that a drillable opportunity is identified
I think TGD is certain to get drilled again if there is even a 10% chance of getting the oil to the surface....but I don't think it will be drilled by SOCO alone - and I don't think that it will hold up other matters.
ee
p.s I suspect people will be underwhelmed when a bid for Soco does materialise, given the financial climate and collapsing markets, but at least they wont have to sell.....unlike EO which had little in the way of cash flow.
I think people have been over critical of Booth's decision to sell at 70p, when IMO although the price is low compared to what could have been achieved 6 months ago, in the currently climate I think it was an excellent decision and certainly in the interests of shareholders.
What he has allowed people to do is take a 55% premium to the close priice on Tuesday and for investors to then cash out and use the proceeds to buy the likes of Sterling, Soco, Serica, Heritage, Premier, Cairn, Salamander etc
All of which offer a potential 50% upside IMO.
I call that working in the interests of shareholders. What Booth has demonstrated time and time again is how shrewd and smart he is and a good track record of finding Oil.
If he came to the markets for money with a new company I would certainty consider backing him.
p.s. It is so much nicer to be able to talk about a company director in a positive way, I'm a straight talking & direct person....
>> do you think they should/would 'go for it' ?
I think if there is a drillable target, it will be drilled, whether by soco or by another company with soco farmed in as ee suggests.
I say this based on the AGM discusions, I was left with very little doubt that they want to drill TGD,
it might be their crowning achievement, and who can blame them, If they can get it to flow, and imagine there's 500M recoverable there, with there share of 60% ish ? say 300M at $10 lowball price $3BN,
for a company with a market cap of about a billion pounds, and perhaps a value of 2BN, so it's maybe doubling the value of the company ?
Hard to see how it won't get drilled one way or the other, then maybe we'll get a bit of luck in Africa, imagine 100M there too,
Too early to get excited about these things but £10 + doesn't sound impossible to me,
a lot of luck in there of course, but as they say, the more you practice, the luckier you get,
K
I agree that Boothy has has demonstrated an impressive track record of finding oil (pity the likes of AST and AEX have been unable to follow his example) and would certainly back any new venture he pioneers, should he choose to do so. And this is despite my impression that he has sold EO on the cheap - but then circumstances dictated his weak hand,unfortunately. Where's a white knight when you need one!!!!!
Concur with your "I'm a straight talking and direct guy" as I'm pretty similar myself. I certainly don't beat about the bush when something annoys and share some of your concerns you have highlighted over the years vis director performance/remuneration etc etc. But I do believe you often don't give enough credit where credit is due. Still, we do all have different opinions on many things, often shaped by our personal experiences and upbringing. Life would certainly be dull if we all agreed all the time.
One thing I've learned over the years is patience is a virtue.And am sure value will out, at some point , Soco side. A market meltdown however will be a serious spanner in the works as there are plenty of companies out there with significant cash on their balance sheets to go cherry picking assets that are valued at distressed prices. I certainly will be continuing to avoid any companies that require funding for their ventures.
Cash, even fiat cash imv, will still be king come the final reckoning when the bond markets finally implode - why, for example, anyone is chasing very low yielding UST(as a safe haven), the value of which is eroding with inflation is beyond me. Even more so for UK gilts.
But I do believe you often don't give enough credit where credit is due
I think I have given Soco management ALOT of credit over the years in particular 2006-2007 & despite my critcisms in more recent times Soco remains by far my largest holding, it makes up a significant portion of my wealth - I think that alone is probably the biggest compliment I could give -The fact my money is still backing the management.
I think the best course of action management can take is to take on board all my critcism and improve their performance, no ones perfect. We all have faults and there is always room for improvement.
They should aim to get to a level where it is very difficult for people like myself to be critical, I do have high standards and do have high expectations.
But at the end of the day, can you blame me ? I worked very hard for my money and no way am I prepared to lose it, performance is paramount & it is important that they add value to my Investment via a higher share price.
Soco could sit on the beach playing elephant polo for all I care, as long as the share price goes up I could'nt care less about their salaries or what they are up to.
But if they are sitting in the office working 16 hour days and value is being destroyed I can assure you I won't be very happy.
One thing I've learned over the years is patience is a virtue
The last 4 years has seen a negative return on my Soco Investment when taking into account 15% inflation. The performance needs to improve, it is completely irrelevant to me what 'operational milestones' are being hit. I want to see a higher share price - that is all that matters to me.
I think it is complete nonsense when people come out with lines like 'management have no control over the share price' because I can assure you if they keep finding Oil then the price will go up! Pretty simple really...
I think that alone is probably the biggest compliment I could give -The fact my money is still backing the management.
Really ? it's a complement that you've got a lot of money in soco ? so it's not just that the price is below the perceived value of the company, so you're trapped into taking a hit, or waiting for the value to be outed ?
If the share price was 4.50 today, or even 400, you'd be off like a shot ?
Now I'm not saying that's wrong, or even that I disagree with you, (although I would like a final shot at TGD)
but lets not pretend that it's a compliment to the management eh ?
It's pretty clear why you're still here, and what you are waiting for.
K
Kenobi
Believe it or not my average is below the current share price, I could get out at a profit if I wanted to. But I understand the value here and will stay put.
And yes that is a compliment to management, I am supporting their endeavours.
If the price was £4.5 in the current market I would look to reduce my position and add elsewhere with better upside, hardly a lack of opportunities.
Isaac,
If the price was £4.5 in the current market I would look to reduce my position and add elsewhere with better upside, hardly a lack of opportunities.
So where would you reinvest, and what upside do you see in your choice?
If the upside is greater than in SIA now, why not switch now?
Buffy
I worked very hard for my money and no way am I prepared to lose it,
When I see comments like this about investing in equities, the credibility of the author goes further down the toilet (if possible) because they should be investing in cash and bonds, not equities.
But if they are sitting in the office working 16 hour days and value is being destroyed I can assure you I won't be very happy.
Nobody but nobody sets out to destroy value, especially when they own an equity stake themselves, Sometimes it is just an unfortunate fact of life. Live with it.
ee
Nobody but nobody sets out to destroy value, especially when they own an equity stake themselves, Sometimes it is just an unfortunate fact of life. Live with it.
Tell that to the UBS stakeholders, I doubt Kwekou set out destroy value - Not that I put Soco Management in the same league as Kwekou.
When I see comments like this about investing in equities, the credibility of the author goes further down the toilet (if possible) because they should be investing in cash and bonds, not equities.
Tell that to Buffett I understand he does'nt like risk....
Buffy
See post 642
I think people have been over critical of Booth's decision to sell at 70p, when IMO although the price is low compared to what could have been achieved 6 months ago, in the currently climate I think it was an excellent decision and certainly in the interests of shareholders.
What he has allowed people to do is take a 55% premium to the close priice on Tuesday and for investors to then cash out and use the proceeds to buy the likes of Sterling, Soco, Serica, Heritage, Premier, Cairn, Salamander etc
All of which offer a potential 50% upside IMO.
I call that working in the interests of shareholders. What Booth has demonstrated time and time again is how shrewd and smart he is and a good track record of finding Oil.
If he came to the markets for money with a new company I would certainty consider backing him.
See post 642
Well, that doesn't really answer the question does it. Not that I expected a proper answer.
Regarding the comment about Booth, are you really comparing a company who have become acutely aware of their lack of cash in an ever worsening marketplace for funding, to a company awash with cash, and with the 'elephant' still there to be explored further?
On that point, have you any idea whatsoever how large TGD could be, and the potential value?
Buffy
Others have already gone further: Obviously, we'll be the arbiter of whether comments are 'civil and constructive' and any that are considered not to be so will be removed. Persistent offenders are liable to have their account suspended.
