Sdx Energy Share Discussion Threads

[captainfatcat] 16/7/2018 07:12

Successful production test at SD-4X well, Egypt

[neo26] 14/7/2018 22:01

They did say testing will commence within 10 days after spudding sd3x.So they maybe testing now, i expect is to be similar to sd1x.

[tli8jaguar] 14/7/2018 17:46

Hopefully SD-4X test results next week.

[neo26] 12/7/2018 16:55

ShakeyIncreasing production by minimum 20% in morocco is extra handy especially since they will be getting $12 per mcf.Pw said the company should be worth £300m at the moment, not £120m at present.

[shakeypremis] 12/7/2018 16:00

I agree Griffs, that is a lot going on but I doubt that'll move the price a whole lot as I suspect the market already prices that in. The market doesn't seem to care about the doubling of production.

One think I would say on the 'doubling' of production. It's not like you were producing say 1000 bopd (barrels of OIL per day) from one field in one jurisdiction. Most of this doubling is coming from BOEs (barrels of OIL EQUIVALENT) and they aren't worth nearly as much as actual barrels of oil. So while doubling production sounds awesome doubling production in BOE terms isn't quite so awesome. That said in my book what SDX have done is awesome and they will get significant profits from doing it.

Also, screw the Egyptian government (and all governments for that matter) on their outright robbery. Just thought I would throw that in there. Way to stifle economic activity.

[griffin81] 12/7/2018 15:42

Shakey, we have flow testing results and three (possible four) drill results due in Egypt imminently followed by two 3D Seismic programmes and a casual doubling of production by year end. Plenty of news to cause SDX to rise towards a more appropriate level.

[shakeypremis] 12/7/2018 15:32

Could well be Neo. Just have to find it and prove it commercial. See you in 2019. Not a lot going on that'll move this until then it would seem. That said, no reason it can't revalue in the mean time.

Doubtless there's more cheap gas in SD too.

[neo26] 12/7/2018 13:28

shakey

im convinced there is alot of oil in SD, SD1x did have oil shows.

Really pleased they will target oil early next year, Young prospect looks impressive.

[shakeypremis] 12/7/2018 13:20

Neo

I'd prefer that too. Spend a bit more money doing a little bit more in SD than is planned so far.

[neo26] 12/7/2018 13:04

shakey

with the price of oil i dont see them finding an attractive asset for decent price like they did with circle asset.

IMHO, they have only explored 20% of SD acreage, i would prefer they invest in the SD acreage as i see huge upside.

[neo26] 12/7/2018 13:01

Haidar

Im expecting them to hit £1 before end of 2018, they have another decent drilling campaign planned for 2019 and it will all be covered by current cash flow, so no raising funds unlike most companies on aim.

With regards to the placing you are referring to, one can speculate the company did not need it, we dont really know what happened behind close doors, so i wont speculate.

Strong chance sd3x will reach td late next week, who knows we may get flow rates for sd4x near the same time.

[shakeypremis] 12/7/2018 12:52

Haider, every indication we've had is that SDX won't be issuing any more shares. Certainly not to fund organic growth (unless they come across something huge I guess). Cashflow and the surplus cash they have at the moment should be enough to fund small acquisitions too, should they go for anything.

[haideralifool] 12/7/2018 12:43

neo, as for that 'no debt' argument.

I'm no accountant, but since the company is cashflow positive and becoming more so, I'd have thought it would have been better for us that the company raised the £10m (was it?) last year via debt rather than issuing equity.

I reckon some of the share overhang we've suffered from this year has been due to that.

OTOH if the fundraise was to grease some palms, then that's another matter.

And while we are at it, please nobody mention PWs ambition to get to $1bn market cap. People assume it will be via share price increases, it could just as well be via issuing more shares.

FWIW this is one of my bigger holdings, it' provided a pretty reasonable return this year, and if we hit £1 in the next 8 months, I won't be complaining.

[neo26] 12/7/2018 12:23

The company plans to increase production and they can do so with the cashflow they generate, they do not need to come to the mkt.I believe they will find alot more gas and oil in egypt.Whats important is they have no debts.

[shakeypremis] 12/7/2018 12:18

Haider you are right, although SDX do have quite a lot of cash lying around too.

[haideralifool] 12/7/2018 12:02

The problem is that they talk about free cashflow and it may very well be that, but AIUI they still need to pay capex out of it.

Since they've got a fairly heavy drill campaign ahead (in itself the result of previous successes), the challenge is whether they can discover / prove up more than they intend to invest.

Whether that investment yields a return will take many months. I am not surprised that people are willing to wait on the sidelines for a while.

[shakeypremis] 12/7/2018 11:21

I'd say over $50m in cashflow personally if it's $42m at the moment.

[neo26] 12/7/2018 11:10

Thanks shakeyAt the moment they are generating around $42m cashflow per annum, who knows once sd and morocco increase in production we may generate over $50m in cash flow per annum and with no debt will be extremely attractive.Mkt cap only 120m at moment.

[shakeypremis] 12/7/2018 10:51

Here we are, didn't have to go too far back. Not many posts you see! An indication of the lack of interest in SDX;

"An interesting mention in the latest RNS was condensate production of about 600 barrels from South Disouq. Anyone have any idea how much this might be worth to SDX?

I did some very rough calculations based on a barrel price of $60 (no idea if this is what they'll get but it's a price paid for Canadian condensate for example).

600 barrels/day x $60 = $36,000/day gross

Circa 20% economic interest = $36,000/day x 0.2 = $7,200/day

$7,200/day net x 300 days operation per year (conservative I know) = ~$2m revenue per year.

No idea what costs might be on a barrel of condensate produced from a very low cost Egyptian gas well though.

Anyone have any ideas? $2m revenue is pretty meaningless but if it's mostly profit that will be meaningful as the South Disouq wells are only set to make around $10m profit per year net to SDX based on gas sales at $2.65/mscf."

So maybe the liquids can add another $2m in profit per year from South Disouq given current projected gas volumes.

[shakeypremis] 12/7/2018 10:48

Neo

Everything I've seen from the company so far says they will be producing about 57mmscf/d from SD by the end of the year. I don't think we can expect any more than that at this stage. Maybe if SD-4X flows really well and SD-3X comes in and flows well too. The liquids from South Disouq would add about 2 million in revenue I think and will contribute to quite a decent share of the revenue generated. I did some calcs on here a while back, I will try to find them.

[neo26] 12/7/2018 10:16

ShakeyMoroccan and Egyptian gas production increase will happen.In morocco they said they expect to produce around 8-10 mmcfd, at tge moment they are producing gross 6mmcfd.Lets go with 8mmcfd, net 75% is 6mmcfd to sdx, at $12mcf this is $26.2m in gas sales per annum, rem its tax free.In egypt they said if the 2 development wells come in they will aim to produce 50mmcfd, if kelvin and ibn yunus come in then it will be 100mmcfd, one of them came in so they may go for 75mmcfd. Worth mentioning 25mmcfd is c.4000boe, so the target of 8000boepd by year end is a possibility. Current producing around 3500boepd with majority being oil.Lets see if the final development well sd3x strikes gas and the flow rates of sd4x are on par with ibn yunus and sd1x.

[shakeypremis] 12/7/2018 07:58

MAYBE once SDX monetise their recent discoveries this might go somewhere. I've said this before too, SDX could really do with some larger finds to give them some decent reserves. They did increase their reserves very substantially in the last reserves report so hopefully the same thing will happen when the next one comes out given that they they've made some additional discoveries since then with maybe a couple more to come.

[neo26] 11/7/2018 23:35

On 17th may 18, PW said they are undervalued and should be valued close to $400m, well that will give us share price of £1.50.Maybe sdx can start moving to that level.

[shakeypremis] 11/7/2018 13:43

That's because TGL is moving over in Canada. Don't worry, I am not selling a single share here. SDX could conceivably 10-bag (not on current or predicted production but on further organic upside given the prospectivity of both South Disouq and Morocco).