Bridge Energy Share Discussion Threads

[bomfin] 19/3/2013 15:49

Quite right. A couple more avenues to growth which would be intact if Bridge decide to only sell their share of Asha. I'm not expecting Lundin(operator) to do much on their block to prove up Asha(PL457)extension into their block allthough Wintershall (15% interest) may be more keen. That is a little carrot for anyone who wants to get involved in the action now and buy Bridge's share as currently appraised. imho dyor

[rogerlin] 18/3/2013 18:06

A couple of additional points from the conference call QA session. Tom Reynolds said I think that the initial agreement with the Ivar Aasen holders relates to the Asha only (and not therefore presumably to Amol or Mukta). Further that Bridge believe on seismic evidence that Asha extends into PL338, but that the holders of PL338 are not so far involved in the initial agreement.

[bomfin] 17/3/2013 09:06

Agree with that mattoil

Boa is a fantastic deal and is just another good contact made also. e.g OMV recently bought into 20% of Edvard Greig.

Boa already more than half paid out and giving over £5 million/year cash flow at current oil price!

Recent gas prices mean that Victoria has been giving off similar cash flow even after taking account for hedges.

See the Duart south reserves have also been upgraded so when we get Duart back onstream they may well use cash flow there to help pay for this explo development well?. The one that tests Duart East before completing in Duart South as a producer.

[mattoil] 16/3/2013 23:32

Obviously that is true. But If Bridge wants to become a bigger player in the North Sea, this is a pretty unique opportunity for some excellent long term income with solid partners. Its all about asset management, but I would much rather leave Vulcan be and focus on this field. Do a few quick deals like Boa will ensure access to the tax pool and could potentially be enough to move forward with Aasen, including some lending. The policies on exploration in Norway, along with Bridge's ability to farm out could keep exploration expenses in check. By the time Garantiana will be ready for development, Asha should be contributing to the bottom line.. Maybe a bit hopeful, but the Garantiana will have at least two more wells to be drilled before any decision is made, which very well may be in 2015, then add another year before the serious cash will start running.

Seeing all the great opportunities Bridge has now, I think Vulcan should be secondary, unless they get an attractive farm-out deal, which i honestly doubt will happen.

[bomfin] 16/3/2013 23:13

I wouldn't pay much attention to Tom Reynolds saying that the default position is they go to development! Obviously that's default position until someone makes a serious offer. Personally I don't think it will be default position much beyond that :-)

[mattoil] 16/3/2013 21:41

I think one long term "worry" is if Bridge can afford the investments needed for Aasen to go into production. Bridge says they can through loans, but analysts are unsure. Luckily for us, nothing will be due until an agreement is signed, probably around mid 2014, giving us plenty of time. By then Bridge will probably have a few nice producing fields giving some solid income, as well as good opportunities to lend more money as Aasen will be coming onstream shortly. We have been extremely fortunate, and the way I see it we are sitting in a very sweet spot at the moment.

[bomfin] 16/3/2013 21:21

If they do a deal which also monetises the UK tax pool we must be entering potential multi bagger territory and I'm struggling to see any downside!
With Asha clearly going to production where is the downside?
I can see quite a clear stairway to £300 million market cap! imho dyor

[bomfin] 16/3/2013 17:14

Just Statoil to buy into Bridge's Norwegian discoveries (not bidding for the company and the preferable deal for Bridge directors imho). With Amol, Aglala and Mukta still to drill and the chance there are more Asha reserves where the sands thicken and numerous add on prospects next door to Garantiana discoverey I reckon £200 million should buy Bridge's share in both licences. That's very small change for Statoil. Any bid for these licences will have to bid for double the current P50 reserves because of the further potential prospects on both licences which have been derisked. Selling out solves Bridge's need to find development funds. imho dyor

If that sounds a bit rampy I think some reflection on what has happened so quickly in relation to licence 457 is needed. First announcement during drill Noor water wet and sign of hydro carbons in Asha (Thought to be 10 million barrels gross)
Well is finished and side track is drilled (initial assessment 25 - 35 million barrels gross) Further analysis by Wintershall who proudly proclaim their co-operative agreement with Statoil and on the basis of that analysis reserves upped to 30 -100 million barrels gross. An outline of a prospective field is shown in Bridge's unitisation conference call notes which has a bigger aerial extent than the original Avar Aasen field boundary (Ivar Aasen 148 million barrels recoverable at that stage). So who has had to ok the revised figures. Statoil and Detnor. Statoil 50% in pl001. Bridge are leading the news flow because all these development are very material to them because they have a much lower market cap than any of the other partners. There's no way Bridge are rocking the boast here. They would never risk making an enemy of Statoil so I believe everything they have stated has been ratified by the partners in 457. So much so that Detnor state Ivar Aasen has got bigger and used the same reserves figures. So Statoil and Detnor who are in Unitisation discussions with the PL457 block clearly accept Asha is 30 to 100 million barrels in pl457. With both Wintershall and Bridge not wishing to upset the Norwegian apple cart I personally believe there is more to come. All imho dyor

[mattoil] 16/3/2013 16:16

Not to mention the Mariner where Bridge has a stake right next door. I dont know if Statoil can use Bridge's exploration team as well as a new entrant though. Statoil also has very good opportunities to grow organically in Norway, so I don't see them as a potential buyer, but that is just my very unqualified guess.

[bomfin] 16/3/2013 10:59

For me the obvious buyer is Statoil.

Statoil hold 40% of the 001b licence (original Ivar Aasen) have just done a deal to get 15% of Edvard Greig and have a big share in both Johan Sverdrup licences. PL457 for a full house. all imho

[mattoil] 15/3/2013 18:24

Very good points on the value of Asha as well, using the latest transaction on Grieg, which is part of the same development, Asha would be worth Bridge's MC alone. Add on producing fields, Garantiana, Tax Pool, the exploration licenses and an award winning team..

Its hard to find a downside here. Ss far as being acquired, I doubt many current investors would settle for less than 20 NOK. It should not be very hard to pay that for the right buyer, they can collect the tax pool quick, make well use of the exploration team and get two fantastic new finds, as well as some minor producing stakes and further promising prospects. Norwegian North Sea is hot right now and anyone with producing UK assets wanting to expand to Norway would be ideal... Say TAQA or Enquest..

[bomfin] 15/3/2013 16:50

I see they've put a link to the pre unitisation conference call from a week ago.




In question and answers Tom Reynolds mentions they can probably sidetrack an Amol exploration well to test the thickening eastern sands of Asha. So that well later this year gives 2 chances of proving up more reserves. imho dyor

[bomfin] 15/3/2013 15:21

Having a good day in Norway. If you arn't in you might want to check the difference between uk price and Norway price? Thanks for the broker update Mattoil.

[mattoil] 15/3/2013 14:14

Massive volume in Oslo today. ABG came out with a new analysis, raising the target to 20 NOK from 11 NOK (current share price is 11). Being highlighted as the cheapest E&P stock covered by ABG.

[bomfin] 15/3/2013 08:14

I'm asking the same questions. Linnorm/Onyx was at one time thought to be a big field. Possibly 500 million boe. Why it's still in the planning stage I don't know. if Shell are drilling this new well to find more reserves to improve development economics then that can only be good for Bridge's block because it covers the area between Linnorm and the new well. The Mjosa prospect is pretty big also at nearly 200 million boe P50. Time will tell.

I see Lundin's Jorvik well came up dry. Hopefully they'll concentrate north of Luno now?

[rogerlin] 14/3/2013 20:32

Trying to do a bit of DYOR on Mjosa and it too is a most confusing area. I think that PL511 surrounds PL255 (Linnorm) except for an small separate rectangular bit separate from Linnorm which is also PL511, south of Mjosa and where the new Shell well 6406/9-3 is to be.

I found on the news section of Norske Shell's website an announcement 17.11.2012 saying the final investment decision for a development of the Linnorm gas field has been postponed..."a challenging reservoir with high pressure and high temperature". I don't know if that's the most recent information and why then Shell are proceeding with a new well on a bit of their licence which is not contiguous with Linnorm?

Mjosa itself is shown in Bridge's latest diagram as a gas prospect in the Tilje (lower Jurassic), 7.5% interest, net unrisked potential 14 mmboe, POS 14%. Let's hope this isn't a challenging reservoir as well.

[bomfin] 13/3/2013 17:02

Shell get permission to drill exploration well about 5 miles south of Bridge's Mjosa prospect.

[bomfin] 13/3/2013 09:52

Quite right + amol + agala (The area of the licence is 60 km2) On the other side of Utsira high an 8km2 area up against a fault is giving 1 billion barrels recoverable in the Johan Sverdrup field.

You don't need to find thickening sands to the east (already 70 metres gross at Asha) with more than about half charged with oil for the reserves figures to start really racking up. imho dyor

[rogerlin] 13/3/2013 08:56

Looking at the various diagrams again I can't find one that shows where the original 16/1-2 Ivar Aasen well is in relation to the boundary of the northern part of PL457, but not very far away IMHO. (Asha is 3 km east of Ivar Aaasen 16/1-9 and 16/1-2 is about 3 km to the north-east of 16/1-9). That well was the 1976 one and its findings are based on re-interpretation so may be uncertain. The northern part of PL457 already has the Mukta (Heimdal) prospect. So as well as a possible eastern extension of Asha 16/1-16 there are still hopes for the northern part of this small and oddly shaped area.

[bomfin] 12/3/2013 11:42

Updated in presentations today on website.



page 12

Indicative valuation of Asha
–Bridge reserve report confirms 13 mmboe contingent resource (net)
–Market benchmarks indicate value range of USD$5-$8 per boe
–RWE sold Edvard Grieg interest in 2012 for estimated $8.5/bbl
–Indicative value for Bridge Asha interest $65 – 105 million

[bomfin] 12/3/2013 11:12

Rogerlin,

There may be some chance to pick up some more cheap shares here but I'm not depending on that.
It would take a lull in newsflow and the evidence is that Bridge present regularly and update the market of any price sensitive news quickly. In my opinion Tom Reynolds is on it.

And he's got good reason to be. Statoil loom large over the whole Utsira high and own 50% of Ivar Aasen. They just moved into Edvard Greid just prior to PL457 well result also. They are commited to the Utsira High area.

Fascinating to me that Detnor issued an announcement stating that Ivar Aasen had got bigger which was in line with the PL457 block reserves announcement. What the PL457 block are now showing as the size of what they have discovered is a big field which appears half in PL457 and half in PL001b. The aerial extent suggests to me that PL457 will make the 100 million barrels figure easily. (Just my opinion) but DetNor with no interest and who stand to lose a % of what they have in Ivar Aasen have already mentioned the 100 million barrel figure in their last announcement.
Statoil have a share in all the discoveries in the Utsira high at present except for one which is PL457. all imho dyor

[bomfin] 11/3/2013 21:53

Wintershall's Annual Press Conference tomorrow.

[rogerlin] 11/3/2013 19:10

Interesting calculations Bomfin. There does seem to be sound value here but the good newsflow has only just got us back to the AIM flotation price. There may perhaps now be a bit of a lull- I see from the 2012 4th quarter report that Mjosa should be July 2013, Amol in Q4 and Garantiana 2014. It's quite a while till July.

[bomfin] 11/3/2013 08:45

At lowest reserves estimates for Asha and Garantiana and excluding all further prospectivity on the blocks and taking the lowest price for Norwegian North Sea resource deals over last year then Asha and Garantiana discoveries are worth 55p/share.

If we take the upper range of reserves estimates at Asha and Garantiana along with the highest price for resource deals in Norwegian North Sea in last year and assume no further prospectivity on the licences we get a valuation of around £3/share.

The mid range of the 2 valuations is 177.5p/share.

Since both blocks have only had 1 well with sidetrack drilled on them there is still considerable upside potential for both blocks. imho dyor.

The 177.5p/share does not take account of the value of any of their other assets or the near £140 million of tax allowances available.

All IMHO DYOR