Eland Oil & Gas Share Discussion Threads

[dukedosh] 28/5/2014 21:37

Thanks Don, Yes, remember it well. Nice to hear from you again. Trust you are well and making good coin.

100p? Most doubtful imo. Reckon these are a nice buy at anything under 120p. Admittedly a slow start with unforeseen issues with the old infrastructure but very limited downside risk from here as the share price reflects problems past already. Upside from here I reckon is around the same sort of time frame as the old Addax (circa 5 year, 10 bagger), with same management team and same indigenous partner who both well know how to deal and operate in Nigeria. However, this share is not for the faint hearted nor impatience trader.

[don777] 28/5/2014 14:02

it's good to see Dukedosh here.

do you still remember we met last time at the CEO AGM?

look to buy in here this summer at 100P, do you think any chance here?

TIA

[dukedosh] 24/3/2014 13:19

Good volume too. Some nice big buys in there again. News due soon on who wins the OML blocks that are up for sale.

[plastow] 24/3/2014 12:55

Nice movment on the share price ;-)

[dukedosh] 21/3/2014 09:29

Eland Oil & Gas PLC (LON:ELA) had its price target upped by Canaccord Genuity from GBX 180 ($2.99) to GBX 190 ($3.16) in a research note issued to investors on Wednesday.

[mr angry] 14/3/2014 12:49

Henderson up to 21.77% now - quite a chunk

[dukedosh] 13/3/2014 10:47

Davy Research Note on Pioneer Tax Status

Eland Oil & Gas makes material tax progress

DAVY VIEW
Eland's statement that it has made significant progress in its efforts to become as tax efficient as possible further underpins the stock. The news means that apart from access to substantial physical reserves, these can also be monetised with maximum benefit for equity holders. Clearly, the news is positive for the stock.

Much improved tax status
We believe Eland's statement refers to the Pioneer tax status clause that is available to new venture companies in Nigeria. In this case, it applies to Elcrest – the indigenous company in which Eland holds a 49% stake through which it holds its interest in OML 40. While heretofore this was not a particularly well-known tax concession, several of Eland's peers have secured this concession and there is no reason why Eland should not also be included as a candidate. The tax allows for a very material reduction in the headline petroleum tax payable. It means that a tax liability set at 66% is reduced to an estimate of 2% of the tax liability that would have been payable over the five years from the start of the relief. In the case of Eland, we believe this will be a relatively small amount given the effect of capital allowances that would have been utilised if the tax concession had not been achieved.

High value implication
In value terms, the relief is obviously material. Our analysis of the group suggests that a valuation of 208p per share is justifiable. If the Pioneer tax status is modelled into the cash profile, we achieve a near-50% uplift in valuation terms. Obviously, the news is a good surprise and is positive for the stock.

[dukedosh] 13/3/2014 09:11

Excellent news release indeed this morning. Looks like Pioneer Tax status may well be granted which will be a massive boost to the bottom line over the new few years. This may well be the catalyst needed to fast track field development into production and for the company to grab another field if it can.

[plastow] 13/3/2014 08:38

More of this and I'll be happy the wick is being turned up.. Oil flow

[dukedosh] 11/3/2014 14:58

Very interested but with nothing interesting to add. No point in filling up the board with drivel and dross.

[thesloth2] 11/3/2014 13:11

Very quiet here. Nobody interested ??

2 massive Buys here today, 204k and 500k.

[thesloth2] 07/3/2014 15:16

Are those odd selling patterns ?
Multiples of 600, 380, 400 roughly.

Please can someone explain.
Thanks

Sloth

[dukedosh] 05/3/2014 17:51

May be all these Nigerian stocks are currently in correction mode and starting to re-rate upwards to reflect current values of their acreages, strong Brass River price, political risk the best for some time.

Henderson are buying into this Eland story big time. Their holding is now over 23%. Follow the money!

[mr angry] 05/3/2014 12:05

blimey i think i might have timed a purchase well for a change

[plastow] 05/3/2014 11:41

At long last some movement in the right direction :-D

[thesloth2] 05/3/2014 11:35

109p Breakout ?

Production commenced, New developments in sight, Henderson buying
and DAVY Valuation at 205p.

Looking good.

[mr angry] 05/3/2014 10:05

i guess it's been Henderson doing the buying recently

[dukedosh] 03/3/2014 10:50

Trading Volume has increased dramatically this last week or so. Very interesting. One could speculate (hope) that it might possibly be about the bids on the Shell blocks?

[mr angry] 03/3/2014 10:30

ha - at last a modicum of interest, it seems. Maybe Nigeria seen as a safe haven for oil supply - lol

[dukedosh] 06/2/2014 09:58

Davy Research Notes:

Eland Oil and Gas rating: OUTPERFORM Issued: 28/08/13

First oil production achieved

DAVY VIEW
The advent of first oil is a milestone for Eland. It demonstrates that the investment model is viable and that there is the operational capability to redevelop the reserves and resources that exist on OML 40. This is very good news for shareholders and we think the stock's performance will reflect this.

First oil from Opuama field
Eland has commenced production from two wells in the Opuama field located on OML 40 in the Niger Delta, Nigeria. The field was formerly part-owned and operated by Shell Petroleum and produced between 1975 and 2006 when a controlled shut-down was effected. The field is estimated to hold 54m barrels of recoverable 2P reserves which can be produced through an existing flow station and then onwards to the Shell terminal at Forcados.

Production expected to stabilise at 2,500 b/d
Combined production from the first two wells is expected to stabilise at around 2,500 barrels per day. There may be a short period of higher levels of output as the pressure built up in the two wells following their extended shut-in is released. The redevelopment of Opuama will then move to the start-up of additional drilling in the Opuama field with the first of these wells expected to begin in the second quarter of this year. Eland has stated that its medium-term target for production from OML 40 is 50,000 b/d.

Revenue and cash-flow expectations should be moderated in the current year by the start-up nature of the project. However, with current oil prices and first year operating costs of c. $12-15 per barrel, even early-stage cash-flow will be material. We estimate that for every 1m barrels of oil produced gross (an average of 2,750 barrels per day), the 'net back' to Eland will be operating cash-flow of $20-25m. Eland has a 49% stake in Elcrest the joint venture company which holds a 45% share in OML 40.

Excellent value upside
We value Eland at 205p per share to which it is currently trading at a substantial discount. However, while the market is currently exploration averse, leading to large differences between analysts' valuations and share prices, Eland is not an exploration company, which should result in a closer relationship between imputed value and the share price. The news of first oil, demonstrating that value can begin to be realised, should materially help to close the discount.

[rupert1] 06/2/2014 09:33

Looks like Richard Griffith doesn't read the broker forecasts. And he's a pretty shrewd investor. Hmm..... I'm still underwater here, but might follow his lead.

[dukedosh] 06/2/2014 08:53

Eland Oil & Gas PLC Price Target Raised to GBX 175 at Canaccord Genuity

Equities research analysts at Canaccord Genuity hoisted their price target on shares of Eland Oil & Gas PLC (LON:ELA) from GBX 165 ($2.71) to GBX 175 ($2.88) in a research note issued to investors on Wednesday, AR Network reports. The firm currently has a "buy" rating on the stock. Canaccord Genuity's target price would suggest a potential upside of 80.41% from the stock's previous close.

A number of other firms have also recently commented on ELA. Analysts at Northland Capital Partners reiterated a "buy" rating on shares of Eland Oil & Gas PLC in a research note to investors on Wednesday. They now have a GBX 161 ($2.65) price target on the stock.

[dukedosh] 05/2/2014 10:45

* At last this milestone has been achieved, albeit a tad overdue, but now production has been achieved this allows the $22mm loan to be drawn on to accelerate and fast track further E&D of the OML40 license.

* Another Addax in the making? With the same hunger, same management and same indigenous partners and the addition recently of the new Exploration Manager, Bert Dijksman (30 years experience mainly at Shell), I very much think so.

--------------------------------------------------------------------------------

Northland Capital Partners View on the City: Eland Oil & Gas

By Northland Capital

February 05 2014, 8:21am

OIL & GAS: ELAND OIL AND GAS (LON:ELA)

MILESTONE ACHIEVED: FIRST OIL PRODUCTION EXPECTED TO STABILISE AT 2.5K BOPD

Eland announced that is has achieved first oil production from the Opuama filed of licence OML40 onshore Nigeria.
Production from two previously shut-in wells is expected to stabilise at 2.5k bopd in line with previous expectations.
Initial well head pressure readings are positive and the company is encouraged by production rates from both the Opuama 1 single completion well and the Opuama 3 dual completion well. Management expects to release stabilised rates after the next seven to 10 days.
Oil will be delivered to Shell's Forcados export terminal via the recently re-commissioned flowstation and export pipeline that has capacity for up to 30k bopd.


NORTHLAND UK VIEW: A positive outcome following a frustrating year's efforts and shares should responds well to this news that goes some way to derisking the opportunity. We hope the team can push on from here to achieve its ambitious goals of ramping up production through development drilling. The Opuama field has a significant 54.2mmbbl reserve and significant momentum can be achieved next year, given a six well programme in place. It may be possible to drill most of these wells next year but it seems more likely that a more cautious approach will be adopted. The Depthsize rig is expected to be released from OPL2007 in Q1/Q214. Wells are expected to add IP of 3,000 bopd and hooked up to production facilities once drilled to allow the rapid onset of cashflow. We expect a 3k well could pay back in around 100 days. The $22m Standard Chartered debt facility in place will be available for drawdown 20 days after producing 2,000 bopd. We look forward to updating forecasts on announcement of stabilised rates together with guidance of this year's development drilling programme.

[...]

[zengas] 05/2/2014 08:22

At last, production finally commences.

Development drilling next to push towards 30,000 bopd gross at Opuama with further discoveries to develop.