Geopark Share Discussion Threads

[this_is_me] 31/5/2013 10:48

If the stockmarket was completely rational there would be less chance of making lots of money! I try to buy when a share irrationally low and just wait until it goes up, often taking the dividends while waiting. We are not going to see dividends for a while here due to the high capital expenditure.

[tyler90] 31/5/2013 09:24

No good entering GPK in the competition. This will fly but no signs of it happening in June; this is so undervalued it is getting silly.

[flyingbull] 31/5/2013 08:54

The June oil stock competition is now on.....deadline for entries is midnight on Sunday 2 June. Good luck! fb

[nielsc] 31/5/2013 08:40

Patience with this one as always.

Cheers,
Niels

[this_is_me] 31/5/2013 07:29

That looks good for the rest of the year. The company is seriously undervalued.

[pre] 15/5/2013 15:58

Excellent news here today...earnings enhancing acquisition adding circ. 30% plus 7 new licenses...be very interesting to see the upward revision of broker notes as this look very undervalued now imo...thanks for the detailed analysis Zengas and others..very informative:-)

[sailing john] 15/5/2013 15:46

Zen and TGG - excellent research and thanks for sharing.

SJ

[zengas] 15/5/2013 15:23

We seem to have a 10% interest in a 2nd field today from this sale by Panoro was to concentrate on its select and certain African assets and reduce it's debt. A bit more meat here and asset description. They also have further Brazilian assets for divestment.

15th May 2013

Panoro Energy ASA's (the "Company") wholly-owned subsidiary Panoro Energy do Brasil Ltda has on 14 May 2013 entered into a sales and purchase agreement (SPA) to divest its Brazilian subsidiary Rio das Contas to GeoPark Brasil Ltda for a total consideration of USD 140 million (the "Transaction") plus contingent earn-out. Rio das Contas is the direct beneficial owner of 10% of the BCAM-40 Block in the Camamu-Almada basin offshore Brazil, which includes the Manati and Camarao Norte fields where Panoro Energy holds a 10% interest. Cash proceeds from the transaction will be used to redeem Panoro Energy's outstanding bond loans (ISIN NO 001 059097.9 and NO 001 059096.1) which will leave the Company debt free.

The purchase consideration for the shares in Rio das Contas comprises an initial payment of USD 140 million, adjusted by working capital, with effective date of the transaction April 30, 2013 to be paid in cash upon closing. In addition, a contingent earn-out will be paid in cash over the 5-year period from January 1, 2013 to December 31, 2017. The annual earn-out payments will equal 45 % of the annual net cash flow exceeding USD 25 million. The total earn-out is capped at USD 20 million.

Based on a recent report submitted by Gaffney, Cline & Associates the Manati asset includes 1P reserves net to Panoro of 10.7 million barrels of oil equivalents (mmboe), 2P reserves of 11.4 mmboe, and 3P reserves of 13.5 mmboe. This is an increase of 0.9 mmboe in 1P from the Annual Statement of Reserves submitted earlier this year and reflects new reservoir pressure data not considered in the Gaffney Cline & Associates report on which the filed Annual Statement of Reserves was based. Remaining reserves in Panoro Energy after closing of the Transaction are currently estimated at 1P of 0.5 mmboe, 2P of 0.8 mmboe and 3P of 1.1 mmboe. After this Transaction Panoro Energy's new 2C Contingent Resources total 121.5 million boe.

The Transaction is in line with the priority of the Board of Directors of Panoro Energy to strengthen the financial position through asset divestments. Subsequent to the Transaction, the Company's only remaining asset in Brazil will be the interest in the BS-3 assets which Panoro Energy has previously announced that it will be seeking partners for or alternatively seek to divest. Panoro Energy has also disclosed that sales processes are ongoing for its assets in West Africa, with the notable exception of its interest in the Dussafu license in Gabon. This work continues unabated.

The closing of the Transaction will leave the Company debt free and other potential asset divestments will be expected to result in the Company holding a significant net cash position which will provide substantial flexibility for the future.



We appear to have gained a 10% interest in a second adjacent field 'Camarao Norte' (stated as develovement) where as the Manati field is stated as production.

Development Asset - Camarao Norte
The field was discovered in 2001, 9 km south of the Manati field and extends to the south into the BM-CAL-4 block which is 100% owned by El Paso.
The field reservoirs of the Camarão Norte are of Sergi sandstones (same as the Manati field) and the Company estimates that these reservoirs hold 12.4 MMBOE of recoverable hydrocarbons (oil and gas) inside the block. The Camarão Norte field is a ring fenced area of 17 square km in 40 meters of water depth. The Company's share (10%) of the estimated recoverable oil and gas adds to 1.24 MMBOE.

In September 2007, El Paso declared commerciality of the Camarão field in the BM-CAL-4 block.. According to the Brazilian Petroleum Law, the Camarão and the Camarão Norte parts of the field have to be unitized into a common development plan to be proposed to ANP. The unitization discussions are ongoing.


Gas price recieved circa $7.85 per mcf.

Panoro presentation

[thegreatgeraldo] 15/5/2013 14:50

Update from Parex yesterday (after market close)......

Tua (Block LLA-34, WI 45%): The Tua-4 and Tua-5 wells were drilled as Guadalupe delineation wells outside of the 2012 GLJ Report Possible ("3P") mapped area. On March 25, 2013, Tua-5 began producing at a rate of approximately 1,000 bopd of 16° API oil from the Guadalupe Formation. Tua-4 was drilled and cased and is appraising the southern flank of the Guadalupe structure and is expected to be producing during the second quarter of 2013. We anticipate that additional delineation drilling will be required to find and test the limits of the field;

Tarotaro (Block LLA-34, WI 45%): The Tarotaro-1 exploration well is targeted to appraise a structure directly north-east of the Tua field. The well was spud May 5, 2013 and is currently drilling towards a target depth of approximately 11,000 feet;

WI refers to Parex, but GPK also has 45%

Next up -
Tarotaro-2 or Tua-6 LLA-34 Dependant on exploration results

[zengas] 15/5/2013 14:41

hash your correct and P1 reserves carry a higher valuation than P2.

[thegreatgeraldo] 15/5/2013 12:46

That did strike me as a bit odd, but it seems it is a high quality reservoir,
apparently the field produces from just 6 wells, that's not far short of 40mmscfd/well, so possibly there's not much of a grey area?

[hashertu] 15/5/2013 11:16

Can someone please clarify what has been written about the Manati reserves.
P1 (1P?) = 10mmboe
P2 = 10.7mmboe

P2 includes P1 does it not, so the amount of gas in the probable category is only 0.7mmboe.

Is this correct?

[thegreatgeraldo] 15/5/2013 10:00

GPK is cheap but the liquidity and tightly held small number of shares in issue imo is hiding this companies true value.

It's chicken & egg - instis don't bother because they can't get a decent holding & the company doesn't want to issue stock because they believe it's undervalued.

[zengas] 15/5/2013 09:55

Last year at the time of the acquisitions, I expected that they could make more.
This is the 3rd significant acquisition in 14 months.
The first two added 2800 bopd + blocks and reserves for $105m.
This one adds 4140 boepd and 10 mmboe P1 reserves for $140m.

From their recent figures this would put them on circa 18,500+ boepd (10,150 bopd oil). Revenues should be running now at circa $350m/year.

They have an extensive drilling programme including new discoveries development. If they were to add a further 7k boepd of production growth it should take them into the $500m revenue range - ie major critical mass.


The shares in issue are 43.5m @ £5.8 = m/cap of £239.25m.

The $300m/£195m bond doesn't repay until 2020 = 7 years away.

I still believe that they will grow production internally along with reserves and still make additional acquisitions at a similar pace. They now also have really extensive exploration acerage.

No reason why this can't become a £1b+ company at this rate and a £20+ target. (£20 = £870m m/cap and this company has not diluted via share issues).

Look at Gran Tierra at £1b+ or Amersiur which touched over £600m m/cap on less revenue/production and reserves. GPK is cheap but the liquidity and tightly held small number of shares in issue imo is hiding this companies true value.

[thegreatgeraldo] 15/5/2013 08:58

I do wish companies could get their statements correct first time around!! Clearly the field produces 6mmscMd, not 6mmscfd ;-#)) Gas sold at a touch over $5mcf. Wonder what the scope is for i) increasing that & ii) adding reserves

[zengas] 15/5/2013 08:29

Looks like a very good deal.

Revenues on 11,276 boepd for 2012 was $250m.

Production in March 2013 had exceeded 14,500 boepd (70% oil = 10,150 bopd).

New acquisition adds 4,140 boepd (Q1 2013) = 18,500+ boepd.
Also adds new revenue of circa $45.9m.

Revenues should be running at circa $30m+/month or $360m/year.

Reserves just shy of 68 mmboe P2.

New discoveries made Q1.

Company is attaining critical mass and could make major step change in growth.

[this_is_me] 15/5/2013 07:27

That looks like a great deal, huge increase in earnings for a very modest cost.

[thegreatgeraldo] 25/4/2013 16:30

sailing john
25 Apr'13 - 14:28 - 775 of 775

Large trade £1m at 560p
Seller clearing
Or buyer?

..Both? Given this stock's liquidity, it would be a brave MM to take that much stock onto their books!

[sailing john] 25/4/2013 14:28

Large trade £1m at 560p
Seller clearing
Or buyer?
I'm very long so I'm going for Director buy as they have bought on weakness before at this price. We shall see

BTW - sorry to disturb - just keeping a little life in our thread

Oh - And we have started a 21 well drilling campaign in Tierra Del Fuego. The best bit is that our partner 50/40% is ENAP - Chilean State Oil Company - nice to keep in with the government!

SJ

[tyler90] 12/4/2013 09:06

Am I seeing things? Is that a transaction of over £5m?

[thegreatgeraldo] 11/4/2013 23:43

Cheers Zengas, from the same report news of Tua-5, (GPK 45%)

"The Tua-5 well was drilled as a Guadalupe delineation well downdip to the northwest on the Tua discovery and is located outside of the 2012 GLJ Report Possible ("3P") mapped area. On March 25, 2013, Tua-5 began producing at a rate of approximately 900 bopd of 16° API oil from the Guadalupe Formation with approximately 1 percent water-cut. Tua-4 is currently drilling at a depth of approximately 9,500 feet and is expected to appraise the southern flank of the Guadalupe structure."

[zengas] 11/4/2013 23:15

Some more drilling success from the Bandola well 10% to GeoPark.

"ZENGAS 19 Mar'13 - 15:17 - 758 of 769
This from Parex a few days ago -
Bandola well on LLA32 cased and ready to test (10%).
Llanita well - mobilizing rig".
=======================

From Parex 3 days ago on the 8/4/2013.

"The Bandola-1 exploration well was drilling during Q1 2013. The well was flow tested from the Mirador Formation over a 9 hour period at an average rate of 3,094 bopd. The well was produced under natural flowing conditions with a wellhead pressure of 64 psi and a total of 1,160 barrels of 29 degrees API oil were recovered during the test.
Parex expects the Bandola-1 well to start production during April 2013;

The Llanita-1 exploration well was drilled to its target depth of approximately 11,100 feet. After analyzing the well logs, Parex elected not to participate in casing operations or further evaluation of the well".

[nielsc] 11/4/2013 23:01

Comment from IC.



Cheers,
Niels