Amerisur Resources Share Discussion Threads

[xxnjr] 20/7/2019 13:29

and the extract from Steifel note on AlphaV (note was written last month)

Amerisur is a debt-free, stable cash generator producing oil from three fields across two licences onshore Colombia. The investment thesis is simple: recycle $35-45M of annual operating cash flow into a mixture of short and long-cycle exploration-led reinvestment opportunities.

Continuous H2 2019 drilling programme in CPO-5: We carry the exploration &
appraisal upside at CPO-5 at 18p/shr risked in our 37p NAV (70p unrisked; Figure 1).
The attraction of the licence is: (i) moderate geological risk (75% success rate to date),
(ii) rapid discovery-to-monetisation timeline, a matter of days/weeks, and (iii) benign, lowcost
operating environment both in terms of capex, opex and oil exports.
• Appraisal up next, could add 20% to group production: As previously announced, the next well at CPO-5 will be appraisal of the Indico discovery, with a result expected in ~August (Indico-2). Prior wells have flowed 3-5 kb/d (gross); at the mid-point and net to AMER's 30% working interest, the contribution to group revenue of a success would therefore be around 20% of our estimate of underlying FY19 group production (5.9 kb/d).
• H2 2019 activity on the block could add ~50% to group reserves: The schedule beyond Indico-2 is yet to be determined, but success at the well might encourage further back-to-back drilling on the structure. Indico's upside is c.50M bbls (70 vs current 2P of 23), so, net to 30% working interest, adds of ~15M bbls would equate to ~50% of group reserves.
• Sol testing to complete first: Amerisur expects to wrap up testing of the Sol well in the next couple of weeks. As announced on June 17, the well found 27 feet of net pay, which is some way below the two other successes in the block (100 ft +). Nevertheless, the commercial threshold here is low, and we would expect the well to be put into commercial production even were it to achieve a rate of a few hundred barrels per day.
Production guide reiterated; we are top end: 2019E guidance of 5-6 kb/d looks achievable vs. June daily production 6.8 kb/d, despite a modest first quarter that saw 5M production average 5.3 kb/d. Current guidance excludes any exploration success.

[fatgreek] 20/7/2019 13:27

Should be a nice blue week next week at this rate,,,,, glad I'm in watching the rise. We still have the Sol well results to come yet which may I dare say is "imminent" A positive result there will boost the share price further.Good luck to all holders old and new, it's the first time in years AMER is making me think this could be the day......

[xxnjr] 20/7/2019 13:25

fadilz ref yr estimates (thanks)

".....CPO-5 and Platanillo both have proven reserves, and the AGM presentation puts a net present value of $238m on the 7.6 net to AMER in CPO-5. Plat has 17.9 2p, so that gives us $584m."

Would be nice, but Amerisur are valuing CPO-5 reserves at an absurd $31.2 NPV/bbl, mind you their valuation is pre-tax! Just for ref, the Steifel Note on Alphaville uses these $NPV/bbl inputs:-

Platanillo 1P $7.60/bbl
CPO-5 Mariposa-1 & Indico-1 9.80/bbl
Platinillo "Probable" $11.40 [don't ask me why thats higher than the 1P number!!!!]
CPO-5 Exploration $9.80
Coati $8.80
Miraparriba $8.80
PUT 8 other $5.90
Terecay/Tecacho/Macaya $3.00

[shirley83] 20/7/2019 13:08

So next week 20s or 30s

[11_percent] 20/7/2019 13:07

charlieeee
20 Jul '19 - 12:38 - 21401 of 21403
0 0 0
Ronnie

"Not in public hands"

anyone with over 10% ie Michinoko at 11.06%
plus board holding the remainder of the 16.23% ie 5.17%.

==================

Why is the Michinoko 11.06% "Not in public hands".

Can they not sell them in the market....or indeed, buy more.

[lucyp00p] 20/7/2019 12:51

38p, I've been saying that for months. Based on what we have and what it's worth. Of course any CPO5 result push that higher.

[retailronnie] 20/7/2019 12:39

Thanks Charlieeee

[charlieeee] 20/7/2019 12:38

Ronnie

"Not in public hands"

anyone with over 10% ie Michinoko at 11.06%
plus board holding the remainder of the 16.23% ie 5.17%

[3roach] 20/7/2019 12:34

Up to now the market has been valuing the company, surely now the company and the buyer(s) will value the company?

[retailronnie] 20/7/2019 12:33

Found this little nugget in AR.

Payment for consultancy services:
Fees paid to Tracarta Limited, a company in which John
Wardle has an interest 1,598,000

That's on top of salary and options

[letmepass] 20/7/2019 12:28

Sure a bidder will be buying a few more at market prices. We shall see

[retailronnie] 20/7/2019 12:20

Please remind me, what does it mean by

"16.23% of the Company’s shares are not in public hands, as defined by the AIM rules."

Who owns them?

hxxp://www.amerisurresources.com/images/aimrule26-documents/AIM-Securities-Information-29-03-2019.pdf

[sabre6] 20/7/2019 12:06

If the bid goes hostile the bidder will have to buy shares in the market thus pushing the share price up.
As I mentioned in previous elections post a few years ago the share price was at 60p without what we have now got.
Today's share price is irelivant when it comes to a bid as the bidder will have to pay what the company is actually worth.

[charlieeee] 20/7/2019 11:53

Put simply RH crashed the share price with his sale of 15% of the company, which attracted guaranteed successful shorting from 2016 until recently, when FIL threw its toys out of the pram re the "N" sands.

Overall, there has been a mantra of negativity, including a complete failure to recognise what JW, with his experience of the industry and country and contacts, has actually built.

Even the CPO-5 developments and OXY validation of Putumayo has failed to register with the market.

That of course, has not been helped by the sector being out of favor with the IIs, who seem to be driven by the herd mentality yelling electric, rather than the facts under their noses, that POO is back at profitable levels.

[billthebank] 20/7/2019 11:51

Btw Totally off topic but anyone use HNW Investment Management Co? Or is therexa rgread on advfn I can peruse? Cheers

[billthebank] 20/7/2019 11:50

So favourite is coming in at £400M interesting times that's for sure

[billthebank] 20/7/2019 11:43

Has there been a regularxseller here dampening the sp? Just a thought!

[fadilz] 20/7/2019 11:41

Alas I broadly agree with you charlieee.

I just hope that no deal is struck until Put-9 is drilled. There is a big difference between prospective valuation of $0.41/b and $33 NPV/b hoped for on reserves.

[vermilion1966] 20/7/2019 11:33

With pipeline unpriced. Real question is, given your seemingly rational valuation, why has the market so massively undervalued AMER?

[billthebank] 20/7/2019 11:30

Interesting 're 71p!!! 20p I can't see this as that values us at £240M only so take the cash away and that sees our company assets valued at sub 15p!!! Too conservative at the bottom line IMO

[charlieeee] 20/7/2019 11:29

We are wrong to think in terms of current share price, but it just "feels" too early for this to be the billion $ company which JW and GC were so obviously building, Fadilz.

Simply because of the calculation that you have done, it is obvious that this is not going to be given away for nothing (ie 20p)

The hesitation in the market at the moment is probably concern that this may not happen and that the share price will drop back. It took most by surprise yesterday. Sadly, I think that the IIs will push it through, once the return to them is at an acceptable level and that may be well short of your calculated 71p, but above my 35p, which I see as the discount price!

[fadilz] 20/7/2019 11:13

My initial thoughts were 20-30p, and I still hesitate to believe we'll get much more than that.

However, we do have some means to value assets, using recent farm-outs, and the AGM presentation. Using these I get around 70p. Here's how

CPO-5 and Platanillo both have proven reserves, and the AGM presentation puts a net present value of $238m on the 7.6 net to AMER in CPO-5. Plat has 17.9 2p, so that gives us $584m.

OXY gave $93.25m for the net 224.7m P2 in Put-9, Tacacho, Terecay and Mecaya - that is $0.41m per 1m P2. Taking Put-12 and put-30 net P2 as 200m gives us $83m.

then we have Put-8, at $19.1m

Putting this in table form


_________P2Net____$m______$m/P2
Oxy1_____224.7___93.25_____ 0.41
CPO-5_____7.6____248________33 (claimed NPV)
Put-8_____26.2____19.1_______0.73
Plat______17.9____584_______(CPO-5 $/P2)
Put-30____151.5___ 63_______(OXY1 $/P2)
Put-12_____49_____ 20______(OXY1 $/P2)

Gives us $1027m for the above.

divide by £/$ of 1.2, and allow for 1.2b shares, and we get 71p.



I guess the contentious point is the NPV for CPO-5 and Platanillo. If we value these at 0, then the rest is still worth 14p. So, what value CPO-5 and Plat?

Discuss?