Touchstone Exploration Share Discussion Threads

[che7win] 11/10/2018 07:25

Excellent!

[brasso3] 11/10/2018 07:22

2000 BOPD!

[gabrieloak] 11/10/2018 07:19

Great update from Paul Baay! Well done TXP!

[mr. t] 10/10/2018 21:32

I've pivoted heavily into O&G so I hope high quality O&G continue to outperform...

[mount teide] 10/10/2018 20:38

Many traders favourites with extremely frothy valuations have taken a real hammering over the last few months:

-35% Fevertree
-40% Plus 500
-35% XLM
-35% Die Roboter
-34% Debenhams
-33% Purplebricks
-44% Zoo Digital
-23% GVC Holdings

The wider general market should benefit from having the froth wiped off the top.
High quality O&G sector stocks have bucked the trend and provided a safe haven from the storm raging outside across the general market.

[mount teide] 10/10/2018 17:19

cfc - well done! - i halved my remaining holding again following that post and now hold circa 400k at an average of 15p. Since last summer i've seen a six figure profit build and then evaporate quicker than morning mist as a result of that unexpected huge placing at a massive discount to the previous share price highs.

Giving them until early in the new year to start rebuilding trust and generating some shareholder value - otherwise will look to move the remaining position elsewhere.

[captainfatcat] 10/10/2018 16:48

"captainfatcat 26 Sep '18 - 12:48 - 2969 of 3126

MT probably a wise move on TRIN I feel the share price is going to trade side ways for a while with any rise sold into as placing money looks for exits.

Also a head and shoulder chart pattern looks ominous, should it play out sub 15p looks likely."

-------------

Nice to call it right once in a while.

[mount teide] 10/10/2018 14:53

L2: 4 v 1 / 19.0p v 20.6p ( 3 MM's moved up to join Peel on the Bid in the last hour )

[mount teide] 10/10/2018 12:50

Look East to the ultra high population Nations of SE Asia, China and the Pacific Rim if you want to see where all the O&G consumption growth will continue to come from over the decades ahead.


Global / Regional Oil consumption 1965-2017 - 2018 BP Statistical Review of World Energy

United States consumption is 3.5 million BPD higher than in 1973, which amounts to growth of just under 15% in 45 years. Demand in the EU has declined by 13% since then.

But demand in the Asia Pacific region climbed from 9.1 million BPD in 1973 to 34.6 million BPD in 2017. This huge increase in demand is the primary reason the global demand curve has marched steadily higher.

Of course, Asia Pacific is where most of the world's population lives - therefore demand growth is being driven by billions of people who use a lot less oil per capita than the US, but whose per capita consumption is not only rising but rapidly accelerating.

Chinese demand has increased by 5.0 million BPD over the past decade, by far the most of any country. But Chinese per capita demand is still only 3.3 barrels per person per year.

The US consumes about 22 barrels per person per year. That is partially a result of a more mobile and affluent population, but US consumption also drives a much larger economy.

To put the current US demand in perspective: if Chinese per capita demand were as high, it would be nearly as great as the entire current global consumption.

In second place for the largest increase in oil demand during the past decade is India, which has seen its demand increase by 1.7 million BPD and whose growth is forecast to overtake China over then next decade. Third place will probably be a surprise to many - Saudi Arabia has increased its oil demand by 1.5 million BPD during the past decade.

The largest decrease in demand over the past decade was in Japan, which saw oil demand decline by 1.0 million BPD. Second place will be another surprise, as the US saw oil demand decline by 800,000 BPD. Italy was third with a decline of 493,000 BPD, while the entire EU saw demand fall by 1.7 million BPD.

So, all the demand growth in oil over the last 30 years has come from the ultra high population Emerging Nations - the EU, USA, NZ and Australia collectively only account for 12% of the global population and this is forecast to fall to just 8% by 2030. And the good news for O&G and copper investors is that the demand growth from these regions is still in the foothills due to its very high population, very low but rapidly rising consumption per capita compared to the West and need to reduce its energy generation reliance on high polluting coal for health reasons.

[crooky1967] 10/10/2018 09:09

We could be due one either tomorrow or next week as that will be 2 months after the last one.

[highly geared] 10/10/2018 08:42

Operational update would be timely to reinforce positive direction of travel.
Brent at $85…

[brasso3] 10/10/2018 08:36

RNS at CERP this morning.

Still a long way behind TXP.

[captainfatcat] 09/10/2018 12:52

Sold a few this morning to top up in SQZ but still holding a decent amount

8-)

[che7win] 08/10/2018 13:30

Most people seem to be buying here, in contrast I sold 65k here Friday at 21p.

The market is quite volatile, but I do like TXP so will retain a sizable holding.

[gabrieloak] 08/10/2018 12:48

Hi All,

Just touching base here as have been watching TXP with some interest over the last 6 weeks...in it's own right but also in light of your drilling campaign / progress reading across to Trinity's on a sector / geographic basis.

I remember PB commenting as follows a while back:

"The rig completed at our eighth well recently and should be moving off in the next week. That will free us up to get the service rigs in and ramp everything up, getting us to where we need to be. Hopefully, in mid-September, we will be through that 2,000bopd range, and once we have two weeks of production at that level, we will put out an update with more details. We still hope for our exit rate to be 2,100bopd this year."

Fingers crossed this happens...though we are nearly Mid October.

G

[mount teide] 06/10/2018 21:49

Mr T - interesting comments.

Long term buy and hold investor Warren Buffett famously stated he liked to buy shareholdings in S&P 500 businesses with economics "so good they could be run by an idiot - because one day they probably will be!"


With regard to 'Quality and growth potential of the the assets/business' in the commodity sectors:

Our first hand experience and research over the recovery stage of previous commodity cycles revealed many small/med cap businesses in the Industrial metals mining and O&G sectors with potentially great assets and outstanding growth prospects in a rising commodity price environment, went on to realise much of that potential - in most cases we considered it was probably due to inept or relatively inexperienced management.

'Combine a great management team with a business of poor economics, and it is the reputation of the business economics that’s likely to prevail.'
What Warren described perfectly there is the long post peak stage of the commodity/shipping industry cycle after the product supply has grown far faster than the growth in demand resulting in tightening markets leading to a large oversupply situation - with an all too predictable impact on product pricing.

In such circumstances it does not matter how great the management team are when the spot charter rate drops from $240,000 a day to $2,800 a day for a Cape size bulk carrier and stays at a level for 5 years many times below the break even operating cost , without any contribution towards statutory surveys, maintenance and finance payments - typically 80% of a new vessel is funded by finance. The result is the near total destruction of the equity value of these companies - between 2010 and 2016 every quoted bulk carrier company on the US exchange either ended up seeking Chapter 11 protection wiping out shareholders equity or saw an average 98% loss of equity value.

It was little different in the industrial metals sector - titans like Glencore saw the loss of 85% of its equity value, its dividend suspended and then shareholders were heavily diluted by a massive placing to raise cash to strengthen its balance sheet.

The O&G, Shipping and mining sectors are true boom and bust industries - the little understood secret of the recovery stage of each new market cycle of these industries( average cycle length is 15-18 years) is that the equities almost without exception significantly lag the recovery of the price of the underlying commodities for the first 2-3 years following a cycle bottom - providing in this cycle investors with the opportunity some 2.5 years following the last cycle bottom in H1/2016 to still get in at say the 5 floor of a 42 storey block of offices under construction.

AIMHO/DYOR

[wanobi] 06/10/2018 20:23

Mr.T, thanx for sharing and the heads up, very much appreciated, best of luck with this, cheers Wan

[mount teide] 06/10/2018 19:59

Spangle : Corosan - Carapal Ridge pipeline question - many thanks for your very helpful reply.

'By the end of the fourth quarter of 2002, construction of the gas processing facilities at Carapal Ridge-1 (CR-1) was completed and an 11.5 kilometre, 10-inch pipeline connecting the well into the National Gas Company (NGC) grid at the Trinity metering station was installed. The plant was constructed and brought into service for US $2.4 million and the pipeline was constructed for US $2.1 million.

So you'd need to halve this cost for half the length to Corosan, at least double it for price escalation over that period, at least halve this result again for a smaller diameter, and then correct for any terrain issues that would make a Corosan line easier or harder to install than the export flowline from Carapal.'

[mr roper] 06/10/2018 19:22

Super post, MT. The next couple of weeks shall hopefully be very rewarding for Asiamet holders, while the next 5-10 years most certainly will.

[wanobi] 06/10/2018 17:20

MT, what a post, awesome, hope you don't mind,,, I just had to copy it into my 'wanobi & AAZ' learning thread today as I've been discussing CAML, TXP & JSE with KS all day.... cheers Wan

[mount teide] 06/10/2018 16:58

When researching Industrial Metal and O&G equity investment ideas, two friends and i(all 40 year senior management veterans of the global supply chain industry - shipping/ports) have refined our approach over the decades such that we now place an extremely high investment case weighting on the following:

1 - Stage of the commodity cycle

2 Career track record of Management
3 Management response/answers to some very direct questions
4 Quality and growth potential of the the assets/business

Other than in the most exceptional of circumstances we now only invest in the recovery stage of the highly cyclical commodity markets(as we don't short) - therefore the first item on the above list is of critical importance.

The one exception we made during the industrial metals sector recession between 2010 and H2/2016 was CAML - which incredibly, during the last 8 years, 6 of them a severe recession that decimated the sector, returned an almost unbelievable 20% CAGR - while nearly all other miners generated negative returns.

Number 2 - We only invest in proven senior management who can demonstrate outstanding success in a previous commodity cycle recovery stage.

Number 3 - We ask some extremely direct questions of management both eye to eye and via written correspondence. We expect them to respond by being open and not getting offended by our directness and by providing as much information as is possible within market rules. One CEO, a hard nosed businessman who shall remain nameless was magnificent and actually said; "I am not at all offended by your questions, its your hard earned money, in your shoes i would be asking exactly the same questions!". Needless to say we have been long term investors in his business which continues to go from strength to strength.

Number 4 - While very important, it has a slightly lower weighting than 2 & 3 on the list. Outstanding management in a recovery stage of a commodity cycle can often deliver a much better investment return for their shareholders with average/good quality assets to work with than a modest/inexperienced/poor management can with extremely high quality assets.

Give an outstanding, highly experienced and successful management team with the triumphs and scars of a few long term commodity market cycles etched deeply into their backs, great assets to work with in a new commodity market recovery stage and, the risk/reward for exceptional shareholder returns is potentially excellent.

The most outstanding company's/management's to pass muster with respect to our highly demanding small/mid cap investment case requirements in this new commodity market recovery stage are (in addition to CAML): ARS / TXP / JSE

Some have assets that are potentially world class with exceptional growth prospects - in the hands of outstanding management such assets have the potential to deliver extraordinary returns as was seen during the last commodity cycle when during a long period of modest supply deficits between 2000 and 2008, one management team grew the market cap of Oxiana Metals 2,000 fold from a $3m junior to an an almost unbelievable $6bn large cap and another built an O&G company from scratch to a highly profitable and valuable 20,000 bopd business; while another generated between USD7 – 10 billion of net present value to a company.


As former all time great Olympic athlete Michael Johnson recently said, give an outrageously talented athlete(management) with one in a billion genetics exposure to even a modest programme of chemical assistance(assets with world class potential to work with) as the East German State did to their superstar athlete Marita Koch in the 1980's and, the results are so far off the charts due to the exceptionally high natural talent starting point, that you end up with almost impossible to believe superhuman performances like her 400 metres WR(2,000 fold market cap increases) "that will probably stand the test of time for at least another 100 years without ever being troubled."



AIMHO/DYOR

[mount teide] 06/10/2018 13:28

Good to see many more shares going to sticky hands like Mr T and the Newlands.

Current TSX price of $0.35 is the highest since early 2015.

There's a beautiful deep bowl forming on the 5 year TSX Chart with H1/2016 predictably showing as the bottom($0.10) - target:CAN$1 / £0.60p

Euroclear's latest Stock on Loan Report(Short Position) shows a ZERO figure for TXP.

[wanobi] 06/10/2018 13:02

800K more, blimey MrT. how many have you got in total?

makes my 25K look pitiful :-)

best of luck to us both,,, boy that's some statement of confidence in TXP..

thanx for sharing that, cheers Wan