Share Talk blogger Steven Larratt
Hello there and thank you for taking place in our recent survey in which the winner chosen by yourselves was “The time line of the company and what to expect”… as is obvious, these are only rough estimates and are my thoughts based on my knowledge and research.
Firstly I hope you have all done well and enjoyed the rises over the last few weeks but as you may see there is so much more news to come…
As we know the Thermal Maturity was confirmed on the last RNS released and we were told to expect the next piece of news towards the end of February into March on the rock mechanics. These will let us know what the rock structure is in place and how easily they can be fractured. More importantly the amount of oil that can be released from them and is lying in between them. After this information, the full results will be released. These will show lots of information of what the samples show. Contained within them will be the petroanalysis of the Kaparuk sands and what the 58′ gas discovery holds (should be condensate or light oil). These could be a week or so after the rock mechanics.
Shortly after 88e’s recent good news a legacy payment has become payable via an old contract with a company called GALP. When 88e’s market cap raised above the $50m mark a payment of $3.4m became payable within 60 days, either by shares or by a cash payment. For the issue of shares this will be at a 10 day average price, dependant on the news flow if the share option is chosen 88e will probably do this at a time where the share price should be at its highest. 88e can do both easily at the moment with cash in the bank.
Upon good results, and as per previous RNS announcements, 88e will take a loan out with the bank of America to purchase 3D data. This is where 88e starts to get interesting. There was a company who shot 3D on our original land purchase called SAexploration. 88e is currently in final negotiations to purchase the dataset that has already been interpreted by Saexploation. This is with the company who currently own the data, this was subject to a 85% rebate so should be a cheap acquisition. This data set will allow the potential joint venture partner to see the true potential of 88e’s acreage by seeing the unconventional and conventional oil plays. The loan could come at any point in time and the subsequent acquisition. One thing to bear in mind is when applying for a loan you know what the cost of the item to be purchased is, thus talks may well have concluded. During my research into the who’s what’s and why’s I stumbled across the letter that was used to apply for the 3D data. The links for these are at the bottom of the page with my subsequent thoughts on this matter.
Around a month or so after the purchase we could see an Analysis and publication of the SAexploration 3D seismic data and hopefully confirmation of any “conventional” oil in place as an estimate. There could very well be an independent resource report on the conventional in place shortly after as well.
The 2nd part of the 3D story is the data shoot to be taken on 88e’s soon to be acquired land. These permits were logged in October last year and are now subject to completion of the contracts and they should start the shoot by the end of March. The shoot will be subject to a 75% rebate. Historically the land purchases are around June. I hope the JV agreement that Dave Wall is looking for will cover the cost of the purchase of the land or 88e gets a payment to cover these two costs to date. Thus there will be no need for any further placements in the future.
On the back of our lab tests and published results there will be an Independent Resource Report, sometimes called the competent persons report. Potentially due end of March into April this may or may not contain the conventional oil in place on the 3D but will have a barrels in place figure for the shale’s and any other finds that are in place on the icewine acreage.
Throughout the next few months joint venture and other talks will be in place and this is were patience is key to all holders, the results and independent resource reports will determine how strong 88e’s negotiation position is. The other important factor is the price of oil which the general consensus says will be on the rise across this year, time will tell but expect June onwards to hear reports about how things are progressing. They may well open a data room where all of the companies reports and details are accessible by all parties this will be done as soon as the full results are in on all aspects of our current land.
Confirmation of conventional oil from the 3D seismic still to be shot will be around the end of the year after the interpretation has been completed and late year for an independent resource report on that data acquisition.
There may or may not be other news as we go along and these will all become clear as and when a time scale can be placed upon these, for instance icewine#2 might well be a multiple drill program dependant on the jv partner. The permits on the drill might come before completion of the joint venture or after, this might alter the timing of spud of the next drill. Either way it will be towards the end of the year earliest.
On many forums there has been many discussions about who 88e’s joint venture partner will be or if a takeover offer will be somewhere in the pipeline in the future, the main train of thought is the link between Paul Basinski and Connocophillips. Connocophillips has over the last several months turned away from other areas worldwide to develop a little closer to home and has released several hundreds of millions of dollars to do so. As the major driving force behind the prolific Eagle Ford discovery and the fact that Paul was working on the icewine discovery whilst working for them holds weight to what are ‘theories’, I for one like theories if they can be backed up, but also like to sit back and allow what needs to happen to take place. Last year I came across the Saexploration permits and let everyone know that there was a 3D shoot about to take place on our acreage which bodes well for the future prospectively at icewine. Whilst looking into the permits it looked like the company applying for the permits was accumulate energy, as per page 3 of this link
Looking further into the links between Connocophillips, Paul Basinski and 88e there is a document at this link
As you can see the document states that the company that put in the permit was Connocophillips, make of this what you will but this holds more weight to the theorists out there who mainly state that we are a shell sent in to prove up the acreage at little risk to Connocophillips. I don’t know fully who owns the 3D that we are purchasing apart from Saexploration have shot the data and interpreted it, although what we do know is that someone has to ask Saexploration to shoot the data. If it was Accumulate energy then Dave Wall is the president as per the link above so why the need to negotiate? I will leave you all to make your own minds up on this but all I can say is the future looks very exciting indeed for 88e holders.
Kind regards to everyone and 88e.
LSE Share Talk will be following 88E Energy PLC progress over the coming months and if you wish to follow their twitter account @88EnergyLtd or look at the 88 Energy company website . This is a company with a short – midterm business plan that looks very interesting and one Private Investors should have on their watch list.
A special thank you to Steve Larratt for sharing and if you wish to follow his twitter account @slarratt1
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