Rheochem Share Discussion Threads

[rivaldo] 07/3/2011 07:23

RHEP still has some way to go imho. And today's RNS from IAE will keep up the momentum - there's still potential further upside from Athena:



"Ithaca Energy Inc. (TSX VENTURE:IAE)(AIM:IAE) announces today that the Sedco 704 semi submersible drilling unit has commenced the drilling of the final production well for the development of the Athena field ("Athena").

Well 14/18b-A2 ("the well") is being drilled from the Athena drill centre and is the final well to be drilled of a 180 day campaign of drilling and completion activities. The well is planned to be directionally drilled to produce oil reserves lying in the north west of Athena. In addition, this well is planned to intersect the top reservoir (Top Scapa A sands) at a point within the appraised Athena oil pool and continue north, drilling at a high angle to provide valuable information relating to an area of the field targeted for future development. The drilling and completion of the well as a producer is scheduled to last approximately 80 days.

Co-venturers in the Athena are Ithaca (operator, 22.5%), Dyas UK Ltd (47.5%), EWE Aktiengesellschaft (20%) and Zeus Petroleum Limited (10%)."

[7kiwi] 06/3/2011 21:27

Omni,

I looked when it was at ~5p and decided to pass, given the debt, unclear funding and law suit.

Look where it is now. Looks like I made a mistake.

I haven't done the detailed sums, but it looks pretty fully valued now.

[zhockey] 06/3/2011 11:43

Yeah looking at page 9 of the below link, production drops off by about 25% year on year to 2014. Bear this in mind with any forecasts.

[omnitrix] 06/3/2011 11:35

nice to see some quality posters like Kiwi looking at this

i have only started to look at it seriously since this transformational RNS but there is still time to do some work on it as lots of loose ends need tieing up before full go ahead for Lochard

Judging by the graphic in the IAE presentation it does decline as one would expect but it has 20m bbl? so assuming 33% recovery one would imagine it'll last a few years providing cashflow to exploit other nearby prospects ?

The other interesting thing is whether once they have the infrastructure in place they can tie in some more smaller prospects e.g. RHEP do have some licences next door to the Athena block ?

Anyway it will be interesting what RHEP say in this upcoming exposition of the E&P prospects. I am sure it will be useful having the input of kiwi et al when that document is released and subjected to the keen analysis of this board.

[zhockey] 06/3/2011 11:26

How long is the Athena field expected to produce 20,000boepd for?

[7kiwi] 05/3/2011 23:13

Don't forget opex.

[jamesiebabie] 05/3/2011 22:47

Anyone win on the Thunderball tonight?

[man overbored] 05/3/2011 20:02

Omnitrix - 4 Mar'11 - 18:13 - 2261 of 2264


the $60m estimate seems quite conservative

$100 x 365 x 2000bopd = $73m

using spot brent you'd be at $84m
---------------------------------------------------

Indeed. And at 2,200b x 365 x $140 we are at $112m. PER ANNUM.

Myself, I should have financed it with debt & not the proceeds of a trade sale, because explo activity will increase with the oil price, to the advantage of the fluids business.. Maybe that was not possible?

[zhockey] 05/3/2011 19:37

can someone sum up the legal problems and potential liability?

[rhubarbe] 04/3/2011 23:18

Keeps a lid on it though, don't you think, legal problems. Folk don't like it.

[euclid5] 04/3/2011 22:56

assuming we take in $60m next year / 1.60= £37.5m - less capext / tax etc depending on what that fig is say example 25% (circa £10m) - leaves £27m profit / 250m shs = eps of 10p x a pe of even 7 - 10 gives RHEP potential of
70p - 100p price from this oner Athena field - hopefully next years price of oil stays around the $100 mark

The info re their 9 fields is interesting indeed - just 1 of them along with Athena is a company maker - OR just Athena bringing in cash 4Q 2011 is enough for a re rating later this year as they now have the funds to pay for this financing of their share of the field

I getting some on Monday, main risk is the Senergy legal issue - but $11m is small change compared to say a much larger legal dispute

[omnitrix] 04/3/2011 18:13

the $60m estimate seems quite conservative

$100 x 365 x 2000bopd = $73m

using spot brent you'd be at $84m

[rivaldo] 04/3/2011 18:05

Incredibly perceptive analyst comment here:



"Northland Capital analyst Simon Miller reckons that Rheochem's (LON:RHEP) - soon to be renamed Lochard Energy - deal to sell its drilling fluids business will give it enough cash to fund its participation in the Athena oilfield. According to Miller Athena is expected to deliver 'significantly greater' revenue than the assets that are being sold off."

[omnitrix] 04/3/2011 15:48

I like transformation. A bit like when your namesake transforms the batsman's furniture.

[akhtar8] 04/3/2011 15:46

GCI comment on name change...

[bumble bee2] 04/3/2011 12:09

happy with the RNS this morning topsliced some RRL's profits and took a small holding here today
GL all

[bomfin] 04/3/2011 11:52

And it is significant to me that they've thrown all their eggs into the explo and production area after the results of the injector well were known! imho

[bomfin] 04/3/2011 11:52

Possibly,

But you are relying on the production well being drilled at present being as expected. The water injector proved up connectivity and a good production well may well expand the know area of the field. imho dyor

[jimarilo] 04/3/2011 11:42

First oil is towards the year end all going well, therefore I see RHEP being very up and down before the taps are opened

Long term will be excellent, but short term expect a lower entry from here

[varies] 04/3/2011 10:29

Congratulations to those of you who have predicted for some time that the Drilling Fluids business might be sold.
I had hoped that the North Sea business might be sold instead as there are plenty of North Sea explorers one can invest in on AIM whereas I cannot think of any drilling fluids business quoted there. Perhaps some kind person might point me to one.
I believe that are good prospects for the DFB in geothermal energy as well as oil exploration.
Even so, this rather cumbrous combination should be of more value broken up and let us hope that the Senergy claim can soon be settled soon (if there is any merit in it) and that Lochard Energy attracts investors who found Rheochem too complicated.
I have had a look at Newpark Resources, the purchaser of our DFB, and believe that there might be money to be made there. It is a much larger business (mkt cap US $675m) for whom this looks a sensible geographical expansion.

[eric76] 04/3/2011 10:10

Few big sells coming in and cana have now joined novm at 16p(first day with barcs L2 so complete newbie). Wondering if we'll fill this mornings gap up even with the good news?

[omnitrix] 04/3/2011 09:55

Only cloud i can see on the horizon is the Senergy court dispute which could result in a $11m payout but as this is already in the accounts as a contingent liability i'd imagine there would be only share price upside from a resolution where they met half way or they do otherwise conclude the process ? October 2011 is the court date set apparently.

[eric76] 04/3/2011 09:29

Agreed but I reckon they'll pick up to it soon. Specially if brent does make this $150 a barrel. There'll be a feeding frenzy for all the decent little oilies imo and rhep seems to be on that list now with finances sorted.

[giant steps] 04/3/2011 09:22

eric76, i'm starting to get that encore feeling - i'm amazed so few
have realised the "athena aspect" upside.

$45m (£28m cash) ...and we can dispense with $14m loan.

Nice revenues due from athena



Should be more exciting times for Rheochem imo.