Amerisur Resources Share Discussion Threads

[adam] 31/5/2017 09:49

On reasonable near term expaectations these should be trading at 60p based on $50 oil. I estimate 1.6p on share price per extra dollar on oil price, with P/E 10 and 7k year end exit rate. £1 then a possibility year end if they do hit 7k and their 20k target looks realistic rather than pie in the sky.

[hiddendepths] 31/5/2017 09:30

Dark Horse - the software simply uses the quoted spread at the time of the deal. If it's closer to the bid price it's a sell and if closer to the ask price it's a buy.

Of course, you bought but someone sold the shares to you, possibly a MM but maybe a holder. So in a sense every buy is also a sell and vice versa!

[9barracuda] 31/5/2017 09:09

Good to have your input TDH

[the dark horse] 31/5/2017 09:01

Correction - they just filed me at 26p but it shows as a Sell? How can that be when it was on the bid side of the board and shows as an AT?! Just shows the system of recording buys and sells really doesn't work.

[the dark horse] 31/5/2017 08:58

Market must be tightening up - just tried to buy 50k at 26p and for the first time in ages my broker was unable to fill order and I am on the top of the Level2 board!

[lucyp00p] 30/5/2017 23:13

Don't forget the $24 million tax credit.

[broncowarrior] 30/5/2017 23:05

Great post al, cheers.

[al101uk] 30/5/2017 22:57

harrisun,

I like putting my thoughts in writing (you might have noticed), if he's asking for some other reason... meh... couldn't care less to be honest ;-)

See what you mean though.

[harrisun] 30/5/2017 22:48

A101. Good post but someone may not be genuine. Not sector he usually invests in? Look at Morgans posts

[ianpuddifoot] 30/5/2017 22:45

I would say communication is better this year but not saying it's perfect

[al101uk] 30/5/2017 22:30

mortgage freeman,

Check the header, it's up to date except for the discovery at CPO-5, the Mariposa-1 well which was RNS'ed today, we own 30% of it.

Basically we have a cluster of exploration and production assets in Colombia around an Amerisur owned pipeline which stretches across the river in to Ecuador (the OBA).

Our primary asset is the Platanillo field which seems to flow oil no matter where we stick a hole in it and if we produced at the tested rate of each well could see us producing 20k bopd. But we are forever transport constrained because after we constructed the pipeline (which took years) it was revealed the infrastructure we connected to had it's own bottlenecks. 5kbopd seems to be the cut off. There are also question marks around those production figures because at least one well saw production drop significantly and had to be treated to bring production back to a good level. Five more wells have been identified for the same treatment, but the market hasn't been informed of what has happened to the production profile on those wells, nor any of the others in the field. On the plus side we have several wells producing from areas and depths that don't appear in our published P2 reserves so at some point we can expect a revision upwards.

The good news is that CPO-5 is an outlier in the Llanos basin with good infrastructure so will not be affected by the OBA issues and should see us hit our 7kbopd target by end of year in my opinion. In fact the field appears to have the potential to be company changing.

We have one of the best hole diggers in the industry in John Wardle, but the remaining management and strategic execution has large question marks over it. The management have in the past been lavishing themselves with excessive bonuses for very little, but recently after investor action they have reigned it in and hired some decent non-execs. There is now much talk about good corporate governance and the beginnings of them walking the walk.

Communication is quite frankly poor to abysmal and an area they have promised to improve, but Private Investors have seen no improvement and many of us still await answers to several questions.

In summary:

Great assets with fantastic potential.
Great Geologist with a proven track record.
Very shrewd management as regards acquisitions
Poor strategic execution (although the plan seems sound)
Very poor communication
Low production costs and should be very much profit making at the end of this year
No debt and a fully funded drilling campaign in the offing.

Valuation-wise we appear to be valued by the market according to what we have, with little priced in for any of our risked assets... it feels like it has forever been so.

Sorry, typing off the top of my head, so I'm sure I've missed something or made some mistakes.

[broncowarrior] 30/5/2017 21:53

Suppose the political stuff is a slight drag on price, SOU are mainly in Italy which is pretty stable provided the mob don't get hold of it!

[davwal] 30/5/2017 19:16

The article is typical MF, bland. It even manages to imply by omission that AMER owns all of Mariposa-1. But at least it's positive in tone regardless of quality. We need all the publicity we can get. Meanwhile I for one am totally bemused by the market reaction to a string of good news items. There aren't too many rabbits left in the hat, so heaven knows what will make it take off to a reasonable level. If this was SOU the price would have doubled in recent weeks. Grrr.

[big7ime] 30/5/2017 18:27

Article from motley fool: Is this growth stock about to take off

[mortgage freeman] 30/5/2017 18:25

Could anyone give me a quick appraisal here, as Ive come across this stock whilst doing some research for a local share club. Amer seems an interesting stock after what seems some tricky times. I'm not usually an investor in this sector but with a bit of succinct information I might be able to start the ball rolling for us.

[big7ime] 30/5/2017 18:14

Hugely undervalued, I wonder if IC or DMail will pick up on it.

[al101uk] 30/5/2017 16:45

"If an E&P Contract is awarded through a bid process, the contractor must pay to the ANH, in cash or in kind, the so-called X-Factor, which is the percentage of gross production after royalty offered by the contractor during the bidding process."

That affects the valuation quite a bit :-)

Adjusted for the Factor, roughly 32p

Just grossing up costs I don't think you're far out at all using $15 per barrel.

[fadilz] 30/5/2017 16:41

al101uk - CPO-5 has a 23% x-factor. How is that applied - to profits, to revenue, or...?

Until we have reserves and likely production rate we can only guess at a value for CPO-5, but assuming 30% of 4600, for 20 years (10m barrels to us), and $15 profit, I make this well in production worth 3.5p per share. $30 profit gives 7p. -ish.

[big7ime] 30/5/2017 16:29

Any coverage?

[al101uk] 30/5/2017 16:26

Big7ime,

Everything else being equal ... 65.5p

adam,

Let me know what the price of oil will be in 25 years and I'll be happy to oblige... or pick a different discount rate, a negative one if you like.

[lucyp00p] 30/5/2017 16:22

Oh good grief

[trotting12] 30/5/2017 16:06

Amer will soon be a cash cow , and a great addition to any oil co looking to expand in South america ,, forget about shale gas and fracking ,, amer has proper oil,,and lots of American oil companies need what we have ,, expect the bids by late summer

[adam] 30/5/2017 16:03

Why use a discount factor and not an inflator as well for oil price? Surely if you are doing a NPV calculation you would use some forward curve for oil price?

[big7ime] 30/5/2017 15:53

aI101uk funny you arrived at exactly my opinion of value but that was without cpo
But I'm here for longer and hopefully the recovery of oil price. Can you imagine what these will be worth if poo got to 80$ let alone the price of a few yrs ago 140 was it?

[sleveen] 30/5/2017 15:38

Do a PANR.

Develop the field to sell on.

Let's await development of R2D2.