Valiant Petroleum Share Discussion Threads

[p o n a] 01/3/2013 10:11

On the face of it Ithaca are getting a bargain. Paying around $6 / barrel for developed and producing assets is a steal.. or am i missing something ?

[lanaken] 01/3/2013 10:11

Where is the RNS relating to the agreed offer?

WTF is that all about?

repo

[ed 123] 01/3/2013 09:57

Hi utrecht_00. Yes we read it correctly. It took some courage and we've been rewarded, albeit not generously. Well done to all holders!

I don't think PB is necessarily finished playing his hand yet. He is absent from the list of those supporting the bid and he holds about 7.5%. Also, there are institutional holders who have not expressed support. 65% of the equity is held by significant holders, of whom only 41% are supporting the bid.

I still think the bid is likely to succeed, but there's a small chance (1 in 10?) that a counter offer will be tabled.

[ed 123] 01/3/2013 09:45

Hi clogue. Not seen you for a while.

Yes, this has been a good board, helpful and informative posts.

The Canadian action will be interesting this afternoon. JEC Capital and another, together hold 7% of Ithaca and have been pushing management to enhance shareholder value, eg. put Ithaca up for sale. I'm not sure how they will take this. There may be another sell off over there?

I bought some Ithaca this morning in the dip. May add to it if the Canadians push it down some more.

Happy with my Valiant holding. Highly likely to be taken over now, so not selling at this price (440p). It could attact a counter bid, especially if Ithaca's share price weakness continues. If no counter bid, then I've got Ithaca's offer anyway.

If the bid does succeed, then the enlarged Ithaca might itself be vulnerable?

As someone else said, "Interesting times".

[rojer108] 01/3/2013 09:14

My next share is xel :)

[ohisay] 01/3/2013 09:11

Anyone notice Handcross drilling in Q3 ? - page 12 of the presentation.

[clogue] 01/3/2013 08:31

Can't comment on VPP as just popped over on reading the news and don't know much (anything) about the company.
What did strike me was the sensible and balanced posts on this board.
I have built up a fairly substantial holding (for me) in Caza and have been very disappointed with the attempts at manipulation used by some posters, depending on whither they are long or short.
Perhaps, as this is a larger company, people feel they can't influence the price just as much or you have managed to avoid the nutters.
Good luck with VPP and although the price doesn't look great at least you live to fight another day.

[falklands] 01/3/2013 08:27

With 18% dilution agree for iae

[ohisay] 01/3/2013 08:25

What can PB pull out of the bag - wouldn't rule out something there,
I'm not selling either- I fully expected Ithaca to drop this morning.

[ed 123] 01/3/2013 08:20

There probably won't be a counter bid, imo. Usually a recommended offer gets through.

However, most insitutions were less than delighted with the price. Only 6% irrevocable undertakings were given. 36% letters of intent - hoping for a higher offer, but would accept Ithaca's bid if nothing better came along.

Market possibly feeling that Ithaca is overstretching itself (also has big cost of Stella development ongoing)? Down about 7% at 119p atm. That gives more room for a counter bid.

I'm not selling atm. Will see what unfolds.

[bomfin] 01/3/2013 08:18

Nice surprise this morning. Out with quite a nice profit. First for a while !

[falklands] 01/3/2013 08:16

Doubt that at 1.33 a share have you seen the share price of iae today or yesterday.

[hpcg] 01/3/2013 07:56

Happy for me as a recent VPP holder and an existing IAE holder. No overlap and scale up. I'll hereby grant it great.

[ohisay] 01/3/2013 07:54

Acquisition to be financed
by $350M bridge loan and
$109M from issue of
new Ithaca shares

Issued and outst
anding Ithaca share
s to increase
by 22% to 317 million
1

Valiant shareholders to ow
n ~18% of total issued
shares post acquisition

[bulltradept] 01/3/2013 07:18

Bought some yesterday, not great though is it, I need to reread

[philo124] 01/3/2013 07:16

As you say Ed, "there it is". Not much more to say.

[ed 123] 01/3/2013 07:08

Well, there it is.

A good top up for me yesterday, but the price is disappointing.

[ed 123] 28/2/2013 23:02

Thanks, sludgesurfer. Very happy to hear negative comments. :-)

And thanks to hpcg and frazboy.

Like frazboy, I was relying on the Oilbarrel conference on 7 February 2013. So, my information is about 3 weeks old now.

Repeating others, the comments I picked up were:

Causeway is giving "rock solid, steady production" at a gross rate of 4500 bopd, from a single producer by primary depletion. There are dual esps in the producer, which will come on line in May (when work on North Cormorant has been completed). SG also said he expected the production rate to go above where it is now when the esps are switched on. Also, SG said there was a water injector to come on line in Sept or Oct for pressure support. Lastly, he said that measurements of pressure suggested that reserves were pretty close to the pre-production estimates.

I don't have any more up to date information than that.

Link to the Oilbarrel presentation. (Click on Chapter 5.)



Sludgesurfer, do you have anything more up to date than this?

I've looked back to see if there is any comment regarding when the pumps and injector were originally to have come online. I can't find anything (but stand corrected by others). Valiant's Sept 12 presentation mentioned Causeway's injector would be installed with the Fionn development mid 2013. No switch-on date was given. It was also stated that Causeway would have a single producer with dual esps and a single injector - so no change in the plan, but again no timings stated.

In the absence of any other information, I have relied on Stephen Greer's comments. Would he have stated, "rock solid, steady production", and reserves pretty close to pre-production estimates, if he knew of a problem?

The Sept 2012 presentation stated that Valiant were aiming to conclude the strategic review by the end of 2012. So, the review was to have taken 4 months, but it's now of 6 months duration and continuing. To me, this suggests there will not be a takeover, but markets have been wrong-footed before.

I am buying at this level because of the production, reserves and tax losses. At the half year stage the tax losses were $472 mm. At the year end, they may be $80 (?) mm higher (Causeway/Fionn costs, less production revenue), giving say $550 mm. Taking the blended tax rate of 57% from the presentation, gives an undiscounted value of $313 mm. That compares to market cap for Valiant today (sp 350p) of about $220 mm. On that basis, the Dons production and reserves are in for free, as is the (wounded?) Causeway/Fionn, Crawford/Porter and all the exploration prospects.

I am not happy with Valiant's silence, but they may be (should be!) involved in sensitive negotiations, and a result may be close.

In the final analysis I want to walk away at some point with a profit.

Thanks to all for their comments. :-)

[frazboy] 28/2/2013 21:30

sledgesurfer, you could be right about Causeway. we have little information.

the only information we have is that it was on production at about 5,000 bopd in November, and, according to Stephen Greer at Antrim it was producing at around 4,500 bopd 2 weeks ago. his comments at the oilbarrel conference were it's a rock solid producer (or words to that effect). reassuringly he stated that material balance data was supportive of P2 reserves fairly close to the pre-production figure. but he's a chief executive and that's the language they use.

perhaps the greatest concern of mine in his presentation was that he distanced himself from causeway during the Q+A session at the end. he stated that the development of Fyne was not dependent upon the future performance of Causeway. that concerned me because he also said in his presentation that Causeway would provide $55m of T/O in its first year. i urge you to listen to the oil barrel conference presentation and see what you think

as for pressure support being required sooner than expected, i think it's the other way round. my understanding is that was meant to be on, on day one, but i'm happy to be corrected. please point me in the direction of your information?

and i believe the same is true of the ESPs. more information on these was provided in Stephen Greer's presentation.

if you have a source that tells you that any of the above is not true then please inform the bulletin board what or who it is?

[hpcg] 28/2/2013 21:19

??? Both the injector and ESP are coming on late, not early. The water injector was supposed to be online already but was put back for cost reasons. See the Antrim Q2 2012 interim statement for the original early 2013 timing. Similarly ESPs as pressure support not required early days. From what we can tell from Antrim Causeway has been steady and consistent and there has been not a whisper of any water cut. It's not even off choke. I think we can surmise that there is an integrity issue somewhere down that long wiggly bore hole given the lack of clean up.

You can find out a lot about Causeway from the Antrim. So for future reference Antrim's estimate at that time (30 June 2012) for their share of Fionn was approx 22M USD, so that makes 65M the measure upon which to judge overruns.

[sludgesurfer] 28/2/2013 20:13

Ed, correct me if I'm wrong but that information w.r.t Causeway is pretty dated. I'm going to stick my neck out and say that Causeway is either watering out or losing pressure support quicker than prognosed, hence water injector and ESP turn on (sooner than I believe was predicted).

If I was in the Valiant data room running my slide rule over the company, I'd be sure to keep an eye on the well test results of Causeway from Cormorant. Something is wrong here and this is my guess what it is. A guess is all it is. I'm well underwater here and want a good outcome as much as anyone but something stinks.

I hope I'm wrong but my gut feel is that a bunch of companies have been through Valiant during this process and they've all walked. Conjecture, gut feel and guesswork, but in the barren desert of Valiant investor communications, that's all we've got...