Rheochem Share Discussion Threads

[omnitrix] 04/3/2011 09:16

the only person mentioning RHEP on the CR thread is the one who has been mentioning TRP and BPC

[rivaldo] 04/3/2011 09:15

Stamply, who cares? It has no effect in the long-term.

Better to discuss what a blinder management has played here.

More importantly, I'm an amateur at oil company valuations, so would appreciate any useful guesses at what a true valuation might be for RHEP's Athena interests and for the rest of their exploration portfolio.

[eric76] 04/3/2011 09:15

Doesn't mean its not good value just means theres not much else for him to feed off this morning.
I've come in for a few more now the risk has gone and the cash pile grown considerably. I like the fluids business being gone too what with the weather the Aussies have been having. Now they're a pure N Sea oil play with cash so no dilution, 2000BPD from eoy and other fields to work farm out to boot.
If I hadn't sold down quite so considerably after the results just I'd have played a blinder imo.

[giant steps] 04/3/2011 09:13

Stamply2, seems like they have picked a winner

[stamply2] 04/3/2011 09:09

Guys becareful this is being pump and dumped on the CR pump and dump thread by Onmitrix better known as the notorious Robson.

He has already ramped it across other threads this morning.!

[omnitrix] 04/3/2011 09:06

Further investigation reveals IAE does actually have other stuff going on as well as Athena so maybe valuation differential is not that stark but certainly some gap for discussion/catchup ?

[omnitrix] 04/3/2011 08:59

Agree, this one has been under the radar because it was 'complicated'

Now as a pure oil and gas producer/explorer it could become very very interesting quite quickly

I see IAE who own 22.5% of Athena (i.e. 2x RHEP) and are expecting oil production of 5-6k bopd (3-5x RHEP ?) are valued at 10-15x RHEP ?

That can't be right ?

[annie38] 04/3/2011 08:54

Good morning all ! : Very interesting development. Not sure the significance has been fully appreciated...yet.

[rivaldo] 04/3/2011 08:34

Agreed Giant Steps, and the imminent operational update will give more depth to the explotaion and production programme.

It seems to me that RHEP have achieved an excellent price for the fluids business given its recent performance and have simultaneously achieved foolproof funding for the future of the business.

Management have played a blinder here imho.

[giant steps] 04/3/2011 08:08

Pure Oil Play, excellent
- makes this much more exciting (and with cash)

[ducatiman] 04/3/2011 08:07

thats the working capital sorted! Have they got a good price anyone?

[captainfatcat] 04/3/2011 07:45

Thats a bit of a surprise.

[jimarilo] 04/3/2011 07:28

Significant yes, but why release on a Friday ? normally bad news day

£37m m/cap and around £15m for the initial payment for the services side of the company, what will the market price in for the exploration side ?

Agreed Rivaldo, could be a good indicator

[rivaldo] 04/3/2011 07:21

Lizzie, I think the reaction in Australia is pretty clear :o))

[lizzie ii] 04/3/2011 07:11

Wow, a significant RNS today. It will be interesting to see how the market reacts to the news.

[rivaldo] 04/3/2011 07:08

....and it's due to this!



Disposal of the fluids business for a maximum £28m - a pretty good price methinks?

An operational update coming shortly too, with plenty of excitement to come:

""The Company will be issuing an operational update shortly, to provide the market and shareholders with a deeper insight into the existing exploration, appraisal and production portfolio already contained within the business. We are confident in the potential of the portfolio to generate significant opportunities as we progress the assets through the value chain.""

The initial payment alone is enough to cope with any issues of funding and debt.

Terrific stuff.

[rivaldo] 04/3/2011 06:58

RHEP is up 15% overnight in Australia to 0.265, i.e around 16.5p....... :o))

[annie38] 03/3/2011 12:36

Good afternoon all: With the "bad" news out of the way, could be blue skies ahead.

[rivaldo] 03/3/2011 12:06

Back to the highs again now. Hopefully more buying following tomorrow's IC print edition.

I see IAE is also edging upwards, probably unconnected though.

[rivaldo] 02/3/2011 15:47

Nice write-up in the IC - should play well in Friday's print edition:



"Recovering Rheochem
Created: 2 March 2011 Written by: Nigel Bolitho

Rheochem has certainly tested investors' patience, but there should be better news ahead. At first glance, the latest half-year results are the usual story of disappointment. But they relate to a period when extensive floods in Queensland and South Australia forced drilling rigs to stop work for several months - so demand for drilling mud dried up. The same problem has occurred in 2011 but it isn't so bad.

It's not so serious this year because the high price of energy is encouraging much more drilling activity, both offshore and for coal-bed methane in Queensland. Indeed chief executive Haydn Gardner says the current half year is looking "very promising" with expected revenues "well in excess" of the interim figure.

But the spotlight at Rheochem has now spun back to the North Sea. After a major write-off, the company's balance sheet only includes one interest (valued at A$27.58m) and that is a 10 per cent net interest in the Athena field in the Outer Moray Firth. The operator, Ithaca Energy, has just completed a water injection well and there is one more well to be drilled. Oil should start to flow late this year with Ithaca expecting a flow rate of 22,500 barrels a day.

RHEOCHEM (RHEP)

ORD PRICE: 14.375p MARKET VALUE: £ 35.9m
TOUCH: 14.25-14.5p 12-MONTH HIGH: 15p LOW: 5.125p
DIVIDEND YIELD: nil PE RATIO: 13
NET ASSET VALUE: 15c NET DEBT: 21%


Half-year to 31 Dec Revenue (A$m) Pre-tax profit (A$m) Earnings per share (¢) Dividend per share (¢)
2009 11.8 -1.81 -0.30 nil
2010 10.2 -1.60 -0.70 nil
% change -14 - - -
Aim: Oil services.

£1 = A$1.5817
-------------------------------------------------------------------------------
TIP UPDATE
Buy
No brokers have full-year forecasts, but Rheo should turn in a profit if the demand for drilling rigs (and so mud) is as strong as Mr Garner suggests. The share price has recovered smartly from its mid-2010 low of 5p and the shares remain a buy."

[captainfatcat] 02/3/2011 14:22

Looks like drilling in queensland will soon be increasing, might be good for Reochem the development of Coal Seam Gas requires lots and lots of holes drilled.


Esmarie Swanepoel
2nd March 2011

Updated 18 minutes agoTEXT SIZE PERTH (miningweekly.com)− The Queensland government has given indicative approval for China National Offshore Oil Corporation subsidiary CNOOC Gas & Power to gain a 50% stake in five Exoma exploration permits.

Exoma and CNOOC entered into a farm-in agreement last year, under which CNOOC would commit to spending at least A$50-million on coal seam gas (CSG) and shale gas exploration, to earn the interest in the five permits.

The two companies also incorporated the granting of an option to CNOOC to take a placement of 86,6-million shares in Exoma, at 31,5c a share, as well as 86,6-million options, exercisable at the same price.

The farm-in agreement was subject to state government and shareholder approval.

The state government's approval comes hot on the heels of the Foreign Investment Review Board (FIRB) also clearing the A$50-million farm-in agreement.

The only remaining condition was the consent of the Chinese government, which Exoma said had "progressed positively towards a timely approval".

CNOOC has a long-term commitment to investment in Australian energy resources and in particular the liquefied natural gas (LNG) CSG projects in Queensland.

CNOOC has acquired a 5% interest in British Gas (BG)/QGC's CSG tenements in the Surat basin and a 10% interest in one of the first two LNG Trains to be built by British Gas in Gladstone.

The Chinese State-owed entity has also entered into an agreement with BG to buy 3,6-million tons a year of LNG from the proposed Gladstone plant.

CNOOC further holds a 5,3% interest in the North West Shelf gas project and a 25% interest in certain offshore exploration permits in Western Australia where the joint venture is conducting an exploration programme.

Recently, CNOOC received FIRB approval to acquire a controlling interest in the South Australian Arckaringa coal project where coal for power and coal to oil technology would be developed.

[rivaldo] 28/2/2011 16:17

Johnweaver, RHEP cannot be put in an ISA - unfortunately!

[7kiwi] 28/2/2011 16:04

smarm,

Read the last page of the results published on their website.

The auditors question whether RHEP could continue as a going concern if they lose the court case. Plus there's the small matter of needing to raise a further $14m to fund Athena by April 2011.

[johnweaver] 28/2/2011 15:28

Hi All, this one new to me. I tried to buy for my ISA. Listed on ASX and appears that Australa is the main centre of business from their web-site. Cannot put into ISA because the primary listing is in London. Say Selftrade.
Any comments about ISA possibilities?
I certainly like the look of this company.

[rivaldo] 28/2/2011 14:18

The historic interims were mediocre as expected given the Australian floods - but the outlook for H2 is extremely bullish.

And the North Sea news is excellent, with everything on track and terrific potential from the new blocks.

Some might be put off by the emphasis of matter at the bottom of the RNS, but imo this is just covering of backs. RHEP will presumably soon achieve full funding for Athena given the options available to them, including debt finance, given the near-term rewards. And the Zeus litigation appears to be of little consequence to the RHEP Board, with no provision made by Zeus and no Court news until late this year when the Athena monies will be coming in.

I'd imagine that once an RNS covering the strategic review and/or the additional financing is issued the shares will lift off again.