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Longboat Energy PLC - Farm-down of two exploration licences in Norway #LBE
https://www.voxmarkets.co.uk/rns/announcement/43373f94-39e0-4226-bb90-6cc86e93a745 #voxmarkets
So is this good or not so good news?
less interest in potential future production
I dont think its good news as the sp has barely moved. No cash obtained for the farm-in deals only a carry on for future drilling costs. not the best of deals.
My guess is a fundraise is coming soon, Company is running out of money so i sold out.. GLA
Ridiculous interpretation. The last webcast literally stated that they would be looking at farm outs to minimise the risk of exploration (literally the words were ‘we’ll use someone else’s money’) drilling and focusing on production and development acquisitions.
@Garcy
What nonesense. Getting costs covered is good. That's how these things work.
Whats makes you say a fundraise is on its way? Or is it that you've sold so now talk it down. Funny how today's news makes you sell.
Does anybody even bother to put pen to paper anymore in sussing out, valuing the assets and potential on hand instead of chasing something thats not underpinned just because they think the action is somewhere else right now ?? (but good luck to them).They're paying over 10 times the price at UPL compared to a year ago and 7 times the last placing barely 8 months ago.
UPL no psc awarded yet for the 45% study of the 6700 km2 SK334. Little cash, no 3D seismic to help define any prospects. They've signed letters of intent only for a rig but that wouln't instill confidence in me where they're going to stick a hole whenever the PSC is awarded and at what percentage they end up with or if they farm out reducing the as yet unknown prize.
At 4.3p valued today at £51m - what is there to fall back on if the first drill fails ? PIs neither know at this minute what the prize on offer is and what they might farm out to hold on to ?
At least LBE are underpinned on the assets they have. They may have access up to $200m of financing in Norway. A company like Japex doesn't get involved without dd and some level of comfort.The initial acquisition for the JV will have one year of contributions from the effective transaction date of 1/1/23.
"Based on Longboat Norge's internal estimates, at current commodity price levels the Transaction is anticipated to reach payback in under two years" - "the Transaction is expected to unlock material tax synergies within Longboat Norge associated with historic corporation tax losses"
Around 600 boepd is expected shortly. They paid $8.20 per P2 barrel.
Based on using $50m of the ($100m) JAPEX funding and $50m subordinated debt they could realistically pick up over 12 mmboe P2 and 4,500 boepd to give about 20 mmboe in the JV and around 5k boepd in total and maybe with a similar pay back of which they could go again as its a 5 year facility and thats only looking at using half those funds.What will 'punters', 'herdsmen' or investors think when they see 9 TCF estimated recoverable for Kertang in an exploration hot spot, gas coming from the structure and amplitude brights and covered by 3D when it draws closer.
There's 2 other prospects half the size also covered by 3D - imo maybe 3TCF each which could likely bring it up to 15 TCF but there are multiple prospects all over the block. They've got 52.5% and in the recent interview they expected a farm down where a partner would be seeking 25-30% and if so would leave LBE with 20% minimum - a 3 TCF/500 mmboe prize or some $1.5b of potential at $3/boe or versus 56.7m shares now or even 100m down the road - possibly a tenner a share if that came in but at least the risk is backed up by the assets/production we currently have and will have - that i think could value us well in excess of £2 from Norway on its own.
The unknown is the financing of new production deals in S.E Asia but again a JV route may be the way to go as they've stated they intend to minimise shareholder dilution.
In essence not just one prize on offer for LBE!
Just because the share price is tooing and froing a penny here and there - over 51% is held by directors and instutions and how many HNWs hold a fair view ? - meaning the real free float is very low and that is the real reason for a buy and hold strategy once you have them.
UPL has a m/cap of £51m - LBE £10m. I know where the greatest risk reward lies. At current valuations, one's a punt the others a measured approach when it comes to risk reward imo.
Spot on Zengas. I have a big holding here and see LBE multi bagging over the next 24 mths
Market does not appreciate the opportunities on offer here at a rock bottom price. When this moves North for real, it will not be a couple of pence
Upland living rent free in so many heads at the moment. Don't let it eat you up so much guys, it's not healthy.