Amerisur Resources Share Discussion Threads

[foiledagain] 20/9/2019 12:47

My own opinion is the BoD were pushed into this and it may not have been a time of their choosing as with everything lined up, next year would have been better.

Perhaps if someone pushed BoD they didn't want it proved up?

[davwal] 20/9/2019 12:05

FA - yes I have no argument with the points you raise. But I’m sure our side will ring the best out the potential. Sort of ‘never mind the quality, feel the width’... And clearly there is multiple interest, with Oxy’s previous entry being a major pillar of support, so hopefully a bidding war breaks out. All my thinking is based on my opinion that he timing of this process has been forced on the BoD. I have topped up to maximise my return from an uninspiring situation. I can’t see this management just carrying on in any circumstances.

[moneylender] 20/9/2019 11:59

On a one to one conversation I had with GC, his views were that in order to get the best price for a sale you had to 'get the bidder to a place of perceived value'. Are we getting to this place by not drilling those wells targeted? we all know/think that our asetts are full of oil yet to be proved and reflect in a perceived value.

I dont think we need worry about a MBO as that would lead to litigation as FA suggests. For the moment I am happy to let GC get on with the negotiation and get the best price for us all. Keep adding if you believe!

£1 by Xmas.

[yasrub] 20/9/2019 11:37

FoiledAgain

We are on the same page, perhaps I am more hopeful in that there seem to be multiple parties showing interest and hopefully the likes of OXY, GTE, Parex and Geopark jostling for acreage. Sinopec are active and of course ONGC. Surely the OBA does have strategic value to such operators.

[foiledagain] 20/9/2019 11:20

Yas. As ever they will have far more information than I have. Suspect they have been sounded out both by the original prospective bidder and everyone else.

My concern, and it is only that, is Amerisur being subject of an MBO or a takeover at a pathetic level with support of the BoD at a time when Amerisur really has got everything in line for success on all of its substantial and potentially very valuable assets but where lack of drilling fans those concerns.

[yasrub] 20/9/2019 11:16

FoiledAgain

Do you have a view on the institutional holders who have around 40%.Surely they have been sounded out?

[yasrub] 20/9/2019 11:13

Hi FoiledAgain

I agree with you that is my point we are at this point because other parties are seeing the potential and I assume believe they will do a better job to maximise potential ie Drilling!

ONGC I doubt are being helpful but they also risk getting a new 30% partner so perhaps they need to be careful. I have said before that I see it likely CP-05 might be parcelled up separately in any deal.

[ladeside] 20/9/2019 10:57

I see a NED resigned over at Iron.

[foiledagain] 20/9/2019 10:56

yasrub

It might mean Amerisur are interested in having the information they will acknowledge as being accurate, but its also at that level because of management lack of progress in drilling its own assets, which could literally multiply reserves, so it is strange that Amerisur did not seek to drill if it had intentions of selling? They are operator even of the Occy acreage.

There is no doubt that the lack of new production from Amerisur's assets is not in shareholders best interests.

Yes the bidders would and should know the massive potential, and occy illustrate that by their agreement, but one successful well on any of the other acreage would have illustrated beyond a shadow of a doubt the massive potential, even if one well might not in itself have increased reserves massively it would open up the potential for larger field which would.

From the missed drilling some could be forgiven for being under the impression that Amerisur chose not to prove up other acreage. Whether that's true or not, failing to prove up by even one well is a disadvantage in any FSP.

Hopefully this was Amerisur BoD pushed into the process by a major holder which would at least remove the concern over an MBO or cheap sell off, but time will tell which is right.

However the share price looks as though its been carefully managed, the news flow has a similar feel to it.

ONGC would not want to improve its asset of CPO-5 at this stage and had no motivation for success on the previous drill if they were to approach Amerisur or knew of an FSP.

[yasrub] 20/9/2019 10:41

There is FSP as hopefully others taking part see the potential - we are where we are because of perceived lack of trust and performance of management. I think it is fair to say the assets particularly CP-05 are in vogue and whatever anyone's opinion is of management over a period of time they have cherry picked licences very well when Columbia was not so popular. The reserves report by McDaniel tells me AMER are ensuring interested parties have the information they will acknowledge as accurate leading me to believe AMER are serious in realising a deal. Talks are happening now so one could reasonably expect some news in the next 8-12 weeks. The Indico-2 is intriguing how this will play out in this timescale - hopefully positive.

[underhill2] 20/9/2019 10:31

In my opinion Management just want out now. The lack of current drilling activity says it all. How can Reserves increase without drilling.

[acv74] 20/9/2019 10:08

Bryet i agree that they have rarely met their own expectations.

[bryet] 20/9/2019 10:01

Sorry double clicked!

[bryet] 20/9/2019 10:01

Does Amer ever do what it says how many times as it said x amount of drills this year and they have never happened always jam tomorrow sooner we get taken over the better.

[kaos3] 20/9/2019 08:56

I feel for JW

[kaos3] 20/9/2019 08:55

737

"it seems though the BoD having not drilled what it has predicted for at least two years, knows it cannot increase reserves..."

[xxnjr] 20/9/2019 08:52

The moving 2P parts:-

Mecaya: -100%
Platanillo*: -29.75%
CPO-5: +23.54%
=================
Company: -14.81%
=================

*NB: Second recent reduction, as at year end 2018 Platanillo 2P reduced by -7.60%, equals -35% combined.

[davwal] 20/9/2019 08:49

I dare say potential bidders will do their own OiP calcs and not rely on Amer’s offering. They will make their own judgement and see the greater potential if present.

[11_percent] 20/9/2019 08:43

No more drills this year....

[foiledagain] 20/9/2019 08:43

The failure to drill makes it absolutely obvious that reserves will not rise, and it should be stated in the RNS on reserves, otherwise it seems though the BoD having not drilled what it has predicted for at least two years, knows it cannot increase reserves, with exception of CPO-5 where it isn't operator, and where ONGC know its not in their best interest to increase reserves at CPO-5 at the current time.

So reserve figures are to all extent constrained by Amerisur and again it should be put in capitals in the RNS, as in this situation the reserves bare no relationship to the potential oil in place over the whole of the assets and it is a matter of regret that at a time when the FSP is taking place, this may play into the hands of a cheap takeover or MBO or some other arrangement not in the shareholders best interests, and where one drill could make a massive difference to reserve figures and open up a new field that could multiple reserves and it might appear that the BoD are not emphasising this for whatever reason that is and where ironically they had the job of drilling more in the first place.

[charlieeee] 20/9/2019 08:38

They said in a couple of weeks and are now delivering on that "currently"

"Management presentations with interested parties currently being held in Bogotá"

Roll on Indico 2 and what is happening on PUT 8 preparations, our other drill for this year?

[foiledagain] 20/9/2019 08:38

dgarvey: with respect water cut would already be established on wells producing that have been producing for some time.

Water cut might increase on existing wells with water ingress, poor cement jobs etc., as water will always flow to a point of least resistance, but that would not increase oil reserves, it might reduce them, and even if in the unlikely event of oil contact being suspected to be much higher way after the event, it would require a new drill or sidetrack to intersect that before reserves could be upgraded.

OIP would be established in most cases with the DST, and that's why so many RNS's of drill results mention oil or water being found at levels not originally expected.

I can understand potential bidders being happy to receive these reserve figures, but I'm afraid these reserve figures without the drills now predicted for several years, give a totally understated view of the company, and I'm surprised its not made crystal clear in the RNS and somewhat cautious of the motives.

[foiledagain] 20/9/2019 08:21

Nothing wrong with the reserves figures, but everything wrong on here where some have no idea about how reserves are calculated and where reserve figures can change massively with one drill result.

In Amerisur's case the potential to exceed stated reserves is not potential but almost a given.

As one poster correctly states 'you can't produce 6k per day and increase reserves at the same time without doing some drilling'

Every gallon of oil taken out of existing drills reduces the reserves by a gallon. Easy isn't it. Fill up a kettle with 3 cups of water, pour one out for a drink, you have less in the kettle, unless you increase the reserve by tapping more.

Reserve figures are a poor measure these days because of the above, because they place virtually zero value on assets undrilled, assets that have massive acreage in an oil rich country.

With Occy having a stake, its still held by Amerisur being the operator, so with the exception of CPO-5 where there is little incentive for ONGC to find more oil, if it means paying a higher price for Amerisur or Amerisur's stake in CPO-5.

I know environmental situation have a brake on drilling in many instances, but then forecasts are based on knowing that, and the lack of drilling, on any of Amerisur's own assets or assets it is operator of dictate that reserves outside of CPO-5 would not rise, and this seems to play into cheap takeover.

My only concern is once again the RNS doesn't make that too clear, and seems happy to downplay the value of Amerisur and if that should result in a conglomerate buy out where management are involved, there would be a stink that would not go away, and will inevitably result in significant action in the courts, especially from a company predicting so many drills, but not apparently doing many knowing that no successful drills inevitably means lower reserves.