Faroe Petroleum Share Discussion Threads

[ed 123] 18/8/2017 17:24

Good spot. It looks like the well permit notice is wrong. They are showing the proposed well in 34/4, whereas it should be in 33/9.

[rogerlin] 18/8/2017 16:37

The diagram with NPD permit announcement has the well in the wrong place I think, they have it in PL882 instead of PL881, if you look up the wellbore number it shows the site, right at the edge of the licence just north of Statfjord.

[ed 123] 18/8/2017 13:51

:-)

Goanna has a good postcode. IF they find something equivalent to Statfjord Nord (south-west of the Goanna prospect), then 200mmboe gross or c. 60mmboe net to Faroe would be very welcome. Also, being so close to a nearly exhausted field (c.20mmboe remaining reserves?) might make for a low cost development.

(It's so good not hearing any more mention of Barents!)

Edit:- There's a small oil discovery to the north of Goanna, made by Suncor in 2010 and still held (undeveloped) by Suncor (afaiaa). Anything at Goanna might bring the Suncor discovery into a development?

The big field in the area is Snorre (c. 1.6 billion boe recoverable). Maybe 5km away from the Goanna well at its closest?

[rogerlin] 18/8/2017 13:18

Looks like it's Goanna after all. The pre-lays can be done well in advance, and so maybe Deepsea Bergen will go on to Brasse after Goanna?

[ed 123] 18/8/2017 09:55

Ta, Rogerlin.

Yes, it looks like preparation for the second Brasse appraisal. No consent yet from Oljedirektoratet.

We may a drill or drop decision on Brasse extension when Faroe notify about this return?

[rogerlin] 18/8/2017 07:35

The Siem Opal seems to be pre-laying at Brasse.

[rogerlin] 17/8/2017 08:35

Tugs listed to move the Deepsea Bergen and so Statoil seem to be finishing present well, have to see where it goes to but still no evidence of any permit for Goanna as far as I can see.

[freddie ferret] 11/8/2017 15:13

Interesting the way these small oilers vary in their share price movements. Angus and UKOG have been strong. Hurricane, PVR and SOU weak over the last few months. FPM all over the place.

[ed 123] 09/8/2017 16:40

Well that was a perky close after a very quiet day. Half a million shares traded in the last 10 minutes? Why the sudden interest? Of course, we'll never know.

[wbodger] 08/8/2017 18:02

Licence 881 is adjacent to Statoil's Statfjord fields, and close to Snorre/Vigdis (check out the Interactive Map, Block 33/9). It's likely the geology continues the UK side of the median but I haven't checked. A couple of wells have been sunk in the PL881 acreage, dry with oil shows. Odd that it has not been drilled more extensively with producing fields all around.

This has a good summary of Wellesley, and their CEO:
hxxps://www.bluewaterenergy.com/news/blue-water-energy-announce-250m-commitment-to-wellesley-petroleum-and-appointment-of-chris-elliot-as-ceo

[rogerlin] 07/8/2017 20:32

Still hoping that Goanna might be drilled by Deepsea Bergen after its current drill for Statoil, but no sign of any drilling permit as far as I can see.

[ed 123] 07/8/2017 09:07

Early doors, it's the same as last week: Some buying interest but no big holdings statements.

Holding and waiting.

[bountyhunter] 05/8/2017 12:03

Oli12 - I agree with you that a fair price for Faroe would be well in excess of 110p however having seen Delek in action I know that if they bid here they will go as low as they think they can get away with rather than offering what is fair or reasonable.
The difference here vs Ithaca is that I don't believe that the Faroe BoD would accept an unreasonable offer.

[oli12] 05/8/2017 08:07

Ed, That's a great balanced asssessment you have provided.
Despite the market holding management here in high esteem you could argue the story so far has been similar to many of the small cap oilers - several placings diluting PIs to create value - however that's how this game goes.
Faroe is one of the better run oilers out there - hopefully Delek agree.

[ed 123] 04/8/2017 21:01

We need to view the whole situation and not just the good bits.

When the Norwegian tax losses expire, Faroe will only keep 22% of its pre-tax profits.

Also, it has quite a lot of tail end production, so decommissioning costs will be significant. Also, production will suffer natural tail off, so the current 15,000 boe/d either falls or Faroe needs to spend more on new wells to drain the last bits.

The £100 million in cash? It will cover Faroe's share of the Njord facility update and other capital commitments.

Outlook for the oil price is not good. Stuck in the $45-55 range for the foreseeable?

Finally , there needs to be a good gain by the acquirer or it's not worth the cost and trouble of taking over Faroe.

£2 would be brilliant and, if it happens, I'll come back here and grovel. The shares are trading in the market at about 86p. My guess, fwiw, Delek might pay a 30% premium. That would put a takeover offer at 112p. I'd see that as being fair. Anything above that would be a bonus.

As ever, it's the institutional holders that will decide it. The IPO was in 2003 at 103.5p, followed by a number of placings over the years. It's not been a good investment but nor has it been bad (in the context of all small oil companies). Will management be given longer to test their exploration prospects (which may include something big - eg. Pabow?) or will a couple of the big holders want to cash in their chips?

I feel (but don't know) that there must have been some discussions, at least over Delek's intentions when it bought KNOC's shares. A takeover offer is by no means certain. It's possible that Delek will be a supportive shareholder at Faroe for years to come. Only time will tell.

[oli12] 04/8/2017 20:30

Bounty hunter I would expect significantly more than £1.10. If we take £1.10 that's a market cap of just over £400m for a company with production of 15,000 bopd currently, more than £100m in cash, great acreage, some significant discoveries and the potential to produce 50,000 bopd within 4 years.

Delek paid £517m for Ithaca however it had debt of around £500m...people said they stole Ithaca for peanuts... Ithacas production was just ramping up at the time of the takeover however I expect to see nearer £2 for Faroe based on this.

[bountyhunter] 04/8/2017 13:39

Thanks WB, so they would most likely want to see a reasonable premium on their 95p average to justify their overall investment if they were to sell to Delek. I wouldn't like to see this go for anything less than 110p myself although I've not done any calculations to back that up.

[wbodger] 04/8/2017 13:24

Schroders have had a notifiable holding since July 2015, when they had 10.35 million. They acquired it after the previous placement, which was at £1.20 before the oil price crash, so they might have paid up to £1.10/share.

It looks as if they took another 2.5 million shares in the July 2016 placement at 70 pence/share to keep their percentage around 3.6%.

If Schroders have been buying in the market since July 2016 (probably most active recently) between .75 and current sp, they might have paid 80 pence average. They have added 5.7 million shares.

The RNS declares they have 18.6 million shares, so I estimate (dyor) their price per share must now be around 95 pence.

If this Holdings RNS is the one we've been waiting for it is neutral, imo. 'Schroders adding' is not much different to 'Delek adding'. The vast majority of shares are in insti hands, and Schroders will have the holding 'for sale'.

[bountyhunter] 04/8/2017 12:20

guess I'm a bit sensitive re Delek after they took my IAE shares for less than I felt they were worth post Stella startup, they tried to scare holders into selling up by saying they could be left with unmarketable shares which off course they compulsarily purchased at the offer price in the end as always seems to happen with takeovers; hope this isn't going to be an action replay
:)

[ed 123] 04/8/2017 11:52

Agree, Bountyhunter. :-)

[bountyhunter] 04/8/2017 11:42

Perhaps I should have phrased that more precisely re the asset management company holding - the point is neither of us know whether they have had any discussions with Delek at all. You cannot rule that possibility out. Any institutional investors increasing their holdings are worth keeping an eye on given Delek's history with Ithaca in getting the iis on board to support their low ball offer there.

[ed 123] 04/8/2017 10:44

It doesn't matter who they are buying for.

Two Schroder holders:-

(1) Schroder and Co ltd is a global asset management company. I can't see it being part of a concert party with Delek. It may, though, one day have to make a decision.

(2) The North America unit is said to operate 487 discretionary accounts. So, the beneficial owners of the Faroe shares won't have had any input into the decision.

Re: timing. Schroders informed Faroe and Faroe informed the market - both promptly. That's how it should be. But, who sold and bought the millions of shares traded several days ago?

The wait goes on.

[bountyhunter] 04/8/2017 07:56

Schroders now above 5%
I wonder who they might be buying for

[bountyhunter] 03/8/2017 20:46

Oli12 - you mean the Faroe BoD are not going to just roll over! ;-)