Life After Ugandan Drilling

15th Jun '09 by REO100

132 comments 32829 reads

Iti-1 Completed and abandoned with a clear implication that GBP are not going to use any further resources in this area.

I am interested in what may happen in the shorter term. Based on current SP valuation 15/6/09 Global are £10.5m and what they do have available to them is approx. £13.5m and 25% of the EA5 Licence. I am ignoring the pending legal action and Leighton as I do not believe this will have any significance in the next 9-12 months.

Whilst there is substantial overlap with TRP I am taking a view they will keep the two companies separate as Namibia is LT and they will have plenty of exposure to Uganda via TRP anyway. Surely the GBP vehicle will have looked at a number of plays in the interim period which due to the unfortunate circumstances at Iti-1 could now be brought to the forefront. The question in my mind is which territories would appeal to management and how quickly they realistically may now move. For a number of months it has been said how many O&G plays have been depressed due to lack of funding, well GBP may be about to step up to the plate but where ?

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emptyend

25th Nov '09

In reply to oilretire (post #51)

142 feet of Eagle Ford pay (presumably gross, since they don't specify?). Gross recoverables estimates at 51.5mmboe......worth having (though GBP only 15% AIUI).....

http://www.asx.com.au/asxpdf/20091125/pdf/31m986hk945h52.pdf

oilretire

Just in case anyone missed this from a few days ago (thanks to Doji Star on ADVFN)

http://www.texonpetroleum.com.au/docs/investor/report2009/tplbp091119.pdf

Page 49 details a possible work plan for all the Texon areas - including those up for proposed farm outs - will we see GBP here I wonder, although perhaps the terms available just went against us!

8th Apr '10

Another well at Leighton: http://www.investegate.co.uk/Article.aspx?id=201004080719388744J

REO100

The court case with Woodside is due to proceed next week, it will be interesting to see if it does actually make the High Court. One would hope (there is plenty of time) of a positive settlement for GBP before such proceedings.

I doubt I am alone in then wondering what GBP may be up to with a healthy cash pile.

Reo

Just a couple of cross posts from elsewhere for the record:

Interesting price metrics on the TXN release - confirmation of the increased value of gas produced at Leighton

http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01053254

And from a couple of days ago, what TXN are up to just south of Leighton - perhaps a GBP farm in there is not out of the question?

http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01052561

16th Apr '10

I understand that the Global court case vs Woodside (over the Kenya farm-out) is now scheduled to commence on Monday. I guess it will be confirmed here later today.

yup - there we go.......

COURT 12
Before MR JUSTICE DAVID STEEL
Monday 19 April 2010
At 10:30
For Trial
Part Heard
2008-712 Dana Petroleum (E&P) Limited & Anr v Woodside Energy (Kenya) PTY Limited & Anr

Interesting to see that it is "Part Heard". Wonder who the other party is on Woodside's side?

poobear

Repsol is the other partner......

http://www.oilvoice.com/n/Repsol_Joins_Global_Joint_Venture_For_Offshore_Kenya_Drilling/a9caa17b.aspx

Holdings in the L5 and L7 Joint venture :
Woodside 30% (and operator);
Dana 30%
Repsol 20%
Global 20%

Going on from my initial post here could be the bone of contention;

"The costs associated with Global’s 20% in L5 and L7 are carried for all activities through the drilling of the first well in each of these areas. Woodside and Repsol earn their farm-in equity when these two wells are drilled........"

They may argue that as they had elected not to proceed with the second well to earn the equity....... just a thought.

Yes - but it isn't clear to me that they are also considered liable. IIRC they farmed in quite a bit later than Woodside (and they are also not the Operator) - hence I'm not certain that they are necessarily the "other party" with Woodside.

Guess we'll see soon enough.....

As I recall at the time in 2006, being a holder then, I believe the decision not to drill the second well was made during a meeting between partners just after Pomboo-1 was drilled and found to be dry.

The vote was split 50/50 in percentage terms but carried by Woodside's veto as Operator who, in conjunction with Repsol's vote, overruled the other two partners Dana and Global. I believe Repsol can be held into account as co-defendants, whether or not they end up paying any damages, that would be a different matter, assuming the lawsuit is found in favour of the plaintiffs of course.

Yup - that is almost certainly what happened, I guess....though I don't recall the voting being reported at the time.

I recall it was mentioned somewhere in the Global account of events, not too sure now, may have had 61pt8's investagative work involved but I am aware that I knew the breakdown of voting at the time.

Here is a bit more from Global Annual Report 2007

Talks about voting;

"On 23 January 2007, Woodside as operator of the Company’s Kenya Joint Venture announced that Pomboo No. 1 had reached a total depth of 4,887 metres and would be plugged and abandoned. The well encountered “in excess of 200 metres of moderate to good quality reservoir sandstones” in the primary target zone from 4,685m to the total depth but without oil or gas.
It had been expected that the drilling rig would move to Licence L-7 immediately following Pomboo to drill Sokwe South No. 1. However at a meeting of the Joint Venture on 24 January 2007 it was decided not to drill Sokwe South No. 1 in this drilling campaign. The voting equity of Woodside and Repsol as farminees was sufficient to make this decision binding on the Joint Venture. The Company’s announcement dated 25 January 2007 advised shareholders of this outcome..........."

http://www.globalpetroleum.com.au/gplinfo/gplinvst/ar/gplar07.pdf

20th Apr '10

Out of court settlement announced......USD 12 mn split equally between Global and Dana.....

....so the rumours of a few months back were correct as to the size of the deal, though GBP is getting 50% -so better than I'd assumed!

That is worth about 2.25p per share.......

Case settled out of court.

US$12 split 50/50 with DNX.

Approx 2pps IIRC?

ohisay

Pleasant surprise -that poster on Hot Copper got the amount spot on a few months ago .

Makes current total cash almost exactly 10p per share with revenue from their existing Texon assets paying off qtry admin costs.

Personally I hope they don't blow any more of it away on another Ugandan well .The US route seems much more prospective.

With the case now resolved on a positive note - we will hopefully see some indication of activity,maybe in the next 3 months. Based on their past committment to Uganda I would guess they would maintain the 25%, but surely they have some further asset plays in mind with the cash ?

As a side issue GBP seems to be below the radar for PIs and their website is still lacking on content and appeal.

uncommon13

A passing thought but what do you think about the likelihood of Aminex (AEX) and GBP collaborating in Tanzania's Ruvuma for the next drill through another farm-in?

21st Apr '10

Not impossible, but on a regional basis neither would a deal with DPL be.

FWIW, I would like to see some cash go towards expanding US ops into adjoining blocks with TXN and use some cash for some high risk high rewards like the 3rd Uganda well & farm ins whether that be east Africa or further afield.

22nd Apr '10

6th well at Leighton is successful:

http://www.investegate.co.uk/article.aspx?id=201004220738336036K&fe=1

Life After Ugandan Drilling

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REO100

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