So, where to go post Dana?

Thanks for the heads up...will check it out.

Ah I dont actually have that one on the radar.

Worth taking a look?

Some crazy moves Oil E&P wise so far today.

Great news for Bowleven on Cameroon discovery - up 34%!

Elsewhere:
BPC up 13.4%
Caza up 13.4%
NOP up 15.5%
Pele up 20.5%!
PMG up 9%

and astoundingly
WBN up 75%

Bar PMG and Blvn, little in the way of news out there,,,,

Spec money seems to be chasing resource stocks as well - Gold, Silver.

Crazy days it seems.

GS note on oil stocks has been posted all over Advfn ..

If you aint seen it ....

http://www.mediafire.com/?5vc4vbeueq8qbv1

Union Securities note from 5th November available here :

http://www.union-securities.com/CMResearchFiles/1_152_International%20Junior%20Oil%20and%20Gas%20Nov%205%202010.pdf

FWIW, they have both Ithaca Energy & Sterling Resources as a 'Strong Buy' with targets of C$3.00 and C$4.00 respectively.

The financial performance of Ithaca’s production, as measured by cash flow from the Beatrice (50% interest) and Jacky (47.5% interest) oil fields, during the first part of 2010 has been outstanding at $51/b, which we believe may be the highest of any junior company. Annually, this represents almost $100 million in cash flow. In western Canada, the highest cash flow during the same time period appears to be just over $40/b.

Sterling has one of the most extensive inventories of exploration and development opportunities of any company in the junior oil and gas sector, and should be a key holding for investors. Over the short term, an active drilling program could affect stock valuations, and over the long term, development of significant discoveries should result in one of the better growth profiles in the industry. Development of the Breagh Field (30% interest) is underway, with initial production of 65mmcfd net expected in Q2/12, providing annualized cash flow of $0.40. Although less clearly defined, substantial gas production from the Black Sea and oil production from Cladhan should be able to provide growth later into the decade.

I hold a decent chunk of both, though I have been top-slicing my Ithaca position at the current price and buying a few more Sterling.

Cheers,

Chris

Updated 16 page RBC presentation on international Oil stocks - basically covering Octobers wells and more besides...

http://www.oilbarrel.com/fileadmin/content/pdfs/Brokers_Notes_Oct_10/International%20EP%20October%27s%20Prospects%20Oct%2710.pdf

Excellent!

Worth recalling that Antrim is ISA able. Maybe this is finally the deal that will get them moving again. Some significant upside IMO

B.

Will be interesting to see what get's scheduled for explo, from the Interim Financial Report........

Antrim has identified five high priority drilling prospects on its surrounding licences (the 'Greater Fyne Area', Antrim 100%).

I don't get to see a lot of broker notes and this one on a large universe of oil stocks is the best part of 7 weeks old and has in many cases been overtaken by events.

Nevertheless there are lots of interesting metrics in here - I'm sure some will find it useful.
I quite like exhibit 28 on page 19 .

http://www.oilbarrel.com/fileadmin/content/pdfs/Brokers_Notes_Aug2010/International%20E%26P%20August%27s%20Prospects%20Aug%2710.pdf

Some nice posts here, but sorry chaps and db,

It's still SLG for me.

Rumours of no oil water contact abound and look to be from a reliable source

repo

DYOR research today?

I took a wee top up too, and was planning more. Very interesting news this morning. The notification was on 24th, but I understand there was above average volume yesterday - Hedgehog still building?

Anyone know who they are, Google doesn't help much at first glance.... website under construction

http://www.hedgehogcapital.co.za/

How about VPP ? Plenty of cashflow from the Don area 6K-7.5K BOPD and

Successful 'Tybalt' discovery earlier in 2010 which VP have 80%

 They are currently drilling the Viola North prospect.

http://www.investegate.co.uk/Article.aspx?id=201008310700568300R

'...The Viola North prospect is a mapped three-way dip and fault controlled structural trap in the Fulmar sand formation and is targeting an estimated gross prospective P90-P50-P10 resource range of 63-111-191 million barrels of oil equivalent. Viola North is located in the Central North Sea, near the producing Janice, Medwin, Clyde and Fulmar fields...'

http://www.valiant-petroleum.com/assets/documents/assetsdocs/000012-10_viola_north_south_prospect.pdf

50% of Viola has been farmed out to Apache with apache paying 75% of well costs

Planty of future explo prosects during 2011 with 'Handcross' a WOS paleocene prospect with P50 resource estimate of 70Mmboe nett

I have recycled the proceeds from the disposal of DNX into 5 other O&G sector stocks which I believe may have the potential to multibag.

MOG - Mediterranean Oil and Gas - the SP has recently been slashed partly as a result of the Italian Govt imposing a ban on the drilling of offshore wells subsequent to the BP disaster in the GOM. This seems to be a knee jerk reaction and one which will be reversed when the fuss dies down. There is a big difference between deep water and shallow water drilling in terms of risk, and Italy still needs oil. This stock should either reverse its nose dive or it becomes vulnerable to a take over. Their only problem is the cash situation.

IAE - Ithaca Energy - covered in some depth elsewhere on stockopedia by DJP.

LGO - Lenigas - I bought in after reading the recent Edison note on the company in which they suggested a value of 7.8p. We currently await news of Hontomin testing in October. Also Ironpyrites on TMF contributed this piece:- http://boards.fool.co.uk/lgo-leni-gas-oil-12046562.aspx?sort=postdate

AST - Ascent - covered elsewhere by JohnnyT which he has championed for some time. Inland well drilling in Slovenia and Switzerland could multiply the depressed SP.

DPL - Dominion Petroleum - Operating in central and west Africa. Lake Albert prospects alone could work wonders for the SP. Long term, offshore Tanzania could be a company changer.

There are others I considered such as NPE, GPX and AEX but I tend to diversify rather than to increase what are already substantial holdings.

icdgyixify

Well I have recycled about a third of my Dana position into Circle Oil (LON:COP) - I liked the Circle story before but didn't want too much of my portfolio exposed to Egypt because of concerns about future instability when Mubarak dies. The other two thirds is still waiting for a home. I hope to get some time this weekend to read up a bit on companies flagged up on the FirstEnergy conference thread..

I have been buying some Sterling, but that is from top slicing my Encore position, rather than Dana money. (nb I know it's all just fungible money, but this seems a simpler way to think of the problem.)

db

Sooner or later I guess there had to be a "serious story" about the recent stellar rise in oil stocks.Pity the obviously overvalued like DES and BOR are being conflated with the likes of Encore NPE and to a lesser extent.RKH

http://www.ft.com/cms/s/0/8b38f5b0-c805-11df-ae3a-00144feab49a.html

A number of big exploration successes, in a packed drilling calendar, have focused investor attention on the sector. The North Sea has enjoyed something of a renaissance in the wake of two big discoveries: Catcher and Cladhan, which analysts estimate could have recoverable reserves of 60m-100m and 70m-90m barrels of oil respectively. A discovery – called Sea Lion – has also been made off the coast of the Falkland Islands that analysts believe could contain recoverable reserves of about 240m barrels.

It is these discoveries that have propelled share prices higher. Encore, which has interests in both the Catcher and Cladhan prospects, has risen more than 600 per cent this year while Nautical Petroleum, which has a stake in Catcher, has climbed by a similar amount. Rockhopper Exploration, holder of the Sea Lion licence, has surged 700 per cent and is now valued at almost £1bn.

Investors seem increasingly to have been blinded by these few big successes.

Consider Desire Petroleum. Even though it has found no oil, the company is still valued at £500m and its shares are up 70 per cent. To justify that valuation Desire needs to find 150m barrels of oil at its other Falkland wells. Similarly, Borders & Southern, which is searching for oil in the deep waters to the south-east of the Falklands, is valued at nearly £400m. Yet it has still to even secure a drilling rig.

EnglishDragon

Try the password "password"

You can listen to Niko's presentation at the Global Oil Conference here: http://jetslides.tv/webcasts/7

Give me a chance repo!! ;-)

The conference is still ongoing.

Imo one very interesting (and $5bn cap) opportunity worth looking at is Niko.

Fag break over. Back to it.

What did I say about opportunity cost on this thread?

They're have been some absolutely stunning runups in prices over the last few days as hot money from one bluesky, or success, story piles into the next.

However anyone interested in making a couple of quid, short and long term, could do worse than listen to the presentation made by SLG yesterday and try to work hrough the implications for Encore and Sterling. The link is a couple of posts back.

Some feedback from DJP, or other attendees, on that and other interesting prospects at the conference might stimulate some useful debate too.

repo

Can't resist posting this - especially the comment about GKP .

http://www.thisislondon.co.uk/standard-business/article-23880142-moneysupermarket-enchants-as-140p-bid-talk-gains-strength.do

Gulf Keystone Petroleum rocketed 20.8p to 158.2p on talk that bosses are eyeing a move to the main market in London early next year. Analysts said that this move — which should see it enter the FTSE 250 — would help it to raise more cash. The oil explorer divided opinion with one analyst — convinced the gods of black gold are smiling on the group — saying: “Entry to the FTSE 250 would be great news,” while another said: “I wouldn't advise my granny to put her money in Gulf Keystone, certainly.”

The Falklands explorers were also in demand. Rockhopper Exploration jumped 49¼p to 469¼p as investors applauded news that its oil discovery off the coast of the remote British territory will be commercial. Evolution Securities raised its rating from “neutral” to “add”, and lifted its price target from 359p to 450p in response.

Argos Resources — which has a neighbouring prospect — was up 4p at 42.2p. “These oil stocks are proving very popular indeed,” said one dealer. “I've been busy with these all morning — probably half the trades I've done were in these stocks.”

I see Angelos has sold all his Dana and by virtue of Encore's recent rise it's now his largest holding as of end August.

http://www.junioroils.com/docs/201008_update.pdf

In terms of investment positioning, Junior Oils Trust has enjoyed multiple success in the last two
months. The takeover of Dana Petroleum appears to be nearing a conclusion and we have,
therefore, decided to liquidate the fund’s holding in order that we may re-invest the proceeds into
other opportunities.

Encore Oil grew into the fund’s biggest holding as it rose six times over our
original investment level. Caza Oil & Gas also rose to prominence with its recent discovery in
Texas. We believe that there is some further potential for rerating in our portfolio and we have
also introduced some new holdings at attractive valuation levels. It is the fundamental value of the
fund’s investments that can provide outperformance over the market and the sector as a whole.

Given its isable staus there must be worse ways to take a stake in otherwise non isable small/medium oil co's.

Confess I'm rather tempted (if for no other reason Encore's Cladhan update is as upbeat as we all hope.)

Can we please stop the OT posts?

This is a thread relating to dicussing oprions for reinvestment of Dana proceeds. I can't prune the thread to remove OT posts from the handheld but I'll try it tomorrow during a break at the First Energy conf.

I'm not expressing any favouritism, I just want a pure and On Topic thread.

Thanks.

D

JPGH

I never take anything at face value. I always question and try to understand what is being said. I absolutely hate it when someone tells me something but can't explain their point.

Because it tells me they most likely don't know what they are talking about. Do you not hate it when someone tells you this is the way it is but don't ask me why?

Having worfked in the City for all of my career I can tell you there are lots of overpaid idiots who click buttons on a mouse but have'nt got a clue what is going on. They work on the basis of rules and processes.

I work on the basis of understanding, thinking for myself and I ask loads and loads of questions.

I realised it matters not a jot how well you can carry out a NAV/DCF models, how well you understand the implication of a drill test RNS or new corporate acquisition...etc

Yes I know this. That is why I think one needs to learn how to read the market and understand what the market is telling you. A value investor can buy a value stock and wait for a very long time whilst the stock is dead in the water. Or they can wait for the market to tell them when the stock is ready to go up and then Buy. Who do you think will make more money?

You can have two people with identical stocks, but with very different results in the end.

If it was simply a case of looking at numbers and doing DCF/NAV then loads of accountants would be seriously rich from Investing in shares. But they are not.....

I missed the most blatantly obvious sell signals of them all in late 2007/2008 because I was up my own sefl important arse thinking the Oil & Gas industry was immune to what appeared to me to be a regional US induced housing/bank lending crisis .....

Most people did on TMF. Because most people were happy to listen to 'experts' and invest in a group in the same stocks with similar positons rather then questioning and constanty researching the markets and thinking for themselves. There are no experts, they are only as good as their last trade.

The reality is if there is likely to be a crash then the best course of action to take is to sell up regardless of what material news Soco or any other stock is going to release. Because the truth is in a crash there will be loads and loads of cheap stocks to buy that Soco won't matter anymore............................

My strategy is pretty simple. Massively pile into Mid to Large cap stocks after a crash. Be patient. Be very very patient. Then when it is hard to find good value in large stocks rather then trickle your funds down to the more risky small caps, exit the market and wait for the next crash.....Then repeat this process...

 Ever since the begining of time every four years or so there have been decent corrections :

Tournesolf,

Good post, thanks for sharing your thoughts. I think all the points you made are logical and make a lot of sense. But why does'nt the market recognise this? It appears to me that the stocks I mentioned trade at a higher rating then Soco and Dana.

Do you think you would have made more money if you had chosen one of these GKP, HOIL, TLW, CNE and did LTBH rather then Soco/Dana ?

No matter how logical/sensible our stock picks are, the market does'nt care. Maybe the trick is to work out what the market wants to take much higher rather then what we think should be trading at a higher price?

When you look down at the small E+P's that are currently valued at £2-400m i personally question their valuation and think to myself if there was a significant downturn in Oil prices these stocks would trade at a fraction of current market caps.

For me it is very clear the E+P sector is overheated, I think this can remain so for a few more years though. Therefore I think peple should tread more carefully, boom will turn to bust at somepoint, it never is different.

JPGH

Do you ever question how Oil experts on this board missed stocks like GKP, HOIL, TLW, CNE etc ?

I personally do. I tend to ask myself why they favor the likes of Soco/Dana/Aminex etc over the above stocks which have had a significant run on the drill bit. How did they manage to miss these?

The only conclusion I can come to is they have 'special' relationships with the Said companies that they can't get with the likes of GKP, HOIL, TLW, CNE etc.

So it actually does'nt surprise me that some people don't know where to put their Dana money.

There is only two people that can stock pick very well to achieve a high degree of success without having some kind of a strong relationship. I'm not one of them though, WShak and DJPreston are my two champions....

SW10

its fair to say that my initial GKP investment was fairly small (got in at approx 10p using profits earned from a decent sized punt/lucky gamble on Sibir Energy earlier on that in 2009).....but took fright when GKP 50p so quickly in Aug 2009 and top sliced 50% but have been adding on dips (added quite a few at 75-85p range). I haven't sold any since Aug 2009. Its not everyone cup of tea (nor was Sibir for that matter, I recall being a small minority there also, I have an affinity for companies with lets say "a bit of previous").
I am hopeful that GKP will go under the hammer in 2011 and the upcoming news pipeline is very promising (Akri Bijeel sidetrack and drill test results, Shaikan-2 sidetrack flow test, Shaikan-3, Shaikan-1 extended well test, Sheikh Adi drill....etc). It costs next to nothing to get oil out of ground in Kurdistan, PSA terms are severe but still profitable. Politics in Iraq looks to be better/more stable than it was in early 2010 and with GKP now approaching the £1b mark I guess GKP board will have to tread carefully if they are to attract the big oil bidders to offer >£4/sh that will probably be required to prise these out of hands of holders. Hopefully no more dilutions.
There are possible downsides but I am confident that at least the oil (and lots of it) is there....which is a major plus these days.

JPGH

After a recent portfolio clean up (including a 15% trimming of Tullow holding, spending my POL 3p dividend) I sold all DNX which was a significant % of portfolio and have recycled proceeds mainly into EO with some also into BP.

For those interested portfolio looks as follows.
Gulf Keystone (GKP)           22.8%
Tullow Oil (TLW)                  20.1%
Soco (SIA)                             15.6%
Encore Oil (EO.)                     9.2%
BG Group (BG)                       8.1%
BP (BP)                                    5.2%
Nautical Petroleum (NPE)   3.3%
Aminex (AEX)                          3.0%
Bankers Petroleum (BNK)    2.3%
Regal Petroleum (RPT)        1.5%
Polo Resources(POL)           0.9%
Circle Oil (COP)                      0.8%
Kryso Resources(KYS)         0.5%
Caledon Resources (CDN)  0.4%
Antrim Energy (AEY)                0.3%
Cove Energy (COV)                 0.2%
Allied Irish Bank (ALBK)         0.1%
Cash                                          2.9%
Managed Funds                      2.8%
Total                                        100.0%

Some more tidying up in next few weeks should see me increase holdings in BNK, POL, BP, COV and reduce/eliminate holdings AEX, AEY, RPT. Regal have been my “Falcon Oil” investment of 2010 (every year I usually pick a complete dud), when I rather rashly jumped in and am paying dearly for the lack of DYOR on this one.
Having missed the early easy gains in Falkland Islands stuff, XEL…etc I have stubbornly refused to buy in when in hindsight there were still easy gains to be made. Cest la vie....
My watchlist include various non O&G high yielders and PTR, ENQ. I am struggling though to find the enthusiasm to invest other or new LSE listed O&G compaes to invest in…which measits probably time to broaden my investment horizons by getting a foreign dealing  account or to move more out of O&G comfort zone.

JPGH

I think Lundin is worth adding to the list - but the timing is perhaps wrong - it has just announced a discovery

http://www.businessweek.com/news/2010-09-17/lundin-soars-on-significant-oil-discovery-near-luno-field.html

and the shares have soared by 15% this morning.

It is a mid cap, which expetcs to triple its production to 100,000 barrels a day within 4 years. Unlike Dana the shares are relatively tightly held - around 30% owned by Lundin family trusts.

Strange, I sold 19 August also, for the same reason as mangotree. Had been in for many years.
Bought BNK (thanks for the earlier heads up djp!) & (more) CTP, & also kept some cash.
Both looking good in comparison so far, particularly CTP.

Just looking through all these posts I can't see any mention of the Falkland oilers.

Of course its all high risk and some of these companies other than RKH seem to me to be quite fully valued already (DES in particular IMV) but if the Sea Lion flow test for RKH comes up trumps in a few weeks time I'd expect to see all the NFB companies rerated and on the back of that the plays in the southern basin getting some sympathetic backwash.

Mention of a barbel approach has been mentioned.
For myself I topped on BG this morning - a real long term hold for me for its many prospects and coupled it with a small purchase of ARG - Argos resources.
The latter seems to me to me to be heavily leveraged to a decent Sea Lion test given its rel. low mkt cap - I expect it to run away if the flow test is as hoped for.

There is a slight hint of something confessional about this thread, so I'll get on my knees now and own up to my own sins both venial and mortal.

Over the past 10-12 years I've made a lot from Dana. I originally bought in at about 120p and my core long term holding averaged out at 150p.  In the 10-12 years since there have been 3 ocasions when I've sold all/most of my holding before re-entering at much lower prices. The effect of LTBH combined with this occasional topslicing and re-entry has been to deliver a compound annual return of approximately 28% pa over a 10-12 year period. My holding in Dana has sometimes been as high as 60% of my total portfolio. In recent years it has been closer to 30%.

I went 100% into cash a few months ago to protect against the risk of another major financial tremor. (Thanks to that decision I have been spared the terrible fate of making an absolute fortune from my previously large holding in EO.) When I sold up I sold everything including my ultra long term holding in Dana. I was in the early stages of rebuilding that holding when KNOC came along.

In the past few months I have been dripping money back into stocks as and when the price/risk/reward has looked attractive.

My portfolio currently comprises holdings as follows:-

Aminex - 1.5% (thank you EE)
BP - 5.5% (thank you Barrack)
Caledon - 1.5% (thank you Marben)
Dana - 8% (thank you TC)
Europa (EOG) - 1.5% (from an original idea of Marben I seem to recall)
Nautical - 2% (Thank you carmensfella for organising mello x2)
Petroceltic - 1%
Soco - 19% (thank you EE)
Sterling - 3% (Thank you Wshak)
Xcite - 4% (Thank you Oilbarrel)
Cash - 53% (Thank you LR and BB and AP - private joke)

Of the above everything except EOG is showing a very healthy profit.

I would be happy to add to any of the above holdings if the conditions look right - price vs newsflow vs valuation vs risk.....

my watch list is rather long but the most likely candidates include :

BEZ
COP
ENQ
KAH
KYS
MML
PMG
PMO

Mid Herts

Dragon is interesting especially in the light of what has happened to Dana. This is the exact opposite. Independent directors recommended the bid from the majority shareholder but a couple of determined institutions meant that it did not succeed. Probably I should have sold more when it spiked early in the year but it was not convenient. I am not a buyer at current levels but unless good alternatives appear I am happy to wait a while because I think that some sort of corporate action will take place. Meanwhile the majority shareholder is a good one to have in relation to where its field is and there is a very comforting cash pile.

I wouldn't agree that the ENOC bid for Dragon was "an exact opposite" of Dana-KNOC.

First, it wasn't just 'determined institutions' who were responsible for the bid failing, but the fact that what appears to have been an overwhelming majority of PIs simply felt that the bid was way too low.

Secondly, ENOC already had over 50 per cent - what was remarkable about this failed attack is that, given that, ENOC still failed, though they clearly were very keen indeed to get their hands on the remainder, whether for the cash pile or to turn DGO wholly into the Dubai government's overseas E & P company. There could NOT have been any potential competition for ENOC - unlike the Dana case (even if, ultimately, it seems as though one isn't going to appear).

I would agree that  I think that some sort of corporate action will take place, although I'm far from convinced that this will necessarily be wholly in the interest of the non-ENOC shareholders, and, in that sense, I wouldn't agree that the majority shareholder is a good one to have.

Once the Dubai Government has decided what it wants to do with regards to setting up its own E & P arm, whether through a bid, much higher, for the rest of DGO or by starting again, then the shares will no doubt get re-rated. But the Dubai Government doesn't seem, at the moment, to have much in the way of spare cash to make a move.

Worth watching, definitely, and there may, of course, be a surprise new offer from ENOC or some kind of deal between ENOC and another party (a state oil company, perhaps), but I have no rgrets at having sold out a year or so ago, just beneath the level of the ENOC offer.

Not that I have any real (new) suggestions to make as to where Dana proceeds could be put, for those that have/will have them.

Man Siarad

In all honesty enjoying this thread tremendously at present - long may it continue.

SB

Ithaca could have been a fantastic company until the credit crunch, directors squandered money, paid themselves very well and nearly went Oilexco

22,000 million bopd targeted for Athena next year, but since the credit crunch and the sell off to Dyas Ithaca only have a 22% interest and therefore just 4950 bopd net and proved/probable reserves just 5.49 mmbbls net to Ithaca for Athena

The company are doing their best to keep production up from Jacky/Beatrice/Bravo, but are loosing the battle as production is down 2800bopd net since start up. Beatrice needs $75 oil to be commercial, hence the importance of Jacky which brought the threshold down to $10/15 per barrel. As Jacky tails off the running costs go up

In terms of reserves Xcite Energy (XEL) is the one for me, once reserves are proven XEL could be the third largest independent operator in the N/sea

Over the past 10 years I have often wondered whether a more focused approach of the sort advocated by ee would have been better than a mixture of losses and gains.

Judging by the list ee has given it seems as if there have been a fair number of losers promoted on TMF and I'd count myself as having t-shirts from a number of them.

Though I'd rank myself firmly as one of the people at the back of the class - I would say that the quality of posts on various BBs has meant that my losses on the Falcons of the world have been more than mitigated by gains in stocks such as Heritage (which started off life on the TSE).

And the recent experience with Encore has meant that I am now firmly of the opinion that losing money on the FRRs of the world is just an entrance fee to having a sizeable position on the EOs of this world.

I don't get involved too much in the more heavily 'promoted' companies on TMF.

-So are you making up for lost time with SLG? ;-#)))

We all have different circumstances and holdings. I start from a present oil related portfolio listed below. Shares were bought at different prices from those ruling now and I intend no recommendation. I will start with the smallest as 1 unit and proceed from there:

Heritage 1 unit (just paid a special dividend also awaiting investment)
Salamander 1.3 units
Hunting 1.7 units
JKX 2.3 units
Faroes 2.6 units
BP 2.8 units
Tullow 3.7 units
Dragon 3.9 units
Dana 5 units
Soco 7.3 units

Frankly, I am on the wall of worry with most of my oil holdings...but it has been a good wall to worry on so far. Still I start by asking myself the question "is it time to go elsewhere?"

If I am to stay in oil I would prefer not to expand my number of holdings much if at all so I have thought about what I have now.

Brief comments

Heritage - an enigma. Well cashed up and looks to have a good find in Kurdistan but how things will play out just isnt clear to me. Shrewd man in charge though
Salamander - rather unlucky with exploration but I was more pleased with the Bualong deal for them than for Soco
Hunting - not strictly oil in the same sense. The remains of a larger holding which did me very well.
JKX - a steady performer for me. I am hopeful of performance at their Russian acreage. Thinking more about this one
Faroes - already increased my stake here from other funds. Obviously very dependant on continuing discoveries but I like the spread of assets.
BP - Ah well.
Tullow - a very good performer but I would like to see present issues resolved.
Dragon - another enigma. But this was one where institutions said the bid was low ball. Presumably they expect another attempt when possible? My stake is enough for me and I reduced it on a spike well over the bid price in the spring.
Dana - Obviously it would be nice to get more but the price represents a good return so I am happy with that. Hard to see it getting any closer to top dollar
Soco - Hopefully the Vietnam well will test OK. Congo? Overall, I think I am plenty weighted but will wait with fingers crossed.

Others

Ithaca - quite small although they look more attractive in their new incarnation. I want to think about in comparison with Enquest.
Encore - pleased for holders but I think I am late to the party now
Sterling - not very keen on a non UK quoted stock though I see the case, a fair bit of which is is now in the open.

Someone said, I think, that it would be nice to avoid political risk. Where might that be?? I guess there is political, geological and specific risk everywhere. I would like the debate to continue on how best to position portfolios to achieve the best risk/reward balance.

MH

On the Canadian topic, Ithaca hasn't done too badly either........didn't hold, just watched the story unfold.

And funnily AEY got mentioned earlier as I was starting to turn my attention towards them, I think their time will arrive in the next 6 months or so.

I was glad when they reduced their stake & financial commitment in Causeway as IIRC it might be a bit more compartmentalised than owners initially thought.

http://www.investegate.co.uk/Article.aspx?id=20100304143002M0679

So that leaves them with Fyne as their primary focus. This from 2Q report:

With the conditional divestiture of an interest in Causeway announced in March 2010, Antrim's primary focus is on
the development of its core UK asset, the Fyne Area, located in the central North Sea in block 21/28a. In addition
to the 17.5 million barrels (net) of proved plus probable reserves in the Fyne licence, Antrim holds 100% interest
in three adjacent licences (total of four blocks) comprising the Greater Fyne Area. Antrim's strategy in this core
area is to accelerate its development by working closely with industry partners. In this regard, Antrim is in
discussions with several potential partners to sell a portion of its high working interest which could provide
Antrim with funding to place the Fyne Field on production.

Antrim has progressed discussions with floating production storage and offloading ("FPSO") providers as well as
local existing infrastructure owners to select the most efficient production export route for the Fyne Field. An
FPSO pre-qualification process has been conducted and engineering studies performed, allowing for the
identification of an alternative subsea tieback scheme to nearby third party infrastructure. The production system
is being engineered to handle up to 20,000 barrels of oil per day ("bopd") directly from the Fyne Field, with
potential capacity add-ons to handle additional volume from the satellite fields.

Antrim intends to select the optimum Fyne development scheme and prepare a Field Development Plan ("FDP") for
submission. In addition to the Fyne development, Antrim has identified five high priority drilling prospects on
its surrounding licences (the 'Greater Fyne Area', Antrim 100%). Antrim expects to submit the Fyne FDP and
schedule drilling of these wells upon completion of a transaction with an industry partner for the Fyne
development.

and a reasonably healthy financial status* leads me to believe these are due a re-rating (to recover some of the 85% from peak) once some of the deals click into place for Fyne.

*Financial flexibility with strong cash position of US$ 26.4 million, positive cash flow and no bank debt

http://www.investegate.co.uk/Article.aspx?id=20100813070002M8682

repo it was me (amongst others) who posted about it being isable on advfn. Note that Barclays won't allow it, but selftrade will, ee will be pleased to hear!

Hi Tournesol,

I think I'm much more intersted in making money than scoring points which I was why I kept coming back. As an economist I knew from an early age about opportunity cost. However It would seem that some Dana holders don't.

I've said enough now. The gym beckons.

Enjoy the next four weeks.

repobear

Hi ee,

I've tried to be constructive earlier in this thread but that one must have passed under your radar and under the radar of people who've given the thumbs down too..

There's enough info in that post for anyone with some nous to begin their own research into what I consider is an excellent prospect but I don't want to be accused of ramping again.

There are others though. Soco and FPM, but the materiality is not so great, although FPM may be comparable with a truly great result at AM. The chances of that are however far lower than Cladhan, although both will be known before Dana holders get their money should the bid succeed.

repobear

Repo

what exactly is your objective in posting here? are you simply trying to score points and/or wind people up? I can't see any other obvious explanation and it is getting to be more than a little tiresome.

T

So six days further in from my last posts some questions for Dana holders.

What are the chances of a counteroffer now?

If there isn't one, when is the earliest/latest date you will get cleared funds in your dealing accounts?

Are there oil companies out there with long term growth prospects and short term, i.e. before your Dana funds arrive, likely material drilling/testing news?

Is there any potential benefit in moving early to get positions before others arrive and before the news materialises?

Or should we continue with our early postmortem debate because this game isn't only about making money;-)

repobear

Or was all that angst worth it? The point is you could have made more with Encore this week than you've agonised over potentially making with Dana I rest my case.

I argued the same case about a month ago. At the time I was told apparently 10% or so can be made in a week.

In all th years I've been Investing whenever there has been takeover talk 99% of the time it has been the right decision to take the money and run.

Encore this week than you've agonised over potentially making with Dana

Precisely. Encore is'nt the only stock though, it has been a good few weeks in the makets in general and Dana has been treading water.

Hi tournesol
,
It's not aimed at you, actually. At least you've had the balls to recognise that it might be a problem, so in my mind you're more than half way there.

Count the number of posts on the Dana-KNOC thread and the number of views and then do the same for this thread and ask yourself. Do people on S'pedia needto get out more?

Or was all that angst worth it? The point is you could have made more with Encore this week than you've agonised over potentially making with Dana

I rest my case.

Dana is dead in the water at 18 quid and that is a right result for those holding before this all kicked off and what is said here will, sorry, have a minimal affect on the outcome.

Otherwise where are all the posts saying that Dana is the cheapest ever ?

i'm bored with Dana now.

repobear

PS I love those neg recs

Encore Oil being another one of them.

With two big successes in the bag, well nearly;-)

Rumours on FTAlphaville today of a PMO bid ..yes they have recent form in this respect.

No announcement on Cladhan from the operator or any real movement in SLG's price.

Seriously heavy buying of Encore at fixed limits over the last few days and a veritable ADVFN type whoosh in the price. At 90p still looks a far better bet than DNX to make money over the coming weeks and there are still 50 trading minutes left today;-)

wakey wakey!!!

There were 3 broker comments on FTalphaville yesterday - the first of which I found fairly compelling (in the bold section of the highlighted area)

http://ftalphaville.ft.com/blog/2010/09/08/337226/markets-live/

The long-awaited defence document from DNX does little to persuade us that shareholders should hold out for a higher price from KNOC.

A valuation range from independent expert Senergy of 2120-2312p/share sounds pretty punchy and assumes 688p/share for risked exploration at the lower end – something that we are uncomfortable with considering DNX’ patchy exploration record. The group also announces that it is acquiring 33m barrels of 2P reserves in the North Sea from Suncor at a price of £240m. Senergy values these at £368m ie a 50% premium to what DNX paid, largely confirming our view that their valuation is way too high. These assets were sold as part of an auction process, hence it is likely that a number of other oil companies did their due diligence and could not even get to a price that matched the £240m that DNX is paying.

I'm not that close to the Dana story these days - Is this correct ?

Hi tournesol,

As someone who has bought 70 houses or so at auction I can tell you that something is worth what someone is prepared to pay on the day. it doesn't mean the price is right or fair, it just means it's the price on the day.

That's 18 quid for Dana right now because the auctioneer is now saying 'for the third and final time...Do i see anymore?''

The rational investor should have been looking, at the very latest, to move money out of Dana, the moment the market stalled just above 18 quid, because there were, and still are better, chances of making money. Now that the price has sunk below 18 quid ,do you hold on for your full 18 pounds or get your arse out and on to better things? The market is now giving a very clear signal that 18 quid is the price unless someone sticks their hand up soon.

Now after buying all those houses I knew that most of them were worth more than that, but i would need to add value in some way to make it happen. TC saying that Dana's latest acquistion is worth loads more, doesn't cut it I'm afraid. KNOC knows that and so does the market without someone else coming in.

Whatever happens to my mind some posters here will end up with egg on their faces too, because their emotions have taken hold of the dealing side. Even if a deal comes along there were better opportunites out there over the last weeks and to get back on topic, Sterling Resources is one of them, but I would judge that most people here
are too busy fretting on missing out on 5,10 or 15 perecent to bother looking at it or anything else for that matter.

repobear

PS

is it just me or is there something very irrational in analysts arguing that the bid for Dana is reasonable because it represents a hefty premium over the pre-bid SP....

.... and then going on to argue that on the basis of the Dana bid other E&P's like Premier and Enquest are now worth 50% more than their current SP?

If Premier and Enquest and salamander are worth 50% more than today's SP that just tells us that the markets and the analysts who serve them are "hopelessly out of touch"* with the real value of E&P assets on the open market. Which some of us have been saying for some time - (about 10 years in my case)

* to coin a phrase

It's worth reading this piece on alphaville by Joseph Cotterill

The basic thrust is that analysts have systematically undervalued E&P companies with reserves in production

He quotes Rose of Oriel as saying

If we apply the same metrics from the Dana and Cairn deals to the other potential candidates in the UK mid cap E&P sector we see an average 50% step up in our valuations (see the table attached), with for instance, Premier* worth potentially c2500p/sh and EnQuest 175p/sh…

Salamander also gets a strong mention

I am surprised to see that so little attention has been given to this thread whilst the Dana-KNOC-white knight? debate continues at full throttle

Sterling Resources is to my mind by far the outstanding candidate for some of that Dana money, looking for a growth story in oil and gas witha low cost entry point. It is on the Toronto exchange,TSX-SLG, based In Calgary ( weren't KNOC there recently ?LOL) with a C$400 market cap on yesterday's close of  C$2.57 with operations inthe UK, Romania, France and the Netherlands.

This little snippet may encourage some of you to dig further

http://boards.fool.co.uk/as-someone-who-has-been-critical-of-slg-at-times-12029757.aspx

''As someone who has been critical of SLG at times here is my bottom line. Their geo-science team, and a ver small team it is, has done the following. They successfully drilled and appraised Breagh as operators to the tune of over 100 mmboe (probably over 1 TCF of gas in fact) before farming it down and transferring operatorship to RWE. They successfully drilled and appraised, again as operator, an old Enterprise Oil discovery in the Black Sea (Romanian waters) and some now believe that the block has as much or even more than 100 mmboe (gas and oil). They are looking to farm it down and transfer operatorship to Melrose. They have just recently and are still in the progress of delineating their third very large discovery in the last few years at Cladhan. It is speculated to be another 100 mmbo+ possible field. Add in the fact that they were shrewd enough to farm in on the recent Wintershaal Blakney discovery drill and you are left with the following insofar as I am concerned. Who would you want to wager a few pounds on with regard to drilling commercial and in fact commercially large discoveries if not these guys?? One wonders what they will do in the coming years for an encore (no pun intended).

These projects will take time but a producing asset is always worth much more than an undeveloped one in the ground. Over the coming years these assets will make loads of money for the company and thereby extension their share-holders as the commodity price will surely trend higher. Albeit..no idea with regard to how much and exactly when.

Encore and SLG are not really comparable then. They are different beats. Now having blown smoke up SLG's arse I now have to admit that I own Encore and not SLG for the previously discussed reasons. If you want expsoure to a long(er) term UKNS (mainly) player who will be a producer and an explorer than SLG is as good a fit as any imo. Why Wintershaal would not wallow both Encore and SLG is beyond me. They would become operator of Catcher and Cladhan by extension and already have a working interest in both.''

Was seems interested in why it has seen so little interest, but with 72 interested parties it's not so bad

http://boards.fool.co.uk/given-the-rate-at-which-repobear-and-i-have-been-12032766.

''Given the rate at which repobear and I have been ramping SLG, 46 interested parties hardly makes it a TMF favourite just yet, although I am surprised there hasn't been a little more discussion by others - apart from GHH's pathetic attempts to get the price down so he can get another slug :o)

I always think that a company starts to become a TMF favourite when interested parties gets up to about 80 or so, with something like SIA up well past 100.

Some people get nervous when a stock becomes popular here, often with good reason, but there are plenty of examples on TMF where the majority here are right and the market wrong so it's an unreliable sentiment indicator for the market as a whole. We've seen it with Encore, Soco, Banking prefs, Dana, the list goes on - it ultimately depends on the quality of the stock concerned and I think we're still pretty early in the SLG story.

There's still an opportunity for some of that Dana money to come on board, rather than mess about waiting for a few extra pence from KNOC ... :o)''

If you've read this far you may care to read the following threads. I believe you can put it in an ISA, not that this Belgian resident gives a toss and you shouldn't either if it produces the sort of returns I expect;-)

http://boards.fool.co.uk/sterling-resources-slgv-encore8217s-big-b-12011623.aspx?sort=whole

http://boards.fool.co.uk/sterling-revisted-12026491.aspx

An operational update here

http://www.sterling-resources.com/docs/2010_Ops_Up.pdf

A podcast here

http://podcast.newswire.ca/en/

A multi bagger in prospect or a Falcon Oil and Gas wannabe? Or is it back to Dana?

repobear

PS It has gone from under C$1.90 when Was first posted to C$2.23 when I first got involved following the excellent Cladhan result to C$2.57. That´s the equivaent of six quid on the Dana price from barely three weeks ago. It is geared 78Cc to 10p for EO: on any further Cladhan news, not that the first news has been factored in yet!

I can´t get the hang of that quotations thing

Hmmmm....I'll mull that one over whilst enjoying a SOuthern COmfort ! There must be SOme COmpany out there thats fits the bill.

Anyone know of any companies that fit these points as a starter for further analysis ?


1. low political risk/ safe operating country
2. Cash generating
3. Proven reserves (audited)
4. Decent management with track history
5. Already producing.
6. Little or no debt
7. Low SP compared to NAV



and a 8th

Some blue sky potential :-)

Always the possibility of a stand-off if Anne Marie is a rip roaring success & KNOC baulk at putting a few more quid on the table!

However, a few more to add to the list....

Coastal Energy (CEO), also listed on TSX (CEN). Ops in Thailand where it currently produces just under 14k boepd, mainly oil. In the middle of a dev programme on its Bua Ban field, with results from the first few wells put into production in line with expectations. Currently waiting on results from 2 wells which are apparently testing the Eocene - A04 & A-07. All booked reserves for BB are in the Oligocene, so if successful, these 2 wells have the potential to add to reserves. The company also has moderate production (80bopd) from a Miocene layer. Rig is booked until next summer, with work to include more dev drilling on BB, work on the other producing offshore field, Songkhla as well as explo drilling to the north of Bua Ban

JKX - main production base in Ukraine, where it's currently drilling a horiz section on its deep, tight Rudenkovskoye gas field. Will all but double production early in 2011 as its Russian gasfield redevelopment is due on stream. Also has moderate production in Hungary & explo licences in Bulgaria. Last, but by no means least,

Geopark (GPK) which has been quietly building a successful production base in Chile. Very much off most folks' radar, but rarely disappoints.

Nice geograhical spread with varying levels of political risk!

..or for a play on cladhan mobe into Eo. or SEY

I think the Sterling involved here is Sterling Resources, TSX:SLG.

OMH

How about a play on the Catcher /Cladhan situation ? If it is timed right move into EO. or PMO.for catcher ( I'm personally not that fussed with NPE ) or for a play on cladhan mobe into Eo. or SEY ?

Encore has had a strong run as we all know but with imminent RNS on cladhan and a 4 well appraisal in catcher block there has to be potential for more growth.

See the recent PMO webcast and see how they feel about Catcher.


http://www.axisto.com/webcasting/investis/premier-oil/half-yearly-results-2010/register.htm


Just a thought.

FWIW I hold EO.

And IAE have today reported latest figures, which I think read very well.

The Chairman's statement is, I feel, very positive:

Iain McKendrick, CEO, commented,

"Our strong second quarter / half yearly results represent another major step forward for the Company, in particular the doubling of net profits from the first quarter.  Cash flows from operations have been very healthy, despite lower commodity prices during the second quarter. The Company's projects are moving ahead at pace.  Athena FDP and the finalization of all services contracting agreements are expected shortly. In the Greater Stella Area, export route surveys have already been completed and a full suite of pre Front End Engineering and Design studies is ongoing. During the fourth quarter, the Company aims to complete the acquisition of various interests from GDF SUEZ E&P UK Ltd and we continue to be active in the asset acquisition market. Early in the fourth quarter the Company will announce an ambitious 2011 work programme across all its assets."

As for the operational and financial details:

Strong cashflows, exceptionally strong finances given the new facility and the placing so ideally placed for development plans and also more asset acquisitions. Note that production has edged upwards since end of the Quarter as well.

Seems as if IAE is doing exactly what it should. I dont think it will be too big a reach to imagine that it could well, in turn, become a target for another oilie looking to expand their N Sea presence and production, especially in view of the cashflow profile and boost as development occurs over the short (in oilie) terms.

SUMMARY OF KEY RESULTS

 

For the second quarter ended 30 June 2010

 

Financial

 

·    Net profit of US$10.5 million for the quarter ended June 30, 2010, resulting in net profit of US$15.9 million for the six months ended June 30, 2010

                                                                                                   

·    Positive cash flow from operating activities of US$38.3 million for the quarter ended June 30, 2010 ($6.2 million for quarter ended June 30, 2009) and positive cashflow of US$42.2 million for the six months ended June 30, 2010 (US$3.3 million positive cashflow for the six months ended June 30, 2009)

 

·    Cash balance as at June 30, 2010 of US$51.0 million and no drawn debt ($29.9 million as at 31 December 2009) (pre-equity raise)

 

·     Weighted average realized price for Q2 of US$73.98/barrel (weighted average realised price of $60.38/barrel for quarter ended June 30,2009)

 

·     On July 28, the Company closed an equity raise consisting of a Canadian bought deal and UK private placement, issuing 92.7 million common shares of Ithaca for aggregate gross proceeds of approximately US$150 million.

·    On July 12, the Company signed a borrowing facility agreement for up to US$140 million with Bank of Scotland Plc

Operational

 

·    The Company announced a significant increase in reserves post the success of the Stella well. Total Proved ("1P") reserves increased 30.6% from 15.99 million barrels of oil equivalent ("mmboe") to 20.88 mmboe and total Proved plus Probable ("2P") reserves increased 12.8% from 37.19 mmboe to 41.96 mmboe following an independent evaluation of the Company's petroleum and natural gas reserves by Sproule International Limited (www.sproule.com).

·     Combined production from Jacky and Beatrice averaged 10,217 barrels of oil per day ("bopd") gross (4,914 bopd net to Ithaca) over the three month period from April to June 2010 as measured at the Nigg storage facility.  Production in the second quarter increased as a result of the Beatrice Field coming strongly back on line combined with the Jacky field performing above expectation.

 

·    Coiled tubing work commenced on the Beatrice Alpha platform to undertake preparatory 'clean up' work on five production wells prior to mobilization of a Hydraulic Workover Unit ("HWU") to the platform in early July 2010. 

 

·    On August 4, the Company entered into an agreement to acquire certain UK North Sea gas interests from GDF SUEZ E&P UK Ltd for a cash consideration of £11.25 million (approximately US$16.9 million).  This acquisition includes producing assets and further development potential.  Completion will be in the fourth quarter, with effective date of January 1, 2010

·    On August 5, the Company announced that a revised corporate presentation had been released on its corporate website.  The presentation states that production for July 2010 from the Jacky and Beatrice fields averaged 10,884 barrels of oil per day ("bopd") gross (5,225 bopd net to Ithaca), as measured at the Nigg storage facility.  In addition, the presentation gives details of the workover operations currently ongoing using a HWU which was installed on the Beatrice Alpha platform in July. The results and impact of the first of five workover operations will be reported in September. 

 

Well, a couple of ending comments re FPM in these articles.

http://www.heraldscotland.com/business/corporate-sme/dana-forecast-to-lose-battle-as-koreans-go-hostile-on-bid-1.1049607

http://www.ft.com/cms/s/0/cf70fac2-ae13-11df-bb55-00144feabdc0.html


Holding Faroe Petroleum Plc (LON:FPM), Ithaca Energy Inc (LON:IAE) and my largest holding Afren (LON:AFR)

Minor holdings in Xcite Energy (LON:XEL), Borders & Southern Petroleum (LON:BOR) - purely punts here.

Good stimulating point DJ. Are we all standing arround with cash burning a hole in our pockets post DNX? What happens if SIA go next! Should we stay cashed out for the time being?

For me its about potential for growth with out being overly boom or bust. Should you follow new geological fairway's, like the Falklands, Greenland ,East Africa etc, or a company ploughing a narrow furrow in the Noth sea or other establish basins?  Heavy oil may yet have its day. Perhaps a mix of all.

Interestingly Venture Production (LON:VPC) and Dana Petroleum Plc (LON:DNX) both grew to about 50kboepd then seemd to hit a critical mass and were bought out (or will be in DNX case).

I also think its more difficult to grow a company from 50kboepd to 100kboepd, than from say 10kboepd to 50kboepd.

For me , I want to be in new oil fairways,in companies with small but growing production (out of sight out of mind), and keep a good gas oil balance.

I have allways respected those companies that operate production. Its a big step up from being a preoiler.

The other issue we all face is its hard work getting to know companies that are new to us-who are the ones on many fronts such as governance,prospects, oil gas mix and financing that we should go for?

For me ITHACA is a strong hold & accumulate. They have a decent plan but wont set the world on fire, so fit into the "be taken over category" and make a decent return.

On the new fairway stuff its SOCO.TLW,l but not such good returns for new investors.

Tournesolf talked about the goose, he also cashed out at the recent peak, but to harvest you have to keep planting seeds.However I feel its slim pickings at the moment on yet to be stock.
FWIW I hold:

• Dana Petroleum Plc (LON:DNX)
• BG Group (LON:BG.)
• BP (LON:BP.)
• Tullow Oil Plc (LON:TLW)
• Aminex (LON:AEX)
• Kea Petroleum (LON:KEA)
• Petroceltic International (LON:PCI)
• Dominion Petroleum (LON:DPL)
• Victoria Oil & Gas (LON:VOG)
• SOCO International (LON:SIA)
• Ithaca Energy Inc (LON:IAE)

FH

Hi DJ,

I've been pondering the same thing and spent my Dana monies on Smith & Nephew, Balfour Beatty and BAE Systems.

However, in light of the BG Group rumours and Dana being taken out I'm still heavily focused on the oilies (65% of portfolio and mainly SOCO) so that's where I intend to still invest the bulk over the next 2 years. Hopefully SOCO selling off its Vietnam assets.

So, for me, I'd add Dragon Oil (LON:DGO) and Exillon Energy (LON:EXI) to your list. Both are well funded, Dragon has a huge cash pile and Exillon had a nice little recent find, virtually no debt on the books. Can easily see Dragon's share price doubling over the next 2 years. No investment in either at the moment though myself.

ArtN