Caza Oil & Gas Share Discussion Threads

[mark10101] 28/10/2015 20:39

Crazy market, this RNS took a company drilling the eagle ford to £100m MCAP????

[jotoha2] 28/10/2015 17:53

There is some talk that we are close to a deal , but very punitive for current holders , not long to go .

[andrea152] 28/10/2015 15:07

And yet they had plenty of chance to do that in the Summer of 2014, when the placing was done at 18p/share. If their NOMAD, Cenkos , cud have been bothered to raise the $45m at that point, instead of only £5m, Apollo could have been paid off & we wud hav been relatively OK now.

[shawzie] 28/10/2015 13:45

Like many other companies, CAZA has come unstuck by raising external debt rather than tapping cash from shareholders.

[andrea152] 28/10/2015 12:54

Caza BOD either hav to recapitalise this to repay the debt (via a huge share placing or rights issue), sell the assets, or just let it fold. Given that management don't hav any other jobs to go to, I suspect it will be the first option.

[1628386] 28/10/2015 11:12

Looks like it's going to the wire...

[pavey ark] 28/10/2015 09:21

Currently on holiday but obviously looking in every day.
As I said before there are many possible scenarios and that would be the case if we had all the facts and details so given that we don't have anything like all the facts speculation is futile ( doesn't stop us trying though and I have run through many possible outcomes but still don't know where we are going)
The management do own 11% of the company so it is reasonable to imagine they in there fighting.
My own view,based on nothing other than hunch and guesswork, is that management have tried to retain more than is reasonable/practical perhaps bringing a change of heart to Apollo.
The mood at Apollo seems to have changed in the past three months from highly supportive to where we are now (?).
Admittedly the fall in the oil price from Q2 to Q3 may have precipitated the change and it is worth remembering the Caza were quite (very?) confident of prospects with oil at $60.
A return to much over $50 would put a different complexion on things.( but it would have to be very soon)

On the wider theme of the oil price I cannot see how the Saudi plan can possibly cut US tight oil production.
All that has happened is that these producers have become more efficient and whither it is the likes of Caza or much bigger conglomerates the minute oil goes over $60 the taps are turned on.
If oil doesn't go over $60 the Saudis are in bother !

Edit: not trying to save a few bob here, my subscription has expired and I'll renew when I get back.

[buffythebuffoon] 25/10/2015 21:09

The portfolio will still be around, but the company may not.

Buffy

[jotoha2] 25/10/2015 19:30

Just love their mission statement .........We are diverse and balanced , our portfolio is built to last . Let's hope so for all the pi who have followed the spin.

[gkp heros] 23/10/2015 17:44

Selling at 7p and all 2.5 million was a wise move I could of held for a zero return. Sorry for anyone stuck in here now

[bustedflush2] 23/10/2015 15:39

BUST very very soon.

[sleveen] 22/10/2015 13:30

Might be worth taking a look at FOG, just had good news this morning re second drilling for shale gas exploration. Close to some infrastructure.

Free carried for about $60m drilling by two large oil companies farming in to licences in Australia.

Has about $11m in CASH no debt.


DYOR.

[micronesiac] 19/10/2015 15:59

Results due in 4 weeks if I'm not mistaken. I'm the same Bb, write off but also interested to see what happens. Lots of speculation as always, OPEC meeting in December, Saudis bullying everyone else but also hurting themselves, Iran talking up 500 to 1m daily production and then Russia....oh Vlad....what are you thinking?

[balbains324] 19/10/2015 13:39

Should be due 3rd quarter results soon. Have pretty much written this one off but one just hopes that the management can pull something off.

[gkp heros] 19/10/2015 10:32

Looks like LGO is catching up with us

[ih_538282] 16/10/2015 11:55

@ Buffy and Cash.
‘Love in blind.’ The fantasist like the romanticist would fail to see the picture, I agree. However, the men in suits would have been looking at it with a magnifying glass. They would know the market and their team would know the basics of economics (greater supply less demand, economies of scale and so on).
And just in case the fantasist woke up from their buzz, incentives such as hedges would soon put them back to sleep. Did not realise that advertising serves to stimulate desire? To reduce critical thinking and structure a self which depends on material consumption for satisfaction?
I therefore disagree with you on your point. My point being that the birth of this event was not instantaneous rather, signs of labour were evident from the very day of conception.

[sleveen] 16/10/2015 11:44

Spot on analysis.

[1628386] 16/10/2015 11:13

Sleveen

A great find! This does explain a few things. We'd been arguing for ages that 'Asset Valuations' shouldn't be used as a basis to invest in a company on its own as it's the price a buyer is willing to pay which is the important factor. Market forces are once again at play and prices are now dislocated from the fundamentals.

This actually spells more trouble for CAZA; aside from selling itself, they are looking at a refinance. The Financier will be looking to be fully secured against CAZA's asset base, but the valuation will (for security purposes) be based on current market valuation not what's on the balance sheet.

The higher the loan to value the poorer their terms offered (if any are offered at all).

[pavey ark] 16/10/2015 09:31

Normally of some interest, but greatly overshadowed at the moment, is the recent production figures (August).
Caza's production is holding up well and little tweaks here and there appear to be producing very nice up turns in some wells.
I suppose any work done on a well is at a much lower cost than before and the resulting increase can be significant, certainly in percentage terms.
It looks to me that the tight oil,permian producers have been caught in the crossfire and I simply cannot see how the oil production from this and other parts of the US can be stopped or even damaged,long term.
If small,tight oil producers fail they will simply be taken over by larger companies so increasing economy of scale and further reducing cost.
Given the speed that production can be boosted/created and the certainty of success, the US could ramp production almost at will.
One final point is that the recent wells drilled since WC4 (broadcaster,Igloo,MR)
have, or will, produce over 125k in the first year. Last December MF said that a rule of thumb for a "Caza" well was 75K in the first year.(new drilling techniques used since then)
If well costs averaged $7.5m and have fallen to c. $5m and we divide the $7.5m by 75k we get $100 but if we use the recent figures of $5m and divide by 125k we get $40.

As I said, this is all meaningless if Caza can't broker a decent deal but it does reinforce my view that the Saudis can't be going after the permian producer as there are much easier targets but that doesn't help Caza.

[sleveen] 16/10/2015 07:08

1628

Not sure a sale of itself or assets is feasible at least not for a significant sum:

Some other drillers are letting valuable land positions in one of the highest yielding basins in the United States go for less money than they had hoped. Linn Energy sold high-yield Permian positions (worth $281 million). W&T Offshore had to sell off Permian assets for which, according to Bloomberg, it received ‘less than a fourth what was paid for similar land in another deal just months ago’ ($376 million) in order to reinforce its balance sheet.

[1628386] 15/10/2015 22:41

I still maintain that CAZA's Achilles heel was their poor finance negotiations and that same handicap looks to be their death knell.

Firstly, the Apollo deal was very onerous .. Yes Apollo lent $50m but boy did they have their pound of flesh (big initial fees on each drawdown, 25% royalties on net profits, 12% APR and capped off with a 1st charge on all assets!)

Secondly, they had a chance to refinance in June 2014 when they raised the $10m equity at 18p per share. They were riding high on WC & GR and published that multi rig drill plan which would have taken them to the holy grail of self financing.

Unfortunately, they missed the refinance boat, POO collapsed and that was that.

Even now, they are demonstrating that their finance negotiations are poor. IMO they should be selling themselves to a larger outfit for a premium to the current share price not diluting current equity out of sight just to stay on life support.

Having said all of that.... Can they pull a rabbit out of the hat?

[buffythebuffoon] 15/10/2015 16:27

Nobody foresaw the precipitous decline in the OP. In fact, can you see the logic of the Saudi's strategy? The oil and gas is still there. If one company doesn't drill and produce, another will. It has cost the Saudis a lot of money. Unless it really is different this time, what will it have solved. Of course, it may not be just the Saudis who have supported this OP drop.

Anyway, what I meant to say was, CAZA couldn't have foreseen this. Apollo lent money to a small company and the company were doing very well. Of course, putting on the retrospecs does make things look different to those who have them.

Take the money or don't drill fast enough to gain critical mass was the option.

Buffy

[cashandcard] 15/10/2015 16:24

Perhaps so if Caza was an exception, but its not. At the time money was granted, commodity prices were much higher and no one foresaw the large oversupply of shale and resulting collapse of crude due to that oversupply. The majority of the industry did not see it - only BP really got to maximise its asset values, but they were being sold off from 2010 (before the OP collapse) to settle GOM liabilities. Every other oil co has had to write down the value of some of their assets.

Cash