to learn of the closure of the Forties pipeline 'for a few weeks' to effect repairs; we don't know whether that encompasses three weeks or, maybe, a bit more than that to get it 'back on line'. The consensus right now suggests it's more likely to be nearer the former.
Although Serica's lowered its prod. forecast again for Erskine for this year, it's worth bearing in mind that, for the 1st half our income was based upon sales averaging $51.5 bbl's a day whereas the 2nd half benefitted from more buoyant prices nearer $60 bbl's a day (ave) until the closure announcement.
Over the past day or two, Brent has risen to $63.75 per bbl and gas has risen sharply to 70p odd per therm, the latter being way above the ave. selling price of 42p per therm last June.
Ergo, if the pipeline repair is completed by early January as the benefit of the BP income flow commences around these higher prices, Serica shouldn't be unduly affected, income - wise but might even be , somewhat perversely, slightly better off because of it?
Worth bearing in mind as the sp treads water, pending completion of the repair work - sasa.
Yes my post was not trying to be too precise.
I probably should have worded "exclusively African" like the AFR debacle, by way of simple example.
I don't really regard SOLO as a true blue African play (although see few lines down) as it is an investment vehicle which does seem to just put a finger in the air and see where it drops on the page marked "What next?" - helium at the moment.
However if the Gatwick Gusher does produce then this it is the "UK" side of SOLO that interests me.
Incidentally I wasn't really trying to air TLW, SOLO and UKOG here in depth; just in context of why I am slowly withdrawing from some of these (at horrendous losses in some cases) as I feel, quite frankly, that SQZ is a company I can trust. Trust being operative word when you mention likes of UKOG directors and DL etc. Let's not go down that road here but I take your point.
UKOG is a punt but based at least on possible enormous returns/reward after Horse Hill initial testing (albeit nothing to raise the rafters about just yet) but more imminently - Broadford Bridge.
SOLO, yes, are in Tanzania together with AEX but again this is, for me now, just a short play on the side (for Africa interests) and you never know what the government is going to do (or who will be in charge) over coming months although the gas find does seem to be quite exciting.
I suppose really I am de-risking and in a sentence: de-risking but remaining in AIM oil points to SQZ.
My decision investing more in SQZ too is that I am not phased by a pipe line crack (which is fixable) whereas i am phased by sudden RNS's about corruption nd bribery.....and the rest; still very prevalent on the African continent.
I don't know and maybe others may have a feel for this but whereas UKOG and the likes, "if" lucky, can produce multi-bag returns and news is imminent I am not so sure if SQZ offers this opportunity. However SQZ being quite likely to add, let's be optimistic, say 100% from here over a longer period, is still very attractive.
I am slightly "eggs in one basket" as far a spreading my portfolios and maybe over the top but my advice (to myself) is if one is willing to risk the AIM oilers mentioned (and a few others) and spread the risk on these alone then SQZ, from my limited research, seems to really fit the bill.
I tried to get in on the drop today (having been so pleased with my Fill or Kill yesterday at 73.50 but like many (probably)I was still digesting the drop this morning until it was too late.
Anyway, seems like a blip and if we can creep up to 80p by next week and news comes out on fixing the pipe then I agree with many we could be into very exciting ride into 2018.
I am hoping for a small drop again to nearer to 70-72p and will definitely dive in for a top-up but I "fear", as has been suggested, I may not be "lucky" as, hopefully, we will be blue by 4.30pm.
Thanks for your [other] informative and interesting points in your post.
PS: Thanks too, btw, for the pdf file link (300 pages) which I believe you posted. I am working through it slowly.
fl, I think we will see a rise into the New Year as the deal starts and cash build speeds up. However the Forties pipeline news may be a buying opportunity today if weak holders are shaken out. Which they really shouldnt be, as I see this a "non event".
Best share on AIM? Quite possibly!
jontee - nothing to do with me really but as you have given UKOG and Solo 'air' on here, I'd rather take my chances on African plays (I thought Solo was into Tanzania anyway?) than either of the two companies you say you've invested in. Be careful would be my advice (not that you've asked for it).
Both bear the hallmarks of a certain DL and UKOG has already issued enough shares to award one to every other person on the planet - and they're still issuing more. There's a SEDA agreement in place (where have we seen those before and what was the outcome for shareholders other than a select few who happened to be directors who got their rewards in unjustifiable salaries and options). The two UKOG exec directors took over £1m between them last year and as far as I can tell the outfit from which UKOG buys the valuable stakes it's adding to its oil assets portfolio is Horse Hill Developments, which appears to be privately owned. UKOG's exec directors seem to be involved. Have you seriously looked at booked reserves and their make-up?
I attended an extended high court case LGO frivolously and imv dishonestly brought against a company I was heavily invested in in about 2013/14. Ritson, as LGO's CEO, gave evidence under oath. To suggest His Honour Mr Justice Males left any doubt whatsoever in anyone's mind about what he though of Ritson's evidence would be pushing the limits of credibility.
I wouldn't touch either company with a proverbial barge pole. I'm only in 3 AIM companies now and will withdraw my funds when each plays out over the coming years. These are JOG, SQZ and a more chancy play CLNR. I like Algy Cluff, who's a canny individual and is much respected in the industry. CLNR is probably his swansong (he's about 75 and has recently been awarded an OBE for services to business and charity). Present market cap £7.75m. CLNR has two gas licences in the S North Sea it is currently trying to farm out. Licence P2248 has P50 Prospective Resources of 1.73 TCF which is equivalent to approximately 300 million barrels of oil.
JOG is not fully de-risked yet but has produced incredible returns to date thanks to its hard-working and talented team. The journey (I hope) has only just begun.
Sorry for the off topic nature of this post. It's not totally off-topic as to subject matter. The theme is that good management rarely fails shareholders and in SQZ it was Tony Craven Walker and his reputation, plus the experience, ability and clear integrity of his team of non-execs - one of whom had £12m of his own money invested (at then value - it's more like £40m today) that persuaded me to invest (in several tranches starting at 14p) in SQZ.
Here's to Stockopedia being on the mark. My own 'back of an envelope' calcs, using different assumptions about well maintenance costs, oil and gas prices etc using DCF to get to NPV showed SQZ shares being worth somewhere in the range £1.25 - £1.50 a share but value usually unlocks in the medium term as the cash materialises.
There are almost bound to be short term price fluctuations, which I intend to ignore.
It looks like the Forties pipeline is going to have to close for repairs, the export route for our Condensate from Erskine!
Erskine gas goes via CATS but I assume production at Erskine and the other eighty or so fields will cease completely?
Not looking to de-ramp before anybody gets the wrong end of the stick. I have been a long, long term investor here and am a very happy bunny right now.
This might temper the spike which in the long term, which might not be a bad thing.
Well, I agree with Franconia, jontee, whilst it's always painful cutting nasty losses, the pragmatic approach is to recoup those funds faster with something like this which has its tail up rather than persevere with 'duds', 'also rans' or whatever...
Don't know much about BLVN, tbh but was in Tullow a while ago now but growing debts is / has been the problem here for some time - HUR looks interesting but needs to raise a lot of development capital as I understand it .
Never followed AFR but wouldn't touch UKOG myself because of one individual being involved with it - in short, I reckon you've swapped uninspiring stocks (to be kind) for a particularly undervalued / exciting situation here, which looks capable of doing much more than we've seen so far, so good luck...
Hope I've not put the mockers on it now for all our sakes! - sasa.
jontee, I reckon your purchase today will do well over the next few months. Someone is accumulating (imo)and I expect this will push higher over the next few days. I am still eagerly awaiting a Holdings RNS anyday now.
Well sasa43, just for the record, I have today purchased just under 2% of the total BUY volume added to my small holding of 17-28p days as I have enormous faith in this share.
However, it comes as a cost as i liquidated at dreadful losses my remaining African plays (BLVN, TLW and a few others including one I had no control over from months ago - AFR).
I am feeling much happier changing my portfolio slowly to UK based - i.e. North sea including HUR and, ok its a gamble but I have to admit to UKOG and SOLO etc.
Given the latest assessment of SQZ from Stockopedia out last week; maybe, they just confirmed what everybody else on here knows, that this is still dirt cheap, even now...
For those who've not yet seen their figs, they reckon 34p eps is attainable next year, giving a prospective p/e of 2, a PEG ratio of 0.3 with an Nav of 134p v 29p - haven't seen stats as good as that for yonks, if ever, tbh.
We begin to benefit from Jan1st with the deal (to be officially concluded in June) and If all goes well, bearing in mind that the Rowallan 'spud' (free carry for us )will be underway by then, with Columbus soon after, the outlook seems particularly rosy.
if Rowallan finds a commercial discovery, well, say no more...sasa.
Hi Ripley - no disparaging remarks intended; I always think in %tage terms, that's why it's better to see a very cheap share reach a realistic valn rather than muck around with a smidgen here, a smidgen there, (don't forget the dealing costs accruing with all the ducking & diving going on) - no, if you want to succeed in this game, find something going begging, like this and hang onto it.
I've known a number of successful investors in my time but can't recall one who really made a bomb out of trading all the time. Good luck, anyway - each to his own, etc., - sasa.
"Not interested in penny pinching here and there, myself "
Now I'm not as educated as most on this site but i know its better to think percentages.
Your penny s could be pounds , 100s 1000s to others !!
Very simply, Divmad, you raised an issue that might have greatly concerned an uninformed reader, perhaps even causing them to sell their shares.
The part of the deal involving Rhum won't go ahead if there is no reasonable certainty Serica's interests will be well served by the acquisition (I mean of Rhum), The situation is set out in full on page 30 of the admission document, which I respectfully suggest you read before making further negative comments. Whilst every endeavour will be made to ensure Rhum will produce gas as expected, there are no certainties in life, death and taxes excepted.
The admission documents also tells a reader - via the report of an independent firm of Petroluem engineers and consultants - that SQZ's 2P reserves in the interests it is planning to acquire from BP, when used for DCF/NPV10 modelling purposes (a majority of the reserves is 1P) and considered in conjunction with other benchmark indicators of fair value, supports a current share price of well over £1. I don't suppose many punters have read the admission document - or even the original RNS in full because this would imply a thorough approach to investment, when they're only betting on SQZ's short term price. This comment isn't intended to apply to all holders, of which I know many are long term investors.
Wiser? Maybe in the immediate term, Ripley - I bought this a while ago now, 'cos it was very cheap then and it's still that now, after the mega deal for them last week, if you bother to re - do the calcs...
Not interested in penny pinching here and there, myself - much prefer the big pay off which is only half completed, imv - sasa.
Asset X 16 worth!Today 05:55As the assets, which will increase Serica£s portfolio by sixteen times, are worth more than the company itself, its shares were suspended until the firm submitted an admission document for investors to inspect.
I'd average out of UKOG altogether jontee - looks like a confidence trick to me. Horse Hill is the company getting the loot as far as I can tell - and it's private. UKOG's directors (who are involved in HH) take more than £1m between two of them out of UKOG, which I think I noted pays HH for additional lucrative prospects - who pays for this? New subscribers to endless placings or whatever............it's always the same. I didn't look too far into it - looked like all the others so not worth spending the time. It's not to say the price wont spike - people don't look at the basics. Just make sure you're not on the dance floor when the music stops.
Wherever you see the name 'Lenigas' (even if he's apparently gone - he has a habit of sticking around in the background) and the name: 'Chapman & Co' as auditors, watch out. You and your money aren't destined to remain together for long......................
Last 2 posters. Thanks for that link and yes I agree about UKOG and HUR is another year away or longer.
Hoping now for a quick kill on UKOG "if" it gushes in next few days/weeks then might average "up" more in SQZ after I do some proper research.
Amazing, normally have to think about averaging down on AIM stocks; not always best policy.
Have to admit - I thought there was a bug in the streaming prices this morning on my computer.
Also have to admit it was one of my rare "what the heck" plays when I got some LLOY dividend money and bought this on a whim.
i.e. a quick ruler over the website, some chat (probably on here) about 2 years ago and then I think there was an open offer to which I subscribed.
Anyway I cannot believe I am up over 100% and having just logged into this BB haven't even read up on the reason.
Be grateful if someone could summarize in a sentence or two what happened and/or point to where/what suddenly made this take off?Just checked my notes attached to my BUY Portfolio and notice I wrote in the Comment section: "divvy money - In for a penny in for a Pound - what the heck/why not". LOL.
Kicking myself, as always, why didn't I take it more seriously as only a paltry amount. Now I can fix my SBC pump (kills battery every day) on my old Mercedes as it costs £1,500 to fix. Rip off but at least it's "free" now if I sell but then that's all my SQZ gone.
Hope UKOG and HUR do the same.
C'est la vie.
Now that they're up and running again and the shop (Peel Hunt) is out of the closed period, it'll be interesting to see what sort of a new price target they put on it and others, too.
Personally, I put an initial 'fair value' of well over 100p on SQZ for the time being but it's difficult to gauge the revised op. costs ($20 - $25 per bbl v $14 per bbl hitherto?) and thus it'll be interesting to learn what the analysts come up with.
The forthcoming Rowallan 'spud' is coming up in the 2nd / 3rd qtr next year, just as the deal is scheduled to formally complete, so further excitement lies ahead... So GLA - sasa.
It will take a few days before the market decides on a price with many cashing in their chips after a bonus of this kind. But in my experience, pricing tends to be conservative with risk on attitude. Hence if or when Serica starts delivering the cash flows, that's when the market will rerate to more realistic levels.
45p is laughable. It should be 100p+ but as I said, it's going to take a few quarters before the market fully understands the costs involved vs the cash generation.
Eitherway, it's transformational for Serica and Santa has definitely come early
BP announced that they believe they will receive £500.00MM from this deal over three years ( but no mention of assumed gas prices )... over this period Serica should get a minimum of £350.00MM - plus Columbus ( one day ) and perhaps Rowallen
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