Should the Soco management resign from the Board?

Wednesday, Jan 25 2012 by
40

Fwiw I think the Soco management should resign from the board as I simply don't think they have done a good job for shareholders at all over the last 4-5 years.

As a long term shareholder I feel they have had numerous opportunities to deliver operationally but have consistently failed.

Most notable failures are

-Lack of Commercial success on TGD & millions spent on various wells.

-Several wells drilled in Africa, again millions spent but no commercial success

-TGT 55,000 bopd year end target missed when it was only late Aug 2011 they talked about such target

-Selling out Baulaung only to see months later reserves upgrade & further drilling success by Salamander

I feel the management's judgement is questionable. It is difficult for the markets to have confidence in a management team that seems to be getting it wrong consistently.

I just think a management team with 30+ years of experience should be able to provide an accurate estimate as to when production targets on a big project like TGT is likely to hit 55,000 boepd. And have the ability to achieve those targets?

Why would you set a public target if you could'nt achieve it?

I mean if you can't work out when targets are likely to be hit then why should Investors have any confidence in their judgement as to which wells should be drilled?

Soco is down 13% over the past month, there are 46 E+P stocks that are up more then 10%. Soco has significantly underperformed in a what has been a bullish market the past 4 weeks. It is clear the market has 0 confidence in Soco.

http://www.digitallook.com/cgi-bin/dlmedia/heatmap??&&country_id=1&tool_url=/cgi-bin/dlmedia/heatmap&index_security_classification_id=-1&sector_security_classification_id=100148&dataplotcatergorycategory=share_performance&dataplotcatergory=price_mvt_3m&orderby_field=value1&action=tool_submit&tool_id=10&hide_extremities=undefined&remove_nas=undefined&username=Invisage&ac=208992&tc=


I don't trust the manageement team to make the right decisions for shareholders.

I would feel more comfortable if the two execs on the board resigned & the chairman indicated to the markets the company was for sale.

I think shareholders have given the management team enough chances over the past 4-5 years & feel enough is enough.






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SOCO International plc is an international oil and gas exploration and production company. The Company has oil and gas interests in Vietnam, which includes Block 9-2 and Block 16-1; Republic of Congo (Brazzaville), which includes Marine XI Block and Marine XIV Block, the Democratic Republic of Congo (Kinshasa), consists of Nganzi block and Block V and Angola, which include Cabinda Onshore North Block. The Company's operations are located in South East Asia and Africa. It holds its interests in the Republic of Congo (Brazzaville), through its 85%-owned subsidiary, SOCO Exploration and Production Congo SA (SOCO EPC). It holds its interests in the Democratic Republic of Congo (Kinshasa) through its 85%-owned subsidiary SOCO Exploration and Production DRC Sprl. The Company’s net entitlement volumes were approximately 15,500 barrels of oil equivalent per day. more »

Share Price (Full)
323.8p
Change
-2.4  -0.7%
P/E (fwd)
8.5
Yield (fwd)
5.3
Mkt Cap (£m)
1,083



  Is SOCO International fundamentally strong or weak? Find out More »


145 Posts on this Thread show/hide all

kenobi 30th Jan '12 26 of 145
6

In reply to dawnpatrol, post #24

dawnpatrol

>>Who exactly do you think would do a better job? Can you imagine the contacts and relationships the team have built up over the years?

I think Issac has expressed his oppinion quiet clearly. His view seems to be that the company should shut up exploratation, put the company up for sale officially, and give the money back to the shareholders.
You don't need great technical knowledge to do this, Its a view.
A perfectly reasonable view, and some years back Paulypilot on the fool, ran campaigns to get money back
from companies where the market had lost confidence with them.

Its not wrong to do this if that's his view, and if a majority of the shareholders wanted it, then it would definitely be the right thing for the management to do.

At this point, I don't think there is a majority view for this.

However, its a perfectly valid view,

K

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emptyend 30th Jan '12 27 of 145
6

In reply to kenobi, post #26

I think Issac has expressed his oppinion quiet clearly. His view seems to be that the company should shut up exploratation, put the company up for sale officially, and give the money back to the shareholders.
You don't need great technical knowledge to do this, Its a view.
A perfectly reasonable view, and some years back Paulypilot on the fool, ran campaigns to get money back
from companies where the market had lost confidence with them.

One of the main problems I have with such comments/views is that they presume that:

a) management don't care and

b) managements are idiots - or are blinded by massive packages

There is ZERO evidence for that in this case. Management's interests are extremely well-aligned with shareholders'  interests and I do not doubt for a nanosecond that if a deal came up that was in shareholders interests but left no jobs for them, then they would be off in a nanosecond! And I'd be pretty certain that they have considered the course of action suggested by Isaac at least a couple of times in recent years.

I would also point out that this sort of complete rubbish and lack of understanding of the way that companies are run seems to be quite general across the market from shareholders who have suddenly discovered in the last few years that share prices don't always go up! The ludicrous witch-hunt over Hester's bonus at Royal Bank Of Scotland (LON:RBS) is but one case in point.

ee

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kenobi 30th Jan '12 28 of 145
3

In reply to emptyend, post #27

ee,

I wish I hadn't replied now, as I didn't want to put words in Issacs mouth, and I feel I have a bit now.

While I agree with your position on SOCO, and am happy to back the management, I disagree with your two points.

a) management don't care and
b) managements are idiots - or are blinded by massive packages

If I can put the counter arguement that has been discussed here, it is that some people would take £5 per share asap, in preference to perhaps 6, 7 or more in 6 months (or more). And that we should stop spending money on expo, and cash in. It doesn't mean that the management don't care or they're idiots or they're blinded.

Might mean that this is their lifes work, and they want to make the most of it, and get the best possible exit,
and aren't looking to make a quick turn to invest in the next share. And since they own a lot of the stock, difficult to argue with their position.

I hope that within months, flow rates will rise, tgt 2 will come on stream and people who want to sell out for a fiver can do so in the open market. There may well be an opportunity to get out during the drilling of tgd, assuming they are going to re drill it. That would seem like the ideal solution, however, it's not something soco can do a great deal about other than argue to open the new zones on tgt 1 and progress tgt 2.

I can understand this,  as my investment in soco is now a very long standing investment,  I don't think most people expected it to take so long to reach a realisation of the vietnam assets. 


cheers K




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emptyend 30th Jan '12 29 of 145
3

In reply to kenobi, post #28

If I can put the counter arguement that has been discussed here, it is that some people would take £5 per share asap, in preference to perhaps 6, 7 or more in 6 months (or more). And that we should stop spending money on expo, and cash in. It doesn't mean that the management don't care or they're idiots or they're blinded.

Nope. Instead it means that people who put that argument think :

a) they understand the situation better than management and

b) they think that such options are the actual trade-off that would have to be made.

I strongly doubt that either of those is true.

 

Those who contribute to bulletin boards seem to me to have a systemic blindness to the fact that:

a) they are never actually in possession of the full & detailed facts and

b) sometimes management requires more than just bashing out a few messages from one's armchair

I am as guilty on the first point as everyone else (though of course it shouldn't prevent one having an opinion) - but I never overlook the real world implications of the second!

I can understand this,  as my investment in soco is now a very long standing investment,  I don't think most people expected it to take so long to reach a realisation of the vietnam assets.

Perfectly correct. We also failed to accurately predict the financial crisis, the euro crisis and the damage these have done to market confidence! 

I would say, though, that retail investors' confidence has been damaged more than corporate confidence........back in the real world, where managers are managing real companies, there is a continual focus on how best to move companies forward and how to increase shareholders' wealth. The fact that retail shareholders plainly fail to understand that (Royal Bank Of Scotland (LON:RBS) example again) doesn't make it any less true!

I may well be the only person who will be unsurprised one day when a deal apparently emerges from left field.....

ee

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kenobi 30th Jan '12 30 of 145
3

Yes completely agree,

my point is that some people trade shares, and when the share price is suppressed, it's not unreasonable to consider the close up and cashback option. This is what we all want eventually, the difference is

1) Management we know the strategy is to find oil and sell on when we're not adding much value, get on with it and get us out at the best deal you can.

2) Publically announce that the company is for sale, cash out and give us the money.

I personally don't think that's the best thing at this moment, I'd like another last shot at tgd,

I agree with your points too that we're not in possession of the full facts, and perhaps the management
would have taken an offer in the region of £5 pounds anyway, the view does rest on the expectation that
this price could be got on tuesday week, which may not be the case.

This is the problem with companies trading at a discount to their assets, hopefully, the market will correct this
anomaly before long, and those who want to sell out for a fiver can,

re who'll be surprised if there's a deal emerging from left field, I would say it depends when it happens !

K



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emptyend 30th Jan '12 31 of 145
4

In reply to kenobi, post #30

I agree with your points too that we're not in possession of the full facts, and perhaps the management would have taken an offer in the region of £5 pounds anyway, the view does rest on the expectation that  this price could be got on tuesday week, which may not be the case...

......re who'll be surprised if there's a deal emerging from left field, I would say it depends when it happens !

One of the main things that investors generally cannot know is precisely what the constraints are on potential timing. These uncertainties can work two ways....either:

1) some things are real and critical constraints but may not be regarded as such by the market, or

2) some things are regarded as critical by the market but are in fact not a barrier at all

 

An example of 2) might be the thought that a deal can't be done until TGT (phases 1 or 2)  has hit plateau or that a deal cannot be agreed without first drilling TGD again. An example of 1) might be that PV or the Government may need to approve a buyer - and that they have so far vetoed four buyers without the market becoming aware. 

Obviously no such example as per 1) has occurred to the best of my knowledge and neither do I think such approvals are needed.......but that is the point - there may well be unknown unknowns that are causing delays in getting a deal done!  An example such as 2) is the sort of reasoning that has been repeatedly advanced over the last year or two by those who were convinced a deal wouldn't happen - but AFAIAA no such barrier actually existed and a deal might easily have occurred at any time.

Meanwhile, another 67k shares have been bought today.

ee

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Isaac 30th Jan '12 32 of 145

In reply to kenobi, post #26

I think Issac has expressed his oppinion quiet clearly. His view seems to be that the company should shut up exploratation, put the company up for sale officially, and give the money back to the shareholders.
You don't need great technical knowledge to do this, Its a view.
A perfectly reasonable view, and some years back Paulypilot on the fool, ran campaigns to get money back
from companies where the market had lost confidence with them.

Its not wrong to do this if that's his view, and if a majority of the shareholders wanted it, then it would definitely be the right thing for the management to do.

At this point, I don't think there is a majority view for this.

However, its a perfectly valid view,

I agree with most of this (apart from shutting up exploration). Most of it has been my view for a long time now. Sell TGT, release cash to Shareholders & if the management wishes to continue to explore then do so. But not with TGT cash.

I am STRONGLY AGAINST spending ANYMORE TGT cash on exploration. They spent MILLIONS of TGT cash drilling TGD, failure after failure.

Now I get the feeling they are trying to use TGT cash to explore in a virgin territory. So I have no problem with them exploring, but don't do it with the value that has already been created,

Release the cash & let me the Investor decide whether I wish to continue investing in this management - There is hardly a lack of opportunities.

Or do a Burren / Dana, sell up & start a new exploration company.

Can readers tell me why they would'nt pursue such a strategy? There are a few reasons, but one that comes to mind is to continue to be listed as a FTSE 250 company taking large salaries.

If they sold Vietnam and released cash & explored as a minnow on the AIM market they would earn less then their current salaries IMO. I don't think the current salaries are justified and I don't think it is necessary to pay such large amounts of cash to merely bring TGT online.

One of the main problems I have with such comments/views is that they presume that:

a) management don't care and

b) managements are idiots - or are blinded by massive packages

I don't presume that at all. But since you raise the points perhaps you can tell readers why you think otherwise...

- Is it because management have a shareholding which they never bought with their own cash?

Can you enlighten readers with what you think they did that has added value to the share price in the last 4-5 years? I presume that is an acceptable time frame to asses performance in your book? Perhaps you know more then Mr Market, the analysts, institutions, Oil najors, NOCs.

There is alot of money in the markets, why don't the insitutions take up the slack? Why don't they buy the stock if it is such an unloved, undervalued company?

I may agree with you that there are quite a few foolish people that work in the City, but I can't agree that everyone is stupid. Surely, the chap at Black Rock is not that dim?

Why has he been selling his large holding that he has held for years and years? Surely, there must be something wrong with the company/strategy/management?

Let's say the whole city is stupid, But surely the majors/large oil companies/Noc's can't be stupid as well? The sector is BOOMING and is flush with cash. So why don't they buy Soco equity?

There is ZERO evidence for that in this case

Are you sure? Please read the thread header

 

Should the Soco management resign from the Board?

I am yet to see a convincing case to say otherwise, I have made my points clear in the header as to why I think this.

Management's interests are extremely well-aligned with shareholders'  interests

I may believe that one day when management dip their hand into their own pockets & actually buy some shares. You know with hard cash, like most of the people that read these boards have done.

You know the money you work hard for, the money you Invest in for your future, for your well being, family, school fees, retirement etc etc I honestly don't care if Soco is some life time work for the management, if they want to carry out an academic excercise I would politely suggest they go back to University.

 As quite a few of us have hard earned life savings invested in this company, I would like to think this is more then some academic excercise. 

I would also point out that this sort of complete rubbish and lack of understanding of the way that companies are run seems to be quite general across the market from shareholders

Surely, the market, institutions, fellow private investors can't all be wrong? The Sector is in a BULL MARKET. The eyes are firmly FOCUSED on all companies in this sector, they are being WIDELY followed. I can assure you the market has'nt missed a FTSE 250 company.

The stock could barely get a bid the past month when the markets have been very fruitful for making money. The Market has lost confidence in Soco....Investors have lost confidence in Soco

I think the management should tell the remuneration committee they wish to decline their bonus. I think it is outrageous that one of the exec members take home approx £30k after tax per month. I don't thnk a single individual should be paid such a large sum of money especially when it is hard to see how value has been added to this company over the last 4-5 years.

The share price is still 50% below the peak it hit 5 years ago.....2011 was a year where the Oil price was HIGH & STABLE. The share price has underperformed in a BULL MARKET - I think that sum's up management performance.

As Soco is my largest holding and as I feel I should do my bit to cut excessive fat cat pay I fully intend to instruct my broker to vote against Soco remuneration & re-appointment of directors. It is not necessary to attend an AGM to vote. 

 

 

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Isaac 30th Jan '12 33 of 145
3

Instead it means that people who put that argument think :

a) they understand the situation better than management and

If you read the header, I have made it quite clear where I feel management have failed in the last 4-5 years. Why should Investors think the management understand the situation any better then the rest of us?

Over the years there have been numerous cases where various management teams have run their company into the ground. What makes you think the same could not happen here?

Because they hold shares they never paid for?

I guess Fred the Shred felt he understood the situation better then anyone else before running RBS into the ground. Or Eric Daniels thought he knew better then anyone else taking over HBOS?

Worth putting the situation into perspective. These people are just human beings.  They are not some super human beings like some would like to believe that can pull rabits out of the hat.

If TGD was some hot shot project, why would Soco look to acquire virgin exploration? Surely they would be solely focused on this 1bn bbl prospect? A 65% interest in a 1bn bbl project will surely take up LOADS of cash to explor & develop?

Why would PTTEP relinquish their stake in TGD?

What does common sense say?

To me it says Vietnam is DONE. Time to Sell up. Return cash to shareholders.

I want to do what I WANT to do with MY MONEY.

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Isaac 30th Jan '12 34 of 145
3

I strongly suggest readers contact Soco & recommend they pay a dividend to shareholders in the Final results due for publication in 6 weeks time :

http://www.socointernational.co.uk/contact_us

The longer they keep building cash the more likely it is to be wasted on mindless acquisitions or speculative drilling IMO.

The return of cash would allow shareholders to chose what they want to do with their cash.

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peterg 30th Jan '12 35 of 145
14

In reply to Isaac, post #34

The return of cash would allow shareholders to chose what they want to do with their cash.

Isaac, if you in fact have money in Soco, which I find hard to believe given how you clearly feel, you can get your cash back tomorrow, anytime after 8:00am.

I have made a choice what I want to do with my cash, and in effect I do every day that I decide to leave it in Soco. I have chosen to leave it in as I believe that value will be added by staying in, and by letting management get on with their job of maximising value. If I felt that management were not likely to have a good chance of increasing value then I wouldn't hold.

I have been very happy over the years for Soco not to pay dividends, as my view was, and remains, that there are better uses for the cash. That seems very clear at the moment, while a buy back of shares at well under NAV is ongoing, there looks likely to be considerable expenditure planned for TGD before long (something I welcome as it would be, in my view, the height of irresponsibility for management to give away cash rather than pursue what looks like a very worthwhile piece of exploration) and there is potential for new opportunities elsewhere. 

It may well be the case that before long some or all of the company will be sold, and you will get your wish, or part of it. However, if the company is going to be sold, I want the best possible price to be obtained, and I'd have thought it was clear to anyone that you don't do that by acting as though you are desperate to sell, and have no plans at all for the future if a sale falls through. I prefer to bargain from a strong position, not a weak one, and I'm sure management share that view, even though you clearly don't.

That is what E&P companies do, invest cash in future explo and opportunities. If you feel you don't want your cash invested in an E&P, as that is what Soco is, I'd suggest you take it back and invest it somewhere you are happy with. I know this is pointless advice as there is no chance of you following it, but I have to try, you are clearly suffering so much from being invested in the wrong place.

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davjo 30th Jan '12 36 of 145
14

Isaac

I want to do what I WANT to do with MY MONEY.

What's stopping you? If you entrust your money with Soco management you cede control of that money to Soco. If you don't like what they are doing with it you sell. Simple!

You are peeing into a gale and getting your trousers very wet. Indeed, it's made worse by you making a public spectacle of yourself, if you only but knew it !!

 

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Isaac 30th Jan '12 37 of 145
3

In reply to peterg, post #35

Peter/David

Selling into a weak share price has never been one of my traits. I know there is value here. Tell the management to get the price back to ~£5 and I will be out like a shot.

 

It may well be the case that before long some or all of the company will be sold, and you will get your wish, or part of it. However, if the company is going to be sold, I want the best possible price to be obtained, and I'd have thought it was clear to anyone that you don't do that by acting as though you are desperate to sell, and have no plans at all for the future if a sale falls through. I prefer to bargain from a strong position, not a weak one, and I'm sure management share that view, even though you clearly don't.



The best possible price? Peter, we are an E+P company that sells OIL into a GLOBAL MARKET priced of BRENT as a MARKER crude at a $6-7 Premium in the back door of an ENERGY HUNGRY OIL CONSUMER.

We are in a BULL market for Oil & Brent was HIGH and STABLE in 2011. Why would we be in a weak position? We have reserves. We have production.

So what exaclty do you mean by the best possible price? Surely the price is the market price and nothing more or nothing less.

What makes you think we are bargaining from a weak position? We have x amount of bbls in reserves. The price of Brent is $111 +$6-7 prem for TGT Crude. That is the market price, take it or leave it.

I have been very happy over the years for Soco not to pay dividends,

It's hard to disagree with that view if you look back 10 years. But the truth is the last 4-5 years have been terrible for investors. At what point do you think a change of strategy is needed?

If the management pay dividends or return cash to shareholders those that wish to use that cash to buy more shares in Soco can do so & those that wish to release cash and Invest elsewhere can also do so. Optionality,

That seems very clear at the moment, while a buy back of shares at well under NAV is ongoing, there looks likely to be considerable expenditure planned for TGD before long (something I welcome as it would be, in my view, the height of irresponsibility for management to give away cash rather than pursue what looks like a very worthwhile piece of exploration) and there is potential for new opportunities elsewhere.

 

So do you think management can with current cash resources

a) Continue to Buy back shares

b) Continue to spend capex developing TGT

c) Continue drilling wells in Africa

d) Drill another well or two in their 65% WI of 1bn bbl TGD prospect & later develop

e) Acquire new acreage in virgin Burma, shoot seismic and drill exploration wells

I am sorry guys but this is the management team not thinking at all IMO.

Aminex spread themselves allover the place a few years back, ran out of cash and diluted shareholders to oblivion.

The management need to wake up IMO - the above is FAR TOO AMBITIOUS for SOCO IMO, I think SOCO would struggle to fund the capex to drill the necessary wells on TGD & if Commercial would struggle to fully fund the whole project IMO.

Forget Africa. Forget Burma. Forget TGD.We have been there & tried it, got the Blue Peter Badge. It did'nt work, MOVE ON!

Keep buying back shares below NAV. Return Cash to Shareholders. Develop TGT. Sell TGT & return more cash to shareholders.

The way to add value and return it to shareholders is CRYSTAL CLEAR.

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emptyend 31st Jan '12 38 of 145
2

In reply to Isaac, post #34

I strongly suggest readers contact Soco & recommend they pay a dividend to shareholders in the Final results due for publication in 6 weeks time

...whereas I strongly suggest that readers don't even think for a nanosecond about wasting management's time on that issue!!

I have little doubt that, for the first time ever, the question of a dividend will have been receiving some very serious consideration by the board - probably for several months already. I am vehemently opposed to gratuitously wasting the time of management teams who have far far better things to be doing than dealing with enquiries that they are unable to give a proper response to in a close period!

Whether the board will, this time, recommend a dividend is quite difficult to say. Straws in the wind (such as the recent trimming of the buyback price) may suggest that they are preparing the ground for such a policy change. But ultimately it is a matter of tactics.......in particular, what impact it might have on the attractiveness or otherwise of the Vietnam assets to whomever is a potential buyer. It is impossible to be sure whether a dividend is an excellent idea or a very poor one, when one has only a small fraction of the relevant information.

Life is too short to waste on the rest of the rants but when Isaac says.....

As Soco is my largest holding and as I feel I should do my bit to cut excessive fat cat pay I fully intend to instruct my broker to vote against Soco remuneration & re-appointment of directors.

....we should all be encouraging him to sell his shares as quickly as possible instead of espousing such dangerous clap-trap. The last thing that anyone should be contemplating is that approach, which was effectively the one espoused by Ed Miliband in respect of Royal Bank Of Scotland (LON:RBS) - because trying to drive executive directors out of a company by such ill-informed interference is a quick route to the poorhouse for shareholders! Different story with non-execs of course....they are there to be shot at if they aren't doing their jobs (one of the most important of which is to ensure that Exec management do theirs!)

ee

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kenobi 31st Jan '12 39 of 145

Issac, I seem to have misunderstood your view on exploration, you say

>>I agree with most of this (apart from shutting up exploration). Most of it has been my view for a long time now. Sell TGT, release cash to Shareholders & if the management wishes to continue to explore then do so. But not with TGT cash.

It seems you're happy for them to explore but not with any cash that came from tgt.
I am STRONGLY AGAINST spending ANYMORE TGT cash on exploration. They spent MILLIONS of TGT cash drilling TGD, failure after failure.

what cash are they allowed to use ? cash from cnv ? from the sale of thailand ? or has that been used in tgt development ? or would you have them return cash to shareholders and then have a share placement?

and then you write 

>>Forget Africa. Forget Burma. Forget TGD.We have been there & tried it, got the Blue Peter Badge. It did'nt work, MOVE ON!

doesn't sound like you're in favour of exploring anywhere.  Sounds like  I bought an a company whose assets are at a discount to market value,  I want you to sell up and realise the value asap. 

Decisons need to be taken on whether something is a good bet, not where the money comes from,
Having said that, I do understand the risk of big chunks of cash being spent on explo with nothing to show for it,
a lot has been spent on africa and so far we have little to show for it, but, if we get lucky and find oil, it might turn out to be a big deal.

I have sympathy with the arguement that perhaps we should be investing in undervalued assets that need cash for development rather than drilling wild cats. That would produce lower but more certain returns.

Still, we have no choice but to leave it to the management to decide.

K

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peterg 31st Jan '12 40 of 145
9

In reply to kenobi, post #39

Hi Kenobi,

I'm afraid I do sometimes find your posts very hard to read. Please don't be insulted, but in your last post, for example it took a little effort to work out what you thought, and what were quotes from Isaac! If you use the text editor, click just under the Reply button when you are replying, it becomes very easy to format quotes as italics, making it easy for the rest of us to understand what's what.

Regards Peter

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extrader 31st Jan '12 41 of 145
3

Hi Isaac,

The anarchist thinkers will tell you that justice lies ' not in the counting of men's heads but in the freedom in men's hearts' or some such.

You may be in the silent majority. However, most of the opinions so far voiced disagree with you.

I submit that the sensible course of action is for you to seek to table a 'no confidence' motion at the next opportunity (ie in about 4 1/2 months' time) and await the outcome. If your motion is carried, you'll be vindicated and can then see what changes are implemented; if it isn't , you'll then have to decide whether to accept a situation that is clearly not to your liking ......or vote with your feet.

A point of principle is only meaningful if - when push comes to shove - you're prepared to pay something to defend it.

So why not fire off that letter of instruction to your broker NOW and move on for the next 4 1/2 months to other, more productive pursuits ? It's a beautiful spring day here and I'm reminded of the grafitti on the promenade at Bondi Beach (many unhappy years ago) : " Life is too short to waste time on anything that doesn't lead to happiness".

Good luck with your other investments.

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Spurticus 31st Jan '12 42 of 145
8

I think the difficulty with SOCO, is that there are at least two kinds of shareholders.

1. Very long-term holders, who bought the majority of their holdings at much lower prices. Large gains made, very relaxed about the current SP and the Company prospects over the mid-term. If the 'endgame' is 2 months or 2 years, they can wait and are happy to see what the board delivers

2. Mid-to-short term holders, who have bought and held within the last 4/5 years. Best case, they might be level, worst they're sitting on a TGD (x2) -induced loss.


I'd guess that Isaac is in the latter camp, and feels pretty frustrated with the events over the last few years.
Prospects may be rosy, but hard to convince yourself of that when you're underwater.


I don't agree with many (any?) of his comments, but I can understand the sentiment.

(Me? I'm a '1.5', with a mix of purchases at different times.)

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kenobi 31st Jan '12 43 of 145
3

In reply to peterg, post #40

I'm afraid I do sometimes find your posts very hard to read. 

Sorry,  I'm afraid I have kids and sometimes I'm writing something and get interupted, like this am,  came back to it finished,  then edited in the second quote (where I forgot to put in the >>)  so a bit confusing I agree. 

I will follow your suggestion and try to use italics,  as above.

To be honest I wish I had left this thread well alone !

K

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emptyend 31st Jan '12 44 of 145
10

In reply to Spurticus, post #42

I don't agree with many (any?) of his comments, but I can understand the sentiment.

I think that every shareholder here has no trouble understanding the sentiment. He is simply frustrated.

Nothing new there - everyone is.

Including management.

However, most people can summon up a rational response to such frustration....and that is where most/all part company.

Fair comment, Spurticus, about two types of holder. However, there is absolutely nothing unique in the position of shareholders who have seen the share price go nowhere much over the last 4-5 years........but people really ought to put things in perspective:

Over the last 5 years SOCO International (LON:SIA) shares are down 9% (according to Digital Look's HeatMaps). That is not far short of the average for the FTSE350, since at least 150 companies in the FTSE350 have done worse! Those that have done worse include BP (down 12%) and  Salamander Energy (LON:SMDR) (down 15%)....and a host of supposedly solid and well-managed companies such as BT (down 33%), J Sainsbury (LON:SBRY) (down 34%), Marks And Spencer (LON:MKS) (down 52%)....to say nothing of the even worse performances from banks, retailers, builders, brewers etc etc etc.

Yes it would have been nice if the 5 year share price performance had been more like that of Tullow Oil (LON:TLW) (+243%), BG(+112%), £PMO(+75%), Cairn Energy (LON:CNE) (+67%) or even Royal Dutch Shell (LON:RDSA) (+32%)........and, with only slightly better luck (eg on TGD-1X), it could easily have been....but lets not pretend that bad luck (or even average or "as expected" luck) represents some sort of disaster. The share price performance has certainly been disappointing - and certainly worse than I had expected - but if we could all foresee the future perfectly then doubtless we'd have done things differently.

ee

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Isaac 31st Jan '12 45 of 145
5

Kenobi

To fund drilling....

Soco should sell Vietnam, ineffect sell Soco as the rest of the portfolio has little value IMO & return cash to shareholders.

Then...

Start a new company via an IPO.

Those that have confidence in the management team will back them. I have no confidence in the management team so I will walk away.

If the management are honestly any good they would back their own reputations just like Finnian of Burren and Cross of Dana did & start a new company & explore.

If the management are not driven by their salaries they would have no issues with starting a pure exploration company on lower salaries.

If they are hungry to take a salary then they would hold onto Soco IMO.

I think the Soco management are overpaid and don't have the required skill set to run a FTSE 250 E+P company. If it was'nt for TGT one could argue they failed. A blue chip company should not have a string of well failures. They should NOT underperform for a long period of time i.e. 5 years.

An AIM company ok fine. But for a FTSE 250 company it is unacceptable IMO.

Apart from TGT Soco has been a total disaster. I think Soco would be bust now without TGT. It is TGT that has saved them IMO. It is perhaps the single biggest reason as to why Soco is a FTSE 250 company.

Without TGT success a lot of readers would be very angry with the management team.

I just feel the management are a one trick pony that got lucky with TGT.

Spurticus - I have been a shareholder for just under 8 years. I think that puts me in the former camp. There was value that was created via TGT, my concern is management will destroy that value with pointless acquisitions. People like Booth had their own interests aligned with shareholders. I don't find that hard too believe as he and his team bought shares with their own cash.

With Soco it certainly does'nt feel as clear as it did with Encore.

apparent willingnes to continue expanding the portfolio

Zero actual evidence for this of course - not that it will stop such wittering.

Hard to agree with those comments when management have said numerous times in official RNS statements

The Company continues to evaluate exploration opportunities in South East Asia and Africa.

http://www.investegate.co.uk/Article.aspx?id=201111010700312105R

I urge readers to DYOR. Don't trust or listen to posters on these boards. A lot of hogwash is written by people who like to talk to their own book. Over the years I have called up the management team to confirm/deny some of the comments made by certain experts on these boards. Only to hear the management deny certain comments made.

To follow blindly on these or any board is a very dangerous game.

I also don't care if management are 'frustrated'. I honestly have no sympathy. They are paid to be frustrated, £30k per month.

I as a part owner of this business have yet to recieve a payment for the frustration I have expressed.

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