Quick round up.
Not had time to post or say much recently so have taken a
quick 30 mins to catch up on a few things. Overall for me its still a waiting
game to investing, happy to keep a nice cash pile to take advantage of
seriously silly prices.
#ECR still waiting on the administrators, Paul and Stephen
have had a couple of years to plan and arrange something, question is have they
?
I have brought a few of these at .19, current MCAP of around
6m would indicate that Mercator has not been priced in, given the advancement
of Itogon. A very safe buy for 3 months, looking for a .30 or so sell.
#HER no Oz minerals update yet for Guam, but they still on
track for production come 12 months time. Patricia still on a wake up list.
Again at .24 to buy it’s a safe 3 month target of .35, 6 month of .5 and 12
month of 1.3 or so. Again I have a few of these at .29
#SAV I won’t make any friends by saying that JORC is likely
end of Jan and not Dec. Equally I do not believe that Bergen have finished with
SAV yet. I do still have a very clear target of 8p by end of jan and 12-14p
with a clear path to production of Oman. Again I still have a holding in SAV
which I brought at just over 4p.
#Rose, this is really struggling at the moment. Average cost
per barrel of production is paradox and mandos is likely to be around $45-50.
With the current price in the high 70’s rather than above $100 we have seen any
potential profit halved. This however isn’t Roses main problem, its main
problem is the concern that the price
will fall further to maybe $60-65 in which case the economic case for
extraction becomes difficult to make. When the oil price increases above $85 we
will see a sustained increase in rose imho. A second play for rose will be the
spudding of the mancos drill which could well see a healthy rise in the SP. Currently
not in rose, but would be at sub 2.50 or when mancos looks ready to be drilled.
#UKOG, no surprise to see it back at .5. Enough said really.
#OXS Waiting game must be nearly over now. Win or lose we will
know soon.
The numbers you used for ROSE's cost of production is too high. ROSE's finding cost is estimated at $20 per barrel. The extraction cost is about $10 per barrel. So total cost is actually circa $30 per barrel.
ReplyDeleteThe average total upstream extraction cost per barrel of oil across US onshore is $33.76 - that's from independent analysis carried out by US Energy Information Administration. The link is here: http://www.eia.gov/tools/faqs/faq.cfm?id=367&t=6.
In addition ROSE's RNS release from Fri 23rd May also states in a quite detailed fashion the costs for finding and extraction. Link is here: http://www.lse.co.uk/share-regulatory-news.asp?shareprice=ROSE&ArticleCode=2lardpq1&ArticleHeadline=Publication_of_Economic_Analysis
SO, even at lower per barrel prices on teh market ROSE would be profitable. Admittedly it would be less profitable but none the less profitable.
Add to that the additional news that ROSE has released since your article. ie. The $1.5m acquisition of oil & gas gathering processing facilities an dproducing wells AND that that 1.5m goes against the cost committed to RSOC, then additional values has been added.
In addition your article does not mention the Copper drill that is happening now and results are due any day now too.
Then I struggle to understand your reasoning and target price.
(Credit for the links go to Wodster from LSE.
Rose breakeven price is way off, independent consultants have it at $20 and the EIA adds another $10 or so for extraction. Also Rose is currently a producing outfit, this has not been factored in nor has the current drilling campaign. Rose CPR shows 1.5 billion barrels of oil potential and current mcap of circa $35M, massively undervalued.
ReplyDeleteThe previous article I referred to above in my first article was in fact the one you published in July on ROSe. And the following extract is taken from that artcile: "“For Mancos….finding and development costs less than US$17 a barrel”
ReplyDelete“For Paradox…experiencing on a single zone completion, again we get over 100% rate of return and less than US$20 a barrel finding cost”.
I'll say no more on it ...