Every time I see you pop up I think of Dad's army and Frazer, where all doomed captain mannering, I always follow your posts from hard lessons learned, and others comments when u pop up on there boards :-)
When a company has the fundamental potential to be 10,20 or even higher bagger like FRR,the decision for some that includes myself is not when to sell but when to take profits and when to buy back.
Even if the potential is clearly there to be 25p it will not happen in a straight line,on the way there will be many opportunities to take profit ,sit for a bit then buy back .Sometimes you end up having less total overall money but with more shares,which is always my aim,to gain more shares when i know the company has a future.
So far i have done quiet well on FRR in the last 3 months,infact at least 30% of my shares are from top slicing at peak or near peak and buying back when its 20% lower.
That is one way you can look at it as a beginner ,of course there is always other ways too.
I see massive opportunity here with FRR and it would not be a good idea to be out of it completely.
A very eventful week, and you know what? We didn't even get an RNS last (trading) week! Now with the power of social media especially twitter (plus a very open and engaging CEO), we saw what was going on the ground.....and there was lots. We saw that the gas well was hooked up to the 'Christmas Tree' (good spot ToT) and flaring good quality gas (just those few pictures killed all the speculation that the Ud well was a dud and reassured the faithful). In addition, we also saw lot of activity around T45 and if I had to take a guess, I reckon drilling at T45 may commence as early next week, before Thursday's gathering so at least Zaza has something new to say at the meeting. But any news on Ud will really get the atmosphere buzzing......Someone has already said this, but next week is 'promising' to be very exciting.
On the s/p, we had a really strong finish to the week with s/p reaching the par price of the last PB placement at 0.58p (mid-price). Hopefully it can kick on next week.
But for now, all eyes continue to be on results from Ud as this will transform the gas side of our operations and unlock recoverable MK gas of 5.8TCF. We also know that FRR want to rework another deep gas well drilled by the Soviets and this is most likely to be V-1, which is situated around 14km from Ud and is known to have similar quality gas. So most likely, we will probably get one lumpy g'Gas Window' RNS in terms of Ud results, laying of the pipes and reworking the next well.
However, when will that be? Not sure as most of my predictions on FRR timings have missed the targets. But I do believe they have probably now completed 30-days of continuous testing at Ud, so must be close. If Zaza is interested in attracting new investors during his upcoming London visit and O&G Conference, then releasing the gas results will do the trick.
BF1 - I personally don't focus on SP so much as MCap re long term investments - which FRR is for me (in fact very long term). It is all about where you believe the market cap can get to, and then track back to SP.
So, rounding the numbers, if you thought the WHI version of the oil play was possible you have a MCap of - say - £600 million against - say - 15 billion shares. So an SP of 4.00.
If you believe the MCap should just be sufficient for ZM/SN to recoup their investment (say £35 million including the RPNs at full value), and they have - say 2.8 billon shares then the target Mcap goes to around £190 million. The SP would be around 1.25P just for them to break even
If you believe they wish to make a good return go well North of £190 million and 1.25P
If you believe the gas will add value then add a number to the oil number- and how long is that piece of string? But for me the gas is surely worth far more than the oil - assuming that they can move to a programme of commercial extraction and proven assets. You would then be talking about 10p - and the rest.
Or simply accept the SN/ZM declared target of $1 billion so MCap of around £750 million and SP of around 5P
There are no certainties in this life least of all in high risk/high reward investments. But I made my choices many years ago and feel more confident now than ever. I am sure that like others with large holdings will cash in some shares in the early stages of any rise but the bulk is definitely there for the high reward part of this play. Otherwise I would have stuck my hard earned into a host of other safer bets in the first place.
I plan to buy the missus a newish car and join the Hilton fun at 3p. But not sell more until 5p then 7.5p is my big target. If its strong there then 10p should see me done.
I will have retired at 7.5p though. Anything above that looks after the kids and theirs too!
I think we will sell the gas at lowest 5p but can get a further 2.5p out of the oil conservatively
Mmmm he can't tell us anything that is price sensative. So would need to be an RNS b4 if he has any good news. Apologies for stating the obvious
Delay in testing, all good, something out of the blue scuppers hopes short term. If nothing by the meeting then I think the market boys will dump us, hopefully Z sorts a late xmas prezzie out as promised.
TOT, just enjoy the peace and quiet for now. If ud2 is commercial and the flow rates are in the 10mcf range this board will go crazy.
Something very big is about to go down and I think Zaza wants to tell the news in person.
What did Zaza say Aug 2017? Give me a year? If ud2 flows and the 3 oil wells come good I think we'll be looking at a market capitalisation in excess of 500m gbp. I remember DES being nearly worth a Billion pounds with nothing but dreams...
Anyway I googled Flaring gas and Flare pit and this is what I found
During well production testing after drilling is completed
After a gas well is drilled and/or hydraulically fractured, a temporary flare is used during well production testing. Testing is important in order to determine the pressure, flow and composition of the gas or oil from the well. Flaring at the well site can last for several days or weeks, until the flow of liquids, detritus and gas from the well and pressures are stabilized.
The enclosed or ground flare system is preferred when the gas composition is of clean burning gases such that there are no residual contaminants left after flaring.
Thats clear then, a few weeks in and we are shown our gas flare during testing. We know of the clean composition so we also have that confirmed by the type of flare utilised.
I look forward to next week and will thoroughly enjoy my weekend on the back of these tweets and the confirmations that they bring us.
Just had to have a couple of goes, furst one, no firm price, so I left it open and eventually came as sold at 0.6, ( buying 15k worth)so had another go for more and same again at 300,000 shares for 17k odd, got quote but pending yet again, just so you know.
Got to make sense now surely, have I missed something?
Well looks like a project I work on may fold in the next 1 1/2 month, so last tranche bought and hopefully not the worst mistake I have done .565. I am very superstitious, if there is a delay in a bet I do, a purchase of shares, anything for some reason delays me from handing cash over, I don't buy as it goes wrong, and this time it was delayed :-( but still hung on and bought on a T10.
So hopefully she can rise to 4p at some stage pretty soon, then it's off on holidays lol, if not then a nice 3 month break before looking for work again.
Frankly I am amazed that this board is so quiet considering what's about to happen here. Blowing up the picture of the Ud2 rig you can clearly see the Christmas tree fitted , which is of course only used for production testing, and you can see the red pipe coming off it towards the flare pit which hadn't been excavated when I was at the well site.
Now one thing I would mention is that FRR share the same broker as VRS (which has been exceptionally good to me over the last year). Like Zaza, the CEO of VRS is closely aligned with his investors with a massive shareholding , and it has not escaped my attention that he uses his twitter account to drop subtle hints to his investors when good news is coming. I have taken the hint and benefitted from this on several occasions, and I wonder if the broker and PR team at YJ suggested to Zaza that it would now be timely to drop the hint here? I have added two more tranches yesterday and today on the basis that they are now pursuing the same strategy.
I mentioned last week that Zaza is possibly playing a blinder here as to timing, and am now more convinced than ever that that is the case. Let's face it who would want to sell post Ud2 news when we have the prospect of follow on news from T45 in pretty short order, not to mention the possibility of a JV being announced for the MK gas field in the interim? The London gatherings will no doubt provide additional assurance as to the company's plans and the implications of Ud2 results for a revised CPR.
Next week is going to get the adrenaline pumping for sure.
The flaring to me indicates that they have completed the perforations into the three target zones ( enough rather than full length possible), have flow and pressure tested at each level, cleaned up as far as possible and are now flow testing the co-mingled gas to help clear out any remaining fluid and acertain how the pressure/volumes hold up over time and valve opening sizes; e.g. peak volume when fully open, valve size max with stable flow and pressure, etc. which will take about a week.
This implies a fairly report should be ready for an RNS next week ahead of Zazas planned meeting.
This all looks very good to me so far for a commercially profitable service to start very soon given the excellent gas content.
Market and some people appear to be underwhelmed with yesterday's twitter pictures on the gas flare and it seems you can't win either way. But for me it was a massive boost, because it confirms we are still on track to bring Ud in to production and "on our way to prove gas reserves of 5.8TCF". The only factor waiting to be confirmed is the daily flow rates. But hopefully, after yesterday's photos, we are past the stage of questioning if there is natural gas there or the quality of it.
Now, we (investors and the Market) have very limited memory and patience, so it is worth referencing yesterday's important twitter pictures to the last Ud official/RNS update, which was on the 28th November. Here Zaza told us that "As expected, we have drilling debris and fluids (hematite) still coming out of the formation and perforations, and once the well cleanup is completed and we are in a position to accurately measure gas flow rates, we look forward to updating market in due course." So few weeks later, still no news but Zaza gives an interview released on the 13th December where he claimed that the clean up would be completed 'any day now' so testing can begin. It is also in this same interview where is claimed "presents for adults" for Xmas or latest by year end. But obviously that didn't happen. But do I care? I did until we got that twitter pictures yesterday which massively reduced my frustrations. And I won't care if he delivers Ud in to production at big levels in the next few weeks.
So why release the flare pictures yesterday? I think they have achieved massive operational success, probably at the most important productive interval (the third one). Hence felt confident enough to show some pictures yesterday. I have always maintained that we, the investors, are at least 1-2 weeks behind progress updates and this is a deliberate safety net that Zaza /PR team has built to manage investor communications.
Now, the other important comments that's worth highlighting from the 28th Nov are the following:
1) ".........Based on the Netherland, Sewell & Associates resource estimate, the Gareji and the Maykop reservoirs of the Mtsare-Khevi Gas Complex are estimated to contain 8.3 TCF of Gas in Place (OGIP), with 5.8 TCF considered to be recoverable."
2) "......We are hugely excited with the interim results of the Ud-2 well testing. Flowing gas from Miocene-aged Gareji reservoir is a transformational milestone for the Company and a big step towards the energy independence for Georgia."
3) "........Natural gas with similar quality as at Ud-2 well had been sampled by a previous operator whilst drilling the Gareji reservoir at V-1 well, situated 14 km north of Ud-2 well in the Mtsarekhevi Gas Complex, and also at wells T-39 and T-40 in the Taribani Complex, situated 50 km east of Ud-2 well. Within Block 12, the thickness of the Miocene-aged Gareji reservoir is estimated at approximately 2,000m and extends for about 130km from northwest to southeast. Oil and gas contained in this reservoir is sourced from the world class Maykop source rock. 500km further southeast from Block 12, the giant Shah-Deniz gas field contains natural gas sourced from the Maykop formation as well. Current progress at Ud-2 well brings all abovementioned into context for future drilling operations and tremendously increases our confidence while flowing Miocene-aged Gareji natural gas first time in Georgia's history."
Finally, with the London gathering fast approaching next week, the chance of getting the gas update before then has gotta be high, particularly after release of gas flares yesterday.
In the meantime, FRR about to embark on a 3 well oil campaign which will unlock 100m barrels, at a time when oil has found its mojo again.
Please hold on for another week before RNS in FRR as I really need a majority stake invested in LION to multi bag with todays amazing news before I can release further monies for FRR, Good luck to all investors.
Just catching up on todays posts, and I see RB40 on LSE has already commented. A few points re my understanding of the notification process:
- Under AIM rules the shareholder should notify the company of any single name holding above 3%. On receipt of a TRI the company then update its records and notifies accordingly. The Nomad would be immediately made aware of such notifications, if they exist.
- However as FRR is Caymans registered I understand that different rules apply to holders outside of the UK ie a 5% rule. Hence the disclaimer on the website.
- Zaza holds 7% of stock just under 1.02 billion shares valued at around £5.5 million. If he was trading he would have to let the Nomad know and report accordingly. The Nomad would be very insistent on this.
- SN holds 11.8% of stock - around 1.71 billion shares valued at around £8.6 million. Same rules apply.
- Collectively they of course paid over £20 million for these shares over the years (source - SB and myself have simply kept track of this over the years). I have never for one single second thought that ZM or SN are out to simply recover their outlay
- I have no idea how Reuters get their data.
The accumulation could of course be anyone, but Stephen Hope is the one director who holds no stock personally. However I am pretty sure that Outrider would have investment vehicles that could operate at arms length to Hope himself. Pure speculation on my part - but if you were a director and obviously in the know, and your convertible debt had recently given up the convertible option, I would have thought that you would have been busily exploring new ways to ride the equity wave.
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