Stratic Energy Share Discussion Threads

[surfer2] 12/11/2009 23:12

was watching this ( used to follow grove energy a few yrs ago )but dissapointed to see sale of what was supposed to be their best asset in the short term /medium term - Abbadesse... so what now?

[rathkum] 08/11/2009 10:25

So much for the bullish outlook some of our well informed friends from across the pond were posting until recently, more so as to what was being posted prior to the Bowmore announcement. Shows how BB can be bad for your health.

Sadly the outlook appears very bleak even with good results from Syria. Only saviour would be for someone to take us out but at what price.

[steelwatch] 08/11/2009 07:59

Farmscan - I think ifu would agree with you on that and it is now the only card in the pack to stop the share price tanking following recent disappointments.

[farmscan] 07/11/2009 20:16

IFU

Why do you say that "Syria becomes more important than it should be in the larger scheme of things."?

With 35% of block 17 is there not considerable potential for this to be a "company maker"?

[ifudrillittheywillcome] 06/11/2009 14:47

The news is a big yawn over there. Could be ignored over here too. It's has now become very important that they correct the issues at W. Don and get the production numbers up to at lease decent numbers. And with one less than exciting piece of news after another -- Syria becomes more important than it should be in the larger scheme of things.

Lack of cash - will make them a North Sea Oil company whether they want to be or not. I thought that the crucial times were behind us -- but they are not. no one will jump in with deep pockets it's clear that the last financial hurdle is behind them.

ifu

[ed 123] 06/11/2009 11:11

Thanks, Rich. :-)

The figure of $3.6m per bcf puts a better spin on it.

Italian sale will get borrowings down to about $40m. They seem to be committed to developing Crawford but haven't got the funds (est. $80m). It might be better to sell this? Worth $30m (?) undeveloped and avoid the $80m expenditure. That would greatly improve their near term financial outlook.

Further expenditure to come in 2010 on West Don, but at least it's earning its crust.

It's not easy for a North Sea minnow atm.

Maybe they should be moving their geographical focus?

Market unmoved by today's news. Waiting for Turkey and Syria results?

[rrogans] 06/11/2009 09:23

Hi Ed 123,

Divided the price by the proved reserves - but is should be $51m/21 bcf = $2.4m per bcf. Using the better case above it is $76m/21, or $3.6m per bcf.

Looking at Breagh, that was 600bcf (100mmboe), and they sold 10% of that for $60m, but without any real development costs, so perhaps this deal isn't so bad.

Rich

[steelwatch] 06/11/2009 09:05

Another from the IV board:

Msg 4320 of 4326 at 11/5/2009 4:42:30 PM by algrovenew


Recs: 7 | Views: 154

They are getting more than what appears

Don't forget that before they were committed to pay about $15 mil to extinguish the low price gas sale contract that Grove had entered into, as ENI wanted a clear title to the asset. Under this deal it appears they no longer have to pay :"and the assumption of existing obligations relating to the assets." So in effect they are getting US$50.9 +15 approximate + 9.8 contingent=75.7 x 1.08=Can$81.7, which is roughly equal to the 85 that some of us (including me) have speculated about on this board sometime ago, when the canadian dollar was much lower. US$ is more relevant to them as their expenses and loan are in that currency.

[ed 123] 06/11/2009 08:59

Rich.

How did you calculate the pricing quoted in your final paragraph?

Thanks.

[steelwatch] 06/11/2009 08:39

Buyers market I guess. With bank funding still pretty much closed, that may turn out to be a good price when measured against any future acquisition, remembering that West Don production is delayed, not lost, and the oil price has improved, though for how long remains to be seen.

[rrogans] 06/11/2009 08:27

Does anyone have a view on the price tag for the Italian assets? Must have cost Grove a good proportion of that figure in exploration and initial development costs.

From the Development plan agreement ...

CALGARY and LONDON, February 25, 2009 - Stratic Energy Corporation (TSX Venture: 'SE', AIM 'SE.') ("Stratic" or the "Company") announces that the Development Plan for the Longanesi Field has been agreed with Eni and submitted by the two partners to the Italian authorities for approval. The partners have agreed that Eni will operate the development. Submission of this plan initiates the start of the formal regulatory process, which will take at least 12 months and is expected to result in the award of two production concessions (San Potito and Bagnacavallo), and the necessary consents to permit construction and drilling operations to commence within those concessions in 2010. The Development Plan includes the drilling of three new wells within the field, the completion of the two existing wells as producers, the building of a pipeline gathering system and processing plant and connection to the national gas grid. First gas is targeted for 2011.

... so the deadline for the milestone payment is tight since the Italian bureacracy is terrible, and an optimistic 12 months puts the paperwork at March 2010. Then rigs would have to be mobilised and so on - I don't see any prospect of that $9M, especially if I knew a few delays would save me having to pay $9M!

Reserves were 21.62bcf (3.6mmboe) proven, 37.2 (6.2) probable and proven, so that puts a price of $2 per mmcf (or $14 boe), which seems poor to me, bearing in mind there were other assets tied up in the deal.

Rich

[steelwatch] 06/11/2009 08:26

OJ was spot on. in two out of three respects, so another announcement may be in the wings, possibly for the TSX open around 14:00 GMT?

JAK108 - 30 Oct'09 - 17:16 - 706 of 708

Some more commentary from OJ (message 1719, 29 Oct. 09)

'Next is another company that I own and follow. SE. The sale of Longanesi is to be announced very shortly and this along with Turkish results (which we are hoping will be good as they have a 90%+ drilling success rate there) could move the company's share price much higher.

I was, however, disappointed to learn that Petrofac continues to have problems with the West Don and Don Sw Fields and getting them up to full production.

[father_paul] 06/11/2009 08:08

Revenue from West Don will be $22m by year end rather than the $33m hoped for in September.

Sale price of Italian assets spot on at $50m, but with an additional $9m.

[steelwatch] 30/10/2009 17:27

Jak, work is continuing on the tie back to the Thistle platform which will relieve the bottleneck in the New year.

[jak108] 30/10/2009 17:16

Some more commentary from OJ (message 1719, 29 Oct. 09)

'Next is another company that I own and follow. SE. The sale of Longanesi is to be announced very shortly and this along with Turkish results (which we are hoping will be good as they have a 90%+ drilling success rate there) could move the company's share price much higher.

I was, however, disappointed to learn that Petrofac continues to have problems with the West Don and Don Sw Fields and getting them up to full production. See today's article from below.

Northern Offshore Comments on Northern Producer's Backlog
Northern Offshore, Ltd. 10/29/2009
URL:
Northern Offshore has announced a revision of estimated 2010 production tariff revenues from its offshore floating production facility, the Northern Producer. The Northern Producer is on location in the Don field area in the U.K. Sector of the North Sea under a "life-of-field" term contract. The majority of revenue from the Northern Producer is derived from a tariff on production moving across the platform. The tariff is based on both the level of oil production and the price of Brent crude. Estimated tariff revenue is included in the company's estimates of its contract revenue backlog.
Based on production estimates available to it, the company had recently estimated the production tariff revenues for 2010 at approximately US $84 million. Northern Offshore has now reduced its internal expectations and projections of 2010 tariff revenue from the Northern Producer to about US $50 million at current Brent oil prices. This revised estimated tariff revenue is based on many uncertain factors and assumptions that could cause actual tariff revenues to vary materially.

' I was able to discover that Petrofac should be able to rectify the problem but we may have to wait until the end of November for a final answer. It is not a problem that cannot be overcome but the fact that it still persists does now make clear why there was a recent sell off. More to come in the days ahead then. '

So there could still be some further uncertainties with West Don output?

[steelwatch] 30/10/2009 17:02

JAK - maybe farm-out news also possibly?

I have created a second link in the header to IV to read Oj's new board. Not sure what's going on over there, but the site is running slow, but should be fixed Monday according to IV.

[jak108] 30/10/2009 16:57

steelwatch - Petrofac update of 22nd Oct reported water injection operational but gas lift was still being optimised after having been commissioned. Presumably both water & gas lift should be effective by now one would think, thus giving higher production? Also with oil holding at ~ $78-80 a barrel, the revenue to SE should be rising.

Crawford FDP submission is being worked upon - due for submission soon - is it by Y/E?

Longanesi deal / West Don update are more material from impact on share price OJ is implying news rather more imminently - next day or two? Time will tell no doubt. GLA

sw - Smart move to add link to OJ's commentary site.

[steelwatch] 30/10/2009 15:52

Q3 results out in around 3 weeks. Too early for news from either Turkey or Syria. That leaves Longanesi, West Don production update, or maybe Crawford update. Anything else anyone can think of?

[jak108] 30/10/2009 14:36

According to latest commentary by Oiljack

'For holders of SE. Watch this morning and next mornings volumes. Word out of London is that an RNS/NR is finally coming and is to be released very shortly.'



Certainly it is long overdue and there seems to be some action today - fingers crossed. See the link above.

[steelwatch] 22/10/2009 21:57

water injection has now commenced on the West Don field

[jak108] 20/10/2009 00:27

Strong finish on tsx @ 0.32 - perhaps the persistent seller is out, perhaps we are nearing RNS re Longanesi - some further buying by OJ & others on tsx. We are now past mid Oct so RNS for Longanesi well overdue - could come anytime, fingers crossed.

[steelwatch] 08/10/2009 22:53

Farmscan - and pray for the sale agreement for Longanesi soon to secure the gateway to the bigtime!

[farmscan] 08/10/2009 17:10

This is like being in EEN & GPX. 2 pieces of positive news in as many days & very little reaction. I like that!

Fingers crossed for 50days & 80days.

Tick Tock (to coin a phrase)

[ed 123] 08/10/2009 14:46

... and a second countdown timer of 80 days.

They seem to be getting their ducks in a row.

The big daddy duck I want to see is the Italian asset sale.

Sentiment should be improving. Market waiting for 'bid daddy'?