Sdx Energy Share Discussion Threads

[mesquida] 27/2/2017 18:44

I think that wisecat has correctly identified orinocor, see his post 324.

[tournesol] 27/2/2017 18:23

Orinoco

Listen to the interview with the CEO - it answers your questions

1) COP borrowed to fund exploration drilling which failed. They were left loaded with debts denomninated in $ which they could not service.

2) The Egyptian State did not have enough FX to allow it to pay all of the regular monthly production payments in hard currency - which was what COP needed. COP refused to accept part payment in Egyptian £ because they had no use for E£.

3) When COP was unable to service its debts, the lenders whose loans were secured against assets forced asset sales. They only cared about covering the secured portion of the debt. The unsecured lenders got nothing from the sale. In effect SDX bought from a desperate/distressed subset of creditors at a value which was less than the valuation previously assigned to the same assets.

4) SDX has other business in Egypt. It is therefore happy to accept payment from the State in a mix of $ and E£ - it can use the latter to cover local expenditure which arises across its business portfolio. Because of this there is no problem in it accepting payments from the State and the backlog of receivables which came with the assets is now gradually reducing.

5) One of the assets is a 40% stake in a field where SDX already had a 10% stake. SDX was not the operator and will not become the operator. Its small team assigned to this field can administer a 50% stake just as easily as a 10% stake. So no additional on-costs arise from that part of the acquisition. So the asset will cost SDX zero to administer - that represents a reduction in overheads by comparison with COP. That means the asset is more economic/profitable in SDX's hands than it was in COP's.

If you put all the above together it is easy to see that the asset sale could be a distressed and disadvantaged sale for COP and at the same time a great buy for SDX.

According to the CEO the assets acquired will pay for themselves in around 18 months. That's a pretty attractive and value additive deal.

If you still disagree then please be so kind as to explain why.

[bestace] 27/2/2017 18:12

There may be lots of O&G companies looking to buy assets on the cheap from a distressed seller, but maybe not so many who were prepared to take on a slow paying Egyptian government as a debtor, receive settlement of debts in Egyptian pounds and who were already partners with Circle in a producing asset.

[haideralifool] 27/2/2017 18:05

orinocor if you watch the video on the sdx site the ceo explains that the egyptian government were paying circle in a mixture of egyptian pounds and us dollars, circle did not have much use for the egyptian pounds (like i guess various other potential buyers). sdx on the other hand have various expenses in egyptian pounds.

[nasnas1] 27/2/2017 17:57

Just shows the shrewdness of Paul who by the way has done all this before with CHARIOT. Roll on tomorrow

[orinocor] 27/2/2017 17:52

If the assets are all they are cracked up then there would have been a queue of buyers

[pauliewonder] 27/2/2017 17:42

What you think circle we're going to get market value when they were a distressed seller??

[orinocor] 27/2/2017 17:23

yes circle were in trouble but there are a lot of o&g companies looking to buy cheap assets. Therefore there should have been a lot of interest in these assets and so circle should have got a good price.

Come on guys, none of this makes any sense. Either circle have got a rotten deal or SDX have got a great one. The rise in the SDX share price says it's SDX who got the great deal and the Circle guys don't know what they are doing. I've been round long enough to know when something smells off and something's not right here.

[milliecusto] 27/2/2017 16:59

Circle where in debt trouble if you bothered to do any research..

[wisecat2] 27/2/2017 16:11

Just looked up " orinocor" Its Egyptian for I haven't doubled my money so Im bitter and twisted LOL LOL

[orinocor] 27/2/2017 16:00

LOL you guys are having a laugh. The new Dana? £30M raised at 30p last month to buy assets from Circle. Obviously Circle have been completely outplayed by SDX here. I mean its obvious Circle did not have any idea how much these assets were really worth. Right? LOL. Why are the shares now at 50p??
A barge-pole stock at anywhere near this price.

[blueball] 27/2/2017 14:05

In a strong uptrend worth 100p plus imo.

[soulsauce] 27/2/2017 13:44

This is more like it ;-)

[borg45] 27/2/2017 13:43

Up up and away!!!!

[someuwin] 27/2/2017 13:37

Cheers cash - that sounds awesome.

[pauliewonder] 27/2/2017 13:36

50p. Spread is zero. Come on baby, you can do it...

[pauliewonder] 27/2/2017 13:28

Here we go. Big test. Push on past that 50p mark!

[cashandcard] 27/2/2017 12:50

The size of the potential identified by the seismic looks staggering - being compared in that artile to the mammoth Zohr field (30tcf) discovered by ENI offshore. Important to keep in mind it could go either way, as they need to prove it up with the drillbit.


Cash

[shakeypremis] 27/2/2017 12:29

I would say the company in the article is DANA/BP, not SDX. But SDX is right on the doorstep still.

[cashandcard] 27/2/2017 12:27

The source of the Nile delta large gas discovery:

"Egypt to Announce Huge Gas Field Discovery

Thursday, 23rd February 2017

A source at the Egyptian Ministry of Petroleum and Mineral Resources stated that Egypt will announce a new gas discovery in Nile Delta to be located in Mahala city. The new discovery’s seismic surveys revealed huge reserves that might be equal to Zohr field’s volumes, Egyptian Media reported.

The company responsible for operations in the field is currently drilling a number of exploratory wells to ensure reserves. The discovery will be announced by terminating the first drilling phase, which will take place before the end of 2017"




It would seem this is based on seismic and actually not yet confirmed by the drillbit. So take it with a pinch of salt. SDX block is just south of this one.


Cash

[soulsauce] 27/2/2017 12:04

Ahmen to that tournesol, luckily I found it in the low 40s but the upside here is as good as I have seen in many years.

[tournesol] 27/2/2017 11:59

I already had 1% of my money invested here and have been thinking for a few days about adding to that. Having this morning watched the interview with the CEO on the home page of the SDX website I've increased my holding to 5% which is my maximum limit for a single stock.

This company reminds me of Dana back in their early days. The recent acquisition of Circle's assets seems to me to open up very significant upside. I think this will be an inflexion point for the share price.

If only I'd discovered this sooner.