Mayan Energy Share Discussion Threads

[fairenough11] 19/2/2018 08:17

ALIGN UPDATE

MAYAN ENERGY – ALIGN UPDATE
February 19, 2018 | Posted by admin

By Dr Michael Green

The latest update from Mayan Energy last week concerning its rising oil production was unequivocal good news for investors. The RNS seems to suggest that the 300 – 500 bopd production target is now firmly in sight. In addition, we provide some color on the valuation of Deloro Energy in anticipation of a capital raising within that entity as it moves towards the 1000 bopd production trigger.

The board of Mayan was able to announce that the Gilbreath #15 well at Forest Hill Field had come on production with 51 barrels of crude oil in the first twenty-four hours. Importantly, this level of production is ahead of the company applying any of its proprietary production enhancement techniques which we expect will boost these initial rates. Mayan plans to produce Gilbreach #15 for a couple of weeks to establish baseline production before attempting to further stimulate the well. The Gilbreath #15 was the fourth in an eight well programme, where the necessary permits have been granted to complete and produce from the first six well. Permits for the remaining two in this field are expected next week. This eight well programme at Forest Hill Field is targeting 35-50 bopd per well.

This news follows the announcement concerning the initiation of production at two other wells earlier on in the week. Production was initiated at Gilbreath #19 and Forest Hill Field (Mayan 70% WI, 52.5% NRI) and the Morris #1 well in Stockdale Field (Mayan 60% WI, 45% NRI). Mayan was also able to report the successful workover of the Collins well in Forest Hill Field. Gilbreath #19 was brought on line with 55 barrels of oil produced during the initial 254 hours and rates since have not disappointed whilst at the Morris #1 well, this was put on production at a rate of 24-26 bopd from the Upper Anacacho and has continued to consistently produce at this rate.

As part of our analysis on Mayan Energy we have run the numbers of Deloro LLC in recent days and have accordingly updated our SOTP’s valuation.

Deloro of course holds a 49% interest in the Asphalt Ridge oil sands project. We have determined a Net Present Value using a conservative 12% discount rate to a current derived value for the project and which comes out US$355.34 million. We make the point that we have also been highly conservative in this see through analysis in employing a flat WTI oil price of UIS$60 per barrel even though management have stated that they in fact anticipate obtaining a premium to WTI and the average so far this year has been in excess of $60 a barrel. Deloro’s 49% interest thus equates to US$174.12 million, and which we additionally risk by a further 25% to account for the risks associated in moving from 1,000bopd to a far larger name plate capacity. The resultant value is thus US$130.59m.

In revisiting the value in Mayan Energy following this valuation we are expecting Deloro to raise circa US$7.5 million from new investors in the near term. Management are thus expecting a valuation on this entity in the range of $35-50m. Currently there are 1,986 units in issue in Deloro and taking the expected weighted average mid-point in this raise (likely in 2 tranches) produces a unit valuation approaching $20,000. This suggests that Mayan’s holding of 358 units at this still early development stage (and if the raise is successful, validating the value by third party investors) will be valued at circa $7m at this stage (a four-fold uplift). Considering that the company paid $4,300 per unit only 4 months ago this would illustrate two things. Firstly, what a cracking deal the Deloro acquisition and Asphalt Ridge project is (contrary to misinformed or biased other analysts/commentators postulations on this) and secondly, that the continued speculation of a capital raise within Mayan in the near term os completely ill-founded and without a fundamental base.



Incorporating the expected see through valuation of Deloro reveals that approx. 0.43p of the current stock price is underpinned by this stake alone. Valuing circa 300-500 Bopd at a rump £3.5m illustrates starkly just how the market continues to apply, in our opinion, a completely wrong valuation on the stock. As management moves further towards the key 500 bopd production level and, assuming Deloro receives the third party valuation validation at the $35-50m level, we expect the market will finally re-rate the stock towards our near term price target of 2.1p.

At the current price of 0.68p we thus remain highly positive as evidenced by our increased holding in recent weeks and reiterate our Conviction Buy stance.

[wossupsa] 19/2/2018 08:16

Another moron enters the fray, iii/lse, I use neither so who cares? Was there anything else material you could take issue with, no? Have all you hateful morons been in since 10p or something, is that why you are all so bitter & twisted?

[johns288] 18/2/2018 10:07

God knows what these idiots will do when myn delivers.....pull the wings off flies maybe? It's pretty obvious something is missing in their life....maybe a large amount of money lost because they are clueless and need to seek some kind of retribution in the form of bashing a share. I'm studying psychology and my door is always open to study strange behaviour in people with issues

[keya5000] 17/2/2018 19:12

Nice one Johns.


cannot even get simple facts rig

[johns288] 17/2/2018 16:17

And keya said Lse not iii.....bellend boy

[nicosevos] 16/2/2018 12:49

.









Post removed

[wossupsa] 15/2/2018 20:39

keyless, another idiotic post - don't use iii but daresay leapfrog is an upstanding individual based on your assessment of him! Not much of a rise here of the back off that news (or the news the other day) was there, some very keen sellers it would seem desperate to offload when ever the chance (volume) avails?

[cashandcard] 15/2/2018 15:16

What is quite exciting is the use of the Roke Quad Neutron tool. Other operators have used this successfully, elsewhere, to identify missed payzones which have not been perforated for production. It is one of the most efficient downhole data gathering tools available, the use of it is very positive - flush production from untapped virgin payzones. I am also intrigued by the presence of the Sub-Clarkesville on the property, a known producer in those parts of Texas that has produced reliably at modest, yet economic rates for decades. At current oil prices, it looks quite commercial indeed.

At little over £8mln marketcap, with some 300bopd from current workover program and additional interest production/cashflow from Asphalt Ridge, there is upside to be had at these prices. I look forward to the next update.


Cash

[keya5000] 15/2/2018 14:45

Wossuppa I think is leapfrog off lse.

Either that or one with a similar failing agenda.

[mkmmkm1] 15/2/2018 13:07

Is anybody able to copy the sh!te that TW has been spouting at all please

[cashandcard] 15/2/2018 12:39

Piperpeter,


In short, yes. Payback in 4-6weeks (I've included declines from 51bopd), otherwise payback could be as quick as 3weeks if rate remains around 50bopd. The netback I'm using is a conservative $20/bbl.


Cash

[piperpeter] 15/2/2018 12:34

Am I correct in believing that with the costs running at under US$30,000 per well workover, the pay-back period per well will be very short?

Pp.

[tel11] 15/2/2018 12:29

next stop 0.80p :-)

[cashandcard] 15/2/2018 12:16

"The Company is in a position financially to complete this programme with current resources and cash flow available. In addition, we are pleased that actual costs are running significantly less than the budgeted US$30,000 per well we planned to spend"

[wossupsa] 15/2/2018 10:50

Writing is on the wall here but few can see it? These RNS's are great for the sellers!

[master rsi] 15/2/2018 09:34

Buyers are back at the moment after the good RNS
The 300-500 bopd production target, should be easyly achieved now

[grannyboy] 15/2/2018 09:32

Good update..it would seem that now the permits and approvals are starting to get approval in a timely manner, they can now get on with producing oil and getting it out the ground..And let's not forget about Asphalt Ridge, which is expected to be on production in the 1Q, with a production rate of 1000 bopd.

[cashandcard] 15/2/2018 08:45

Another good update, long awaited no doubt. The marketcap is still really low so this could go quite some distance. An important line from this mornings update concerning (initial) declines which some may have missed is this:

"In addition to the results of the Gilbreath #19 well and the Morris #1 well at the Stockdale Field, Wilson County, Texas ("Stockdale"), which continue to produce at rates consistent with their initial flow rates"


Cash

[jayj4u] 15/2/2018 08:20

We should break 0.8p today and 1p by the end of this week! So far we have had all positive news. Yes, they were some delays but what matters is the news!! FACTS!!! It seems we have a GREAT TEAM working for MAYAN! Thes really care about increasing the value of the company!!! I believe in the team and i will not sell for many months!