Infrastrata Share Discussion Threads

[bronislav] 28/4/2015 09:13

Island Magee will be sold off .my view is there is someone already lined up .we just need data saying it is suitable for gas storage and a nice earner for company .

[bobby.ifa] 27/4/2015 12:26

Dipped my toe in for 20,000 of these which took about 5 minutes to execute. Not a lot but I don't think I could get anymore unless I was prepared to pay a premium.

[howdlep] 27/4/2015 09:13

2 April 2015

InfraStrata* (INFA LN) – Gas storage sector newsflow

Buy CP 2.9p TP 36p



Key Points: There have been two pieces of newsflow lately in the UK gas storage space that pertain to InfraStrata and the company’s Islandmagee project in Northern Ireland. First is news that due to technical issues with some of the facility’s wells Centrica is shutting in 29% of storage capacity (c.1,000mcm) at its Rough facility in the North Sea. Second news that SSE has decided to mothball a third of the 18mcm/d of withdrawal capacity at its Hornsea facility in Yorkshire given the operating, maintenance and upgrading costs of the older parts of the facility compared to contemporary storage prices. At first glance these developments can look negative for UK storage and this perception may have been a contributory factor to the drift in the InfraStrata stock price in the past few days. There are several points we would make here as to why this does not apply to InfraStrata however and hence why the price fall is unjustified.



First both Rough and Hornsea are facilities that operate by taking in gas in the summer when it is cheaper and withdrawing this in the winter when it is dearer. As such the spread between summer and winter UK gas prices is the key driver of profitability. We know that this spread has fallen sharply from the highs of 2006/07 and this shutting in of capacity at Rough and Hornsea could be the result. It’s worth noting that both facilities are ageing and hence costs may be higher than for new facilities squeezing margins and possibly helping drive the shut-in.



Second InfraStrata’s Islandmagee facility is aimed at a completely different section of the market to Rough and Hornsea. The project is specifically designed to allow fast injection and withdrawal on a daily basis. This is helpful for the UK in that with the decline of the North Sea reliance is increasingly on pipeline and LNG imports. When supplies are squeezed these can take time to come through so fast acting storage is ideal to help in plugging this gap (where summer/winter storage has been marginalised). Islandmagee is well placed to profit here and we would expect the analogous Stublach facility in Cheshire (owned by GdF) to be experiencing solid demand since it began to come onstream in late 2014. Indeed were market conditions to warrant it Islandmagee could potentially increase its injection/withdrawal capabilities in the final facility design. As such the shut-ins at Hornsea and Rough are of little direct relevance to Islandmagee other than that they could draw attention to the UK gas storage sector and potentially persuade the government to provide more assistance which could have a positive spillover effect into InfraStrata’s section of the gas storage market.



Third and finally InfraStrata’s specific position in Northern Ireland makes it even more valuable from the point of view of providing fast response gas when supplies are squeezed. Both Northern Ireland and Eire get the majority of gas via export pipelines from the rest of the UK (complemented by some indigenous production). There is no LNG import capacity and all of the interconnectors run from Moffat in Scotland. Capacity at Moffat is limited and this could create even more acute supply constraints at times of relatively high demand going forward particularly as Northern Ireland and Eire’s reliance on renewables (and hence gas fired power to plug any gap) increases. As such it is not just Islandmagee’s general location in the UK but its specific location in Northern Ireland that gives value to the project’s fast cycle design as it allows the project to both support general short-term supply issues in mainland UK and the specific issues found in Northern Ireland and Eire.



InfraStrata is due to release its interim results on Tuesday 28 April.



Forecasts:



Jul 2015 Sales £0.25m, PBT (£1.09m), EPS (0.87p)

Jul 2016 Sales £0.25m, PBT (£1.14m), EPS (0.75p)



Valuation: Risked SOTP NAV of 36p/share (149p/share unrisked)



Conclusion: We remain with our positive stance on InfraStrata. As detailed above in our view the shut-ins at Hornsea and Rough do not imply pressure on the fast cycle section of the gas storage market that InfraStrata is aiming at. Indeed the continued progression of construction at Stublach supports a buoyant market here. We continue to expect newsflow from the test well on Islandmagee to spud in May followed by engineering work and hopefully FID in early 2016: this work programme is fully funded. There is also an exploration well planned on PL1/10 in Northern Ireland in October and another on P1918 in Dorset in early 2016. As such we are entering an increasingly busy period for InfraStrata with increasing material newsflow that could drive the share price. We have a Buy recommendation and 36p price target.



Analyst: Daniel Slater 020 7614 5947 [e-mail]



*Arden Partners acts as broker to this company

[howdlep] 27/4/2015 08:32

Update out tomorrow.

I am now looking towards MA200.


free stock charts from uk.advfn.com

[howdlep] 27/4/2015 08:26

InfraStrata makes solid progress towards drilling its first wells in Northern Ireland

Well worth reviewing the Oilbarrel article from 2 April:-


[...]


Apr 2, 2015


Gas storage in Northern Ireland


By Stewart Dalby

InfraStrata is an Aim-listed small cap oil explorer and gas storage company focused on the UK, where it operates four licences and has interests in several others. This year is an exciting one for the company because it has two wells planned, one on its Northern Ireland salt cavern gas storage project and another on its onshore Northern Ireland exploration licence which could be basin-making.

We have written before that its potential fast-acting salt cavern gas storage project in Northern Ireland has seemed like a bit of a Cinderella in the portfolio after the group diversified into more exciting exploration projects following the mothballing of a seasonal gas storage scheme in Dorset, Southern England.

The Islandmagee gas storage project in County Antrim, Northern Ireland, appeared to be left on the shelf following the pull-out of partner, BP Gas Marketing, last year to concentrate on other projects. To date InfraStrata together with partners have spent over £5 million advancing Islandmagee.

The project also looked stalled because funding (£4 million) was lacking to drill an important well to extract a salt core and further advance the project’s design. But the scheme started to move again in late 2014 when it was given a boost by the news of a €2.5 million (£1.9 million) matching grant from the EU towards the drilling of the Islandmagee-1 well, which is required to provide further data to understand the rock mechanics and composition of the salt to complete engineering design ahead of FID in 2016.

Since then InfraStrata has got a placing and subscription of 52,500,000 new ordinary shares away to raise £2.1 million which together with £400,000 received from a data release agreement provides funding to pay the other half of the well cost and meet management costs till the end of 2015. The well is planned for May.

This is a major strategic project. It will consist of seven salt caverns which, if and when built in five years’ time, will give it capacity of 16 billion cubic feet (500 million cubic metres) of gas. This is enough for one month’s supply for the whole island of Ireland and 60 days for Northern Ireland.

InfraStrata has been at pains to communicate with local community and environment groups as well as local newspapers and other media in all its projects. Comment has been made that Ireland is dependent on gas for around 60 per cent of electricity supply with 90 per cent of the island’s gas imported via a single pipeline from Scotland.

Security of supply is very much on people’s minds in Northern Ireland. The issue has been heightened by the recent news that Centrica, which controls Britain’s biggest storage site, Rough, has said a technical problem identified by a routine inspection could reduce supply capacity at the site by 30 per cent, potentially tightening supplies and fuelling sharp price gains. In these circumstances, sites like Islandmagee become ever more important. Salt cavern gas storage provides much-needed flexibility when compared to other storage methods. The facility will be able to switch from injection to withdrawal quickly to cater for short term spikes in demand such as a cold spell or a period of low wind generation which increases the load on gas fired generation.

The prospects for Islandmagee are good and it is a major project not only because it has a capex of £274 million. However, InfraStrata will not be in for the long haul. The company’s CFO Stewart McGarrity told Oilbarrel recently: “The company’s intention is to realise value for shareholders from the company’s interest in this project as soon as practicable”.

With the collapse of the oil price, exploration is perhaps not as beguiling as it was perceived to be, but InfraStrata has an exciting exploration well on the cards, also in Northern Ireland. On shore the company holds a 663 sq. km block in the central Larne-Lough Neagh Basin, which, said CEO Andrew Hindle has been “completely overlooked” by the industry, with just six wells drilled despite its potential to be an onshore extension of the prolific East Irish Sea Basin. There has been just one well on InfraStrata’s licence, drilled by Shell back in the 1971 without any seismic.

Indeed, lack of seismic has been a key reason for the basin’s neglect. A layer of basalt at the surface makes imaging difficult but InfraStrata has applied new technology to this problem, allowing it to create a model of the subsurface and identify previously unseen prospects.

One of these, the Woodburn-1 well which will be InfraStrata’s maiden exploration hole will be tested this year. It will be a £4 million well that will drill to 2,000 metres to target Triassic and Permian sandstones as well as additional potential in the Carboniferous. The well carries a P50 prospective resource of 40 million barrels (11 million barrels net to InfraStrata).

All the necessary regulatory approvals have now been granted to allow the company to drill the well at Woodburn, near Carrickfergus.
The ‘Consent to Drill’ approval from the Department of Enterprise Trade and Investment, follows a separate consent issued by the Northern Ireland Environment Agency (Water Management Unit (NIEA) which regulates the well in terms of surface water and groundwater impacts.
These approvals embody the previously stated commitment by InfraStrata that the exploration is conventional and will not now, or at any time in the future, involve any hydraulic fracturing (also known as ‘fracking̵7;).

The shares were trading at 2.88p last evening, well below the placing price of 4p. But then the trading climate for small cap oil and gas shares remain poor at the moment.

Again InfraStrata has been scrupulous in conferring with local press and interest groups. One oil and gas centred publication said: “ If oil and gas is encountered and successfully developed in County Antrim – following the relevant approvals – it would have a positive impact on the local and regional economy, with job creation and other economic benefits. Northern Ireland has a long tradition of engineering industry and indeed, the Harland Wolff shipyard has focused on the offshore energy sector in recent years”.

In Dorset, the company is operator in a 584 sq. km block near the giant Wytch Farm oilfield. This is an area that sees sporadic flurries of interest from industry, and rightly so. It seems the Basin could ultimately produce over 700 million barrels, of which 100 million could be in its licence.

There are two targets here: the offshore Colter prospect, which could host 50 million barrels in the Triassic and where a 1989 well drilled on the margins found a 10 metre oil column in the Sherwood Sandstone. “We believe there’s a significant structure updip of that,” said Hindle.

[howdlep] 23/4/2015 07:51

Target now the MA200 at circa 6.7p

[howdlep] 06/2/2015 16:35

Remind me Stig, what's your CCE target and what did CCE place at?

INFA BOD had to match the grant in a placing, so I am happy to have bought a few at that level.

[the stigologist] 06/2/2015 15:36

lol zero credibility

if it was worth 25p why place at 4p

con artists no wonder they went bust

[howdlep] 06/2/2015 15:34

VSA initiate coverage with 25p target or 6x current level

[the stigologist] 05/2/2015 20:38

Booth failed with Encore's gas storage effort Esmond-Forbes

His success was on the conventional oil and gas exploration front which is why I suspect INFA is interesting for him because they have some prospective licences with existing discoveries offshore near large proven oil/gas fields and some of these offshore prospects are drillable from onshore. He is a clever/lucky/successful guy who has been building his stake here for a while.

[guesswhosback] 05/2/2015 20:21

Yes, he's a bit clever and has the knowledge of storage. You may remember they drilled for gas storage just before the crash. That one did not come in but he has the experience. Not sure if Graham Dore is involved but thy are a good team. Reliable and honest.

[eswr] 05/2/2015 18:40

Yes, this is Alan booth of encore

[pugugly] 05/2/2015 15:54

Anyone able to advise on Mr Booth and why he could be a mover and shaker for this share.

Is he the Alan Booth of Encore ?

[guesswhosback] 05/2/2015 12:58

TS - I guess you have some history here. I cannot find very much about this share, they are very much under radar. Any feedback would be gratefully received :-)

[the stigologist] 05/2/2015 11:46

yes once he has filled his boots with low priced placings

[guesswhosback] 05/2/2015 11:33

Is anyone invested in this share? Looks like it could be a mover and a shaker with Mr Booth involved.

[pvpower] 27/10/2014 17:09

I just went to a presentation in Swanage by Infrastrata, as an interested local. (I hold no shares). Andrew the CEO was being ranted at by a self appointed anti fracking crusader, who had already made her mind up and had turned off her ears. Unfortunately her mouth kept going. The sort of ghastly ratbag that used to inhabit Greenham common. I was given a glossy leaflet outside by a mob that seemed to call themselves "saving Swanage" which contained a collection of distortions and ludicrous exaggerations about the California Quarry Exploration well. Unfortunately, some people believe them and are frightened by their lies and distortions. What exactly drives such people?

[deuchar] 16/9/2014 09:05

Cash flow all important

[deuchar] 16/9/2014 09:05

Good reply

[the stigologist] 16/9/2014 08:04

maybe it wasn't a good announcement then?

[deuchar] 16/9/2014 07:31

Good announcement but no price movement

[joan1234] 20/7/2014 08:18

InfraStrata The reservoirs are expected to hold about 40 million barrels of oil.
Today, 8:18 AM

[c2b] 27/2/2014 11:41

Strange? 34 trades 915k shares and all before 10.34, very unusual for this share. Anybody know why?

[megabear] 28/1/2014 17:35

Good find. Thanks C2B!