22nd Dec '10 by loglorry

35 comments 14614 reads

This blog has been setup for general discussion of many different oil and gas companies similar to the TMF thread here http://boards.fool.co.uk/oil-gas-companies-50029.aspx.

The thread is intended for general market gossip and chat on a variety of subjects which are perhaps not suitable for the company specific blogs that already exist. For example comparing two oil companies which have similar assets.

The thread/blog welcomes light hearted comments as well as more meaningful analysis.

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Loglorry

Premium Member

35 comments

loglorry

23rd Dec '10

Parkmead's Tom Cross while formulating his Christmas receipe for gravy has discovered a way to turn gravy into light sweet crude oil. Stock has risen 22%. Parkmead has issued the following statement from TC:

"While it was difficult to put a price on PMG shares given their limited assets their biggest asset hast to be me. I think I have proved myself here with my recent discovery of how to turn gravy into oil while dabbling with my Christmas dinner. Using this discovery we intend to build a new Oil factory in the North West of England where the supply of gravy is assured."

Log

jonnyt

23rd Dec '10

Should have $30m left. Enough for Sarquala and the shallow Explo well adjacent.
The big cost for Kurdamir II won't be until the backend of the year.

If the two shallow wells prove and flow oil then raising finance shouldn't be too dilutive.

Parkmead Market Cap £110m, or WZR less than £50m with two potential giant fields 40% owned in the block, one has proven oil, 20 other drillable structures....

JonnyT

repobear

26th Dec '10

Middle East Online

'We reached an agreement with the Kurds'

BAGHDAD - An oil dispute between Iraq and the autonomous northern region of Kurdistan has been resolved, the central government's oil minister said in Baghdad on Thursday.

"We reached an agreement with the Kurds that all revenues will be handed over to SOMO and the Iraqi government will be responsible for paying the extraction expenses in Kurdistan," Hussein al-Shahristani told reporters.

SOMO is Iraq's State Oil Marketing Organisation which deals with sales of crude and other petroleum-based products.

Iraqi Kurdistan halted oil exports in October last year due to a payment dispute with Baghdad.

http://www.middle-east-online.com/english/?id=38845

Well that's pretty good news. Whatever stock takes your fancy in Kurdistan will probably help your portfolio to outperform in 2011 and thereafter.

repo

ManSiarad

26th Dec '10

Repo,

more information and background in this story for Abu Dhabi's The National

http://www.thenational.ae/events/categories/gastro/iraq-gives-go-ahead-to-kurdish-oil-contracts

Iraq gives go-ahead to Kurdish oil contracts

Tamsin Carlisle and Hadeel al Sayegh // $("html>head").prepend(""); $("html>head").prepend(""); //

Last Updated: Dec 26, 2010

Iraq's new central government plans to recognise contracts for oil and gas production in Iraqi Kurdistan, a step towards healing an extended rift that has delayed development of some of the world's largest oilfields.

Several UAE companies stand to benefit if the dispute is resolved.

Abdul Luaiby, two days into his new job as the Iraqi oil minister, said yesterday that there was an agreement between Baghdad and the regional government of Kurdistan.

"We have already signed an agreement with Kurdistan," Mr Luaiby said in Cairo yesterday on the sidelines of a Christmas Day meeting of the Organisation of Arab Petroleum Exporting Countries.

Under the deal, Baghdad would recognise several dozen contracts that the Kurds have unilaterally signed with more than a score of foreign oil and gas producers in their semi-autonomous territory in north-eastern Iraq.

The deal would also contain a revenue-sharing provision allowing foreign companies to be paid for oil and gas they pump for export.

"Yes, we will recognise them," Mr Luaiby said of the Kurdish contracts, which his predecessor, Dr Hussain al Shahristani, had declared illegal.

His statements followed five days of intensive talks last week when Nouri al Maliki, the Iraqi prime minister, led a delegation from Baghdad to meet Kurdish politicians on their home turf to hammer out a deal for an Iraqi coalition government.

The country has been without a government since its national election in March, and winning the support of the Kurds has proved the essential last step for Mr al Maliki to form a cabinet.

"The mood is much more positive now," said Hussein Baker, a Kurd from Erbil, the regional capital.

peterg

26th Dec '10

"We reached an agreement with the Kurds that all revenues will be handed over to SOMO and the Iraqi government will be responsible for paying the extraction expenses in Kurdistan,"

It's certainly a step in the right direction, but I'm keeping the cork in the champagne till I've seen more. Paying extraction expenses may not end up meaning the same thing as honouring PSAs.

jonnyt

29th Dec '10

Since been denied....

JPGH

31st Dec '10

For a bit fo fun (if nothing else) some preductions for 2011.....

Tullow Oil: Uganda will continue to dog the company but it's % value of Tullow market cap becomes less and less as Ghana remains centrestage. Deep Water Tano development to gather steam and possibly some major drilling success in South America and within DWT block to supplement resource base. Some reserve hungry bidders may want Uganda so no exit there but expect Tullow to play a harder ball game with GoU. Maybe this is the year of that elusive £18-£20/share bid?

Soco: Vietnam to be sold to highest bidder. Possibly even the whole company. Most shareholders happy to take £5-£5.50 for the lot?

Gulf Keystone: Politics continue to undermine GKP's share price adn attractiveness, with the odd unexpected court case thrown in for good measure. Drilling results continue to add more OIIP and firm up the underground oil lake theory across all GKP blocks. Low ball bid at £5 sometime during the year once new Iraq Gov is up an running and PSCs appear to get close to the point of being accepted and ratified.

Encore: early 2011 hiccups with drill bit but ending year with a 140p bid. Bid rejected.

Nautical Petroleum: early 2011 hiccups with drill bit but IIs/PIs all excited by heavy UKNS oil potential as POO heads towards $110-$120/bbl range then cant see NPE falling back. Continuing northwards.to 550p?

BP: Dividend declared equivalent to 4% yield at an SP of 460p. US law suits drag on with many frivolous side suits also clouding the litigation. SP climbs back to 600p by year end. Like Paul the Octopus time has no enemy and that bloody bird/Stork/Pelican that featured on every anti-BP news item meets its maker.

BG: Recovery in worldwide LNG prices, further progress with their Queensland LNG project and more oil developed/discovevered in Brazil. BG and Petrobras to continue to "dis" each other via various go-it-alone style RNS throughout the year. 2011 to see BG SP return to noticeable growth after a relatively poor previous 2 years. Possible 1700p by year end? Bid rumours in the background at all times.

Bankers Petroleum: continues to produce more and more crude under the radar of most observers. Successful Steam Flood project to move chunk of OIIP to reserves category. 600-700p by year end?

...etc.

Anyone else fancy a bit of crystal balling?

JPGH

thegreatgeraldo

31st Dec '10

JGPH,

What are Tullow up to off Mauri? They've been drilling there for a touch over 3 months.....

JPGH

31st Dec '10

TGG
Still drilling as far as I know. They didn't start until November sometime from memory.

JPGH

thegreatgeraldo

31st Dec '10

JGPH,

They updated in November in their IMS,

" Tullow's non-operated two-well exploration campaign in Mauritania commenced in September with the Block 7 Pelican/Cormoran well which is targeting both appraisal and exploration objectives in the Cretaceous interval. Following the drilling of this well, the rig will move to Block 6 to drill the Gharabi prospect."

Cuthbert C

31st Dec '10

"...Anyone else fancy a bit of crystal balling?

Before next Christmas

PMG SP reaches 800p and co enters the FTSE-100 - TC quoted as saying "we have a wonderful plan which is much to our advantage but nobody is to know what it is"

Aminex reports major discovery in Tanzania and SP rockets to 11p

BP touches 550p

DEO reaches 100p

EOG reaches 50p

NOP reaches 200p

PCI reaches 20p

SIA reaches 450p but still no offer received for VN or whole co

XEL to announce that flow test insufficient to permit booking of reserves - SP collapses - announces repeat flow test to be done - SP recovers - SP oscillates madly in run up to flow test #2 - successful result but SP overwhelmed with fatigue and does not respond........

Oil rises past $100

Oil producing countries announce that China will be barred from acquiring oil reserves unless/until western countries are allowed to acquire rare earth resources located in China. China denounces this as economic colonialism.

IEA or is it EIA (I always forget) announce that global production of conventional oil will plateau at 95 million bopd but that this will be sufficient to meet future demand

OPEC roflao

emptyend

2nd Jan '11

Soco: Vietnam to be sold to highest bidder. Possibly even the whole company. Most shareholders happy to take £5-£5.50 for the lot?

Just for the record, "most" very definitely doesn't include me! And I don't think it will include the major connected shareholders either!

How about this?.....90% of companies in the sector will put in their highs for the year during Q1(starting 4th Jan)

Isaac

2nd Jan '11

How about this?.....90% of companies in the sector will put in their highs for the year during Q1(starting 4th Jan)

Your not the only one thinking this.....Infact it is a point I have been thinking about the past few weeks. As the majority of the Small cap E&P sector has been overvalued for sometime. Back in the late 90s the tech sector was overvalued & 2-3 months later it all topped out.

I think something similar could happen with the E+Ps.

So if the Directors at Soco have any sense whatsoever they would SERIOUSLY get a move on & SELL UP in the next 1-2 months.

They have'nt exaclty been the shrewdest bunch of people the last 3 years.............Let's hope they can see the light now..

What is incredibly frustrating is Soco is'nt overvalued, infact it is undervalued but if the sector gets hit then lets not delude ourselves that Soco will escape the rout.

The problem is the performance has been so dismal the past 3 years, the market has lost confidence & therefore won't take Soco to fair value until they can demonstrate that when they drill holes, they actually find Oil in Commercial quantities they can produce and thus are succesful. So the way I see it if the management are seriously interested at this stage in unlocking the value in Soco in the short term then the route they need to take is to market the assets and sell to the highest bidder.

I'm not so sure the management realise this & if they don't then it concerns me.....But maybe they do and it is why they are batch drilling 4 wells on TGT to unlock & prove up as much value as they possibly can before selling up.

Leekgo

4th Jan '11

I am interested in EE`s and Issac`s concerns re overvaluations in the O&G sector. I think many share these concerns (and clearly many don't!) when it comes to the high-profile stocks operating in the Falklands and Kurdistan, and some of the PMG-like tiddlers in the North Sea, but many of the popular Stockopedia stocks seem to have the downside protected with assets in appraisal or development that they are quietly getting on with appraising and developing - I am thinking of the likes of Bankers, Petroceltic, Circle, Coastal, Ithaca, Aminex, etc. Most are well off their historic highs, and out of favour with little in the way of over-enthusiastic promotion. They dont seem overly dependent on high-impact high risk drilling and at least some have put in pretty unexciting performances in 2010.

Do these quieter O&G stocks also seem overvalued to some? I must admit they don't to me - i wouldn't like to claim they will all necessarily put in great performances in 2011, but at the same time i wouldn't think they had far to fall.

Or are they an unrepresentative sample, picked by the finest minds on Stockopedia? :)

emptyend

4th Jan '11

Most are well off their historic highs, and out of favour with little in the way of over-enthusiastic promotion. They dont seem overly dependent on high-impact high risk drilling and at least some have put in pretty unexciting performances in 2010.

Do these quieter O&G stocks also seem overvalued to some? I must admit they don't to me - i wouldn't like to claim they will all necessarily put in great performances in 2011, but at the same time i wouldn't think they had far to fall.

Or are they an unrepresentative sample, picked by the finest minds on Stockopedia? :)

It won't surprise you to know that I am in broad agreement with those comments. However, there are a few points to note, I think:

Investors in the sector aren't there for the downside protection - they are there for the upside exposure.
Investors misjudging the upside potential of a few stocks still has the potential to damage the wider sector - like it or not, success begets success in terms of investing fashion but the same "herd instinct" applies to failure (look at the rise of the other Falklands drillers on RKH's success earlier in 2010 and their subsequent performance).
in 2008/9 when investors cut back investment across the sector (and the wider market) it still damaged the share prices of many companies which then went on to trade at a progressively higher discount to realistic NAV estimates. EO. was a case in point - and has since recovered dramatically thanks to drilling success - but there are many other companies that haven't (GBP, for example, which has traded at a discount to cash for most of the last two years). Companies are not immune from sectoral influence.

Leekgo

4th Jan '11

Thanks for the response EE.

I guess visibility both in terms of market capitalization and in terms of which exchange stocks appear on may well have a substantial bearing on how much they suffer in a general sell-off. If small companies like Circle or Petroceltic can be ignored when Oils are in fashion, one can`t expect their undervaluation to be recognized if sentiment is against the whole sector.

So maybe it follows it is best to keep to the larger and mid-tier O&Gs.

I don't suppose you will be able to respond, but this sector view can`t bode well for real tiddlers like Aminex - It would be ironic if Aminex`s outlook finally improved with some ability to generate cash and sustain itself only for a general market sell-off in 2011 to lead to a loss of interest in the smaller AIM stocks.

davjo

4th Jan '11

this sector view can`t bode well for real tiddlers like Aminex - It would be ironic if Aminex`s outlook finally improved with some ability to generate cash and sustain itself only for a general market sell-off in 2011 to lead to a loss of interest in the smaller AIM stocks

Yes...but that's exactly the sort of attractive opportunity one should home in on ;-)

emptyend

4th Jan '11

I don't suppose you will be able to respond, but this sector view can`t bode well for real tiddlers like Aminex - It would be ironic if Aminex`s outlook finally improved with some ability to generate cash and sustain itself only for a general market sell-off in 2011 to lead to a loss of interest in the smaller AIM stocks.

Just to correct an implication here - Aminex is fully listed on the LSE. It is unique amongst the (market cap based) peer group in that respect, I think. Please don't help perpetuate the common misunderstanding that ALL smallish E&P stocks are listed on AIM.

As to the outlook, I refer you to point 1 in my short list above and to the recent presentations.

rgds

Leekgo

4th Jan '11

Apologies. I knew it had a full listing in Ireland but was under the misconception that it was on AIM in London. I will correct my previous post (if i could work out how to edit - the function seems to have disappeared for my previous posts). Certainly it has a lot of potential for a dramatic increase in value. But so did EO (as history proved) when it was overlooked as you said.

As Davjo said, if stocks like AEX get marked down in a general sell-off this should be an opportunity for those who have the capital at the the time to invest.

Lets see what 2011 brings.

emptyend

4th Jan '11

FYI re editing, you only get an hour to edit a post

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Loglorry

35 comments

Iraq gives go-ahead to Kurdish oil contracts

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