Caspian Energy Share Discussion Threads

[chopsy] 21/8/2007 19:58

Dear Cleo,

I'd buy if I thought it was the bottom.

It might be but I can't be sure, I'll keep it on the watch list.

On a personal note, CEK are my actual initials!

Regards,

Chopsy

[cleo1601] 18/8/2007 17:32

Good find Rupe, thanks for posting it.

CEK is now so low it seems rude not to add... trouble is nobody (including me) seems to have anything spare after the latest carnage. Other trouble is I've been thinking the same thing for a long time and it keeps going further. If it gets to a minus figure I'll have a little top-up I think.

[rupe1958] 16/8/2007 15:47

This isn't about about CEK, but interesting all the same. Looks as though the Chinese are going to pay big money for Transmeridian, who are right next door to CEK's North Block, I think They have larger proved reserves, but also alot more debt.


WSJ(8/15) Tiny Transmeridian Attracts China's Energy Firms (Dow Jones News Service)
Updated: Tuesday, August 14, 2007 07:36PM ET

(From THE WALL STREET JOURNAL)
By David Winning

BEIJING -- In a time when big Western oil and natural-gas companies are spending billions of dollars on projects around the globe, Transmeridian Exploration Inc. might escape notice. The small Houston oil company, which trades on the American Stock Exchange, last year posted $24.7 million in revenue and has yet to show a profit.

But thanks to its holdings in oil-rich and strategically important Kazakhstan, Transmeridian is attracting attention from Chinese energy companies. China's Zhenhua Oil -- whose parent company is an arms maker against which the U.S. has issued sanctions -- and Cnooc Ltd. have signaled to China's National Development and Reform Commission their interest in bidding for Transmeridian, people familiar with the matter said.

It is unclear whether the interest will result in a bid. Transmeridian Chief Financial Officer Earl McNeil declined to comment.

China's oil consumption is growing rapidly, and stagnant domestic crude output has prompted its state oil companies to seek access to overseas reserves through acquisitions. But Beijing's economic and political clout has intensified concerns in the West that the second-largest energy consumer is using its state companies to lock in resources at the expense of the energy security of Western countries. Cnooc withdrew its $18.5 billion offer for California's Unocal Corp. in 2005 after encountering a critical storm in U.S. Congress, clearing the way for a lower bid from Chevron Corp. to win the auction.

In part as a response to that, China's oil companies have focused on smaller deals, often with less-prominent Western companies that are less likely to draw political fire. China's Citic Group last year agreed to acquire the Kazakh assets of Canada's Nations Energy Co. for $1.91 billion. Two years ago, China National Petroleum Corp. paid $4.18 billion for PetroKazakhstan, a Canadian oil company whose main asset was a field in Kazakhstan.

This year, CNPC, the state-owned parent of PetroChina Co., bought rights to fields in Canada with a view to exploring and developing the technically challenging oil sands there.

"Transmeridian's oil assets in Kazakhstan are extremely interesting because there aren't many oil assets available in the market at present. That's why Chinese companies are prepared to battle each other for them," said an official at one of the Chinese companies weighing a bid.

That leaves them circling companies outside the oil-patch establishment that often have shallow financial resources, thinly traded shares or lack a track record in developing new resources.

Transmeridian has a 100% interest in CaspiNeft, which holds the license to the South Alibek field in western Kazakhstan. The field had total proved reserves of 67.2 million barrels of oil at the end of 2006. On its Web site, Transmeridian valued the field at $970 million.

But the company and the property face challenges. Transmeridian has been selling its oil at well below world-market prices. Last year, when light, sweet crude was trading at roughly $60 to $70 a barrel, the company's crude fetched an average price of about $34 a barrel. In its filings with the U.S. Securities and Exchange Commission, the company blamed its need to ship oil via rail or sell oil direct from the field, and said it started to export oil via pipeline on better terms this year.

The company is also working under a significant amount of debt. It has about $268 million in long-term debt due in 2010, according to its annual SEC filing, stemming mostly from privately sold debt that it says carries restrictions on whether it can sell assets or make other corporate moves. Another SEC filing this month showed that Transmeridian had a net working capital deficit of $15.6 million at the end of June. Last year, it reported a net loss of $53.2 million.

Its volatile shares have lost most of their value so far this year, and at 4 p.m. yesterday were trading at $1.87, compared with a 52-week high of $5.18 reached Aug. 31, 2006. It has a market capitalization of $189 million. Its capital structure includes convertible preferred stock that could significantly add to shares outstanding.

Despite the numbers, speculation has swirled in Asia, where both China and India are looking for deals to add to oil reserves. In July, the chairman of India's Oil & Natural Gas Corp., R.S. Sharma, declined to confirm media reports that its ONGC Videsh Ltd. unit was interested in Transmeridian.

Transmeridian effectively put itself up for sale in April when it announced a strategic review of its assets while retaining Jefferies Randall & Dewey, a unit of Jefferies & Co., as its financial adviser. Jefferies declined to comment.

Disclosing the decision to evaluate the company's strategic alternatives in April, Transmeridian President and Chief Executive Lorrie Olivier said it was because "the current market value of our common stock does not adequately reflect the value of the company's investment in the South Alibek field."

Chinese interest is likely to be stimulated by strategic needs, given the proximity of Kazakhstan to China and the likelihood that a 470-mile missing link in the Central Asian country's pipeline network from Kenkiyak to Kumkol will be built so it can connect with an existing cross-border crude pipeline to China.

China's interest in Kazakhstan has spurred a political response there, in a time when oil-rich nations are taking a greater say in the ownership and terms of developing reserves within their borders. China's recent deals there spurred the Kazakh government to change the law to allow it to step into any deal concerning the transfer and sale of assets involved in mineral production, with state oil company KazMunaiGaz usually taking as much as 50% of the assets.

It is unlikely that China's oil companies would go head-to-head in bidding for Transmeridian. The National Development and Reform Commission, China's economic-planning agency, discourages domestic companies from competing for foreign assets, because it drives asset prices up and exposes the companies to the risk of overpaying. Transmeridian has said proposals for its acquisition are expected in early September.

Zhenhua, a state-owned oil trader that already has some assets in Kazakhstan, lodged its interest with the NDRC before Chinese rivals, although the NDRC has asked it to work with its rivals to construct a bid consortium, the people said. Zhenhua is an oil trader whose parent is state-owned arms maker China North Industries Group Co., known as Norinco, a major supplier to the People's Liberation Army of China.

Norinco had sanctions imposed on it twice in 2003 by the U.S. government for allegedly selling missile technology to Iran. Norinco says the sanctions are "unreasonable."

[rupe1958] 15/8/2007 15:07

I've just been looking at the Q2 results.
Oil production has fallen back slightly - from 1400 bpd to 1310 (982.5 net to CEK)
Gross income was $1.889m (I assume that's Canadian $)
If production was: 90 days x 982.5 bpd = 88,425 barrels total Q2 production
Then average price per barrel achieved was Can$21.36, which seems very low, when Brent average was in the mid-60's at least.

Most of Q2's whopping loss of c$7m seems to have been non-cash exceptional items - there's a $3.34m forex loss and $1.87 stock-based compensation charge. They have also taken a charge of $0.45m for future taxation. Maybe they are trying to get all the bad news through in one quarter.

Q2 Operating costs - $560.5k
Q2 transport costs - $156k
Q2 administration costs - $984.8k

They still have $9.1m in cash, which should last for a while, assuming current production maintained.

We have to hope that the shallow well programme at Baktigarin hits some oil and raises production. 3 wells to be drilled from October. So it looks liks there'll be not much news until Q4.

[cleo1601] 20/7/2007 02:41

This really is the forgotten share, or forgotten company. It's had an incredible string of bad luck so far and on the laws of probability alone ought to be due a break or two. Are there any parallels anyone brave enough to dust down the cobwebs and enter here can think of? any companies that did what I think of as an Abe Lincoln, and eventually succeeded after everyone had given up? In other words, somebody tell me a story please. I guess I'd better go to bed without it since it's not far off 3am.

[rupe1958] 10/7/2007 10:58

Very disappointing, but at least current production (1040 bpd net to CEK) should support the share price at this level.
The next interims, which might be published this week, may be a bit less grim than the last. Assuming a net price pb of at least Can$30, income should be around Can$ $1m per month. And that ought to cover the admin and drilling costs.
Since there seems to be zero optimism in the share price at the moment, it's probably a good idea to hang on through the shallow drilling programme this autumn and winter.

[drewz] 09/7/2007 13:26

I thought oil was supposed to float on water - so how can a well updip of an oil producing hole flow only water? Very odd.

[robin_of_loxley] 05/7/2007 20:42

Oh dear, a shame for holders:

extract from RNS:

Caspian Energy Operations Progress Report

RNS Number:7341Z
Caspian Energy Inc
05 July 2007

Caspian Energy Inc, an oil and gas exploration company operating in Kazakhstan,
today announces that Aral Petroleum Capital LLP ("Aral"), in which the Company
holds a 50% indirect interest, has completed the swabbing operation on well
Zhagabulak #303 and that the KT-1 tested only formation water with no
hydrocarbons. The well will be suspended pending further evaluation.


The Company is evaluating bids for its planned drilling campaign in the western
side of the block. Drilling operations are expected to start in the third
quarter and will focus on Baktygaryn, Itisay, and Kozdesay areas in the post
salt deposits.

Charles Summers, President, Caspian Energy, Inc. commented:

"Even though well 303 is 225 meters updip from our producing well 301, it has
tested only water. We will return our focus to the northern side of the
Zhagabulak Area where there are proven reserves, and the western side of the
block to pursue shallower, less expensive targets."

no advice intended

[kevinlinus38] 05/7/2007 16:13

Yeah with all the ice caps melting water is sure to be in short supply!!!!

[ju1cester] 05/7/2007 14:39

with global warming, water could be an important commodity in years to come.

Hold.

[thepinkpanther] 05/7/2007 13:15

u should'nt patronise, it's out of order...........for holders

and no i am not one...............

[hercy] 05/7/2007 13:04

Oh dear only water rns.

[twosmiles] 28/6/2007 15:49

I reckon that's about 55 days of the 45-60 days statment?

[rupe1958] 25/6/2007 15:05

Charlie11908
Have you looked at Bmb Munai, on the NYSE? Ticker KAZ

[larsen] 24/6/2007 12:41

Transmeridian is listed as TMY in the US.

[charlie11908] 21/6/2007 06:05

Just got tolf by a friend that JP Morgan took 8%
of BSKO.......

Anyone else have any Caspian favourites?

Is Transmeridian listed anywhere?

[charlie11908] 20/6/2007 10:29

Big Sky has a very interesting management profile
that might be of interest to anyone investing in
the same country as CEK............
the CEO was brought in last year and is very much an "insider" politically....................

Caveat Emptor!!!

[thepinkpanther] 19/6/2007 16:44

wonder when these will start going up!

[twosmiles] 19/6/2007 15:06

I reckon thats about 46 days of the "about 45 to 60 days" statement...

[thepinkpanther] 18/6/2007 11:27

that's why the above purchases were made, soaked up the slack possibly......

did u buy all those shares drewz!

[drewz] 18/6/2007 09:19

Life in the old dog?

[thepinkpanther] 01/6/2007 17:55

recently,

16/05/07 302,000 bought @ 29p
23/05/07 300,000 bought @ 30p
29/05/07 197,000 bought @ 30p
30/05/07 29,500 bought @ 30p
01/06/07 357,600 bought @ 29.7p

thought........some investors buying!

DYOR.

[cleo1601] 01/6/2007 09:58

interesting deletion of that huge trade, filed under Buy, to be replaced by one for 2k more, marked L and filed under ?. Can we take it this was a buy? with the offer on 27 at the time and yesterday, it seems unlikely to be a sell but, OTOH, the 197k on 29 May went for a tenth of a penny more... any thoughts anyone? (I hope it wasn't you selling HD!)

[thepinkpanther] 29/5/2007 10:28

197,000 purchased at 30p

[cleo1601] 23/5/2007 10:37

Thank you for that very interesting post Rupe. Looks like someone picked up another 300k this am. That you again Drewz?

All I can say is good luck to whoever it was and roll on the result of the 303 test. We've had so many false dawns here recently I've almost given up looking