Caspian Sunrise Share Discussion Threads

[credock] 31/3/2024 09:27

This could be one hell of a week for us all. If they announce the buyer i can see a price of 6p on Tuesday with a week ending up at at least 8p. Good luck everyone.

[bluemango] 30/3/2024 14:56

"As one investor I know well said, it was good in the case of Caspian Sunrise (CASP) to see a stock go up and stay up. This was and still is something of a rarity in current stock market conditions. Here the trigger for the Sunrise rise was considering selling all or part of the BNG contract area’s shallow structures. As is often the case these days, we have a company sitting on an asset whose value has not been factored into the market cap. Indeed, many small caps have this sum of parts being great than the whole problem currently"

[spangle93] 29/3/2024 17:44

I think his overall gist is rose-tinted. Where he says "MJF and South Yelemes are far superior assets to Galaz, both MJF and S.Y require an updated valuation and probable resource." I'd suggest that if they did, it would be lower than previously, for reasons I've already explained.

I wouldn't be invested if I thought there wasn't the outside chance that they could blow the current share price apart, most obviously by achieving unequivocal success on a deep well, while the production from the shallows mitigates against the need for dilution to fund activities.

The concert party are so heavily invested that they need to make money, and we in turn have the faith to ride on their coat tails, rather than on the next to useless information provided by Carver.

[bluemango] 29/3/2024 17:11

I'm sure anyone can pick holes in some of the detail, but I think his overall gist/argument is valid.

[spangle93] 29/3/2024 14:05

"they wont have the winter weather excuse"
No, it's usually the spring thaw in Kaz.


BM "MJF has a fantastic drill to production success ratio, 10 drills is 7 - 8 production wells, this can more than double the resource and using the new horizontal side track method a tree branch drilling programme can be classed as a 'workover drill' so 10 drills becomes 40 etc."
It's hard to know where to start on just how wrong this is. I hope the poster is better at matters above ground

[le mailot jaune] 29/3/2024 14:01

Coffeecups Hello George,hope you are keeping well.Great posts who needs Flawless eh, Owe you a few pints for first getting me interested in Novacyt got a 12 bagger out of it,let’s hope this is going the same way

[konil] 29/3/2024 13:25

so i will add another reason they want to sell the shallows - the need for further spend under licence obligations. far from being a positive during a sale, these costs will be used by a prospective purchaser to impair the potential value of the assets during negotiations, notwithstanding that success, not guaranteed, would eventually lead to increased profits.

following not directly related to prospective shallows sale:

the historic shenanigans put 3ab (no wonder it is stalled!) and block8 under a cloud and these are a major impediment to getting a proper valuation for casp assets and more generally to getting a proper market valuation for the company as a whole.

as for the cts accounting shortfalls, its laughable how they have got away with it and how the auditors have sought to wash their hands of it.

countering all this is the possibility they have got, or are close to getting, success at a deep. not holding my breath. let's see what the next 3 months bring - they wont have the winter weather excuse and many items overdue for reporting.

[bluemango] 29/3/2024 12:42

Here's a link to the original 5th June 2019 Long Term Incentive Award Scheme, note market cap and share price targets relate to no of shares in issue at the time:

[bluemango] 29/3/2024 12:09

And a reminder of options/incentives:

OPTIONS & IncentivesToday 11:51
On 10 January 2022 Shin Seokwoo, Chief Operating Officer was granted 2,500,000 options exercisable at 5.5p and Edmund Limerick, non-executive director was granted 1,000,000 options exercisable at 5.5p per share. Both option grants being exercisable until 9 January 2032.

Long Term Incentive Plan (LTIP) scheme:On 5 June 2019 the Company made awards under a long term incentive plan. Clive Carver, Chairman, and Kuat Oraziman, Chief Executive Officer, are entitled to receive cash payments to be triggered by the Company's attainment of both pre-set market capitalisation and share price targets as follows:

Market Cap hits $800m they get $3M each!

Only a 9 bagger from here - very reachable with deeps on board!

Edit: Doing the sums here, at current exchange rate 0.7926, $800m is £634m.

At 2,250.5 million shares in issue, that's a target price of just over 28p for Clive and Kuat's awards to kick in. By my calcs, a mere 7 bagger from here.

[bluemango] 29/3/2024 12:03

'coffeecups' has put a series of posts over on LSE this morning, I'm sure he won't mind me copying his conclusion on here:

ConclusionToday 11:51
MJF and South Yelemes - valuable and over book value will be paid - what is book value? When CASP put themselves on the market in their 2022 accounts saying all of part of any Group asset was up for sale they handily reminded everyone about Galaz.

MJF is already on a full production licence and unusually also has approval to drill another 10 wells of which 155 is the first.

MJF has a fantastic drill to production success ratio, 10 drills is 7 - 8 production wells, this can more than double the resource and using the new horizontal side track method a tree branch drilling programme can be classed as a 'workover drill' so 10 drills becomes 40 etc.

Galaz was sold for $100m, it gave them a $15m profit and left them with $33m to reinvest into BNG.

MJF and South Yelemes are far superior assets to Galaz, both MJF and S.Y require an updated valuation and probable resource.

The whole of BNG has a historic cost of $100m as at 2022, that is all of the deeps and the shallows.

This is what is meant in the 25/03/24 RNS when they say they are after assets suited to them, it means anything underdeveloped that they can add value to and sell on to enable them to move up the food chain.

They have stated in RNS 0546l 25/03/24 that they are going to apply for:

Licence upgrade.

The technical information to be collected from Deep Well 803 is expected to be sufficient together with the information already gathered at the other BNG deep wells drilled to support an application to upgrade the BNG deep structures licence to a full production licence.

This is a full production licence on SIX deep wells.

That is Baby Tengiz on its own.

Then add in the four wells on Block 8 and you have 10 DEEP wells.

Plus the only drill barge in the North Caspian Sea

They are selling the smaller assets as they feel they are now ready to move into a mid sized oil company!

Happy Easter!

[konil] 29/3/2024 11:46

smarty, 22775, good post.
lots of unknowns of course but direction of travel, stated and implied, seems promising.
re. divi, i reckon a big driver for the sale is that they (ko and chums) want to offshore a wodge of cash away from kaz tax. so with sale proceeds they will take some divi and keep rest for development.
another driver may be that they do not have the expertise or maybe desire to deal with the shallows, given the multi-year history of stagnant/decreasing production. perhaps they want to switch all attention to the deeps.
you mention replacement production (i.e. to make up for the 1700bopd from shallow wells which they intend to sell) with reference to their ambitions to start oil exports which requires at least 70k bopd per month - i agree that implies they have some drilling success in the wings...perhaps under test currently. if they dont, it will be a huge gamble to sell the shallows cash cow. it will re-risk casp into a hopeful rather than proven producer. i hope they know what they are doing.

[xclusive2] 28/3/2024 20:19

IMO ;)There is bad news though. I wish the share price rise would have happened post tax year as too much stock sitting out the tax wrapper ! Cant have it all ways .

[xclusive2] 28/3/2024 19:46

Spangle,I believe run not over as it would've sold off today. Start of next week will see more upside

[xclusive2] 28/3/2024 19:45

Primary message, if they sell the shallows, their direction is that monies will be spent on NEW development assets where their expertise is greatest. Not sure where their expertise is greatest so what is that ? More shallows that need development ? Don't see that as why sell existing that need development ? doesn't make sense. More acreage with deep opportunity or deep and shallow ? a possibility . As posted, it could be Block 8. It makes sense to me as it's a producing field albeit minor currently but has 4 deep structures and soon to have a new licence. Why do this deal if the new drilling is unsuccessful ? They've drilled the wells and they'll know whether they've encountered oil on the way down to TD and why continue to acquire it if it's a failure. Don't believe they've tested yet as it would change the negotiation so hopefully we don't wait too long for licence approval. One thing I don't want to see is a windfall divi and cash extraction exercise, they have to replace with production.The licence upgrade on the BNG deeps is also interesting as they believe 803 completes requirements. The change in oil trading regulations is good news for Casper providing they can convert the deeps. I agree 100% on them focussing on 803 and A5. 802 flowing @ 700-900bopd before blockage and 803 1250m into a 3900m TD, maybe 4200m if first target uncommercial. Then there's A5, our best well that flowed at 3800 bopd for 25 days allegedly but now a new sidetrack could be completed this qtr and any success here is a company maker.They also state that they could start exporting oil which will give another boost to share price but need to see production above 70k on a monthly basis. If they do sell the shallows then this is a strange thing to say unless they have production to replace it with ? This leads back to B8 wells and maybe they're expecting a result on 803/A5. If they do succeed then it's onto 801/802/A7 and 6 remedial work as part of the appraisal process to book reserves.Then we have CE cash to hit the coffers in Q3 so hopefully no hiccups there especially as they've spent money readying the barge. Hopefully any signed contract would cover any costs incurred in the event of cancellation or delay but not so sure with Caspian.The multi-bagging upside is still in play and 24 looks to be a defining year for shareholders. No guarantees but you've got to be in it to win it or lose it !

[bluemango] 28/3/2024 18:30

...or, if you're a glass half full kind of guy ... at least staying around these levels as people realise rather more gains are very possible from here onwards.

[spangle93] 28/3/2024 18:11

Great run up to the close.

Have a good long weekend, everyone, just dreaming about....
...the almost certain fall on Tuesday morning, sigh ;-)

[maxim1999] 28/3/2024 13:23

Great price action today. Brilliant to see buyers coming in on weakness to take us back under to position territory . Sellers feeling that were wrong footed .

[xclusive2] 27/3/2024 13:40

There's going to be selling on the way up, profit takers and I've had enoughers. Needs new blood and the longer this little run continues, the more peeps will become aware. It wouldn't surprise me to see it trade into the 4-5p region but as we know, there'll be profit taking and probably a retest of support levels. The big move will come from the assets mentioned earlier and that's when it multibags .

[bsg] 27/3/2024 13:32

Or ... they find no buyer, continue with their constant failure of the deeps and back down to 2p.

[maxim1999] 27/3/2024 13:28

I think 5 p is the next level, hopefully this week. FOMO is beginning to kick in and it is all beginning to feel more positive .Imagine where it goes with some drilling success. It could get to 10 p on South Yelemes, or 155. Good news on A5, A6,A7,801,802 or 803 frankly could see it going parabolic / 20 p +.

[bloomberg2] 27/3/2024 10:57

Bit of 5s anyone?

[xclusive2] 27/3/2024 10:34

It's actually 10th on gainers list again today although not registered as yet ? The more it appears there the more interest from newbies. Some will be hot money, the Zak Mir TA boys but importantly there's an abundance of material news that could take us back to double figures, long overdue !

[lawson27] 27/3/2024 10:18

Could see it through 4 today, GLA

[xclusive2] 27/3/2024 08:38

The share price is very likely to trend north on anticipation of the key events over next 3-6 months. A5/803 & B8 are all hugely material as is MJF possible disposal. 3.5p ? , don't believe we're at this level for too much longer and hopefully any continued rise sees new investors joining the game .

[spangle93] 27/3/2024 08:33

Smarty -

Before you get into valuation, maybe worth a consideration of the quoted reserves.

In the last annual report to be published, the company noted "Despite the last external review of the Group's reserves being in 2016 [and dated end 2015], the Board considers their assessment as set out to be valid". Reserves at end 2022 were P1 14.3, and P2 25.5 because of the production deductions after the CPR.

First point is then that with production at around 1700 bopd, or 620k/year, it's going to take a long time for these P2 reserves to ever be realised. Remember, at the time GCA conducted its review, there was the intention to drill 10 consecutive producers on MJF, and to grow production to 4,000 bopd from 6 wells. How far did that get? :-( Did GCA model the water influx as it happens, how would that change their thoughts (It's all well and good saying "the company believes the volumes still to be valid ,but that's not independent, and they only published the executive letter of the CPR, so we don't know the assumptions for water production used).

So, if GCA were to review the field again, how much of the field's volumes would they rate as reserves, and moreover how much would they be compelled to rate as contingent based on CASP not actually having the intention to drill more wells.

Second point is that they quote gross reserves, whereas "Net Entitlement Reserves are the Company’s net economic entitlement under the PSC that governs the asset, i.e. Company’s share of cost oil and profit oil." This is 58.4%, unless it changed when the licence became international?

So I'd take a much more sanguine view of the underpinning volumes.

As for valuation, that's more Hiddendepth's manor. But as value in the ground is a proxy for NPV, it depends on rate of extraction and value earned on the oil. Maybe $5 for proved is OK, as it's in production, but how much above zero for the 2P with no realistic extraction plan? [Don't forget to subtract the 1P from the 2P if you're ascribing a $/bbl value specifically to that. ;-)