Jadestone Energy Share Discussion Threads

[thedudie] 18/11/2020 10:20

Think it was flagged as non core earlier this year - so expected I guess.

See RNS 9th January - Especially Paul's comments as below

"The SC56 asset is not consistent with our strategy and was inherited from the former Mitra Energy management team. It has remained in the Jadestone portfolio solely as a result of the carried well commitment, which was intended to provide a cost-free option to further test this frontier basin. It was important for the Company and our shareholders to pursue our legal rights to a successful conclusion. With the satisfactory resolution of this matter, we can now refocus on our strategy to deliver exceptional value to shareholders, through investment in producing assets and discoveries which can be quickly developed for early cash flow."

[soggy] 18/11/2020 10:14

Surprised no-one has a view on today's RNS..???

[mount teide] 17/11/2020 22:51

With the Oil Majors increasingly taking a knee to political and investor pressure to pivot to renewables, National Oil Companies and high quality Independents are likely to be the medium term winners once the dust settles and smoke clears from this Covid-19 pandemic - as the Major's O&G disinvestment is likely to throw up plenty of serious bargains over the next few years - particularly in the long in the tooth SE Asian and Australasian O&G basins where the competition for buyers of mature assets is very thin and prices attractive by North Sea standards.

[spangle93] 17/11/2020 21:12

On a much bigger stage, Abu Dhabi (UAE) always says it will manage its resources to produce the industry's last barrel of oil.

[dcarn] 17/11/2020 20:58

Details here.

I was never in RR and know very little about the man but have seen a lot of chatter about this over the last few days.

RockRose founder Andrew Austin makes North Sea return with new company
Andrew Austin is making his North Sea return with a new investment company, aimed at buying up UK assets, after selling RockRose Energy.

[donald pond] 17/11/2020 20:56

yup, me too, didn't know the name, thanks fozz

[fozzie] 17/11/2020 20:54

Kistos, I will be a buyer dp for sure.

[donald pond] 17/11/2020 20:49

I've a friend who advises on M&A, and one thing he always says is that once a big business decides it wants to sell something price is rarely a consideration. So many big businesses want to divest away from O&G, the pickings must be rich for JSE. Just need to time things right
And sort of connected, I hear Andrew Austin is launching something new very soon.

[bamboo2] 17/11/2020 20:24

Cheers MT.

Agree with the basics, and also great to see the plethora of other good names here!

I am chart led, but the fundamentals led me to the chart.
gla

[mount teide] 17/11/2020 19:53

bamboo - 'I just thought that 'last man standing' had a touch of doom and gloom about it!'

I suppose it depends on the context - if you're an O&G sector investor looking for a management with a proven track record of success building multi $billion companies through the implementation of production efficiencies and development, and operating cost reductions at very selectively acquired, high quality, mature, but modestly performing producing assets with excellent reinvestment potential, to produce a lowly leveraged business with very strong cash flow at low oil prices then a company like Jadestone Energy should be on your investment research list.

The best Q&A comment from Paul Blakely that sums up his and Jadestone's specialist second phase operator approach was probably his description of the take-over of the ageing Beatrice and Buchan Oilfield from BP when he ran Talisman Energy.

BP had decided to sell the asset as they believed the field had just 12 months remaining commercial life - a view that was reflected in the acquisition price.

Specialist second phase operator Talisman, through a combination of production efficiencies and re-investment, and cost reductions, were still profitably running the field some 20 years later.

AIMHO/DYOR

[mr roper] 17/11/2020 19:07

Nice chart, Ptolemy. Looks like a large rising W with a target above 100p

[bamboo2] 17/11/2020 19:05

MT, I agree the co has great plans and fundamentals.
I just thought that 'last man standing' had a touch of doom and gloom about it!

[mount teide] 17/11/2020 18:52

If the completion date of the Maari acquisition or news of another acquisition were imminent, it would be a very smart move by the company to secure an interview with the Energy Editor of the Financial Times to showcase the company and its highly accomplished management's business approach of pursuing attractively priced mature O&G assets with significant reinvestment potential from National Oil companies and the Majors as they vacate mature O&G basins or increasingly pivot to renewables.

"Last man standing" is a great investment marketing slogan with which to differentiate and promote this management's previously very successful low leverage, low risk profile, strong cash flow generation at low oil price, specialist second phase O&G operator business model.

[ptolemy] 17/11/2020 10:39

Very good FT article. Thanks for posting. Made me look at the chart (timeframe: week).

[mount teide] 17/11/2020 10:34

Meteors - LNG import prices into the region are back up more than threefold since the Covid-19 lows and oil is back into the mid 40's - this will be concentrating the minds of the Government of fast growing energy supply stressed Vietnam.

[meteors] 17/11/2020 10:05

The whole Vietnamese gas deal seems to be looming, was expecting a go-ahead from the Government, but I suppose covid has potentially delayed that.

What are people thoughts on this call. Could it still fall through? There has been little news from JSE regarding it recently which is why I ask

[thedudie] 17/11/2020 10:00

I hope they have a deal or two at locked in sales prices in the pipeline right now.

If OPEC+ decide to push back the date at which they start adding more production barrels then we could see Brent climbing up closer or even over $50 a barrel. Although a useful boost to cashflow that may make sellers greedy and complicate Jadestone's expansion plans. Clearly if gas is more their preferred target then that does not apply.

[mount teide] 17/11/2020 09:54

Yes, thanks Pro.

“What we’re doing is really mopping up after the majors.”

Since its a tried and tested, highly successful MO used twice previously in other oil and gas basins by this outstanding management to develop multi £billion companies - it's no surprise to find plenty of serious Institutional smart money on the shareholders register in the expectation Jadestone will be their third.

[lord gnome] 17/11/2020 09:41

Thanks Pro.

[buffythebuffoon] 17/11/2020 09:22

Thanks for posting the FT article Pro.

Buffy

[thedudie] 17/11/2020 07:50

Raises the profile for JSE.
Solid management with realistic medium term target. What's not to like.

[pro_s2009] 17/11/2020 07:44

Jadestone Energy vows to be ‘last man standing’ in oil and gas production

Independent producer sees opportunity to expand as majors pivot to renewables
Jadestone Energy is focused on Australia, Vietnam, New Zealand and other countries in Asia-Pacific © AP

David Sheppard, Energy Editor 4 hours ago

Jadestone Energy might pump just a fraction of the oil and gas of the energy majors, but its chief executive believes the Asia-Pacific focused producer will outlast bigger rivals when it comes to making money from hydrocarbons.

“It won’t be a Shell or BP that will be the last man standing in the oil and gas space,” Paul Blakeley, chief executive of Jadestone, said. “It will be the small independents.”

It might seem like a bold claim for a company that employs about 220 staff and produces only 10,000 barrels of oil equivalent a day, when giants such as Shell produce almost 300 times more.

But it has become Mr Blakeley’s pitch to investors when they question whether there is still a place for small independent energy producers, at a time when concerns about climate change and peak oil demand have seen the European majors begin a long pivot towards renewables.

But the former Talisman Energy executive said this will be key to Jadestone’s growth. As the energy majors pull back from hydrocarbons, he sees the opportunity for smaller producers to move in, taking over assets and expanding their lifespan.

The exploration drill bit drove short-term success and long-term decline. What we’re doing is really mopping up after the majors
Paul Blakeley, chief executive of Jadestone Energy

Jadestone is focused on Australia, Vietnam, New Zealand and other countries in Asia-Pacific, where they expect oil demand to continue rising.

Pursing older assets marks a significant switch from the old mindset of the $100-oil era, when small exploration and production companies used to pitch high hopes of discoveries in frontier basins as the root to shareholder success. When oil prices crashed almost six years ago, many came close collapse.

“Too many [explorers and producers] have relied on the exploration drill bit and many have failed on that basis,” Mr Blakeley said. “The second significant flaw is overleverage. Keeping the risk profile low is very important to our shareholders.”

It is a steadier model that is attracting some interest, with Jadestone a rare oil and gas success story in 2020.

Shares in BP and Royal Dutch Shell are both down about 50 per cent this year as investor appetite for fossil fuel companies has waned. Jadestone was not immune to oil’s dramatic slump in March and April but shares have doubled in the last eight months from their low point in the depth of lockdowns, giving it a market capitalisation of £256m.

BMO Capital Markets has highlighted Jadestone conservative model alongside Energean and Africa Oil as being relatively insulated against lower oil prices and with one of the “strongest cash flow profiles”.

Mr Blakeley said the company is still pursuing growth but through acquisitions in the Asia-Pacific region including taking over “stranded discoveries” — those deposits already found but never developed.

“I don’t see any reason why we shouldn’t be thinking 50,000-75,000 [barrels of oil equivalent per day] over the next 5-10 years,” he said. “What isn’t material for the majors can be hugely material for us.”

The approach is rooted in investors’ fears about the long-term future of the oil industry, should demand peak in the coming decade.

Mr Blakeley said he is not worried by that prospect. If oil consumption plateaus rather than crashing, as many industry analysts expect, the world will still need in the region of 100m barrels of oil while gas demand is still expected to climb as a cleaner alternative to coal.

That could leave the heavyweight national oil companies churning out barrels while smaller, nimbler players fill in gaps, should the oil majors follow through on plans to eventually reduce production.

“The exploration drill bit drove short-term success and long-term decline,” Mr Blakeley said. “What we’re doing is really mopping up after the majors.”

[dcarn] 17/11/2020 07:39

Use SGA's link about 6 post back, it takes you straight to the full article via Google. Or it did on my mobile.

[lord gnome] 17/11/2020 07:30

Could you give us the gist of the article, please?

[croasdalelfc] 17/11/2020 07:30

https://www.ft.com/content/f81763ae-93a1-4f0b-a35f-3ef0812f6354