Iofina Share Discussion Threads

[sefton1] 13/11/2014 10:44

Thanks superg1

[superg1] 13/11/2014 10:14

Just for the record

'The Company has secured the sites for the outtake water depot, multiple truck distribution terminals and potential waste water disposal sites in Montana. These terminals will have the ability to fill and receive multiple trucks simultaneously'

I have and a few others took the time to discuss the water disposal side at the various meetings.

The water supply side has more aspects to it than most realise, but going back to the obvious point. If a company is supplying water to frac a well, they also tend to pick up the disposal contract. The higher the volumes of water you have access to, the more disposal contracts you will gain.

[superg1] 13/11/2014 10:08

Heart your the one twitching as any water JV with a large wedge of cash is very damaging for a bear.

The details of the last one turned down by IOF are available, if you know where to look.

Some forget water disposal may feature too, as for every supply contract a disposal contract is gained. IOF mentioned disposal too.

It's not necessarily about the number of wells available to frac it can be about companies like Halliburton not having enough water supply to meet potential contracts.

Under US law you can't create contracts for something you can't supply, you need the supply first. That's why water permits talk of letters of intent, which are then converted to contracts post permit awarded.

Some depots are just not viable to use for big contracts, as they simply aren't big enough in terms of water filling points.

[superg1] 13/11/2014 10:00

Good old MM3

Yes it has been mentioned a few times.

The key point being the SWDs existed long before the Mississippi boom arrived in Oklahoma.

Oklahoma pre this current boom is the second largest state in the US for produced brine disposal. The number 1 is Texas.

In fact I believe the two states cover more than half of all US produced brine, I'll check.

So if the fraccing stopped overnight then great and the disruption IOF have seen would evaporate, but there would be more brine around than pre the frac interest.

The last official figure I found for Oklahoma was 2007 which showed 2.1 billion barrels of brine going down wells per year. With all this recent drilling it should be quite a bit higher now.

The Mississippi play in OK has however attracted attention due to the lower cost wells. With the high water cut it has provided enough produced water to use for fraccing.

The highest concentration of drilling has been in Woods county which is where IOF plants are.

Some seem to have a strange perception that fraccing suspended would be a bad thing, when fraccing has been the problem.

Long term more drilling just identifies more sites.

IO2 was chosen as the first location well before the boom started.


My thoughts if I was choosing sites would be to target the best returns. That is not an easy task while drilling is in play as a 300ppm site may turn into a 100ppm site once all drilling is complete as you can't forecast whether additional wells will increase the ppm or lower it.

So imo best to wait for any particular SWD to be at it's limit with little frac disruption and then you will know the bpd and ppm.

Wells in the area can be very high ppm and a stone's throw way they can be zero.

So it's the fraccing that has caused all the short term problems, but long term it increases the number of lucrative sites, and the iodine resource overall.

[heartwell] 13/11/2014 09:47

Plan A not working for you Bankys.
Plan B Stena will beat you to it.

[sefton1] 13/11/2014 09:37

superg1, why don't you delete all those flags from the header. They serve absolutely no purpose and it just means you have to scroll down further to reach the posts and fewer are displayed

[wizard2020] 13/11/2014 09:15

Just back after a 3 week trip with no wifi! To save me trawling through the posts is there any view on the likely effects of Brent etc pricing on fracking activity?

[monkeymagic3] 13/11/2014 08:22

DBEYR would more appropriate.

[mister big] 13/11/2014 08:01

You should buy - WTF!

[monkeymagic3] 13/11/2014 07:43

Where can I buy shares in the acronym "lol"?

[mister big] 13/11/2014 07:32

Yes , I worked for a number of years at Berkshire and a huge fan.
A five dollar bill with warren and Charlie's signature sits above my desk .
The drop is on light volume , been busy but I might pay a bit of attention to IOF at 38p!!
Lol

[crosseyed] 12/11/2014 23:29

Monty Panesar,

Regarding Iodine inventories, by which I presume you refer to inventories of raw iodine, my model which incorporates the calculation of monthly inventory levels for raw iodine, derivatives work-in-progress, and finished goods, and assuming total IOsorb production for 2014 of 336 mT (midway in the guidance range of 325-350 mT) plus a further 60 mT from re-cycling (5 mT per month), indicates that raw material inventories could remain quite steady finishing the year at 80 mT (I have estimated start of year at 88 mT). That implies iodine used for derivatives of 342 mT and a further raw iodine sales of 60 mT (some raw sales were indicated in RNSs earlier in the year).

The production schedule I use is adjusted to replicate as closely as possible the known figures from IOF sources though obviously involves quite a lot of guesswork.

I would think, with most of IOsorb production going into derivatives, that IOF's revenues are almost insensitive to the market price of iodine at the moment since derivatives generate the bulk of revenues. That would change should the volume of raw sales be increased, though by then the market price might have improved.

c

[bocker01] 12/11/2014 23:20

Well having said that.....

[arlington chetwynd talbot] 12/11/2014 22:21

"I'm amazed this has gone below 40p."

I'm not.

[woodpeckers] 12/11/2014 21:40

bobby, couldn't agree more.

I'm amazed this has gone below 40p.

We have suffered the punishment heavily meted out to AIM stocks which don't achieve targets. There can surely only be upside from here with nothing presently priced in for all the good news that is highly likely to come in the next couple of weeks. It's not as though people will have to wait for months for confirmation!

Can only agree that these few sells must be 'forced' so feel for those in that position.

[bobbyshilling] 12/11/2014 20:51

You have to think where IOF will be in a 2-3 year timescale. We all know what they have to offer, and short term share price movements are just that. Do the homework, (in this connection SG, thanks for the detailed info on how other iodine producers are fairing). In just over a couple of weeks time, the finalisation of the water permit should be with us - a massive step forward, not just for now, but for permits in the future; we have (almost) run the gauntlet on this one, and future applications should be a lot easier, as the company has gone through the learning process and know the score.

I read a few posts earlier relating to the apparent lack of volume in AIM transactions. Well, my take is that there are still many investors out there just holding off because of general uncertainty, and don't forget that there will probably be many more new people taking an interest in the stock market as a way to make money, as new pension laws come into force regarding the choices available, and low interest rates for investors. If a company comes up with good news then investors seem to swoop pretty quickly, and over the medium term IOF should deliver on that front, even if there are apparent short term hiccups.

It is easy for people on these bbs to come out with one liners to sow doubt. It always happens, and will probably continue. I was actually going to add at 40p ish, but will hang on to see what happens - in case the share price goes lower, but the fundamentals are in place here; patience is the key now. Just my views.

[monty panesar] 12/11/2014 20:34

Che7,

We know Q4 is the weakest sales period but we can expect IOC to have lots of Q1 sales to prepare for so they need a bigger inventory. The growth in the chemicals division over the past few years has been really impressive. You would think over 500t of sales next year so will need production of over 40t per month for internal use but jan-may are the when the biggest sales go through hence they need a big inventory now to prepare the larger forward sales starting in 7 weeks time.

Monty

[henry9th1] 12/11/2014 20:08

Bear trap heartwell, not a good short, better options out there.

[che7win] 12/11/2014 19:57

Monty,
H2 this year might be flattered because IOF didn't close out some sales h2 last year and Chinese/Indian sales had been slow.

[monty panesar] 12/11/2014 18:50

Can't help but agree with mister big. Is it true you(he) learnt your(his) trade at Berkshire Hathaway?

On a separate note I saw the dicsussion on selling raw iodine a couple of days ago. World price is weak for the reasons we know and the cut backs by the bigger players over the past year will start to filter through in the new year.

As Mentioned a couple of months ago inventories must have been very low in August(10t or so maybe?) and they need 30t per month for the chemicals division. Inventory levels should be closer to 60t so I can't see them selling any raw iodine into the world market this year especially as this is the quiet quarter for sales before stock gets delivered in the new year.