Reabold Resources Share Discussion Threads

[jungmana] 28/2/2018 21:11

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[jungmana] 28/2/2018 21:10

Euclid £0.008 is 0.8p. You need to the maths again. Secondly you keep on going about npv as someone who is obsessed with it. You came here talking about high risk exploration wells until Cash told you that these are appraisal projects.I didnt hear you talk about dilution when UPL raised £1m from Tune and issued new shares.These guys have just raised £7.8m to grow the business . Simples!

[euclid5] 28/2/2018 21:03

Bageo, agreed many O&G shares trade at a sall % of their potential NPV, until they start to prove the asset up this discount narrows - not sure about re valuing it on the new cash raised as that will be spent over time.

And Yes, agree they could buy some very good assets, low risk

Calculates roughly the same - would rather see neither reduction

Would you rather have seen dilution at the Corallian level or at the Rheabold company level?


Oulten:

No, it's 0.008p that's correct - do the simple maths

£23m div 2.845B shs NPV/share = 0.008p

Can't recall Parta Npv net to RBD

Reabold will have a 29% interest in Danube Petroleum, a 50% owner and operator of the Parta license, onshore Western Romania.

Reabold management has attributed a net success case NPV (10) in the success case of up to $86 million gross for a multi-well development across the two appraisal projects.

$86m / 1.40 = £61m x 50% to Parta = £30.5m x 29% RBD wi = £8.845m NPV div by 2.845B shares = 0.003. three tenths of a penny

In fairness they do have the below also in Parta, but they don't state the potential NPV

Danube Petroleum Limited consider further potential on the Parta block to total approximately 300 BCF of un-risked gross prospective resources of gas and 45 MMbbl of oil using existing 2D seismic data.

hxxps://reabold.com/projects/parta-romania/

Show me your calculation to 20p NPV please?

That's our wi% being worth £570m

"Our total npv/ share for parta, colter, wick and oulten together even with the new shares is over 20p"

[jungmana] 28/2/2018 20:44

Our total npv/ share for parta, colter, wick and oulten together even with the new shares is over 10p. Lets see how much further that can be grown with the new cash.
All the above projects were acquired with just £3m cash in last 4 months. Now we have about £10m cash in hand i believe a lot more projects (ie NPV) will be added soon

[jungmana] 28/2/2018 20:37

Euclid first you mean 0.8p not 0.008p i believe for new npv/ share for oulten alone?Secondly whats the npv for Parta ( Danube)? If i recalled was about 5p .Thirdly yes we have 1.3bn new shares but are £7.8m richer and will be adding new projects with that money. So our cake is growing bigger not smaller.

[bageo] 28/2/2018 20:30

Euclid
What % of NPV do you see a typical resource company (mining or oil) trading at? pre-revenue it is at a fraction usually

Yes the potential per share has dropped on these particular assets due to the new shares but this has to be offset against the new value (currently cash). So it depends on how you value the risk.

Would you rather have seen dilution at the Corallian level or at the Rheabold company level?

[euclid5] 28/2/2018 19:43

Take Oulten asset

Corallian estimates a mean recoverable success case of 20mmbbls with a high chance of success, currently estimated to be 64%. With a gross well cost estimated to be £7m, the company has ascribed a success case NPV of £132m

Assume they farm out 50% - £132m x 50% wi x RBD's 35% = £23m div 2.845B shs NPV/share = 0.008p (as opposed to 0.015p with 1.54b shs before - so nearly an 85% drop in NPV value

before the placing the 2 appraisal assets could of been worth nearly 7.5p

[euclid5] 28/2/2018 19:27

Simon, think we are crossing wires here, I do know RBD are buying stakes in O&G Explo/ Apraisal assets. But when they require more funding then RBD have to increase their funding to them to hold the same stakes - therefore they are in practice having to fund the extra costs to keep the same stake plus Corallian gets funding sorted by RBD.

Rbd as a business is similar to many O&G Aim listed co's, that buy stakes - positions - holdings in assets on the hope some or one of them comes to commercial success - but sadly issue far too many shares to keep them funded.

Don't get me wrong here - they could do very well, especially with Wick & Oulten - Appraisal assets

below is an example of how the Wick prospect's NPv vale per share has dropped by 50% net to RBD

£255m X 35% = £90m div by 1.540b shs = 5.8p

Today that NPV for Rbd is £255m x 35% = £90m div by 2.845B shares = 3.2p

Corallian financial modelling based on the above prospective resources forecasts a gross NPV (10) in the success case of £255 million.

Reabold has an agreement in place to acquire a 35.4% stake in Corallian Energy.

Everytime they increase their exposure to keep the same wi% or increase it to fund the underlying co they have to pay for this - be it a farm in or an increase in a stake into the company that owns the assets. They still have to fund them - so what ever way you cut the mustard they have to issue more placing shares.

It is Reabold's intention to participate in the fundraise in order to increase its exposure to Corallian, and thus to Colter, Wick and the additional Corallian opportunities.

The New Placing Shares will, when issued, represent 85% of the existing Ordinary Shares prior to the issue of the New Placing Shares

[gibso6767] 28/2/2018 19:18

Well they’ve got a fair slug over money over an unknown length of time ( forget twitter rumours ) , however there’s dilution as such ie more shares but cash at hand .

Crux being , yes we have three drills this year , but nothing is certain here .

We are yet to see what happens to the newly acquired cash plus that still held by RBD .

But Chick ls counted before hatched springs to mindv

[cf456] 28/2/2018 18:53

Bring on the substantial value...

"We are confident that Reabold's funding of near term drilling activity, enhanced by subsequent involvement of additional industry participants, will create substantial value for Reabold shareholders."

[ileeman] 28/2/2018 18:48

Nothing is without risk.

[chorus1] 28/2/2018 18:23

Whether it's money well spent is still unknown, but I agree that they are building the foundations of something exciting with a lot of potential

[ileeman] 28/2/2018 18:16

Not really Chorus they intentionally cut retail because they didnt want to do a discount and only a premium, they cut retail and kept the high quality institutions.

If anything shows how good the directors are.

[jungmana] 28/2/2018 18:15

they have spent about £3m in last 4 months building a portfolio of good assets; corallian (colter, oulten, wick), danube(parta). thats money well spent and will in the near term create value for shareholders imo.

[chorus1] 28/2/2018 18:09

Agree in theory, but the company have yet to prove their ability to create significant shareholder value so it's all ifs and buts at the moment

[jungmana] 28/2/2018 18:07

chorus.is a wow! am impressed. the stock market is for companies to raise money and utilise that money to create value and return for shareholders. thats what this guys are doing. simples!

[chorus1] 28/2/2018 18:07

You could argue that they got significantly less than they wanted given the weekend's rumours of a £12m placing. The company are always going to put a positive spin on things so I would take the comments with a pinch of salt personally

[ileeman] 28/2/2018 18:03

They got more than they expected and big ii backing, the comments from the CEOs are great aswell.

Big things to come.

[chorus1] 28/2/2018 17:56

Not sure it's that 'wow', Jungmana. In the short term, it's just a great deal of dilution.

[jungmana] 28/2/2018 17:49

wow, just wow! bookbuild closed raising £7.83m

[cf456] 28/2/2018 15:17

A few weeks old but worth watching

[jungmana] 28/2/2018 14:56

Soul - i think the rns is very clear :-)

[soulsauce] 28/2/2018 14:41

Is the 0.6p a definitive figure or could it yet still be 0.55 or 0.5p?

[simonsaid1] 28/2/2018 14:08

Euclid you still don't seem to get it as you said 'farm in'. Reabold doesn't do farm in or JV agreements, that's not the business model.

They buy equity stakes in businesses with distressed assets/drills, see them through the drill, then sell the stake afterward. They explicitly avoid farm in and JV's in order to not take on drilling costs, but they are known to assist the businesses they buy into with their own fundraising (that's what the CEO's are good at).

Not trying to enter an argument here, but it sounds like you're not terribly familiar with Reabold as a business, and you really have to understand this slightly unusual company to understand why some of us long term holders are excited about the prospect of fresh cash and fresh deals. I recommend seeking out some of the interviews they did around last autumn when the new CEO's were appointed, and when they bought the stake in Corallian.

As regards dilution, if the new assets are valuable then the pie is that much bigger, so each slice does not have to get smaller just because there are more of them!