# HOG - Hawkley Oil and Gas



## System (12 September 2010)

Hawkley Oil and Gas Limited (HOG) is an oil and gas development company with 100 per cent owned assets in the Dnieper-Donets Basin, the most prolific gas basin in Ukraine.

The Company made its debut on the ASX on 29 June 2010 following completion of a reverse takeover of the former biotechnology company Incitive Limited (ICV) and a successful $5.5 million capital raising.

http://www.hawkleyoilandgas.com


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## prgudula (12 September 2010)

Wiseowl report

28 Jun 2010

http://www.hawkleyoilandgas.com//me...-Wiseowl-report-38/Wiseowl-Hawkley-report.pdf

Moyes report

5 Jun 2010

The Moyes report is an independent evaluation of the potential resources of Hawkley OIl & Gas Limited's two fields and an independent review of the possible development scenarios. The report includes a review, audit and assessment of the two fields, a review of the existing and planned infrastructure, generic development scenarios and a mid-point estimate of current project recoverables.

http://www.hawkleyoilandgas.com//me...0805-Moyes-report-46/Moyes-Report-Hawkley.pdf


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## basilio (29 November 2010)

Hawkleys have found excellent oil and gas in the Ukraine and the financial  returns look very promising. Already doubled  to 29 cents since  early November with  further exploration in the New Year.


> *Hawkley find one of the best for a junior in years*
> Barry FitzGerald
> November 29, 2010
> 
> ...




http://www.theage.com.au/business/h...est-for-a-junior-in-years-20101128-18cbl.html

Hawkley has  released it's projections to the market this morning.


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## basilio (30 November 2010)

*Will pigs fly ?
*
The financial analysis from HOG’s  oil and gas strike in the Ukraine is excellent for any company let alone a recent start up currently valued at  $39m with just 136 million shares on issue. HOG’s current SP is 28c         .  .

HOG’s figures on the current well indicate a gross revenue of  around $51m a year as a midrange estimate. * Final earnings after all costs and tax would be  $20-22m a year. That’s 37c a share gross revenue and 16c a share net. *The strike is the middle of a highly developed oil and gas precinct with a new gas plant only 7 klms away. The pipeline to the gas plant is currently being built and cash should flow early in the new year.

And there is a second asset that also appears to be equally profitable. I think this pig will fly....

http://www.hawkleyoilandgas.com/display/index/assets

http://www.hawkleyoilandgas.com/med...201-range-of-estimated-financial-outcomes.pdf

___________________________________________________

DYOR and I do hold.


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## ParleVouFrancois (30 November 2010)

Nice to see someone else is interested in HOG , I bought in yesterday with the view to hold until at least the next well is brought online, with the massive cashflow from their first well, the rest of the wells can be paid for/secured with loans via the cashflow. So it's most probable that we'll see little to no dilution from here, which is brilliant news for a junior oiler (even quality like SEA and AUT have had to do capital raisings recently).


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## Lionel (3 December 2010)

Also hold for the free cash flow. Their drilling programme appears fairly prospective.


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## basilio (8 December 2010)

Another excellent update from HOG. The oil and gas flows from the first well are even better than indicated previously. * This would suggest around $55-60m a year gross returns from this well alone.*

The company is looking at drilling a second well in the same field with,one would expect, a similar result. They are also re-examining the total reserves with the expectation these will be upgraded. Production appears to be only a few weeks away with the gas pipeline almost completed.

*And it's still valued at around $42m !! Crazy stuff*

http://newsstore.fairfax.com.au/app...e.ac?code=HOG&submit=Go&section=summary&f=pdf


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## jonojpsg (8 December 2010)

Just wanted to say a BIG thanks to the posters who brought this to our attention

This is one of those hidden gems that, over the last four years since I joined ASF, I have come to appreciate...really we should have a common fund administered by Joe that we all chip in to that..I don't know what it could do - any suggestions?? - as part of the benefits that we all accrue from the combined research and efforts of the ASF community.

Sorry about the waffle, just feeling magnanimous, haven't even made much off HOG yet, but can see how big it is likely to get!!


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## ParleVouFrancois (8 December 2010)

The writing was on the wall, you could've bought in ALL morning and be sitting on a nice buffer (luckily I stumbled upon this, bought in about 30 minutes before the big announcement ). The announcement today gives even higher production figures from their initial well, along with an update on the 9km pipeline, with 7km (2km complete as of last announcement) complete I believe it'd be connected up and HOG will be getting cashflow either very late this year or very early next year (late christmas present in early jan?).


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## basilio (9 December 2010)

Another decent jump with the flying pig after yesterdays announcements,. Up 10% to 33c.

_________________________________________________________

*Correction to earlier posts.*

When I was calculating the current value of Hawkley Oil and gas and therefore potential returns I was using the number of shares listed on the stock exchange as a basis for my calculations.

Since then I've discovered there are a further 72 million fully paid shares in escrow for 24 months and another 33 million performance shares not on the official ASX register as well as about 14m options.

These will obviously have a material and diluting effect on projected returns.

Still looks very good


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## jonojpsg (9 December 2010)

Noted that HOG appeared in Pennies from heaven thread as a 3000% gain from 0.5c a share not long back 

Hate it when I miss out on the first 3000% gain

Will just have to put up with 300%  (which for those in at 0.5c would be 9000%!!!!


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## ParleVouFrancois (9 December 2010)

It never actually traded at $0.005 jono, the journalist didn't bother to check the history of HOG. It was formed via a reverse takeover of some bunk biomed stock, hence the 0.05 share price. I doubt the holders of the old biomed share got many if any shares in the HOG company after it relisted.

PVF.


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## jonojpsg (10 December 2010)

ParleVouFrancois said:


> It never actually traded at $0.005 jono, the journalist didn't bother to check the history of HOG. It was formed via a reverse takeover of some bunk biomed stock, hence the 0.05 share price. I doubt the holders of the old biomed share got many if any shares in the HOG company after it relisted.
> 
> PVF.




Ah, thanks PVF, makes me feel a bit better  Looking forward to some serious rerating of this once production kicks off


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## MBirrell (23 December 2010)

*HOG - HAWKLEY FPO*

Hi all,

I am interested in hearing opinions on HOG. From the stats and news this company is heading for good returns in early 2011.


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## Dinipants (23 December 2010)

*Re: HOG - HAWKLEY FPO*

There's already a thread for HOG btw, just search 'HOG' and it'll come up .


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## WRONG'UN (23 December 2010)

*Re: HOG - HAWKLEY FPO*

Hi MBirrell

There is already a thread on HOG.

https://www.aussiestockforums.com/forums/showthread.php?t=20545&highlight=hog

Yes, I like the look of both the fundamentals and the chart - I hold.


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## MBirrell (23 December 2010)

jonojpsg said:


> Ah, thanks PVF, makes me feel a bit better  Looking forward to some serious rerating of this once production kicks off




So am I - I have invested a lot into this stock.


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## ParleVouFrancois (23 December 2010)

That all being said, never invest more than you can afford to lose in a speculative stock such as this. It will be derisked as production comes online and sales begin to flow to the balance sheet, but as always with small companies such as this the risk is up to a 100% loss. I've been reading the NMS thread on HC (having traded in and out of them a few times before they died) and it's heartbreaking reading how people have lost their life's savings in shares. I'm looking for the rerating with my somewhat outsized position, to then get a decent free carry position going. Never ever get so heavy in a single speculative share that you can't afford to lose it all, just reminding you MBirrell. Now, where's that connection announcement! 

PVF.


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## MBirrell (23 December 2010)

I am only investing my "play" money. At worst it will only make me sad  - I haven't borrowed or put myself at any financial risk.  It is good of you to reaffirm it though.


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## basilio (26 December 2010)

Curious to see HOG release a policy document on insider trading for it's staff.

Fact is of course that HOG has already made it clear that they are in the middle of a substantial up revision on the size of the current oil reserves.  On memory the initial analysis of HOG's first well used previous production figures from the original well in the field. They came up with a share value of 57c I think.

Currently the field appears to producing at 3 times that rate with further improvements also indicated. The price of oil has also risen by at least 15% since the initial report.

*On that basis one would expect at least  a three fold increase in value*.  Since these are public figures then any increase in HOG shares prior to release of the official documents could be explained by these earlier statements. Would certainly let any interested parties off the hook.

I think it will be very interesting to see how HOG behaves in the Christmas /New year trade period.


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## emile33 (27 December 2010)

*Re: HOG - also what is a go in the time to come ....*

Permission already granted for the 
Chernetska project.

In addition to the works at Sorochynska, Hawkley is in the process of preparing for the first well at Chernetska. A full project update on Chernetska will be provided soon. The current timetable is as follows:
Well plan – approved
Environmental approval - granted
Land access - granted
Drilling contract – completed
Pipe, casing, mud, additives, drilling bits etc contracts and supply – in progress
Site preparation – commenced
Drilling rig mobilisation – after Christmas
In order to accelerate the progress of the well ahead of revenue from Sorochynska Well #201, Hawkley has secured a loan facility of US$1.25 million. The purpose of the loan is to facilitate the site preparation and the building of a road ahead of rig up early next year.
Cheers form The Netherlands


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## emile33 (4 January 2011)

*2011*

Happy trading here all and a happy new year ....
News this week would be nice.
cheers.


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## emile33 (4 January 2011)

*News out !!! production to start in Junuary*

http://203.15.147.66/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01139151

Thats January ...


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## emile33 (4 January 2011)

*Target is 100 million a year...*

Ukraine-focused energy explorer Hawkley Oil and Gas Ltd says it is ready to make the leap to energy producer this month.

The company says commercial production from its assets in the Dnieper-Donets basin in Ukraine is expected to begin later this month after a new gas pipeline was completed.

A gas flow of 12.64 million cubic feet per day and condensate flow of 504 barrels per day were obtained during testing, although a flow rate 10 per cent lower was expected once flow was stabilised.

A gas plant has been connected to the pipeline and new equipment has been installed, the company said.

Chairman Paul Morgan told AAP the company was expecting to generate revenue of $US40 million ($A39.41 million) to $US50 million ($A49.26 million) annually, with margins of about 50 per cent.

He said the company may seek a small fundraising to get another well drilled, but now that cashflow would be generated it should be able to afford new rigs.

"We will get another rig out there as soon as we start to see some cashflow out of that well, we will get another well onto Chernetska (licence in the Ukraine), which we hope to get drilled later this year," Mr Morgan said.

"I would like to see a third well, too, and get ourselves to about $US100 million ($A98.52 million) per year revenue," Mr Morgan said.

Hawkley shares jumped on news the pipeline had been completed, and at 1402 AEDT were trading up three cents, or 7.8 per cent, at 41 cents.


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## easylikesunday (13 January 2011)

_Ukraine-focused explorer Hawkley Oil & Gas has secured a “buy” recommendation from Hartleys, which calculates that the company is trading at a significant discount to the value of its soon-to-be-producing project and to its peers._

From what I have heard the 6 month target from Hartley's is .68

Blue skies for HOG. SP should reach that target very quickly IMO when production starts this month.


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## bennywizard (13 January 2011)

easylikesunday said:


> _Ukraine-focused explorer Hawkley Oil & Gas has secured a “buy” recommendation from Hartleys, which calculates that the company is trading at a significant discount to the value of its soon-to-be-producing project and to its peers._
> 
> From what I have heard the 6 month target from Hartley's is .68
> 
> Blue skies for HOG. SP should reach that target very quickly IMO when production starts this month.




I agree, 68c seems very achievable in the short term so long as the flow rates predicted are achieved


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## emile33 (16 January 2011)

bennywizard said:


> I agree, 68c seems very achievable in the short term so long as the flow rates predicted are achieved




Yes the analyst buy report is also on Hawkleys website now.


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## WRONG'UN (16 January 2011)

Hi Emile - greetings from New Zealand.

Thanks for that post - it is interesting that although Hartleys' risked valuation of HOG is currently $0.68, which in itself makes it attractive, they go on to say (p21) that the potential for resources exceeding independent estimates should not be discounted, with consequent valuations in excess of $7.00.
Using the figures from the 5 June 2010 Moyes report, I get a rough unrisked NPV around $3.00 - and this is without considering the implications of the outstanding drilling results of late 2010 - flow rates about 4 times greater than expected ( ref HOG, 8 Dec 2010).
In view of the drilling results, obtained using better control of the drilling techniques than others have used in the past, HOG's independent consultants are currently re-evaluating the entire field, with a view to providing a new reserves and resources estimate. The result was expected late Dec 2010 - early Jan 2011. It's now mid Jan, so an announcement can't be very far away!
In the meantime, of course, they are on the verge of becoming a producer.


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## emile33 (17 January 2011)

Thats correct and i am sure they will try to expand the company with the cashflow to come soon ....
We have in my mind a huge potention here ....
Cheers to new zealand, australia and the rest of the world !!!
From the netherlands.



WRONG'UN said:


> Hi Emile - greetings from New Zealand.
> 
> Thanks for that post - it is interesting that although Hartleys' risked valuation of HOG is currently $0.68, which in itself makes it attractive, they go on to say (p21) that the potential for resources exceeding independent estimates should not be discounted, with consequent valuations in excess of $7.00.
> Using the figures from the 5 June 2010 Moyes report, I get a rough unrisked NPV around $3.00 - and this is without considering the implications of the outstanding drilling results of late 2010 - flow rates about 4 times greater than expected ( ref HOG, 8 Dec 2010).
> ...


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## emile33 (21 January 2011)

*Nice article .....*

http://www.hawkleyoilandgas.com/med...ngs-19-1-11-108/media-clippings-19-1-2011.pdf


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## bennywizard (21 January 2011)

any thoughts on todays IP announcement?


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## emile33 (22 January 2011)

*Re: HOG - ip*



bennywizard said:


> any thoughts on todays IP announcement?




the aim is what i like ........


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## Narralakes (26 January 2011)

Hi
Just joined the site after searching for reviews about HOG.  Thanks for the valuable information and discussion.  I only happened onto HOG through our local paper investor column then tried to find info on the company.  Looks like it has potential, will dip my toes..


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## WRONG'UN (17 February 2011)

It is interesting to compare the chart for HOG's production forecast (ref Moyes 5 June 2010) with that for AUT (ref CBA 16 Feb 2011) - they are remarkably similar - if anything HOG's forecast production is larger.

There are, of course, many differences between the two companies - one's in the USA and the other's in Ukraine, for a start, but, setting these aside, we have AUT with a mc of $1262m, and HOG with $58m - that's a 22 fold difference.

Coincidentally AUT has climbed 21 times since its 2009 low, as more and more wells have been drilled and the acreage derisked.

HOG is at an earlier stage of development, but I believe it is potentially another AUT. And AUT itself is still considered well undervalued!

It's also worth noting that this is without considering the implications of the spectacular flow rates obtained in the first Sorochynsckya well - "three to five times original expectations" (ref HOG 17 Feb 2011). The Moyes report will have assumed the originally expected flow rates.

Roll on the spudding in of the first Chernetska well!

An interesting response to today's HOG announcement - initially a gap up, then a gap fill. Tomorrow's another day, I guess.


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## basilio (17 February 2011)

WRONG'UN said:


> It is interesting to compare the chart for HOG's production forecast (ref Moyes 5 June 2010) with that for AUT (ref CBA 16 Feb 2011) - they are remarkably similar - if anything HOG's forecast production is larger.
> 
> There are, of course, many differences between the two companies - one's in the USA and the other's in Ukraine, for a start, but, setting these aside, we have AUT with a mc of $1262m, and HOG with $58m - that's a 22 fold difference.
> 
> ...




Astute piece  of work wrong un. I'm a strong follower of HOG but I hadn't twigged how comparable the projections were for AUT and HOG. Uncanny.

I thought today was "interesting" to say the least... You would have to say HOG's batting average was outstanding in terms of meeting production commitments ect. And the cash will be coming in from March.. But it still couldn't hold a few cents of a rally!!.

If the analysis you posted are accurate this has to be the bargain of the year.


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## jonojpsg (17 February 2011)

WRONG'UN said:


> It is interesting to compare the chart for HOG's production forecast (ref Moyes 5 June 2010) with that for AUT (ref CBA 16 Feb 2011) - they are remarkably similar - if anything HOG's forecast production is larger.
> 
> There are, of course, many differences between the two companies - one's in the USA and the other's in Ukraine, for a start, but, setting these aside, we have AUT with a mc of $1262m, and HOG with $58m - that's a 22 fold difference.
> 
> ...




That is an impressive comparison wrongun!!  I LIKE it  In fact I think I might load up on more of these given the almost complete lack of interest currently shown by buyers - I was surprised that production ann didn't attract more?


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## condog (21 February 2011)

Hi guys

Magic Man i took a  look at HOG and yes i very much like what ive seen so far. Obviosly a lot of derisking to occur yet, but that first well in what they knew would be a producing zone is fantastic. The other thing i really like about it is the dry gas is double the price then in the US, making the well lives much longer and far more economic in the first place.

To me it looks like they may be on a very very big winner if things pan out as planned. Thier potential flows and reserves to EV ratio will be rediculous if they get this right. 

Obviously a need for a small CR if they are to accellerate things.

Looks to me like it has potential to be a multi-bagger like AUT, but still a lot of unknowns that need to be sorted out.


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## condog (21 February 2011)

In particular, i like that its revenue from its first well , in what looks like will be a prolific producing zone , produces almost as much gross revenue as the mcap of the company. That to me lowers risk somewhat.


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## basilio (21 February 2011)

condog said:


> Hi guys
> 
> Magic Man i took a  look at HOG and yes i very much like what ive seen so far. Obviosly a lot of derisking to occur yet, but that first well in what they knew would be a producing zone is fantastic. The other thing i really like about it is the dry gas is double the price then in the US, making the well lives much longer and far more economic in the first place.
> 
> ...




It* does *look very, very good.... doesn't it.. Actually it doesn't appear as if HOG  will need to do much external CR.  Excellent surplus cashflow  is already coming from the oil and gas sales and  they borrowed some internal funds to kick off the preparations for the next drill.

And of course Coondogs magic touch has already kicked HOG along by 3c this morning.

The other *really* interesting tidbit is that after the first well showed the 400% increase in flow rate HOG has decided to review the reserves in the reservoir.  If in fact this increase in flow rate also reflects a significant increase in reserves just keep multiplying the figures.

It will be interesting to see how long before the penny drops and a serious re rating begins for HOG.


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## condog (21 February 2011)

In particular, i like that its revenue from its first well , in what looks like will be a prolific producing zone , produces almost as much gross revenue as the mcap of the company. That to me lowers risk somewhat.

If they pull off a 2nd well with similar flows, then i think a PE of 5 would be on the cards and if they have revenue of over $100M then thats a 5 bagger, surely??

More realistically it should climb ot a PE of 10 in due course with say 3 or 4 producers , then it would begin to resemble AUT. In fact id probably say this has more growth potential then AUT had when i found it. 

But be warned "potential" doesnt necesarily become reality.

Disclaimer - I hold.


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## Magic Man (21 February 2011)

All great information Condog.. I didnt know you held the stock.. Have you held for long?


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## condog (21 February 2011)

The peer competitor analysis from Hartleys makes it look cheap , but its simply carrying a lot more risk then its peers. 

I found the well cost at $6.7M and it took 9 months which , i know it had its problems, but thats a rediculous cost for a vertical well of only 4400ft depth. They will need to do far better then that in terms of cost and time for verticals. Luckily for them the flows have been rediculously good.


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## condog (21 February 2011)

Magic Man said:


> All great information Condog.. I didnt know you held the stock.. Have you held for long?




Yhe ive had it for about half an hour


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## basilio (21 February 2011)

condog said:


> The peer competitor analysis from Hartleys makes it look cheap , but its simply carrying a lot more risk then its peers.
> 
> I found the well cost at $6.7M and it took 9 months which , i know it had its problems, but thats a rediculous cost for a vertical well of only 4400ft depth. They will need to do far better then that in terms of cost and time for verticals. Luckily for them the flows have been rediculously good.




It is very expensive and slow for a drill. HOG decided that they would use local Ukraine oil drillers rather than Western technology. *Basically it is to keep the locals onside giving them some part of the action and defusing resentments.* What they have done is substantially improve the sealing of the well which apparently is responsible for actually getting it drilled properly and, it appears,  upgrading the the flow rates 4 fold.

As it is HOG will be making out like bandits on this deal and keeping the local wheels greased and happy will just be another business expense.


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## condog (21 February 2011)

basilio said:


> It is very expensive and slow for a drill. HOG decided that they would use local Ukraine oil drillers rather than Western technology. *Basically it is to keep the locals onside giving them some part of the action and defusing resentments.* What they have done is substantially improve the sealing of the well which apparently is responsible for actually getting it drilled properly and, it appears,  upgrading the the flow rates 4 fold.
> 
> As it is HOG will be making out like bandits on this deal and keeping the local wheels greased and happy will just be another business expense.




Thanks Basilio

Theres obviously something still missing though, as a 4400m vertical well built for dry gas should only cost approx $1m. I understand this one cost more due to difficulties along the way, however, at $6.7M, and with Hartleys projecting well costs at $9M connected to sales, something just doesnt add up. There is just no reason that a vertical can or should cost that much. Difficult geology can increase prices, but 9fold??

At $9m those wheels would be so greasy theyd spin on the spot. Still incredibly economic with those flows, but you got to question a $9m well cost.


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## bennywizard (21 February 2011)

condog said:


> Yhe ive had it for about half an hour




Welcome to HOG Condog, it will be great to have your input here!
I really like this stock,  the location and the politics etc in Ukraine may be a reason why the stock was undervalued and the barrier to entry due to the need of local knowledge means that management IMO are well placed to succeed where others might have failed.


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## WRONG'UN (21 February 2011)

Lets not get too worried about the drilling costs.

Attached are some excerpts from the Moyes report (June 2010).

1. Western rig: $12m, 4 to 5 months to drill 4500m.
    Russian rig: $10m, 6 to 8 months.
These are even higher than the $6.7m Hartleys' figure.

2. Fig 29:Capital Cost Schedule - almost all of the cost is drilling.

3. Fig 30: Unrisked Cash Flow Profile. The capital costs are the magenta bit - even at $10m - $12m per well, these costs are peanuts compared to the potential net cash flow (dark blue). And the difference will be even more pronounced when the effects of the x4 flow rates and possibly lower drilling costs (viz Hartleys' $6.7m) are included. 







Additional point, re possible capital raising - HOG stated in their 31 Jan 1011 release that "Current exploration and development expenditure.....will be funded through cashflow generated through sales of gas and liquids from Well #201"

Re possible P/E ratio, HOG noted in their Jan 2011 presentation that another company is operating in Ukraine on an 8.7 P/E


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## condog (21 February 2011)

Yeh im not at all doubting the future of this project. But as an example TXN is to be drilling 6000-7000ft wells in the Wilcox for $0.8M.

This must be some seriously tight hard rock to go $6.7M with a projection of $9m per well.


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## WRONG'UN (21 February 2011)

Attached is part of Dec 2009 news article on a company called Regal Petroleum (AIM listed), that is also operating in Ukraine.
It notes that although modern rigs are a lot faster than the Soviet-era rigs used elsewhere, it still takes months to drill a well - yeah, Condog, the rock must be hard! Whatever, "slow" drilling progress is apparently not just confined to HOG.


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## condog (22 February 2011)

WRONG'UN said:


> Attached is part of Dec 2009 news article on a company called Regal Petroleum (AIM listed), that is also operating in Ukraine.
> It notes that although modern rigs are a lot faster than the Soviet-era rigs used elsewhere, it still takes months to drill a well - yeah, Condog, the rock must be hard! Whatever, "slow" drilling progress is apparently not just confined to HOG.
> 
> View attachment 41516




I just took a quick trip to Ukraine and managed to take a snap of the Russian drill rig. It explains a lot about the slow drilling speed. Theres plenty more kegs to store the oil / condensate, but the drill crew have to drink them first.


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## bennywizard (22 February 2011)

That is funny!  You had me for a minute, but this would not surprise me, they do love their alcohol over there.


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## condog (26 February 2011)

Interfax reported that Ukraine will pay an average of USD 280 per thousand cubic meters of gas in 2011.

This is good news for Hog, with increase from $264, so about a 10% increase. 

To put that into perspective with kfcgas we are used to its $280 per 27000 cubic feet of gas. 

Gas flow during production testing  =  12,641,550cfgpd / 27000  = 468 * $280 = $131,000 USD per day on the 9mm choke for the dry gas.
The condensate price is much harder to pin down in the Ukraine but if we go with $90 we wont be too far off. 504 * 90 = $45300 USD

with 1 well = $176300 pd gross revenue  x 39% = $68757 net per day = approx $24M net per annum. 
2 wells 48m, 3 m, 72

Because where using net figures lets mcap it out using a more significant PE of say 14. 

1 well mcap value $336million
2........................$772   - (Thats a 10 bagger)
3........................$1Billion plus
6.......................$2B plus   (thats a 30 bagger) 

Current mcap is $65M ( doesnt take a rocket scientist to draw a conclusion from this info). But the second well has to hit gas gold to derisk the acerage and operator.

Right now they are intending on drilling wells at say $8m cost out of cash flow. 

We currently have 1 well. We can assume we will have the cash to drill the second in approx 4 months of sales. So 2nd well in approx April looks right - Chernetska. 3rd well in approx Aug Sept if Chernetska is a dud. If Chernetska is as good as #201, then 3rd well should be in approx July, with then possibly a well per month beginning if cash flow allows. 

Now whilst i need to clarrify this only has one successful well at present , and it is an amazingly successful well, if its other wells reflect this look at the possible upside. Even if ones a dud, as long as its not the early next one or 2 its hardly going to cause any grief, if well #201 keeps flowing proloficly as expected. 

Seriously feel free to read this and get a little excited, but for god sake make sure you cross check it at least and , better still Do your own research. This is not without risk. But as you can see the possible reward is significant as well.

risk 100% , reward possible 3000%

What i tend to do is , gradually lift my exposure as the risks get eliminated. AS an example if the  Chernetska  well is similar to #201 i will double my holding, if they then drill a third well and its good to, i will increase again.


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## poverty (26 February 2011)

So you believe it's a possible 30-bagger from the current SP?


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## condog (26 February 2011)

poverty said:


> So you believe it's a possible 30-bagger from the current SP?




Using the information above, yes its possible. Does that mean it will happen no. 

But i can tell you this i wouldnt be in it if i didnt think it was
1. presently undervalued significantly
2. Likely to make me a lot more money then lose me money. 

Does that mean it will happen, hell no. But right now with a $22-$24M net revenue stream from one well, its got a hell of a lot of room to move compared to most similar mcap explorer / fledgling producers.

Its next well might be a complete dud, who knows, but the nice thing this one has going for it is it can actually afford to pay for a complete dud or two without troubling it too much. 

The real nice thing is if its next well is even half as good as #201, then wow, watch the pace of development blow your mind .

Its funny you know, today 100,000 people probably went into a electronic store and blew $1000 plus on a big screen TV or other crap thats only going down in value rapidly, and in 4-6 years time will be completely worthless. 
Id imagine a $1000 investment in this company, may do better. It  has the potential to be $30K, $50K, who knows. And yes it has the potential to be worthless in 5 years. 

But i bet youd have less trouble selling these shares if you didnt like proceedings and id bet thered be a willing market to buy them. Sometime, we stress far too much over taking a EDUCATED AND CALCULATED RISK / REWARD PLAY, yet we willingly hand our dosh over for soon to be worthless crap on a regular basis.

Right now this thing looks way undervalued, its literally flying under the radar, there are other oilers / gassers out ther with far less upside and far more risk operating at multiples to this company.  

Only reason i found it was cause someone PM'd me to take a look see.   The company is not doing a very good job of marketing its brilliant success with well #201, to potential investors. Something that someone here needs to take up with managment.


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## basilio (26 February 2011)

> Only reason i found it was cause someone PM'd me to take a look see. The company is not doing a very good job of marketing its brilliant success with well #201, to potential investors. Something that someone here needs to take up with managment.




Nice analysis Coondog. We all "knew" that if you passed your eyes over the deal you'd wet yourself and become a very keen player. 

Which of course will certainly open other forum members eyes very quickly.

Just to go back on your analysis a bit. I think there is very little likelihood of the wells being duds.  The original analysis by Moyes pointed out that the wells are in areas that have proven reserves. The problems in the past seem mostly related to poor engineering with subsequent well problems and relatively poor outputs.

The outstanding result from the first drill (400% better than previous)  seems likely to be a result of a better well casing.  It also appears that the entire field has been underrated and as a result of the first drill HOG is reviewing the reserves. These results should be due fairly soon and if there is a decent upward revision there should be some extra multiples on the production/profit figures.

And of course the uplift in gas and oil prices over the past 5-6 years  has turned a good result into an outstanding one.

So why arn't management making more of a song and dance over this ? Actually I think their information has been pretty good.  Timely and highly instructive.  For example when the first well showed the extraordinary flow rates HOG mapped out a clear financial return table based on the flow rates. Good simple stuff  with lot's of green in the table. Trouble is I don't think any of the "proper" analysts will even sniff at a share that isn't in the ASX 100. It has to actually beat them over the head before they will  recognise it as a worthwhile investment.

Finally HOG is valued at around $116 m. There are an additional 119 million shares held in escrow - I think by the Board.  (This was pointed out to me a few months ago when I  also got excited at the ridiculously low company value)


----------



## breaker (26 February 2011)

Condog ,I admire your expertise ,I to am in HOG, are there any related books [ oilers for dummies] you could recommend so I can understand WTF your talking about
Thanks


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## condog (26 February 2011)

breaker said:


> Condog ,I admire your expertise ,I to am in HOG, are there any related books [ oilers for dummies] you could recommend so I can understand WTF your talking about
> Thanks




Hey , i would just reccomend learning and interacting on the forums, there are a lot of very knowledgable people online. In particular, whether you hold or not i suggest reading the AUT TXN SEA .  In short i reckon it will take you about 6-12 months and you will be on top of your game in this respect. 

Other then that, read the reports put out by the broker firms and see what they talk about, why they like a stock, why they value them. Go to the AUT and TXN website and read the broker reports, they explain why those stocks are good. More importantly though, you will see upgrades and the events that trigger brokers to change value on the stocks. 

The first few you reead you will need to google terms to know the definitions of some of the Jargon, but in no time you will be up to speed.


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## condog (26 February 2011)

basilio said:


> Just to go back on your analysis a bit. I think there is very little likelihood of the wells being duds.  The original analysis by Moyes pointed out that the wells are in areas that have proven reserves. The problems in the past seem mostly related to poor engineering with subsequent well problems and relatively poor outputs.



Doesnt matter at this stage its all risk, so you got to price it in. I think the markets just havent discovered HOG yet and that needs to be addressed. The mgmt need to keep thier presentation matierial current and start presenting at some of the Good oil conferences etc. 




basilio said:


> So why arn't management making more of a song and dance over this ? Actually I think their information has been pretty good.  Timely and highly instructive.  For example when the first well showed the extraordinary flow rates HOG mapped out a clear financial return table based on the flow rates. Good simple stuff  with lot's of green in the table. Trouble is I don't think any of the "proper" analysts will even sniff at a share that isn't in the ASX 100. It has to actually beat them over the head before they will  recognise it as a worthwhile investment .




Initially you have to pay for a broker to put out reports. You go to smaller niche brokers like Hartleys, Euroz etc that have exsisting clientell happily investing in minow oil and gas companies. Then once your on thier radar, the word starts to get out, very soon the number of brokers "if the stock is good value " begins to climb and they continue thier coverage for free. Mgmt now is definitely at the stage where they should have at least one paid broker report. No excuses, you cant attract the investors to bid up your stock to fair value without it. 

Rest assured if mgmt dont start selling this story publicly via conferences, presentations and broker reports, i will be gone in a matter of months , and id chase a company even of lower quality, thats willing to attract investors. Its so crucial for these small companies. 




basilio said:


> Finally HOG is valued at around $116 m. There are an additional 119 million shares held in escrow - I think by the Board.  (This was pointed out to me a few months ago when I  also got excited at the ridiculously low company value)



 yes i remeber that now. cheers for that. Its still even at that very cheap, i think $175- $240m would be more appropriate for the current state of affairs. On an mcap PE basis its worth $336, but then you need to discount the valuation to apply a risk discount for all the unknowns. I thnk an approx 40% discount at this stage is ample for me .


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## WRONG'UN (26 February 2011)

Hi guys
I agree with the foregoing analysis - I've done my own and that's why I'm in.
Moyes are talking about 50 wells over the licence area, 34 for Chernestska, and 16 for Sorochynska (Ref Moyes pp 32 and 34 resp)
I'm not sure exactly how many shares are potentially on issue - I depends where I look! Basilio's extra 119m must be near enough for valuation purposes.
The gas price in Ukraine is a huge plus for HOG - more than double the US price.


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## condog (27 February 2011)

Hartleys have it valued at $1.14, with plenty of room for upgrades on each ne well release, its upcoming acerage acquisition etc

at 48c which is only 50% of its current valuation, its a red hot buy imo.


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## Magic Man (27 February 2011)

Sounding good. Holding at 0.43!


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## ColB (28 February 2011)

Magic Man said:


> Sounding good. Holding at 0.43!




Hawkley Oil & Gas Limited (ASX:HOG) is pleased to announce that commercial production from Sorochynska Well #201 in Ukraine’s Dnieper Donets basin has begun. 

Completion of commercial flow tests with flow rates three to five times original expectations. These results were achieved through the employment of higher quality completion techniques than wells drilled in the past,

Well #201 is expected to generate significant cash flow for Hawkley. More information on exact flow rates and revenue received will be released once production is stabilised.

The Company is also ahead of schedule for the spud date for the first well at Chernetska, Hawkley’s second licence....

http://imagesignal.comsec.com.au/asxdata/20110217/pdf/01151748.pdf


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## condog (28 February 2011)

Announcment out:

*Sorochynska Well production update* *!*

Cant paste yet, but they are selling on a 6mm choke with 5.2mmcfg/pd and 176bocpd

Expect significant cash flow. OPEX 30-33%
They have enough tax credits to pay no VAT for approx 4 months. 

Sales price $9.32 per thousand cubic feet of gas. 

Plus $104 per boc
*
Performance so far indicates we will be able to run much higher then current rates. *
They are drawing up a full field development plan in the next few weeks. So my opinion is expect a CR in approx 4-6 weeks time. This is good news imo as it obviously proves they are expecting far more revenue then what suits thier current business plan. Perhaps an acqusition or two as well.


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## condog (28 February 2011)

Numbers crunched on new figures going forward. 

Plenty of free cash flow, im not surprised they are going to renew thier full field development.




Click to enlarge..
Note $500,000 cash added to 1st month as cash at bank.


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## suhm (28 February 2011)

Condog your flow rates for 9mm are a bit off i think your using 50% more than 6mm a 9mm choke is much larger flow rates were 12.5mcf gas and 392 barrels condensate at 9mm


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## jonojpsg (28 February 2011)

suhm said:


> Condog your flow rates for 9mm are a bit off i think your using 50% more than 6mm a 9mm choke is much larger flow rates were 12.5mcf gas and 392 barrels condensate at 9mm




Yep, my calcs using those numbers gave around $38m a year NET cash flow.  Nice considering their MC is only around $60m atm  I'm loading up as I still have that comparison with AUT in my mind with a potential 20-bagger holding my attention!!


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## condog (1 March 2011)

jonojpsg said:


> Yep, my calcs using those numbers gave around $38m a year NET cash flow.  Nice considering their MC is only around $60m atm  I'm loading up as I still have that comparison with AUT in my mind with a potential 20-bagger holding my attention!!




Happy to oblige, but think your better of being conservative and being surprised to the upside.  By the way mcap is approx $125m, as they have shares in escrow, which i forgot about as well, till i was reminded above. 

Its still a rediculously low mcap for what they have just achieved with well #201. But i guess people are waiting for a second gusher before jumping in boots and all. 

Note this scenario below does not show further production expenses. ie if they spend $8 million on a well, its not shown. But you can just presume thats going to happen as soon as cash flow allows each well to start.


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## condog (1 March 2011)

Tried to provide a few scenarios for discussion
. 
Just cause it looks flash in a spreadsheet, doesnt make it likely to happen, so be sure to DYOR , seek good advice and never act on forum posts. Happy hunting. Having said that most investments turn out far better then spending money on consumer items.


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## TabJockey (1 March 2011)

condog said:


> Tried to provide a few scenarios for discussion
> .
> Just cause it looks flash in a spreadsheet, doesnt make it likely to happen, so be sure to DYOR , seek good advice and never act on forum posts. Happy hunting. Having said that most investments turn out far better then spending money on consumer items.
> View attachment 41651




No time to look into the fundamentals but technically 20% in the next month wouldnt suprise.


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## basilio (1 March 2011)

HOG has just released Huntleys update after the confirmation of initial well flow and sales.

Very, very bullish indeed. It is really hard to see any downside on HOG at current prices. The current well production alone more than justifies the present price. And there is much more to come.
*
Development at Sorochynska Could Increase Revenue by 80%*_
The Company has also flagged that an additional development well is possible
in the Sorochynska license at the #201 discovery. The decision to commit to this
will be made once additional production information can be used to update the
reservoir model. A second well could result in an 80% increase in production
over and above the expected 10 million cubic feet of gas level. This would imply
production of 18 million cubic feet of gas and 800 barrels of condensate per day.
At current spot prices, this would represent revenue of US$90m per annum with
earnings of ~US$40m._
http://www.hawkleyoilandgas.com//me...s-research-note-117/Hartleys-reseach-note.pdf


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## traderclaude (1 March 2011)

This looks a great stock, undervalued with a lot of potential. 

Seems to be still affected by the day traders. 

Still flying under the radar, there probably some apprehension about the Ukraine, but the reserves there would appear to have been under exploited. With better equipment these days the area could take off. 

If HOG gets this right they are on winner. The news over the next few months will be key and they should get this out there.


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## Trainee (1 March 2011)

Just spent some time digesting the Huntley's update and one thing that doesn't make sense to me is the Gas in place numbers they are assuming - on page 3 they say "B18b reservoir horizon alone, which we estimate at up to 50 billion cubic feet of gas"...

In the very next table, they state that Moyes & Co and RISC both agree on only ~13.5 Bcf (2P).

I think we need 50 BCF to get the stated objective of 8-9 year plateau @ 10 mmscf/d (this rate equates to 3.6 BCF per year production)...

On the other hand, the great things about the HOG Well #201 production update are:
1. Rates and condensate ratio match the original welltest
2. well head pressure of a constant 3,750PSI.... I don't know much about this field but that sounds like there's a lot of energy in this reservoir to get such a high flowing pressure.

My points: a) I think it's going to be critical to see what decline if any they get in the early stage of well #201 production - if it holds in there, then maybe we are looking at more like 50Bcf GIP

b) If so, then a second development well in 18b must be on the cards.

Any comments ?

Disc - I am a holder. 





basilio said:


> HOG has just released Huntleys update after the confirmation of initial well flow and sales.
> 
> Very, very bullish indeed. It is really hard to see any downside on HOG at current prices. The current well production alone more than justifies the present price. And there is much more to come.
> *
> ...


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## condog (2 March 2011)

Ver nice to see HOG green in a sea of red. Could be a sign of value??

Although im wanting to top up and i keep missing my 47c target.


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## traderclaude (2 March 2011)

The trade volumes are still quite low, can't see it going down to much unless that first well fails. 

Friday was 47 cents from memory, but what is 2 cents compared to 20 cents in 3 months. We will have to really keep an eye on the data updates. 

Sometimes seems a good idea at the time to sit on the bench.


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## traderclaude (3 March 2011)

Just noticed they put a marker on the asx charts tonight.

Also first time news has shown up on a google search.

What a day tomorrow to see what happens. 

http://www.oilandgaseurasia.com/news/p/0/news/10708


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## Magic Man (3 March 2011)

Hey nice link posted. Any thoughts on the production?


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## jonojpsg (4 March 2011)

I'm loading up on these while the buying interest is staying low!!  To be able to continue picking up shares at pre $1 is pretty amazing, or at least it will be once the 9mm choke is fitted and we see double the initial flow rates and revenue

Even if wells are expensive as has been mentioned previously, with free cash of around $35m a year, they should be able to get another 3-4 wells drilled within a year, and even if they only succeed with one of them - assume that gives equivalent flows to 201 - then next year they'll have net cash of $70m!!  Even with shares in escrow, HOG only has a market cap of $100m at current share price, so it's blatantly obvious that this is undervalued IMO.  

I'm putting my money where my mouth is anyway


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## condog (5 March 2011)

Simple question folks do the maths on just well #201. That in itself is ample to have sp well above current level. I only typed current once, but it appears twice ???? UFO ??

Lord help us if Chets is good as well. This thing will be far better then the next AUT. Nothings safe, nothings assured, but its a risk/reward play that right now to me is simply enticing.

All opinion so DYOR and seek good advice if you can manage to find it. Beware of ill informed overpaid morons charging you for poor advice.


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## BrightGreenGlow (7 March 2011)

condog said:


> Simple question folks do the maths on just well #201. That in itself is ample to have sp well above current level. I only typed current once, but it appears twice ???? UFO ??
> 
> Lord help us if Chets is good as well. This thing will be far better then the next AUT. Nothings safe, nothings assured, but its a risk/reward play that right now to me is simply enticing.
> 
> All opinion so DYOR and seek good advice if you can manage to find it. Beware of ill informed overpaid morons charging you for poor advice.




The general market seems to be disagreeing with you condog. However, for every stupid seller there is another buyer.... hope you are correct with this one though. I only have small package in HOG but am now starting to track it since it has started falling in the last few weeks. I have alot of trust in your research though and love reading your opinions.

Let's hope we gain from here towards the end of the month.


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## yma (7 March 2011)

Hi All

Can anyone advise the development plan for HOG, e.g. how many wells are they going to drill in the neat future, CR etc?

Not holding yet but will get in soon.

Thanks


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## bbker (7 March 2011)

I thought your perspective was as a trader... so isn't this normal if it's being trading for quick handy cash to put on the next surging trade, considering there's time between HOG announcements?

Is there an expected time-frame for the next announcement roughly? which I assume would be about the larger choke.



BrightGreenGlow said:


> The general market seems to be disagreeing with you condog. However, for every stupid seller there is another buyer.... hope you are correct with this one though. I only have small package in HOG but am now starting to track it since it has started falling in the last few weeks. I have alot of trust in your research though and love reading your opinions.
> 
> Let's hope we gain from here towards the end of the month.


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## BrightGreenGlow (7 March 2011)

bbker said:


> I thought your perspective was as a trader... so isn't this normal if it's being trading for quick handy cash to put on the next surging trade, considering there's time between HOG announcements?




Quick handy cash? Condog has labelled the fundamentals here and they look good. I don't see why anyone would be selling for quick cash? It has been flat line for 2 months. I can wait I was just expecting a better trend.


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## bbker (7 March 2011)

"Ease of liquidity".  

I don't know. I can never judge buy/sell sentiment or the lateral scope of trading.



BrightGreenGlow said:


> Quick handy cash? Condog has labelled the fundamentals here and they look good. I don't see why anyone would be selling for quick cash? It has been flat line for 2 months. I can wait I was just expecting a better trend.


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## ob1kinobi (7 March 2011)

bbker said:


> "Ease of liquidity".
> 
> I don't know. I can never judge buy/sell sentiment or the lateral scope of trading.




You don't know what ... ? Isn't it obvious ... 
Market sentiment is represented in the price action.
Is the price going up or down? 
Answer: currently s/t down : (


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## ColB (7 March 2011)

ob1kinobi said:


> You don't know what ... ? Isn't it obvious ...
> Market sentiment is represented in the price action.
> Is the price going up or down?
> Answer: currently s/t down : (




HOG is reasonably solid around the 46-48c mark and failing a few bad days on international markets this one is ready to move up.  Whilst its trend is slightly down there is certainly no evidence of a rush by investors/traders to exit this one.  Look forward to the next announcement.

Holding LNC TXN HOG PEN


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## condog (7 March 2011)

They are going to fund development from cash flow. 

Also note the drill pace is very slow, it can take 8 months for a vertical well, which either highlights pathetically inept russian rigs, or very very tight hard rock. 

So they will be drilling Chets soon and then the next well near #201. 

If we get a good result at Chets or near #201 this thing will imo rocket.

Check out thier january presentation. Page 12 and 15. Note however they so far are well in front of that schedule.


> *Full field development plan*Over the next few weeks the reservoir data from the well will be used to update the reservoir model and a full field development plan is currently being drawn up.
> Well #201 is expected to generate significant cash flow for Hawkley. Further information on revenue will be released once production has stabilised.









Guys make sure you do your own research and seek good advice if you can find it. This is an early play and as such is high risk and high potential reward. It could fall flat on its face. But it is off to a very good start which somewhat derisks it, as its managed to get commercial flows from its first well at a more significant flow then lots of early phase producers would have from 2-3 wells.


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## traderclaude (7 March 2011)

Look forward to seeing the flows with the 9mm choke at sorochynska well 201 and further development plans. 

They have appeared to be transparent with the announcements and kept things low keyed the best they can. 

They probably don't want to come under the microscope of the asx with a 20% day.


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## Assasin (8 March 2011)

http://www.hawkleyoilandgas.com/med...radio-broadcast-118/Hawkley-broadcast-8-3.pdf

This broadcast is well worth listening to. New presentation is also a good read.


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## ColB (8 March 2011)

Assasin said:


> http://www.hawkleyoilandgas.com/med...radio-broadcast-118/Hawkley-broadcast-8-3.pdf
> 
> This broadcast is well worth listening to. New presentation is also a good read.




Interesting presentation Assasin.  HOG are in the top ten oil & gas companies in Australia by revenue.


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## traderclaude (8 March 2011)

Like I said last night the transparency is now there no need for a speed ticket from asx. 

Wow! 

45 million dollars revenue a year for the first well alone for 7 to 8 years. Second well in next 12 months will double revenue. 

Are these higher than the Hartleys audit?, I thought they forecast 14.2 million dollars for 2011 and 69.4 million for 2012. 

The good oil news is out there.


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## easylikesunday (8 March 2011)

From AussieBulls.com

_HAWKLEY OIL AND GAS ORD  *BUY - IF*
ASX    
Daily Commentary


Our system posted a BUY-IF today. The previous SELL recommendation was issued on 03.03.2011 (5) days ago, when the price was 0.4800. Since then HOG.AX has fallen -4.17% . 


The market considers a bullish attack but still hesitating to do so. The previous bullish pattern is not confirmed today. According to our rules, it is by now null and void. However, a new bullish pattern is developing and another BUY-IF alert is issued today. It is the time to repeat the homework. Sounds tedious? Well, earning money is not easy. Keep an eye on after-hours and futures trading and digest all related news, events, economic data and the outlook of the world stock markets prior to the next confirmation session. 

You must again check if one of the following three confirmation cases hold or not: 

Does the market open with an upward gap? Your benchmark is the opening price. If the prices stay over this benchmark, go long. 

Does the market open at a level, equal to or below the previous day’s close? The benchmark is that closing price. If prices during the session stay over this benchmark, go long. In both of the above cases, avoid buying if the prices during the session start coming below the benchmark. 

Check also the rare case in which the market opens with a big downward gap but the day ends with a long white candlestick though still closing below the previous close. Such activity confirms the bullish alert and the benchmark is the closing price of the long white candlestick. 

If one of these confirmation criteria is not met, or in case of a black candlestick or doji, the BUY-IF alert remains valid (without confirmation) postponing the confirmation search to the next session. Any long black candlestick following a BUY-IF alert, on the other hand, makes the signal void and invalid. 

We do not suggest any new short positions given the new bullish alert. The short sellers should consider covering their positions if the market confirms the BUY-IF signal. Otherwise, existing short positions should be carried._


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## basilio (8 March 2011)

> The market considers a bullish attack but still hesitating to do so. The previous bullish pattern is not confirmed today. According to our rules, it is by now null and void. However, a new bullish pattern is developing and another BUY-IF alert is issued today. It is the time to repeat the homework. Sounds tedious? Well, earning money is not easy. Keep an eye on after-hours and futures trading and digest all related news, events, economic data and the outlook of the world stock markets prior to the next confirmation session.
> 
> and so on  _Aussie Bull _




What a fascinating story from Aussie Bull....  Long detailed discussions on gaps and candles and benchmarks.  Sort of wondering why they didn't throw in some  nipples of black cat or sprigs of virgin plucked rosemary or similar nonsense...

So where in all this analysis  was there any discussion of the actual company business - *the successful drilling of a very valuable oil and gas well with the very derisked opportunity of 2-3 further wells drilled in the next 12 months out of current cash flow ?*

Perhaps Aussie Bull is more about the very short term art of picking week by week market rises and falls. But surely the very concrete reality of  current positive cash flow and  excellent  drilling opportunities deserves consideration.

Otherwise I think it is just a load of bull..


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## traderclaude (8 March 2011)

Well you had it go from 48 cents to 44 cents in 12 hours, so roughly 10% down and back up 5% with a surge at the close... Something is brewing that trend suggests and I havn't seen bad news, which is why a 20% day is possible and the carefull media releases.


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## basilio (8 March 2011)

traderclaude said:


> Well you had it go from 48 cents to 44 cents in 12 hours, so roughly 10% down and back up 5% with a surge at the close... Something is brewing that trend suggests and I havn't seen bad news, which is why a 20% day is possible and the carefull media releases.




For what it's worth I suggest that one of the reasons HOG's SP has fallen could have  been the analysis from Aussie Bull. It's also worth recognizing that we have had big falls in the general market on Monday as a response to the Libyan oil situation which continued into Tuesday morning. 

I think it is quite possible for market analysts to influence what is happening on a short term basis. Even if one didn't accept the rationale being offered  you could still think that if enough other investors are influenced then the SP will be affected - and with that in mind decide to get out or set up a short term play

*But my point is that absolutely none of this appears to have anything to do with the actual operations of the company. * In HOG's case I believe these fundamentals are well worth recognising in any analysis rather than (relatively) obscure prognostications of quite short term events. (IMO)

 ________________________________________________________________

I think this discussion also brings up an important point. It seems to me that  more and more  buying and selling of shares is done for very short term profits with (by definition) no consideration of longer term value.  In that context it is quite feasible to see shares rise and fall steeply with little logical reason. And we do see this all the time don't we ?


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## ob1kinobi (9 March 2011)

I think the final point you raise is an interesting one, there are many different reasons and factors at play with regard to ST Plays vs Value Investing

Currently the (5 day MA) volume of HOG ($) is approx 200,000 K. So at present we are talking about a low level of interest from the market. 

Im not sure on the size of the trades being but through there $ value is obviously pretty small.

Until some larger players take some genuine interest the price can move around without any real conviction in either direction.

As to the Bull Report? it does seem like a lot of nonsense. 

Any subscribers out there? Or is it free?


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## zzaaxxss3401 (9 March 2011)

basilio said:


> Perhaps Aussie Bull is more about the very short term art of picking week by week market rises and falls. But surely the very concrete reality of  current positive cash flow and  excellent  drilling opportunities deserves consideration.
> 
> Otherwise I think it is just a load of bull..



Probably have to agree. The share price has been forming a nice wedge since around the 20th of Jan though and if it closes above 46c today, then it's still tracking nicely.

"I'm not bovvered." - http://www.youtube.com/watch?v=nTNycV-rThY


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## prgudula (9 March 2011)

Good times for gas productio

http://www.smh.com.au/business/good-times-for-gas-production-20110309-1bn07.html


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## basilio (9 March 2011)

prgudula said:


> Good times for gas productio
> 
> http://www.smh.com.au/business/good-times-for-gas-production-20110309-1bn07.html




Good old Barry! That should be worth  at least a little shot in the arm for HOG today.

I don't think it's an accident that relatively major good stories on particular  shares  in The Age/SMH will result in a surge of interest.


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## condog (9 March 2011)

> *Good times for gas production Barry FitzGerald *March 9, 2011 - 9:09AM
> 
> 
> It is a good time to be bringing on oil and gas production in Europe, the part of the world that has the most to fear from supply disruption in the Middle East and northern Africa.
> ...




Entire article: http://www.smh.com.au/business/good-times-for-gas-production-20110309-1bn07.html


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## BrightGreenGlow (9 March 2011)

Only 3 months to 68c they say... mmm... I kinda wish... is this reasonable condog? Im guessing is will only be the case if the new well goes as planned?


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## condog (10 March 2011)

The markets being an irrational beast at present. Where common sense jumps out the window and stupidity takes over. 

I will be watching for buying opps. CGT prevents me selling unless you can forsee a bigger buy sell spread then your CGT %.


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## traderclaude (10 March 2011)

HOG is derisked from what is going on with the Arabic world.

Really shouldn't be much impact what happens there as I see it. Just people spooked by oil.

Judging by the close trend I think we will see a surge back up to 46 to 48 cents morrow. 

One of those times when you can load up early morning.


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## tothemax6 (10 March 2011)

condog said:


> The markets being an irrational beast at present. Where common sense jumps out the window and stupidity takes over.



Yeah why is "risk of oil interruption in north-africa/mid-ease" translated to mean "sell oil producer stocks _outside_ of north africa/mid-east" .


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## basilio (10 March 2011)

At certain stages markets can become quite irrational.  If investors fear there is a big correction or even crash coming they bail out without questions. Later on the astute investors (who still have some cash left) can make a real killing. 

Theoretically HOG is extremely sound and seems to only have upside. But I still wouldn't expect it to hold up if the market drops another 70 points tomorrow.


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## ob1kinobi (11 March 2011)

The other point re Markets is the absense of buyers.

Simple demand and supply.

What happens when no one wants to buy what you are selling?

Well you have to price it lower to entice someone.

At present there are too few people looking to 'take-on' risk.

An abundance of sellers to buyers.


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## condog (11 March 2011)

BrightGreenGlow said:


> The general market seems to be disagreeing with you condog. However, for every stupid seller there is another buyer.... hope you are correct with this one though. I only have small package in HOG but am now starting to track it since it has started falling in the last few weeks. I have alot of trust in your research though and love reading your opinions.
> 
> Let's hope we gain from here towards the end of the month.




Dont rely on what i say, use it as a basis for your own research or to consult with your broker, but dont rely on it. Im not qualified and ive been wrong before and will be again.


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## Dukey (11 March 2011)

Gonna take this opportunity to get in on this one...   apart from the long drilling times all looks great.  not sure yet if i will be short term or long term yet - as I'm thinking it may rise to a level then go sideways for a while waiting for those next wells....
but we'll see how she goes... 

Thx to all here for bringing this one to my attention.

-D


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## traderclaude (11 March 2011)

Well i got it wrong about getting to 46 cents today, but a 5 cent drop is not to bad. 

The massive earthquake worries the entire market a bit for me, though I'm pretty sure HOG will not be affected itself just by the market. 

At the end of the day iron ore will be in demand with rebuilding parts of the world in the months ahead.

With the news in the next few weeks I would expect HOG to get up to 50 cents anyway, unless that bigger choke does not come off. 

Sad seeing such potential with lack of interest,  but great opportunity to make profit at current price.


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## poverty (11 March 2011)

traderclaude said:


> At the end of the day iron ore will be in demand with rebuilding parts of the world in the months ahead.




Do you think when the 9mm choke gets installed HOG will produce a lot more iron ore?


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## traderclaude (11 March 2011)

LOL! Was that a serious question or you taking the piss. 

No i just threw a general thought out there, HOG has nothing to do with iron ore if I mislead anyone, oops!!!

For me it about the gas for HOG, the oil comes with it, but gas is the best thing about the stock.


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## poverty (11 March 2011)

Surely with a bigger choke installed that iron ore will just fall out!


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## Dukey (11 March 2011)

poverty said:


> Do you think when the 9mm choke gets installed HOG will produce a lot more iron ore?




...now that would be quite tricky ! 

IMO - all stocks are affected by general market sentiment to some extent... but i would think HOG should be reasonably well insulated, apart from local (to their operations) interruptions and general oil price shocks.

... they do only have 1 well though for the moment.


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## tothemax6 (11 March 2011)

poverty said:


> Do you think when the 9mm choke gets installed HOG will produce a lot more iron ore?



:jump:


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## condog (13 March 2011)

Juust to set the record straight - HOG is extracting gas and gas condensate from the ground, NOT  Iron Ore. Not sure whos kidding and who is serious here, but its is wierd.


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## trader8888 (13 March 2011)

poverty said:


> Do you think when the 9mm choke gets installed HOG will produce a lot more iron ore?




LOL


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## ParleVouFrancois (13 March 2011)

If they are producing iron ore instead of oil they really should change their name.


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## bennywizard (14 March 2011)

ParleVouFrancois said:


> If they are producing iron ore instead of oil they really should change their name.




No its not Iron...its more like Gold ... Liquid Gold that is 

By the way if you have not yet listened to this its worth your time
http://www.brr.com.au/event/77311/c...underway-first-revenue-received-from-201-well


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## condog (14 March 2011)

From a fellow forum poster - response from company to his email.

Asking some guidance on cashflow he was provided this response below. 



> We are currently running the well on a 6mm choke during the initial ramp-up period. Once that rises to the expected 9mm choke. That figure, before tax, is $4 million. We're currently low on cash in the bank, although we are now receiving revenue from Well #201 and have been paid for February and March gas. We definitely expect this gas will fund our drilling activities this year. There is absolutely no need for a capital raising.




$4M before tax is a massive cash flow for a company this small. That figure is supposed to be approx $2m net per month which is still phenominal for a company this young. OPEX are around 30-33% of revenue and then theres company admin costs taxes etc. 

$2M Net Earnings pm = $24M p.a.

24M at Sector average PE of 23.7 is $568Million mcap. Current mcap 211M*44c=93M
$568M / 211M shares = $2.69

Applying a lower PE to allow for risk of very junior producer at say 16 = $384M
$384M / 211M shares = $1.82

At PE 10 which is low for a company like this = $240M
$240M / 211M shares = $1.13

Note : DYOR and seek advice, these are not without risks.

2nd well mid year, third well end of year to early 2012. 
If they get a 2nd well even half as good as well #201 they will be sitting pretty.

Pretty easy to see where Hartleys come up with thier $1.14 valuation
http://www.hawkleyoilandgas.com//me...s-research-note-117/Hartleys-reseach-note.pdf


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## condog (14 March 2011)

Thank you to those selling, nice topping up at these prices imo.


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## tradefill (14 March 2011)

condog said:


> Thank you to those selling, nice topping up at these prices imo.




yeh they do provide a good opportunity. I don't understand why anyone would be selling. I would be topping up to if I had the funds, for now ill just have to sit on what i've got


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## poverty (14 March 2011)

I topped up today (0.415), cheap iron ore at these prices!


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## condog (14 March 2011)

In the grand scheme of things weve had a market pullback of around 5-7% and the japan situation, while horrible, isnt likely to cause massive problems globally unless they have a large scale radiation leak that drifts over China or Tokyo. 

If anything now Japan is likely to have stronger economic activity in H2 2011 once the repair and reconstruction phase starts. They will need more Australian resources, more oil, more steel then normal to reconstruct and repair. 

So imo todays selloff is a rediculous over-reaction, which in many stocks was reflected in the intra day bounce after the traders all jumped off the cliff this morning. 

The situation in the middle east and afric has not eased or been resolved, but also energy supply has not been materially effected either "yet". So im seeing energy prices remaining high. Whilever govts worldwide continue to print money , scarce resources like gold and oil are going to head north imo. Oil prices as i see it are a result of US demand , China and India demand and i dont see them materially reducing for any reason at present.

I bought a large parcel of HOG today on the back of thos weekness and hopefully will continue to buy large parcels tommorrow. Its only a matter of time imo till Aussies realise they have significantly oversold the market. To me this is our usual post May doom and gloom arriving early. 

Yes there are numerous simmering issues worldwide, EU debt, EU lackluster economies, US printing money repetatively, US losing its global reserve currency status, Japans recovery and lackluster growth, the middle east and north africa issues, but in all honestly these things may or may not simmer for years before causing an eruption or major problem. Who realy knows. 

So the reality is imo that after this very short term focus on doom and gloom, the market is going to realise the value its currently  giving away and we will see a sustained run again. 

One only has to look at the fundamental intrinsic values of Australian companies to see we are over sold. All 4 banks are under value ranging from 13.3% for WBC to 23.7% for NAB. JBH is 37% under value, BHP 29% under value, woolworths 25%. 

In terms of resource stocks and particularly the small caps imo the risk aversion triggered in the last 3 weeks and from Japan has many of them even more over sold. 
In Hogs case its almost 20% in a week and for what reason.

I think this arvo many buyers started to realised the value on offer. 

Hence why im buying. Enjoy the ride, but personally i find it better to be doing the opposite to the Lemmings. And when they are all buying i will sell them back to them for premium prices.


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## poverty (14 March 2011)

Important update

http://cheezdailysquee.files.wordpress.com/2011/03/90d76766-a7c7-4d86-8bfa-eda36f5d8c97.jpg


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## traderclaude (14 March 2011)

The email from HOG is pretty on par with the forecast if I read correctly. 

The $4 million revenue is for Feb and March from the 6mm chock, They will be aiming around $8 million revenue from the 9mm chock  for April and May and maybe slightly higher. 

If you get your calculator out it adds up to close to $50 million revenue per year (they have said $45 million from the first well alone). 

The second well will aim to double revenue later in the year pushing to $100 million revenue a year. 

There is not much really to worry about with the company operating in the Ukraine with what is happening in the Arabic world. Contracts will be set up with the Ukraine government to deliver locally.

There is also an upside for the Ukraine to look at more gas and oil energy as opposed to a high dependence on nuclear.

Wouldn't mind trying to get in with a 40 cent buy trough, but have a feeling it may be hard in the next week with how quickly it bounces, but only time will tell.


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## suhm (15 March 2011)

Seems there was a reason for the delay in production look at note 6 in the half yearly report, a bit of poor form from the company that they didn't highlihgt this issue. Appears like the drill rig operators were holding the companies well to ransom for 625k, it appears they got paid 212.5k instead when the court ordered the rig operators to hand over the well.
The sums of money are insiginificant but for a company that seems to be quite good at communication, its not good that they didn't explain this before.


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## basilio (15 March 2011)

suhm said:


> Seems there was a reason for the delay in production look at note 6 in the half yearly report, a bit of poor form from the company that they didn't highlihgt this issue. Appears like the drill rig operators were holding the companies well to ransom for 625k, it appears they got paid 212.5k instead when the court ordered the rig operators to hand over the well.
> The sums of money are insiginificant but for a company that seems to be quite good at communication, its not good that they didn't explain this before.




You wouldn't want to highlight that your oil drillers were trying to do you over.  Probably one of the perils of working in a totally commercial marketplace.  Perhaps this has something to do with with what seems to be very long drilling times for the wells. 

Lets look forward to lots of luverly iron ore coming from the 9mm choke.: And hopefully a quick no problems drill for the rest of the field.


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## zzaaxxss3401 (15 March 2011)

Perhaps we should drop the "iron ore" gags. Someone viewing this thread for the first time, is going to be TOTALLY confused by the musings going on. :


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## basilio (15 March 2011)

Ugly day on the market and unless Superman can make a return and spin the world back by a few days it won't get better.

I thought HOG's behaviour was curious. It got butchered along with everything else and then.. lo and behold...two small sales in the last seconds take it from .38.5 to 40c.  Nice piece of window dressing I think.


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## condog (16 March 2011)

Happily buying at these prices. 

Cant see this lasting too long. 

The heat in those reactors, will soon be gone in a few more days and the market will imo realise its over reaction and bounce. , finishing the headlines of radiation leaks.

If it works its way back up to 50c thats a 25%+ gain on these prices.


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## basilio (16 March 2011)

condog said:


> Happily buying at these prices.
> 
> Cant see this lasting too long.
> 
> ...




Sounding  a bit like Superman there Coondog.   IF,  (if,if,if)  the gods come together and everyone holds their breath properly the disintegrating  nuclear power  stations will slowly subside without poisoning a few million people and  making large areas of Jan uninhabitable for years to come. (It could quite conceivably get that bad )

And after that "all" Japan has to be concerned about is a series of totally destroyed communities, upwards of 10,000 people dead,  hundreds of thousands of people without homes or anywhere to live, a crippled power system that will restrict the whole production system and the possible failure of at least one of their biggest companies (Tokyo Electric power company) - and that is the optimistic view.

I don't doubt the intrinsic value of HOG. But sometimes external forces can make a complete shambles of even the best businesses.


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## dumadiscount (16 March 2011)

doubled my holdings in HOG yesterday at 0.40.

hopefully market sentiment is a lot different in the second half of the year.


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## BrightGreenGlow (16 March 2011)

dumadiscount said:


> doubled my holdings in HOG yesterday at 0.40.
> 
> hopefully market sentiment is a lot different in the second half of the year.




.38.... should have waited a few hours... ill be buying but not just yet! the Knife will still fall for a few more weeks.


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## condog (16 March 2011)

The others hve bounced 5%, wont be long hog will imo


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## condog (16 March 2011)

condog said:


> The others hve bounced 5%, wont be long hog will imo




Trippled my holdings in the last two days, hmmm nice thank you.

in reference to the superman tag, not sure what you been smoking, but you could probably sell it for a quid. 

In reference to the hold up in drilling. The good thing is we won the court case, which highlights even if the drillers are a tad dodgey, the courts are clearly operating in the correct manner. And at the end of the day if the courts are going to uphold these contracts, then the drillers will behave.


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## WRONG'UN (16 March 2011)

I doubled up yesterday, as well, and still have ammo left.
With the shocking memory of Chernobyl being refreshed in everyone's mind, it's hard to imagine that the natural gas price in Ukraine could go anywhere but up.


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## basilio (16 March 2011)

> Trippled my holdings in the last two days, hmmm nice thank you.
> 
> in reference to the superman tag, not sure what you been smoking, but you could probably sell it for a quid.   Coondog




Well done !  Certainly seems unlikely you will get HOG at this price in the future.

The superman reference?  I was referring to the movie where Superman spins the earth backwards to restore it before a catastrophe. I was pointing out that I don't believe Japan will simply pull out of this disaster easily and quickly and that the nuclear implications of a leaking power station in particular are still quite dangerous. 

*The power stations are not secure *and the consequences of further contamination and panic in the population, the economy and the share market are still real.


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## kermit345 (16 March 2011)

While I agree with you somewhat basilio, it really does depend on what time horizons your looking at. The news will continue to be flooded with Japan tragedy and nuclear catastrophe stories for at least a couple of weeks longer if not more. But if you look at a time horizon of 4-8 months time or longer then i think you'll see this current volatility and drop as a buying opportunity.

Japan are going to need/want to rebuild and they are going to require the materials to do it. This will underpin the recovery story of the australian market and in turn help money flow back into HOG. I mean look at the recent sell off in HOG and it is almost in no way directly related to Japan's tragedy. So even if Japan takes its time to rebuild, they will need australian resources, and while indirectly related to HOG, risk appetite will return and hence HOG should appreciate.

Not to mention fast forward 4-8-12 months and we should have another 1-2 wells online and fingers crossed producing decent flows. If only I had the funds to triple my holding like condog has, because i think this recent drop will be seen as a great buying opportunity particularly for HOG if we look back in 12 months time.


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## traderclaude (16 March 2011)

That was some surge between 10am and 11am today, close to 10% in an hour.

Then stabilised for rest of day with not much volumes. To me this would mean people are assessing the stock a bit more closely because it does have potential.

Looks up trend to me, as it may have reached a low trough, but only time will tell. 

I would have the buy tick, take it all leave it but fundamentals have it a lot more than around 40 cents at the moment.


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## traderclaude (16 March 2011)

Another interesting story which I can't find information about and trying tonight is how far ahead they have hedged and fixed price sales and if this has been done for March / April. 

Bigger companies will fix for longer to avert risk. 

This could be a big benefit for HOG in the next few months. 

Anyone agree, disagree, have the information, or can expand on this more?


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## condog (17 March 2011)

traderclaude said:


> Another interesting story which I can't find information about and trying tonight is how far ahead they have hedged and fixed price sales and if this has been done for March / April.
> 
> Bigger companies will fix for longer to avert risk.
> 
> ...




Not sure that they can hedge in the Ukraine. Theres probably no futures market operating thier. They can only hedge if the buyer is willing to buy contracts in advance, or if thier is a market for futures, which i dont think thier is in the Ukraine. Happy to be proven wrong if anyone knows otherwise. 

The EU has gas futures and i know they are affected by Russian / Ukraine gas disputes, but as far as i know HOG would not be selling to the EU. They could be, but i havent read it anywhere. If they are selling to the EU, then potentially they can hedge.


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## condog (18 March 2011)

I wrote to WHawkley asking some questions about several issues. Got a response that they will make an announcment in the next few days that should answer most my questions.


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## BrightGreenGlow (18 March 2011)

condog said:


> I wrote to WHawkley asking some questions about several issues. Got a response that they will make an announcment in the next few days that should answer most my questions.




MMM Condog, did u get the impression the answers would be good or bad?. What questions did u ask??


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## condog (18 March 2011)

condog said:


> Not sure that they can hedge in the Ukraine. Theres probably no futures market operating thier. They can only hedge if the buyer is willing to buy contracts in advance, or if thier is a market for futures, which i dont think thier is in the Ukraine. Happy to be proven wrong if anyone knows otherwise.
> 
> The EU has gas futures and i know they are affected by Russian / Ukraine gas disputes, but as far as i know HOG would not be selling to the EU. They could be, but i havent read it anywhere. If they are selling to the EU, then potentially they can hedge.




Our little piggy has not bounced much, if it stays subdued and others continue to recover, it coud become an exciting proposition depending on the imminent announcment of choke size and flow details etc.

BGG I wanted to know about choke size, cash flow, intended spud time sand expected well completion times etc. No i didnt get any incling whatsoever about whether announcments would be positive or negative. Simply a response that an annnouncment would be out soon, that would answer most my questions. 
Id almost put money on it being mainly relating to current choke setting, flow data and then a plan or something bringing forward either Chets or Well 2 at Syra.

Imo if the announcment says they are still on the 6mm choke i think it might present a buying opportunity as the market over reacts. If they are on an 8mm or 9mm it should defintiely imo help the sp head North, especially if the declines are insignificant.


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## kermit345 (18 March 2011)

Condog, haven't actually contacted the company myself however the whispers seem to be that they are still on the 6mm choke currently and as previously stated looking to move on to the 9mm at some stage.

I see the 9mm as icing, and think the real guts of a good announcement would be confirmation of cash flows (reveune / profit and confirmation of forecasts) as well as indication of progression for the next well.

The addition of another well has the potential to significantly de-risk this further and provide additional cash flows. I see this as what could deliver the real gains with adjusting choke a secondary to this but something that could be achieved in the meantime. I'd like to see them follow the stages of de-risk project through other succesful wells, solidify cashflows and then expand cashflows. Expanding is a secondary effect of de-risking.

Good times ahead imo and as you sat condog, if the market over-reacts to an announcement stating the 6mm choke is still being used, could present a great buying opp.


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## traderclaude (18 March 2011)

condog said:


> Imo if the announcment says they are still on the 6mm choke i think it might present a buying opportunity as the market over reacts. If they are on an 8mm or 9mm it should defintiely imo help the sp head North, *especially if the declines are insignificant*.




What did you mean by declines are insignificant, what declines were you talking about?

Just wondering because I didn't understand what you meant, Thanks.


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## easylikesunday (18 March 2011)

traderclaude said:


> What did you mean by declines are insignificant, what declines were you talking about?
> 
> Just wondering because I didn't understand what you meant, Thanks.




Decline in flow rates.


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## traderclaude (18 March 2011)

Ok thanks. 

So where it is between from current 5.29 mcfpd and if it reaches 10 mcfpd or above with the 9mm choke from Sorochynska 201 well, I wouldn't mind seeing 12 mcfpd. 

But at end of day cash flow is already there to keep things good. 

Performed good today so i suspect volatility one way or the other when they announce it. I wouldn't mind seeing them go hard and fast but maybe they will take a long term approach. 

Great to watch the story unfold when you see such big forecast revenue and low operating costs, and hardly anyone notices it.


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## mel (19 March 2011)

From memory, the broadcast posted by Assassin on 8th March spoke about the company's intention to take time to surround themselves with the best people and to not rush their projects which I found to be a positive sign for lthe long term future of this company.


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## condog (19 March 2011)

Every new well once flowing has well characteristics, one of those characteristics is the dry gas to condensate ratio. another is the decline profile. Lots of wells on reasonably small reservoirs will decline in the forst 30-120 days by anywhere up to 70,80% or so.

Newer drilling technologies and better targeting of the location of the wells, allow for better well charecteristics, which is exactly why HOG is able ot make these wells commercial, where as the previous Ukrain wells became uncommercial in the same reservoir. 

Declines - means how much the well flow declines. Its generally measured in terms of 30 day declines, 60 day declines and 90 day declines. What we want is minimal declines. Some times if you let the wells flow too fast, you simply damage the well and create maintainance issues or permanent damage to the well.

For me the fact its still on a 6mm choke proves these operators are careful and know what they are doing. Your far better to flow it on a smaller choke and get to know the well characteristics, before just opening it up. 

For example if they run it on a 6mm choke and get a specific decline in 30 days, they will learn a lot about the well. If they then throw it on a 9mm choke and 5 days later it begins declining, then they will know that they are damaging the well. they will quickly return to a smaller choke to preserve the integrity of the well. 

Its common practice to learn a lot about your well and reservoir before opening it up. especially if its your first well into a reservoir. Good on them. Dont regard the 6mm as a problem.

They also need to play around with thier choke settings to experiment with thier liquids ratios, and see which size gives them the best EUR's (estimated ultimate recoveries) from the well. Theres no point gushig it on an open choke if its going to leave half the condnsate in the well. 

Sure it will lower immediate cash flow, but in the grand scheme of things it is necesary practice to learn about the well and reservoir without causing damage. The will be hopefull and keen to get it on a 9mm choke, but not at the expenses of well dmage or not learning about their reservoir.

Take AUt for an example in the Eagleford, they have almost 20 wells on tap now with Hilcorp. They are also involved in an information sharing arrangment with all the other operators in the eagleford, which between them have hundreds of wells. Yet they are still experimenting with choke sizes, frac techniques and still getting better results all across the Eagle ford. So the fact these guys want to leave this on a smaller choke which is safest for the well till they learn a bit about it is good practice.


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## condog (19 March 2011)

*Gas price for Ukraine to go up 31% in 4th quarter of 2011*

The price of Russian natural gas for Ukraine will increase 31 percent to 347 USD per 1 000 cubic meters in the fourth quarter compared to the first quarter, Ukrainian Energy and Coal Industry Minister Yury Boyko announced on Monday, according to RosBusinessConsulting.

According to him, Ukraine was paying 264 USD for 1 000 cubic meters of Russian natural gas in the first quarter of this year. The price will rise to 293 USD in Q2 and to 313 USD in Q3 on the back of higher oil prices. 

"To deal with the situation, Ukraine purchased the maximum amount of gas in the first quarter at a relatively low price and intends to balance gas supplies during the entire year in order to prevent sharp gas price hikes for households and companies," he said. Such gas prices, which include a $100 discount, are still high for Ukraine, Boyko noted. 

Ukraine intends to buy around 40 billion cubic meters (bcm) of Russian gas in 2011, up from 36.5bcm in 2010. 
From : http://www.russia-media.ru/mainmore.php?tpl=Energy+News&iditem=384

*Ukraine to Raise Natural Gas Prices for Households by 30 Percent*
Ukraine’s government will raise the price of natural gas for households by 30 percent this year as the country seeks to qualify for an International Monetary Fund bailout loan, Prime Minister Mykola Azarov said. 

The increase will help cut the budget deficit of state-run energy company NAK Naftogaz Ukrainy to 8.5 billion hryvnia ($1.07 billion), Azarov said yesterday in remarks broadcast by private TV channel Inter. Naftogaz’s budget will be balanced next year, Azarov said. 

The country first turned to the IMF in 2008 after the global recession cut demand for its exports and the budget deficit swelled. The nation received $10.6 billion before payments were frozen when the government declined to cut spending before presidential elections at the start of 2010. The IMF approved a second lending program in July after Ukraine agreed to trim the shortfall and raise gas prices. 

Ukraine raised the price of natural gas for households by 50 percent on Aug. 1, and said it would increase it more, according to the agreement. 

Households now pay an average of 725 hryvnia per 1,000 cubic meters, compared with an average of $264 the country paid for imported Russian gas in the first quarter. 

From: http://www.bloomberg.com/news/2011-...-gas-prices-for-households-by-30-percent.html

*Price for RF gas for Ukraine to be at $347 per 1,000 cm by end of 2011*
KIEV, March 14 (Itar-Tass) -- The price for Russia’s gas for Ukraine will be at 347 U.S. dollars per 1,000 cubic metres in October-December 2011, Ukrainian Minister of Energy and Coal Industry Yuri Boiko told a TV program on Monday. 

“Proceeding from the formula, the gas price is 264 U.S. dollars per 1,000 cubic metres in January-March 2011; 293 U.S. dollars per 1,000 cubic metres in April-June; 313 U.S. dollars per 1,000 cubic metres in July-September and 347 U.S. dollars per 1,000 cubic metres in the fourth three months of the year,” he said, adding, “This is too big price, even with due account the 100-percent preference.” 

In his words, the government will increase gas reserves in order to balance gas prices and prevent their skyrocketing for the population and enterprises. 

“In order to prevent such a situation, we bought the maximum of natural gas in the first three months of the year, when the prices are lowest, in order to prevent the hike of gas prices for the public sector and plants,” the minister said. 

On March 10, Deputy Minister of Energy and Coal Industry Vladimir Makukha said that the year’s average price for Russia’s gas for Ukraine may exceed 300 U.S. dollars per 1,000 cubic metres. 

In his words, in the middle of April the national commission on energy regulation can made a decision to raise gas prices for the population. 

Earlier, Head of Gazprom Sbyt Ukraine Anatoly Podmyshalsky said that the price for Russia’s gas for Ukraine will be at about 275 U.S. dollars per 1,000 cubic metres in April-June 2011. 

In his words, the indicator stands at 264 U.S. dollars per 1,000 cubic metres in the first three months of the current year. By the end of the year, the price will amount to 280 U.S. dollars per 1,000 cubic metres. 

Besides, Russia’s gas monopoly Gazprom will pay about 2.7 billion U.S. dollars for the transit of natural gas via Ukraine in 2011, as compared to 2.6 billion U.S. dollars in 2010, Prime Tass said, reaffirming that the gas transit cost 2.2 billion U.S. dollars in 2009. 

According to Podmyshalsky, Ukraine’s investments in its own gas transportation network was at 212 million U.S. dollars in 2009, and the indicator grew a bit in 2010. In 2011, the country plans to investment in the project 300 million U.S. dollars. 

Ukraine’s gas demand has dropped by ten percent over the recent five years, he said, adding that the supplies of Russia’s gas to Ukrainian consumers are planned at 40 billion cubic metres in 2011. 

Proceeding from the Ukrainian government’s data, 36.473 billion cubic metres of Russia’s natural gas were used for the needs of Ukraine in 2010, Podmyshalksy said. 

Gazprom Sbyt Ukraine is a subsidiary of Russia’s gas giant Gazprom. It is in charge of direct gas supplies to Ukraine’s industrial consumers. 
From: http://www.itar-tass.com/eng/level2.html?NewsID=16045117&PageNum=0


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## poverty (19 March 2011)

What are the major risks for a company like HOG?  They're already cashflow positive, I guess their future wells and projects could come up failures, which leave HOG stagnating, 'spending' it's revenue as it earns it on failed schemes.  But what could send the SP plummeting to the floor?  An accident at the first well?  Explosion? Earthquake? Sabotage?

This is not a downramp as I'm very positive on HOG, just general thoughts about possible worse case scenarios in these small energy companies I'm seeking out to invest in, not even HOG specific I know


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## Assasin (19 March 2011)

A couple of great posts there Condog.
Thanks


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## tothemax6 (19 March 2011)

poverty said:


> What are the major risks for a company like HOG?  They're already cashflow positive, I guess their future wells and projects could come up failures, which leave HOG stagnating, 'spending' it's revenue as it earns it on failed schemes.  But what could send the SP plummeting to the floor?  An accident at the first well?  Explosion? Earthquake? Sabotage?
> 
> This is not a downramp as I'm very positive on HOG, just general thoughts about possible worse case scenarios in these small energy companies I'm seeking out to invest in, not even HOG specific I know



Meteor hits the site. SP -> 0 in one day .

As the Fukushima incident has proven for any guy who was unlucky enough to be long a uranium exploration stock, you simply cannot factor these things into your individual stock purchase decisions. You can only factor the chance of these 'freak accidents' into whether you choose to buy stock at all, and how diversified you choose to make your asset portfolio. No one can predict a specific type of earthquake, a riot, a tsunami, a flood etc, only the risk of that general occurrence given the location.

Other than that, yes the new wells could turn out to be duds, and the Ukraine is not as politically safe as Aus or US,


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## emile33 (20 March 2011)

*6mm vs 9 or 12 mm choke*

Initial testing of Well #201 showed they were able to run the well on a higher choke but if they run the well at a rate that is too high, they will be at risk of coning around the wellbore. This effectively means the upward movement of water and the down movement of gas –if the gas rate is high enough, the gas may pull water production from an underlying zone. Coning can seriously impact the well productivity and influence the degree of depletion and the overall recovery of the gas. They are aiming for full field drainage so they need to carefully control the gas flow to achieve this. So i see no problem @ all they are carefully trying to increase the producting without accidents.
We might take out 50 cents next week on possitive news.
Thats my vision on the story. Cheers from The Netherlands.


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## traderclaude (21 March 2011)

condog said:


> I wrote to WHawkley asking some questions about several issues. Got a response that they will make an announcment in the next few days that should answer most my questions.




Should be in the next day or 2 then I suppose.

I am not expecting much difference as predicted just confirmation of the flow rates with the bigger choke. 

This will increase confidence and would expect to push the sp through 50 cents quite quick.

If the second and third well go alright by later in  year with similar results it may go exponential.


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## TabJockey (22 March 2011)

Sp decline in recent good market days indicates next ann wont be too positive?


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## poverty (22 March 2011)

Announcement confirms 40mill p/a revenue.  Can this piggy fly now?


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## Assasin (22 March 2011)

TabJockey said:


> Sp decline in recent good market days indicates next ann wont be too positive?




Again, you have been detected as a goose, read the announcement.


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## kermit345 (22 March 2011)

I thought the announcement was great. Dismissed concerns about the 6mm choke still being used and also any worries about flows dropping from using the greater choke.

Spudding next month at Chernetska (think thats spelt right) so hopefully more revenue to come on board later this year.

Its sounding great at the moment, lets hope management can keep it up.


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## Flipper (22 March 2011)

Production commenced on February 17 with the well running on a 6mm choke producing flow rates of 5.29 million cubic feet per day (mmcfpd) and 176 barrels of condensate per day. The process of integrating the Company’s new production facilities with the existing infrastructure at the local plant has progressed well. *The choke size has been progressively increased as bottlenecks in the production facilities have been fixed. Over the weekend, the choke size was increased to 8mm and the well is now producing flow rates of 7.51 million cubic feet of gas per day (mmcfpd) and 300 barrels of condensate per day*. The buffer pressure at the wellhead has remained constant at 3,400 psi and the inlet pressure at the gas plant has also remained constant at 1,200 psi. *The Company expects the choke size to increase again once the gas plant is running at its optimum level.*

I'm not going to pretend I understand this completely. However, based on your previous posts condog i'm assuming this is a very positive announcement? Choke size has been increased. Flow of gas and condensate has increased despite the larger choke? Im new to all this so please correct me if i'm wrong.


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## poverty (22 March 2011)

I can't believe the retards all queuing up to sell this for a few cents gain.


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## TabJockey (22 March 2011)

Assasin said:


> Again, you have been detected as a goose, read the announcement.




Again? When I posted the ann was not out yet. Was pretty happy to be filled at .42 this morning.


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## condog (22 March 2011)

TabJockey said:


> Again? When I posted the ann was not out yet. Was pretty happy to be filled at .42 this morning.




Not sure what your motivations are?? Your post both in AUT and in here are both against the stocks, yet your buying here. 

You where wrong , the reason it dropped this morning was because i decided to cash some of my stock i bought last week. I managed to sell most yesterday at .45 and some today at 445 and 44 and 435, but to get rid of the last few, i just decided to swipe the 43 425, 42, and 41 c levels. 

Still got an average sale price of over 43 which i was happy with as i wanted the cash back in my coffers. My sale was obviously premature, but holding such a large parcel when they had delayed the announcment and given mixed messages to the market, just made be a bit to nervous to hold the volume i had. 

I still have a very decent parcel, and will hold it in anticipation of further well results in a few months time.


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## traderclaude (22 March 2011)

"The Company expects the choke size to increase again once the gas plant is running at its optimum level."

So 7.51 mcfpd with the 8mm choke. 

What would would they get from 9mm, or are they thinking to go higher?

I think the aim was around 10 mcfpd.

I don't think they have been to delayed in announcements, it is quite frequent, but people do get worried with large parcels. 

Be interesting to see how the market responds tomorrow and if bigger players move in.


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## TabJockey (22 March 2011)

condog said:


> Not sure what your motivations are?? Your post both in AUT and in here are both against the stocks, yet your buying here.
> 
> You where wrong , the reason it dropped this morning was because i decided to cash some of my stock i bought last week. I managed to sell most yesterday at .45 and some today at 445 and 44 and 435, but to get rid of the last few, i just decided to swipe the 43 425, 42, and 41 c levels.
> 
> ...




Are you upset because of my aut post? It's a.great company but I think its fundamentally undervalued, that's my current opinion and this forum is the right place to.voice that.

I consider hog a great buy at around 40 cents with multi.bag potential but that does not mean I only speak rainbows and flowers. The sp fell this morning just before an Ann was due, so it was worth asking if that could be the.reason. now I know it was you getting nervous selling into a major market and sector bounce near recent lows. Thanks for that info,.seems a bit ill advised to me but each to their own and thanks for the 10 percent today.

Typing on this phone is a hitch.


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## WRONG'UN (23 March 2011)

It has recently been reported that the gas price in Ukraine is likely to rise by 30% during 2011. What does this mean for HOG?
Attached is an excerpt from HOG's range of estimated financial outcomes for the Sorochynska #201 well (ref HOG 29/11/2010), from which it can be seen that a gross revenue of $60/boe reduces to net earnings of about $22/boe.
Now if the gas price increases by 30%, the gross revenue should rise by 30% of $60 = $18/boe. HOG state that earnings are around, 40 - 45% of gross revenue, but as some of the offtakes will not rise with rising revenue (eg rent, operating costs), lets use 50% for the marginal effect.
So, an $18/boe increase in the gross revenue results in a 50% x $18 = $9 increase in the earnings. ie earnings increase by 9/22 = 41% This is huge!
They are also getting over $100/b for their condensate, cf $90 in their estimates.


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## prawn_86 (23 March 2011)

I was in this morning after reading yesterdays announcement.

Managed to get in at an average of 47. I have been watching it for a while but was happy to wait and make sure things were on track, which this ann provided for me


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## traderclaude (23 March 2011)

They say they will spend some of the profits on the head offices and suppose stock up the fridges with beverages as these miners do.

May go on a bit of a recruitment drive and also jazz the website up.

Most will be spent on further drilling equipment I would think though.  

They still got no marker on the asx charts from the announcement, the bigger companies have them all over the place, wonder if the news is still not spreading much.


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## bbker (23 March 2011)

What's a marker? 



traderclaude said:


> They say they will spend some of the profits on the head offices and suppose stock up the fridges with beverages as these miners do.
> 
> May go on a bit of a recruitment drive and also jazz the website up.
> 
> ...


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## traderclaude (23 March 2011)

I just type asx and the company code, so "asx hog" as an example and google it, and the chart comes up to click on.

Google is the best way to spread news I think, and then they have the google news linked to the charts.

I find it hardy and easy, but always good idea to search announcements on the asx website by code, it is first time to hear news, so you can get in or out quickly. 

Emailing a company will not help for updates, all you will hear is the latest announcements they have released.


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## bbker (23 March 2011)

Hmm still not sure what you mean.

In google, I type asx:hog and get a chart to clikc on just like I would for asx:cba or asx:bhp

So....?



traderclaude said:


> I just type asx and the company code, so "asx hog" as an example and google it, and the chart comes up to click on.
> 
> Google is the best way to spread news I think, and then they have the google news linked to the charts.
> 
> I find it hardy and easy.


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## traderclaude (23 March 2011)

Anyway oil and gas shares you would think will do well in short medium term unless you have missiles flying over your plant. 

AUT and HOG both have good forecast revenue to pick up a good bag.

I wouldn't think you could go wrong though with WPL as low risk just not as big a bag.


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## bbker (23 March 2011)

You might as well put your money in the bank and get 6% rather than buy a few measly shares in WPL with a market cap of $35b or blue chips with the market flattening or falling off. 

I don't know if manipulation has much to do with it but it's going nowhere and looks depressing like the rest of the market. 

I'm happy just to hold a few specs


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## McCoy Pauley (25 March 2011)

Hopped in at $.0455/share.  Good to be aboard.


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## basilio (30 March 2011)

Fascinating seeing HOG slowly drift down... Last time I looked they were still pumping  a ton of gas and oil and I guess the plans and activities around the next drills haven't fallen over...

I think it just reinforces how very short sighted current market sentiment is and the lack of research by the managers who are supposed to be building portfolios for super funds etc.


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## tothemax6 (30 March 2011)

basilio said:


> Fascinating seeing HOG slowly drift down... Last time I looked they were still pumping  a ton of gas and oil and I guess the plans and activities around the next drills haven't fallen over...
> 
> I think it just reinforces how very short sighted current market sentiment is and the lack of research by the managers who are supposed to be building portfolios for super funds etc.



Patience, my friend, patience


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## TabJockey (31 March 2011)

basilio said:


> Fascinating seeing HOG slowly drift down... Last time I looked they were still pumping  a ton of gas and oil and I guess the plans and activities around the next drills haven't fallen over...
> 
> I think it just reinforces how very short sighted current market sentiment is and the lack of research by the managers who are supposed to be building portfolios for super funds etc.




It isn't in the ASX 300 so most managers cant buy it.


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## jonojpsg (31 March 2011)

basilio said:


> Fascinating seeing HOG slowly drift down... Last time I looked they were still pumping  a ton of gas and oil and I guess the plans and activities around the next drills haven't fallen over...
> 
> I think it just reinforces how very short sighted current market sentiment is and the lack of research by the managers who are supposed to be building portfolios for super funds etc.




Agreed bas - can't understand it myself?  Must simply be a lack of awareness around what HOG have actually achieved with current flow rates and what that means for financing more wells this year?  I'm looking to enter again as I had to bail out to fund my super leveraged account with a big AUD short  Still waiting for that one to come off


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## condog (1 April 2011)

Topped up today. Think Hogs being over sold at present.


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## ParleVouFrancois (1 April 2011)

I'd agree Condog, should be around 60 cents or so given the rather derisked revenue/profit profile. Oh well, someone wake me up in June/July.


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## bbker (1 April 2011)

Guys,
When I bought this around a month ago, my trading platform gave some kind of warning that this was trading on a "reconstructed" basis. I assumed this was due to the structure with some shares in escrow....

But I've bought into other companies with a similar share structure and shares in escrw but no such warning.

Please explain?


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## traderclaude (1 April 2011)

It is like a monthly tide chart bouncing between 40 and 50 cents, from Jan to March, 3 or 4 times. 

So if you can get in at the bottom and out at top you get a ROR of about 20% a month, 240% a year, that's huge. 

Problem is if you miss the top or bottom or they stop. Basically it is an obvious trend at moment to make money, 

The peaks are getting lower and the troughs lower which is not generally a good sign for trend traders, which is why I think it will stabilise soon for longer term gains. 

The revenue and net profit are all good so not much to worry about holding at the moment, just is tempting to make bags short term and why not .  

Just my take, but sure is interesting.


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## bbker (1 April 2011)

Or could it be because of the reverse takeover of Incitive?



bbker said:


> Guys,
> When I bought this around a month ago, my trading platform gave some kind of warning that this was trading on a "reconstructed" basis. I assumed this was due to the structure with some shares in escrow....
> 
> But I've bought into other companies with a similar share structure and shares in escrw but no such warning.
> ...


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## stockjunkie (5 April 2011)

does anyone think that the drop in share price today may be due to a delay in announcements by management?


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## jonojpsg (5 April 2011)

stockjunkie said:


> does anyone think that the drop in share price today may be due to a delay in announcements by management?




Nuh, this is simply one of the least known about oil/gas stocks on the market, just have to look at the volume to see that - means that a few sellers can drive the SP down easily.

IMO management are going about the process carefully and professionally, as per condogs post above, not risking damaging the well simply to get better flow rates to impress Mr Market. 

Once 9mm choke is on and flow rates are up around 10mmcfpd + cond around 300bpd, I think we will see another push back towards 50c.  The way this is trading though, as claude suggested, it may take the next well to break it out above previous spike high of 56c (around there?).  

Good time to buy back in though, which I may well do


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## traderclaude (5 April 2011)

I would think there will be an announcement soon for an update on the Sorochynska well flows and the other 2 wells progress. 

I couldn't imagine the sp going much lower as management would not allow it, or should not as to sure up investors, but then again they don't need to raise capital. 

The Chernetska well must be close to drilling after getting through the paper work, then you have you have the second Sorochynska well drilling around mid year, so both will come into production later in the year around the same time I'm thinking. 

Just one of those things to deal with sp movement with low volume trading at the moment, but things can change quick.


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## ColB (5 April 2011)

bbker said:


> Guys,
> When I bought this around a month ago, my trading platform gave *some kind of warning that this was trading on a "reconstructed" basis*. I assumed this was due to the structure with some shares in escrow....
> 
> But I've bought into other companies with a similar share structure and shares in escrw but no such warning.
> ...




Someone is definitely unloading these with a degree of care.  Opened at .425 and slowly the 43 sell side was almost bought up when it dropped back to .425 after 270k of shares traded.

Thought I'd buy another 10k parcel at .425 and then 'whack' minutes later 350k of shares sold SP down to .405 in one trade!!


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## bbker (5 April 2011)

That doesn't have anything to do with what you bolded in my inquiry about it being traded on a reconstructed basis - which I don't think is a big deal anyway. My platform has probably some old data about the company that it has kept flagged. I suppose yours doesn't indicate this.

As for that single trade and the subsequent, it's anyone's guess like a dark secret  (good or bad) ... but I wouldn't exclude pack behaviour playing a part. *shrug*



ColB said:


> Someone is definitely unloading these with a degree of care.  Opened at .425 and slowly the 43 sell side was almost bought up when it dropped back to .425 after 270k of shares traded.
> 
> Thought I'd buy another 10k parcel at .425 and then 'whack' minutes later 350k of shares sold SP down to .405 in one trade!!


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## traderclaude (5 April 2011)

Hopefully in the next day or 2 we will hear that they maintained pressure with the 8mm or 9mm choke and close to 10mcfpd, which means 45 million revenue a year alone. 

Positive announcement may push through 50 cents in a few days, and future plans more some.

Going to plan a dollar by end of year, just my opinion if cards fall right.


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## condog (6 April 2011)

Lots of speculation and worry worts. 

Its not expected to make regular announcments as its in between drills and we can really only expect flow updates every 30 days or so. 

ITs going to be a while between announcments, and hopefully one that reacts violently to good news .  Its imo one of those that hopefully will reward patience. 

The drops in between merely present buying opportunities as peoples patience and nerves are tested. Be warned though its not without risk.


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## jonojpsg (6 April 2011)

condog said:


> Lots of speculation and worry worts.
> 
> Its not expected to make regular announcments as its in between drills and we can really only expect flow updates every 30 days or so.
> 
> ...




My sentiments exactly condog.  Am looking at getting back in BELOW what I had to jump out at (41) which I did NOT think would happen


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## condog (8 April 2011)

Yeh $2M revenue in first 30days on restricted choke for most of that. Looks good for $24+M.......  Currently sitiing in the PE range of 2-4 imo....

Thats imo one very cheap oiler , given the upside potential. 
It does carry risk obviously.


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## basilio (8 April 2011)

> Thats imo one very cheap oiler , given the upside potential.
> It does carry risk obviously.   Coondog




Coondog I can appreciate that one needs to ritualistically note that all investments carry risks but in HOG's case what do you objectively see as  significant risks? As I see it the current well is profitable, operating well and can only produce more gas and oil.  

The prices of gas and oil are increasing and very unlikely to fall below  current levels. Future drilling is in proven fields and the improved result from the current drill is very encouraging. HOG has a 100% interest in the fields so there are no JV issues. Any thoughts ?


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## prawn_86 (8 April 2011)

I guess risk factors are:

Next couple wells are dusters. Highly unlikely, but still a slight possibility. Or that they are too complex to extract from, or flow rates are not what was expected. They are spending a fair bit per well, so need to get bang for their buck.

Macro risk factors is the overall market falling over. No matter how much cashflow a co has, if the entire market tanks every stock is dragged down with it.


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## condog (8 April 2011)

Risks:
1. Overall market
2. Energy Prices
3. Russia hostility
4. Ukraine political unrest
5. Blow outs or accidents during drilling , fraccing or maintainance
6. Damage to the well from geological issues, flow etc
7. Unsatisfactory flows, or steep declines
8. Damage or closure to gas transport pipelines
9. Incorrect reporting, by companie reps
10. Drilling into dust instead of reservoirs
11. Innability to get operators
12. Operators being difficult / corrupt / etc like last well. 


Just to name a few. ITs a risk industry by its very nature, but having it in the Ukraine, which is at the mercy of Russia and Russian / EU political tensions makes it even riskier. But its this risk that also allows us to buy at such cheap prices, and potentially get a large scale reward if it all pans out.

Your not gunna win em all, but if you can get 1 in 2 youl be doing good with the upside most these have.


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## condog (11 April 2011)

TRANSCRIPT OF THE RADIO INTERVIEW WITH RICHARD REAVLEY, MANAGING DIRECTOR, HAWKLEY OIL AND GAS LIMITED, an ASX listed exploration and production company with 100 per cent owned assets in the Dnieper-Donets Basin.

http://ukrainian-energy.com/articles/gas_oil/206/


Can you please provide some background on the Company and the strategy for it?

I think the first thing to say about Hawkley is that we are not an exploration company, and we started back in 2007, as you said, with the specific strategy in mind to target assets that have known accumulations of hydrocarbon.? They are primarily gas and gas condensate assets that are close to infrastructure where we would be able to have 100 per cent operational control and to significantly reduce any title risk around those assets.? Now, given that Ukraine gas prices have approached and have almost reached European prices ? a very strong gas price environment in that country ? we wanted to take advantage of that.? But really, thanks to our excellent team in Ukraine and the Board members who?ve had an awful lot of experience working in that country, we were able to acquire assets through the State tender process, which is a very transparent process, and we raised ? in order to acquire those assets, we raised seed capital really through one of our founders out of, you know, really, mums and dads and friends and family and people in Perth, you know, that have sort of made money with things that we?ve done in the past.? And, you know, that really did allow us to go back to Ukraine where we?d been before and acquire these assets and build on the experience that we?d already had.? I think key to what we do, as I said, is we target assets that have got hydrocarbons in the ground.? And, really, what this Company is about is just going and drilling better wells.? And we?re not doing anything amazing and newfangled here.? We?re just drilling and completing good-quality wells and achieving better flow results out of those wells.? You know, the well that we have just drilled really is a very good example of that where we got, you know, three to five times the flow rate.? So that?s in a nutshell the key to the Company, you know, the operational control and total ownership and then just, you know, the technical experience which we?ve got in the Company to drill better quality wells.

What separates Hawkley from the other juniors?

I think, first of all, certainly in the Australia, first of all the fact that we?re in Ukraine and we?re the only Company that?s operating in Ukraine that?s listed here, as far as I?m aware.? And I think that, you know, in terms of ? my background is more London capital markets and I think there, there is a bit more of an understanding about Ukraine whereas, here, it?s more an educational process for us to go through.? And, know, what we really do need to get across is that, you know, Ukraine is a very European country in many ways and, you know, operating there with the team that we?ve got on the ground, it?s a very normal place to operate and do business.? And I think that?s a big surprise to people.? But, really, the things that differentiate us are, you know, the in-country experience that we?ve got with the local team and, you know, the way they are.? They?re the founders, part of the founders of the Company, and they really do provide us with a very, very advantage indeed, and then the fact that *we own and operate all of our assets 100 per cent.*? I think that is key, and as I said before at the beginning, with the fact that we?re not an exploration company.? So that?s really the big differentiators for us.

Your main asset, the 201 well, can you please provide some details around this?

Sure.? I mean, obviously, that?s been a success for us and people are starting to ? you know, we?re starting to get people?s attention because of what we?ve done.? *Really, what that does is it makes us a production company*.? It puts us into the top 10 oil and gas companies ? in listed oil and gas companies in Australia in terms of revenue, which is obviously a good achievement.? But, *really, what that well has done is, apart from its sort of de-risk to the stock to quite a large extent, **it allows us to go and drill two wells and start a third well this year and, also, it really allows us now to go and start to really seriously build the team that is really going to take this Company forward and, you know, attract good-quality people, which we?re very much in the process of doing, and bringing those people into the Company.? And we can do all of this without going out and doing a big capital raising*.? You know, that?s obviously a very, very important thing.? You know, it has given us that stability and taken a lot of the risk out of it and, as I said, you know, people are starting to see the Ukraine as a good place to operate.? You know, we?ve been paid for our gas.? As I said, we?ve got that revenue.? We?ve taken that money out of the country and, you know, we?ve done a lot of the things that people wanted to see us do to sort of de-risk the story, because people do like the story and that?s ? you know, what we?ve achieved is obviously important.? We need to repeat that.

Hawkley announced it is now receiving revenue from gas sales and it?s achieved better results than expected.? Can you please elaborate on this?

Yeah, sure.? And really, as I was saying at the beginning, it?s about drilling better quality wells and getting better flow rates out of, you know, these assets where we know there?s gas in the ground.? And we essentially drilled a step-out well from a well that produced ? you know, just to throw some numbers in there ? 4 million cubic feet of gas a day.? We got that on an open hole test and then, when we, you know, drilled our well and completed it and perforated it, it was flowing at three to five times those rates.? And, you know, we didn?t do anything, as I said, particularly amazing.? It?s just about controlling the drilling process through the formation and making sure that we don?t damage the formation, which is something we?ve been very successful at really through the use of a seam.? And again, you know, it?s just about the very good technical capability that?s in the Company in allowing that to drill good quality wells and just getting much better results, because the reservoirs are very, very good there.? You know, the opportunities in the country are significant.? *Really, to summarise, we expect this well, once we have it running at its potential, to provide, you know, around $45 million of revenue for the Company on an annual basis, and we expect to be able to run it like that for seven or eight years out of a total life of the well of 20 years.? So, you know, with another well into that same horizon, with the other well that we?re drilling, we should be able to double that revenue in 12 months? time.*What is the biggest challenge and what is the outlook for Hawkley over the next 12 months?

I think, given the success that we?ve had with the well and what it?s going to allow us to do, the challenge really or, you know, the key thing for us ? there are two key things for us to do.? First of all, we?ve got to drill two more wells, and *we?ve got a rig up on the next well and that will be spudding in the near future*.? *We expect to start another production well in the middle of the year and, again, towards the end of the year,* we?d like to start a third well, and that?s *all funded with cash flow*.? So that?s obviously very important, making sure that we repeat the success that we?ve had, and we are very, very confident that we will be able to do that.? But also, I think, we do need to consolidate.? We do need to recruit some key people in Ukraine and in Australia and build the teams in both places, because I think the mistake that we could make would be to try and sort of think, ?Okay, let?s go and drill five wells this year.?? We would lose that control that we have had that has meant the success and has really been the key to the success.? *What we need to do is get the Company in 12 months to position it to such a point that we can then really take it on.? And by that I mean, you know, if we?re doing 2500 barrels a day, or we will be very shortly with this well we?ve just drilled, in 12 months? time to double that production rate is the target, and we feel it?s a very achievable target.?* And then, from there, we will have the team in place and really be able to take the Company on to sort of, you know, move on to 15,000 barrels a day and really take it on.? And that?s what the Company is about.? It?s about, you know, resources to reserves to cash flow, and that?s where you really get the value.? And I think, as well, it?s apparent that, you know, we really do need to continue raising awareness of the Company in Australia.? We very much feel we?re an Australian company but we do still need to get that out there.? We need to get people to understand Ukraine, to understand the opportunity, to understand how we have de-risked operating there, and get people much more comfortable with it, because there isn?t that awareness here.? So those are really the key things that we need to achieve.? We need to make sure we don?t try and grow too quickly and get ourselves into a really solid footing so that we can really take advantage of the opportunities that we?ve got in front of us which are, as I said, significant.

http://ukrainian-energy.com/articles/gas_oil/206/


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## kermit345 (11 April 2011)

thanks condog, only read the parts you highlighted and while he seems to love saying 'You know' it paints a very pretty picture for HOG's future. I am eagerly awaiting a succesful producing second well and if/when this occurs i feel there could be a major re-rating.

At the moment i'm happy the hold and wait. If I had the funds, i'd accumulate on these dips to 0.40.


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## traderclaude (11 April 2011)

Looks like the start of an upswing today.

Starting from a good position if there is more positive news with the next announcement, must be close to breaking mid 50 cent sp soon. 

May be possible they went higher than the 9mm choke to get higher flows.


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## Wombus (11 April 2011)

Long time reader but first time poster.
I'm wondering if anyone can enlighten me what is going on with with the shares in the company. The Hawkley research reports state there are 136m shares on issue, and 284m fully diluted. I have seen in other reports/presentations that there are 244m on issue with 40m options for the fully diluted 284m. So I'm wondering about the ~90m shares discrepancy. Commsec certainly reports market cap based on the ~136m shares. I have read that there is a large amount of shares in escrow, who owns them? when are they released (if they are in escrow)?


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## condog (12 April 2011)

Wombus- welcome.  
You need to count both the escrow shares and the options in your mcap, as the shares in escrow will eventually become fully fledged shares. Im not sure exactly who owns them. The options should become shares, so best to count them or at least 50% of them in your calcs.

TraderClaude
Hope your right, but im not expecting much news flow. Perhaps some update flows , a spud announcment and some drill depths. But i dont think we will see an accelleration till we get news on thier 2nd well flows in a few months time. 

3rd well spudding mid year. So whilst we may get a few announcments, the true catalysts for sp growth will be the flows on the 2nd and 3rd well.

You got to remember these wells take ages to drill (months).

The thing thats becoming obvious is the bullish language they are speaking. That transcript above indicates to me that managment is supremely confident of good cash flows and advanced drilling heading forward.


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## basilio (12 April 2011)

I agree that there doesn't seem much scope for  immediate ongoing announcements with regard to drilling progress. However I remember that last Novemeber when HOG reported the quite spectacular flow rates from their first well (4-5 times more than expected) they said they were going to have a review of the reserves in the fields. I thought this was supposed to come out  in January and it would reflect the capacity to immediately spud a second well in the current field as well as indicating the final total value of the asset.

That would be be a very big driver of overall value  if/when it is released.

Have to say though that it would be good to see a healthier SP instead of this rather an insipid up and down at what seem to be very low values.


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## Wombus (15 April 2011)

The Sorochynska well started production on the 17th of Feb, should we therefore expect the 2 month production figures early next week? if we see minimal declines like the production that occurred back in the 80s could we see a re-rating of the stock?


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## condog (15 April 2011)

Wombus said:


> The Sorochynska well started production on the 17th of Feb, should we therefore expect the 2 month production figures early next week? if we see minimal declines like the production that occurred back in the 80s could we see a re-rating of the stock?




I think we should be expecting them soon and the Quarterly, so hopefully we will see some serious cash flowing in. This thin imo will begin to rise when Initial production rates are expexted on Chets.


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## mel (18 April 2011)

Trading halt - something good I hope!


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## stockjunkie (18 April 2011)

trading halt in place requested by the company due to possible announcement on capital raising.


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## mel (18 April 2011)

Could someone please lret me know what its for as the pdf file wont open on my mobile


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## prawn_86 (18 April 2011)

stockjunkie said:


> trading halt in place requested by the company due to possible announcement on capital raising.




Hang on. Weren't holders told a few weeks back that they had no need to raise capital?

I dont like when management go back on their word, aren't they making enough from the 1st well?


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## mel (18 April 2011)

Not the kind of news I was hoping for if thats the case and was under the impression they werent going to need CR.


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## Assasin (18 April 2011)

mel said:


> Not the kind of news I was hoping for if thats the case and was under the impression they werent going to need CR.




I don't think there's any need to be negative about a CR. Could be a game changer.


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## bbker (18 April 2011)

I can't imagine what it could be other than to accelerate the drilling program or a deal with Shell.


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## Wombus (18 April 2011)

I think cooler heads are required on this one, the CR could easily be to accelerate the drilling program or fund an acquisition. If it's for either I'm hoping I can free up the cash to take up maximum entitlement!


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## kermit345 (18 April 2011)

I too think this CR could be of the positive nature, as the flows from the 1st well were doing great and the 2nd well should have been funded quite easily through the revenues.

It could be my optomistic side, however I think this CR could be more positive and of the acquisition nature as I doubt they would state 'No CR needed' then come out with one unless it was a real timely opportunity.

I've had a few of my holdings raise capital recently, and this is one that i'm not concerned about.


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## bennywizard (18 April 2011)

Great, now they can get things moving faster which is great.
Management seem careful so I'm confident they will put the money to good use and add value for all of us


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## Magic Man (18 April 2011)

I am a bit disillusioned with this announcement, especially with the share price down in the dumps.. have a lot of cash invested here, not sure how to play it.. loosing a bit of faith.


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## bennywizard (18 April 2011)

This is exciting stuff, the Share purchase plan will no doubt be over subscribed, I'll be taking it up in full that's for sure  
Lets hope that they pull off an acquisition as well as ramping things up with development of their acreages.
My guess is that there will be an acquisition announcement that will come in the next month or two, but this is pure speculation so don't take it in any other manor.


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## Magic Man (18 April 2011)

Benny, Why will it be oversubscribed? trading on this stock has been appalling lately. dont get me wrong i hope it is, but not sure which way its gonna go.


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## ColB (18 April 2011)

bennywizard said:


> This is exciting stuff, the Share purchase plan will no doubt be over subscribed, I'll be taking it up in full that's for sure
> Lets hope that they pull off an acquisition as well as ramping things up with development of their acreages.
> My guess is that there will be an acquisition announcement that will come in the next month or two, but this is pure speculation so don't take it in any other manor.




Benny you are a supreme optimist but I must admit your post is more encouraging than Magicmans previous post.  I'm inclined to agree with magicmans sentiment and others who are surprised at this CR given recent comments by management that they wouldn't have to go down this path.  However, as others have mentioned it may be be something quite positive for the companies future and our pocket.

We'll know soon enough.

I hold quite a few


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## djones (18 April 2011)

It will be a small institutional placement not a SPP. Question is what amount will it be placed at and what will the funds be used for.


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## condog (18 April 2011)

Id say patience. They may be raising for an accelleration / acqusition  etc. Just wait see imo.  

I didnt foresee it, although im not that surprised either, given the nature of this game.


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## condog (18 April 2011)

condog said:


> TRANSCRIPT OF THE RADIO INTERVIEW WITH RICHARD REAVLEY, MANAGING DIRECTOR, HAWKLEY OIL AND GAS LIMITED, an ASX listed exploration and production company with 100 per cent owned assets in the Dnieper-Donets Basin.
> 
> http://ukrainian-energy.com/articles/gas_oil/206/
> 
> ...




He was pretty clear in that interview about the need for no capital raising, and funding things from Revenue. So i expect a few people will be upset if this CR is not for something pretty good.

Lets just wait see for the announcment about the use of CR funds.


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## WRONG'UN (18 April 2011)

Actually, Condog, the optimum word in the transcript is "big" - they won't need to do a "big" capital raising - he didn't say there wouldn't be a small one. Maybe I'm splitting hairs, but I'm prepared to give them the benefit of the doubt in the meantime - I've been waiting long enough, a bit longer won't matter.


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## traderclaude (18 April 2011)

They didn't need to raise capital i would have thought. 

If the first well is running as forecast they could just go about business...  bigger players may have moved in to realize the potential with the low operating costs and gas prices. 

Either way we will find out tommorow in my optioion, i got a feeling they either listing on another stock exchange or signed a deal with Shell, but i could be completely wrong.


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## traderclaude (19 April 2011)

More than likely a share offer, but I would have been tempted to list in Europe given the lack of support locally, one of those things with culture holding the share price back.


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## Magic Man (20 April 2011)

Trading is now suspended here. Does anyone know what is going on?


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## traderclaude (20 April 2011)

Probably still getting the paperwork together today.

I hope they can drill wells better than they can spell. The spelling was appalling, someone must have been on the drink.


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## zzaaxxss3401 (20 April 2011)

Magic Man said:


> Trading is now suspended here. Does anyone know what is going on?



If you read the notice:
"...The details of the capital raising are still being finalised. On this basis Hawkley Oil & Gas Limited requests that it's securities be voluntarity (???) suspended until the announcement is released, which is expected to be made prior to the opening of trading on Thursday 21 April, 2011..."


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## bbker (20 April 2011)

Bloody pigs they are.

If they're drunk as hinted at by their spelling it better be from champagne over happier news.


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## bennywizard (20 April 2011)

Management have been very careful to date and we will soon find out the details which may well be very positive for us all. I'd say we will get a bite at the cherry as well, otherwise the raising details would have been announced today. Extra money in their coffers will mean they can either accelerate drilling or be in a position to make a quick acquisition.
My only concern is that they did not wait until after the increased choke setting as they could have done the raising at a higher rate if all goes well there. At the end of the day it will be a good thing to move this little HOG to big HOG in the shortest possible time frame.


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## bbker (20 April 2011)

I'm sure it will be more positive for those inst'al investors who will probably get the biggest bite of the $15 million cherry at a good discount.


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## McCoy Pauley (20 April 2011)

$15 million raised through the sophisticated investors placed by Hartleys at $0.37/share.  Guess that explains why Hartleys was so bullish about the stock a month or so back.

Another $3 million to be raised through a priority offer from existing shareholders at the same price.

HOG down 6% after resuming trade to $0.39/share.


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## tradefill (20 April 2011)

so anyone who holds hog will get to buy an extra 10K worth of shares at 37c?


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## bbker (20 April 2011)

tradefill said:


> so anyone who holds hog will get to buy an extra 10K worth of shares at 37c?




subject to shareholder approval at the EGM 27 May 11 and up to max. of $3 million


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## basilio (20 April 2011)

Really hope there is a very good explanation of why the extra shares were issued particularly after the earlier statements that there was sufficient cash flow to adequately fund the projects. I don't know why but I always get the feeling that many of these additional  capital raising are for the benefitt of spohisticated shareholders, institiutions and the the mangement rather than current shareholders. Hope I'm wrong in this case.

It's certainly had  an immediate depressing effect on SP


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## ParleVouFrancois (20 April 2011)

I haven't posted much about HOG on this board recently (I've been taking a break from posting for a while). Anyway, I think this raising is actually a positive development for HOG, using the figures I used on my blog:

Hypothetical Company #1 (No capital raising)
Equity - 10 million
Return on equity - 50%
60 million shares
Price per share - 1 dollar
Profit per year 5 million
Profit per share = 3 cents

Hypothetical Company #2 (Post capital raising)
Equity - 20 million
Return on equity - 40% (Take note it's lower)
70 million shares
Price per share - 1 dollar
Profit per year 8 million
Profit per share = 5.6 cents

Given that HOG has announced that the 18 million being raised is going to be used to drill a second well at Sorochynska, drill and appraise the first well at Chernetska, build a gas plant to process the Sorochynska gas (presumably increasing the returns from the wells in the area if we own the downstream processing), drill the third well at Sorochynska (simultaniously with the second one I assume), and "one or more acquisitions" (either acerage, or producing assets, either seems good).

Currently we have the situation as in hypothetical company #1, we have a very small equity component in the company which has been priced MUCH higher by the market, thanks to the massive returns we are getting from well #201. Although it's obvious the higher price we raise capital at etc the better, raising capital is actually the right move, if the equity can be deployed to generate large returns.

After this raising the company will be drilling wells 2 and 3 at the same time on the Sorochynska tenements, so if one fails and one succeeds it won't be as bad as going at it one at a time (due to the nature of the geological formations in Sorochynska, it takes around 9 months to drill with a soviet style drill rig, so to do it one at a time would leave us around 2013).

Right now HOG only has one producing well (extremely profitable as it is), so we pretty much NEED to get another one online to derisk the company and to show that the results from this well just isn't a massive fluke. Imagine if the entire area yields similar results (even flow rates of 50% of the #201 well would be massive).

Anyway in summary: If both wells hit gas, then this raising is brilliant (although I would've waited until the production figures were confirmed over a quarter, and the price rise to 50+ cents, before raising capital, but hey I'm not CEO). If one well hits gas, then it's still a very nice risk mitigating move, as we've drilled both at once (imagine if we drilled only one via cashflow, and it was a duster... the price would be WELL below the 37 cents that we raised at today, as the markets would assume #201 is a fluke). If both wells are dusters, then we still have decent cashflow from #201, but obviously the company isn't as attractive, so at least we'll be finding out if HOG is a goer within the next 12 months, instead of the next 24-36. For once, I support a capital raising.

PVF.


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## Magic Man (20 April 2011)

Interested to here Condogs thoughts? is anyone picking up HOG at the moment?


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## kermit345 (20 April 2011)

PVF great thoughts and thanks for the post. I posted on another forum regarding HOG and my thoughts.

Capital raisings through institutions and sophisticated investors is a necessary evil for small cap explorers and producers, its just a simple fact of the ASX. Its unfortunate for those of us who are retail investors, especially when we get stooged with only having $3mill to spread across all current holders so its likely scaling will occur.

Anyway, I still believe the raising is a positive as does PVF and for basically the same reasons. The additional funds gives us the keys to a number of doors, instead of only obtaining 1 key at a time using cashflows to fund developments.

The doors that we now have the keys to and have been signalled by the company include:
- Well #1 at Chernetska (Already underway and was next on the list anyway)
- Well #2 at Sorochynska (Was aimed for spudding June/July, could be brought forward now?)
- Well #3 at Sorochynska (Wasn't even on the radar until today's announcement, could be brought forward to now also?)
- Gas Plant (Not on radar either, would be interested on advantages this brings - hopefully company provides some commentary)
- Acquisitions (Wasn't on the radar either, lets hope some smart ones are made)

So essential we've gone from having 2 doors we knew were on the way to being opened, to now 5 doors which can all be unlocked now and start to open them.

I won't continue to re-hash what PVF has said, but in basic terms if the new wells are even moderately successful, earnings will expand and the share price should expand as well. A little pain now could set up a lot of gain for 12 months time. As it stands currently i'll be taking up some of the SPP.

Oh, and don't forget some resource expansion at Sorochynska which should be out relatively soon, and it wouldn't surprise me if the company already has some indication of a reasonable upgrade that they will use to boost the share price post SPP.

GL 2 all, DYOR.


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## basilio (20 April 2011)

It's all a bit interesting.  My memory of earlier comments from HOG was that they wanted to take things carefully and build up good organisational structures. In effect not over extend themeselves financially, administratively or technically. And becasue they were cash flow postitive with a decent surplus this seemed quite reasonable.

Now we have the prospect of multiple projects which on paper look good in terms of quicker returns but perhaps go against the original ideas? And I'm not that sure that all these projects are fundable with $18m. Perhaps they just get start earlier and cash flow from the first well helps pay them off quicker.

I agree that a reserves upgarde would be an excellent bonus.  It would also be interesting to see exactly what sort of new acquistion was being planned and the potential for that. In any case I want to see it hit $1 before the end of the year!!


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## McCoy Pauley (20 April 2011)

Like many posters, I'm surprised that the raising did not occur until after the updated flow results were released to the market.  The cynic in me suspects that the flow results might not be as good as first thought and so the cap raising is got away now before the SP drops on release of the updated flow results.


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## condog (20 April 2011)

Happy to see a 3rd well on its way.

Not swo happy to see raising done at 37c, when a month ago it could have been done at 44c.

Happy to see SPP as part of it. This is why i always hold shares in each account i have, gives you mulltiple bites at the cherry. 

Lets hope they can get these wells happening asap


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## traderclaude (20 April 2011)

The deal is more or less done and dusted now with the 15% placement.

The retail placement and the remainder of the investment placement is only around 25% of the deal which is pending the shareholder meeting in a month and may just be a wild card or get out of jail card if needed.

If you want to buy you may as well at 38.5 cents, not much difference to 37 cents. 

I think the bottom has been reached and only one way up. At the end of the day emotion can get in the way of common sense, the stock has been massively de risked from this.

The gas processing plant was always part of the equation i believe it is in one of the reports.

When your paying something like 11% of your revenue to use the existing infrastructure at a cost of 2 million you may as well build your own, read into that about the forecast revenue.


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## bennywizard (21 April 2011)

condog said:


> Happy to see SPP as part of it. This is why i always hold shares in each account i have, gives you mulltiple bites at the cherry...
> 
> That's interesting, I've found that companies don't allow multiples from the same name even if in different accounts, how does that work for you?
> Eg with TXN I had them in two accounts but was only able to buy in one. Maybe you have yours in different names?


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## basilio (21 April 2011)

Was just reading the story off the HOG website which in fact was in Australian Financial review discussing the capital raising.  

It seems that one of the biggest  elements in the capital raising was just giving the "institutions" some skin in the game. As the story goes HOG "wanted to see  instituational support as part of it's evolution" and decided that giving them a (cheap) piece of the action was the best way to get some activity by the various funds that advise investors. So if we are lucky we will see a significant increase in institutions chasing HOG scrip in the next few months. 

Hopefully anyway...

http://www.hawkleyoilandgas.com/med...ing-20-4-11-131/media-clippings-20-4-2011.pdf


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## Magic Man (24 April 2011)

Hey .. I was having a look in HC and at the moment they are mentioning licenses and expiry dates.. has gotten me a bit on edge,, can anyone elaborate?? thanks and Happy Easter


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## mel (24 April 2011)

From memory in one of their presentations it mentions the permits were for 5 yrs and they started in 2007 so what happens after that Im not sure


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## Magic Man (24 April 2011)

mel said:


> From memory in one of their presentations it mentions the permits were for 5 yrs and they started in 2007 so what happens after that Im not sure




That cant be good for the long term prospects of the stock... there must be some doubt there??


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## basilio (24 April 2011)

Magic Man said:


> That cant be good for the long term prospects of the stock... there must be some doubt there??




Don't get too excited.  Short story is that the _"initial 5 year licenses which were issued in  2007 are convertible to a 20 year production license upon fulfillment of  minimum work programs. The licenses are are not restricted to any particular horizons and are for all the underlying potential fields."_

http://www.hawkleyoilandgas.com//me...0805-Moyes-report-46/Moyes-Report-Hawkley.pdf 
See section one Introduction and overview.

Obviously it was important that any company taking the licenses actually undertook proper exploratory work with a view to commercial exploitation - which is where HOG is at.   No problems


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## prawn_86 (27 April 2011)

Quaterlies out today.

4m worth of revenue with 2.6m worth of net cash flows. This will increase next quarter.

So assuming going forward net cash flow of 4m per quarter  = $16m pa. Conservative PE of 8 = 128m or roughly 80 -90c per share. I'm at work so dont have full figures in front of me, perhaps someone else can add to this


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## basilio (27 April 2011)

Does look like a good set of figures today. In fact Hawkley is talking of around $40 m a year from the first well. This only partially takes  into account the rising price of gas and oil.  And as noted there is still room for increased production as the choke is increased.

*But the SP is still stubbornly stagnant and in fact has fallen substantially from late February*.   Dunno why  Perhaps all the analysts think the Russian mafia will step in and shakedown HOG when the serious money starts coming in? I would really appreciate an insight into the thinking of any current market analysts who are picking stocks for client portfolios.

Perhaps one way to give HOG a kick would be a dividend announcement later this year ? A 3c a share dividend on around 180m shares would return $5.4 m to shareholders which looks pretty reasonable given the $40m plus income.  THAT should open up some interest.. or is it too down market for companies  making a decent return to actually share the profits with shareholders?

________________________________________________________________________________

It's interesting to review the Hartleys analysis of March 1st where the SP was already 50c. 
http://www.hawkleyoilandgas.com//me...s-research-note-117/Hartleys-reseach-note.pdf


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## kermit345 (27 April 2011)

basilio, I dont personally like the dividend idea. They are running 1 well and have growth plans for future wells which could potentially fail. I'd much rather they use the cash flows and funds from current equity raising to fulfil growth plans successfully and then start thinking about dividends possibly.

Share price is currently down as there is a capital raising in place and so its been sold down to just above the raising price. In my opinion once the raising drama blows over, their second well has spudded and we near both flows from a 2nd well / larger choke on current well you'll see the share price start to trend upwards.

Therefore i'm not in panic mode at the moment. Don't get me wrong, HOG has its risks, but some further success in their growth plans will surely see this share price book some gains.


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## Assasin (27 April 2011)

hmmm, enjoy your posts Basilio but not sure about the dividends yet. IMO, HOG is to young and to small to consider dividends and all income should be put towards assett growth and lease aquisitions. Then in a couple of years, if your still holding, maybe consider dividends.
I'm not sure anyone buying small cap oilers ever consider's dividends.


Holding AUT, TXN, EKA, HOG, MHM


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## basilio (27 April 2011)

Assasin said:


> hmmm, enjoy your posts Basilio but not sure about the dividends yet. IMO, HOG is to young and to small to consider dividends and all income should be put towards assett growth and lease aquisitions. Then in a couple of years, if your still holding, maybe consider dividends.
> I'm not sure anyone buying small cap oilers ever consider's dividends.
> 
> 
> Holding AUT, TXN, EKA, HOG, MHM




It was a rather radical suggestion wasn't it ? The propositon that a quite profitable company should share it's profits with shareholders... (Doesn't that actually sound quite reasonable ??)

On paper and according to the current theories of non/low dividend paying oilers dividends would be off the table. But I wonder if this might just be a ploy to allow mangment to vote themselves some of the very large bonuses they take (Of course this is obviously not the case with HOG at this stage.)

I think it is also worth looking at the figures I proposed. It seems to me that with the $15m plus capital raising,  extra income from increased gas/oil prices, further profits from  using their own gas plant that HOG could allow a dividend of 3c a share if it it was going to cost around $5.4 m. *I also believe it would send a very strong message to the market that HOG had a strong secure and expanding future which managment was prepared to share . All of which would be very good news for the SP*

On the bigger picture I think it is time for shareholders in successful energy companies to expect decent dividends. I believe it would help underpin the SP and ensure  that the theoritical owners of the company recieve a tangible current reward rather than a paper increase in SP with the actual cash being used for a range of other purposes..


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## condog (27 April 2011)

Basilio i think you better stop sniffing that liquid paper.

A small oil & gas co will not pay dividends, unless they are mad or have no idea how to grow the business. They are right noww presumably in thier fastest growth period with hopefully ROI/ROE of well over 100% p.a. if things go good.

Why would smart managment jeopardise that sort of targeted growth to pay a low % divedend of 3% or less and have shareholders invest it in cash at 5% or spend it.  Na, thats not how it works. They will reinvest, reinvest, reinvest, and only when they are running out of ideas or once their ROE start to suffer will they pay dividends. 

And thats particularly the case here, because the earnings are offshore and hence do not carry any franking credits, which makes them fully taxable.

On a note about todays reports. Great to see >$4M revenue in 60 days, with over $2.5M free cashflow. Looking good for a $28M free cashflow + Whatever Chets produces. Conservatively imo $200M + mcap if chets flows anything like #201.  
# 321 showed some interesting pay zones of both oil and gas. Lets hope those two highly pressurised gas zones are huge reservoirs accross the acerage.


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## basilio (27 April 2011)

I won't try to carry my "dividend " story much further in HOG's case. I agree that at such an early  stage of development management would be better off *reinvesting such cash into development of future assets*

The highlighted part is my main point.  I was really trying to argue at what stage do miners redistribute profits  to shareholders versus giving managment extra bonuses or finding some development story to soak up the cash. I think this is particularly relevent in some of the larger miners that have been making a killing off high energy and resource prices but are not returning these profits to shareholders.


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## basilio (29 April 2011)

HOG has just released its story on how they are going to spend the capital raising. All good and from the look of it there could be 4 very profitable wells online within 12 months. There will be 2 extra wells at Sorochynksa and they anticipate returns equivalent to the first well (currently returning $22-25m a year)  

The Third drill will be at Chernetska. This is the BIG one.  The original drill showed 900+ BOED and if the results of Sorochynksa 201 are any indication one could anticipate an even better flow with improved drilling technology. And there are a number of extra sites with known oil and gas deposits in this field

I just noticed on the AUT board  that everyone is rapt with $5m a quarter returns and the expectation of  increasing yields as more wells are drilled. I think HOG's potential is easily as big as AUT and currently at a fraction of the price.  

http://newsstore.fairfax.com.au/app...get_prices=Get+prices+&+charts&code=HOG&f=pdf


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## condog (2 May 2011)

On the one hand if they did the CR for no other reason then to get instos a bite, im furious. 

However on the other hand instos if they begin covering the story will bring in buyers.

Arrrggggggggggggg im torn, whether to be furious or grateful. I guess i will hold judgment and see how it transpires.


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## basilio (2 May 2011)

> On the one hand if they did the CR for no other reason then to get instos a bite, im furious.
> 
> However on the other hand instos if they begin covering the story will bring in buyers.
> 
> Arrrggggggggggggg im torn, whether to be furious or grateful. I guess i will hold judgment and see how it transpires.   Coondog




And at this point in time there seems to be absolutely no extra interest in HOG. In fact at the close of trade today a couple of needy sellers managed to drop the SP by 1.5c with very late trades.

Obviously a bit early to make judgements but HOG stands as either an extremely good value buy or a  mysterious but slighted company waiting to be cut down ?? (How poetic....)

__________________________________________________________________________

_I think back to the earlier analysis by Hartleys in January which rolled out some modest projections of HOG's potential (which have certainlybeen met) and projected a SP of 68c in three months. It actually reached 56c in January.... but tsands at 36c today._


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## condog (2 May 2011)

basilio said:


> And at this point in time there seems to be absolutely no extra interest in HOG. In fact at the close of trade today a couple of needy sellers managed to drop the SP by 1.5c with very late trades.
> 
> Obviously a bit early to make judgements but HOG stands as either an extremely good value buy or a  mysterious but slighted company waiting to be cut down ?? (How poetic....)
> 
> ...




I got to say im more comfortable in the red on HOG then in the red on TXN. Both imo have great potential and risk. HOG's first well however imo, means it can fail its second well and still survive. The same cant be said for many other junior oilers. I could be wrong but thats my opinion. 

Happy to hold hog, despite my half dummy spit and see what happens, cause if Chets, does come good, oh my god this thing should rocket. Its a while off, but these things tend to build in anticipation, often more so then the positive announcment itself. Some say buy on speculation and sell before the news. Time will tell if thats the case here.


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## BrightGreenGlow (3 May 2011)

Correct me if im wrong but HOG is currently at 36c and the cap raising is at 37c. Therefore who in their right mind would sign up for the cap raising for no discount apart from the ability to gain more shares rather than just a few at 36c... and what if it goes to sub 30c??? weird havent ever seen a stock drop below the CR level before between the current price and CR level before the shares are allocated.


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## prawn_86 (3 May 2011)

BrightGreenGlow said:


> weird havent ever seen a stock drop below the CR level before between the current price and CR level before the shares are allocated.




I've seen it happen numerous times. Usually happens in a flat/bear market


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## TabJockey (3 May 2011)

Technically this stock is taking a beating, its actually my only holding at the moment because of my bearish feelings about the ASX over the next few months. Either the slide in price is purely technical, or somebody knows something that we dont. I am really hoping its the former.

I thought 42c was a great entry price! The close on the day I bought in was 46c! Easy come easy go as they say.


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## WRONG'UN (3 May 2011)

It's my only holding as well, but that has me only 10% invested, so I can still sleep soundly!

I believe it's just a technical selloff, along with everything else - the volume is tiny, so I doubt if there's anything sinister about it.


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## basilio (3 May 2011)

All a bit sad and painful with HOG continuing to slide. Finished at 35c - 2c below the new share issue price. And there was a fair few sales.

Is there any likelihood the share placement can be withdrawn?  I remember this  happened a couple of times last year with CTP and I think CXY.

I am absolutely amazed that there isn't some reasonable buying support from at least the directors to

a) Show some confidence in the company
b) Try to keep the  current share price at the new issue price.

This assumes of course that there isn't some nasty news in the background.

Just doesn't look like good investor management. Any thoughts ?  


______________________________________________________________

Does anyone have any comments on the prospectus for the additional shares?  They certainly spelt out all the risks HOG could face but apart from that it seemed ordinary .


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## WRONG'UN (4 May 2011)

Yes, there were a fair few sales yesterday - stop losses will have been triggered. However the volume was still well below the daily volumes of late 2010 - so I still think the current action doesn't have a lot of meat behind it. This doesn't mean the sp won't fall further, of course - 29 or 30c is now on the radar from a technical perspective (coincidence of the 61.8% Fibonacci retracement of the 2010 upmove and the bottom of the 2011 downtrend channel).

In a more positive light, the number of shares currently offered at 37c or less is worth a lot less than $3m - so if there is a genuine demand for $3m worth of shares, then selling such a large number now in the expectation of being able to buy them back at less than 37c may be unrealistic - there just aren't enough on offer at the moment. But time will tell - volume can appear from nowhere.

Of course if the sp stays below 37c the company are going to be $3m short in their CR -not the end of the world, and the company may have other options anyway - they still have the $15m from the major portion of the CR, and that was oversubscribed - surely a vote of confidence in the fundamentals.

Those are my thoughts!


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## BrightGreenGlow (4 May 2011)

Say the price drops below 30c... why would an investor sign up for the CR then??? or the institutions????


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## McCoy Pauley (4 May 2011)

BrightGreenGlow said:


> Say the price drops below 30c... why would an investor sign up for the CR then??? or the institutions????




The way I read the announcement, it seems to me that the instos have already signed up to the placement.  It would just be the retail investors wondering whether or not to subscribe through the SPP if the market price is under the SPP.  I'm currently out of HOG, but if I had the cash, I know what I'd be doing...


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## BrightGreenGlow (5 May 2011)

Surely the institutes wouldn't sell for a loss straight away given the assets that will be acquired with the money.


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## zzaaxxss3401 (5 May 2011)

BrightGreenGlow said:


> Surely the institutes wouldn't sell for a loss straight away given the assets that will be acquired with the money.



They might if they know that, due to the current market sentiment, the price was going to fall further and they could pick up more shares for the same total cost.


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## basilio (5 May 2011)

zzaaxxss3401 said:


> They might if they know that, due to the current market sentiment, the price was going to fall further and they could pick up more shares for the same total cost.




I think it is time for HOG's management to show just what sort of value HOG already offers with one successful well and reinforce the future value when the gas plant is built and  extra wells are drilled in Sorochynksa.  (Given that this field is already proven and producing excellent volumes of gas and oil the extra wells can be viewing as engineering  actions rather than pure exploration.  A bit like building a new factory with a certain demand for its supply).  This doesn't even value the drill in the Chernetska field which is supposed to be much larger - but as yet unproven by the current team.

At current prices  and returns HOG is exceptionally good value. But that doesn't mean it can't be overlooked


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## WRONG'UN (5 May 2011)

zzaaxxss3401 said:


> They might if they know that, due to the current market sentiment, the price was going to fall further and they could pick up more shares for the same total cost.




Maybe, but to spring a stunt like that the instos would have to dump up to $15m worth of shares on the market, ie about 45m shares, and then hope that they can buy them back lower. Are they into Russian roulette, or are they already satisfied that they have bought value at a reasonable price, 37c?

For what it's worth the buyers slightly outweigh the sellers on the MD at the moment. I assume all the buyers are genuine, I know there is at least one - me!


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## basilio (5 May 2011)

HOG announced the start of the Chernetska drill today and took the opportunity to remind the market of the (excellent) oil and gas flow that had come from the earlier 1980's drill.

If it follows the form of the  Sorochynksa No 1 drill it should/could be 3-4 times more productive than the original flows. Company suggest it will take five months - takes us to October-November.  (Be a great Christmas present...)

http://newsstore.fairfax.com.au/app...t/quote.ac?code=hog&submit=Go&section=summary


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## jonojpsg (7 May 2011)

Yep, I've been surprised to see HOG retreat as far as it has, given it's current cashflow from Sor #1??  I guess though, I was also surprised to see the cap raising ann so soon after them claiming that cashflow would see them through - that definitely looks bad 

Similar to SDL ann cap raising after repeatedly saying that they had enough cash!

Long time to drill the well, averages 30m per day?

SHould they get some good gas flows though, there should definitely be interest


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## basilio (10 May 2011)

Well HOG finishes at 33c again today - more than 10% below the issue price for the capital raising.. There won't be many stags for this capital raising !

Could one see the capital raising at 37c as a clever move to lock in "good value" money ?  Or did the capital raising (which at announcement was at  a significant discount to the share price )  actually precipitate the fall in SP ? 

Makes it very hard to see how current shareholders will take up the  offers for the extra shares. I wonder if the current directors will take up the extra shares ? They have suggested they "may" do so in the Annual General meeting notice.

And it would be good to hear some further positive news on oil and gas sales, incresae in production,  kicking off the next couple of drills and an update on income versus SP.


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## Wombus (10 May 2011)

It's definitely underwhelming the current SP performance, and certainly no-one could sensibly take up the SPP at these prices unless they only can afford a few hundred dollars worth.

I would really like to see a proposed timetable for the gas plant at Sorochynska and the additional wells, management came out of left field a little with the CR, so it would be reassuring to see a plan with time-lines and a little more thought than this is what we'll use this money for.


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## tradefill (10 May 2011)

Surely no one is going to participate in this capital raising when you can buy them on market for around 34c?


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## jonojpsg (10 May 2011)

The main bulk of the cap raising is locked in with instos, etc. - but the SPP will get very little showing as you point out the current SP is less than the offer price.  Matters little when it's only 20% of the overall amount IMO.

Still reckon this is great buying opportunity - just wish I hadn't blown all my cash trying to short the AUD


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## PinguPingu (10 May 2011)

^^Same here, but I've put all my spare cash into a silver ETF...so we'll see how that goes..


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## jonojpsg (10 May 2011)

PinguPingu said:


> ^^Same here, but I've put all my spare cash into a silver ETF...so we'll see how that goes..




I'll see your  and raise you   Been trading in and out of silver for the last three months and was kicking myself that I didn't just buy a couple of contracts at $33 with a trailing stop and would have been LAUGHING instead of bloody trying to be a smartass and pick the top of the AUD 

Ah well, it's all part of the game I keep telling myself - stick to my plan, AND STOPS, and don't fight the trend


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## McCoy Pauley (12 May 2011)

I received my SPP package earlier this week from HOG.  I haven't even bothered to look at it.  Why would I when I can pick up shares on-market for 4c/share less than the SPP price?  I hope the SPP is fully underwritten (I can't remember now) because HOG will have a massive shortfall, IMO.


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## skivvy (12 May 2011)

McCoy Pauley said:


> I received my SPP package earlier this week from HOG.  I haven't even bothered to look at it.  Why would I when I can pick up shares on-market for 4c/share less than the SPP price?  I hope the SPP is fully underwritten (I can't remember now) because HOG will have a massive shortfall, IMO.




No, from reading the docs last night I recall that the 3 million shares for retail investors is not underwritten and you are right PM unless the price jumps up pretty quickly then there will more than likely be a shortfall.  I still dont really know why they did the raising to instos and retail investors at this point anyway??  Time will tell if it was worthwhile but not for us retail investors at this stage.


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## ParleVouFrancois (12 May 2011)

Not sure how HOG will have a shortfall, besides it being symbolic. The 15 million as indicated by the costs estimation will be enough to fund all the work that has been stated thus far, with the 3 million shortfall coming from the "acquisitions" fund thingy of 4.5 million. The initial 15 million has already been sold to institutes etc, oversubscribed.


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## skivvy (12 May 2011)

ParleVouFrancois said:


> Not sure how HOG will have a shortfall, besides it being symbolic. The 15 million as indicated by the costs estimation will be enough to fund all the work that has been stated thus far, with the 3 million shortfall coming from the "acquisitions" fund thingy of 4.5 million. The initial 15 million has already been sold to institutes etc, oversubscribed.




yes agree it is not a big deal for the future as the instos oversubscribed for the $15 million of shares anyway and this extra $3 million is not a biggie if it doesnt get picked up by retail investors.  Just a little perplexed with the current sp relative to the raising price I guess, as most other holders would be.


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## traderclaude (12 May 2011)

The placement was oversubscribed by around $1.4M, so there will not be to much of a shortfall if the retail offer is not taken up. 

It would seem to be a waste of time going to all the effort to print papers and mail the shareholders if it was not going to be taken up. I read somewhere the spp retail offer would cost $203,000. 

It would be very odd for a company to spend money like that if they were not strategic and confident about the offer being taken up, maybe there is a pending announcement regarding the choke increase on the first well or an acquisition to boost the share price. 

I did email the company about the choke increase but have not heard anything back, It was probably because I asked if the spp price would be revised down given the share price


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## Wombus (12 May 2011)

traderclaude said:


> I did email the company about the choke increase but have not heard anything back, It was probably because I asked if the spp price would be revised down given the share price




I got the impression from reading the quarterly that the reason they haven't increased the choke was due to a lack of capacity at the 3rd part gas plant (also a small part of the reason they want to get their own gas plant up and running asap)


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## traderclaude (12 May 2011)

The gas plant is interesting, missed that, wonder how long it takes to build. 

There seems to be 3 high sell offers between 35 and 36 and another one at 38.5 cents. 

Maybe 39 cents will get people interested in taking up the offer, but it looks very manipulated the price at the moment. 

Only takes one day to change things, If I didn’t have enough shares already I would be buying more.


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## basilio (17 May 2011)

Well it's not looking that crash hot in HOG territory at the moment.  More like bacon on toast that flying pigs!

One thing I've noticed in the past couple of days has been some astute SP management in the last couple of minutes of trading. On both monday and Tuesday there were very late sales at .5 to 1c above previous trades to ensure the share finished on a better note.

Today for example the SP was 31c at 3.47.then a single small sale at 31.5 (3.49) followed by another single small sale at 32 (3.58.51).  Someone is trying to keep the final days price up !


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## link128 (20 May 2011)

So Mr Reavley has sold a substantial portion. This can't be a good sign at this time could it?


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## Wombus (20 May 2011)

link128 said:


> So Mr Reavley has sold a substantial portion. This can't be a good sign at this time could it?




Suggest you re-read the announcement, he dropped below the 5% threshold due to the dilution effect of the CR.


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## link128 (20 May 2011)

Wombus said:


> Suggest you re-read the announcement, he dropped below the 5% threshold due to the dilution effect of the CR.




Ah right. I'm still learning..thanks for that. I wouldn't think the CR was due to go ahead yet though, and if anyone would even bother applying at the current SP.


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## Wombus (20 May 2011)

link128 said:


> Ah right. I'm still learning..thanks for that. I wouldn't think the CR was due to go ahead yet though, and if anyone would even bother applying at the current SP.




There were two parts to the capital raising (well 3 in some respects) the first announcement said $18m to institutions, $15m has already gone through, the remaining $3m (which is the second part) is subject to shareholder approval (institutions are already committed to this at the 37c/share price). In addition to this is the third part, the retail share purchase plan. That's for the mums and dads, you and me kind of investors and if that gets shareholder approval the company could end up raising as much as $21m. (My guess at the moment is that they will end up raising ~$19m total)

hth


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## WRONG'UN (21 May 2011)

Actually, Wombus, that's not quite right either - attached is what they said in their 20 April announcement. So they already have $13.6m in the bag, and will have another $1.4m after shareholder approval - total $15m (actually $15,003,500)

I wonder if they can drop the price to 30 - 32 for the mums and dads?

By the way, I bought a few more yesterday, just in case we are bottoming.


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## Wombus (21 May 2011)

WRONG'UN said:


> Actually, Wombus, that's not quite right either - attached is what they said in their 20 April announcement. So they already have $13.6m in the bag, and will have another $1.4m after shareholder approval - total $15m (actually $15,003,500)
> 
> I wonder if they can drop the price to 30 - 32 for the mums and dads?
> 
> ...




Ahh right you are, seems I should've re-read the announcement  thanks for the correction.

I think it unlikely they will lower it, but who knows. was playing around on a spreadsheet the other day, and depending on how much brokerage you pay, at current prices it likely costs less to buy $100-$200 through the SPP than on the market.


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## MARYANNE (22 May 2011)

*HOG*



WRONG'UN said:


> Actually, Wombus, that's not quite right either - attached is what they said in their 20 April announcement. So they already have $13.6m in the bag, and will have another $1.4m after shareholder approval - total $15m (actually $15,003,500)
> 
> I wonder if they can drop the price to 30 - 32 for the mums and dads?
> 
> ...




The way I see it, they've raised $15 million through the institutions, and will raise a further $3 million from their shareholders once they have shareholder approval


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## Wombus (25 May 2011)

90 day production figures and a new CEO & MD announced and all quiet on the forum front...

Thought the production figures were interesting, remembering initial flows of gas were 7.51 mmcfgd, and condensate 300bblsd. Now we are getting an average of 7.2 mmcfgd and 250 bblsd for all production on 8mm choke. 

I'd certainly like to see daily or weekly production rates to see the rate of declines. Would be keen to hear the thoughts of others.


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## traderclaude (26 May 2011)

It is pretty close those figures, I am not to bother with it.

Hartleys has a new research note out.

I think they would reach the levels if they wanted to on an increased choke, more about planning and the gas plant to maximise operating cash flow going forward. 

Watch for a pump right now or after the general meeting, could be 2 maybe. 

Exciting times, I think  investors are about to play ball any day. 

A 40 cents for the priority is still possible though appears unlikely, but stranger things have happened. 

There is a lot happening with the market ready to jump on it, watch this space!!!


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## WRONG'UN (28 May 2011)

I like the way it's setting up.


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## WRONG'UN (31 May 2011)

This won't do the natural gas price any harm:

http://news.yahoo.com/s/afp/20110530/ts_afp/germanypoliticsnuclear


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## yma (1 June 2011)

Big volume with price up today, looks like buyers are coming back, good days coming ahead.


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## bbker (1 June 2011)

yma said:


> Big volume with price up today, looks like buyers are coming back, good days coming ahead.




Could it just be because the general meeting is tomorrow? I don't think the timing of its anticipation is a coincidence and the mere thought of the retailers' share placement helps sentiment, even though it shouldn't be passed.

The drilling progress is still a long way off so I wouldn't hold your breath, the share price could easily retrace. But then there's always the reserves report to move things along.


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## isplicer (1 June 2011)

The complete resolution of the SPP could well and truly get this stock going. Now to find an entry point...


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## justiceotp (1 June 2011)

bbker said:


> Could it just be because the general meeting is tomorrow? I don't think the timing of its anticipation is a coincidence and the mere thought of the retailers' share placement helps sentiment, even though it shouldn't be passed.
> 
> The drilling progress is still a long way off so I wouldn't hold your breath, the share price could easily retrace. But then there's always the reserves report to move things along.




I bought a percentage of the HOG shares traded today, nothing to do with meeting or drilling progress, just been watching this share for an entry point for some time, long holder of AUT, EKA, SEA and SSN all these shares have responded nicely over last few days/weeks and HOG looks to have settled and coming back with nice volume. Just felt the time was right.


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## isplicer (2 June 2011)

Post from "Novac" from another forum from a universe far, far away:



> This stock is very de-risked now
> 
> - $20m in bank
> - $3m revenue per month
> ...




I've also had a read of the Hartley's report: http://www.hawkleyoilandgas.com//me...h-note--148/Hartleys-research-note-may-11.pdf

Could HOG be the next AUT (which I SO FOOLISHLY EXITED FROM AT $2.96... c'est la vie. ) is the question on many lips. Could it be SSN? TXN perhaps? Input much appreciated.


----------



## bbker (2 June 2011)

So who's taking up their allotment of 37c shares now that the resolution has passed?


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## WRONG'UN (3 June 2011)

Can't answer that one right now - a lot can happen to the sp between now and 15 June. Another day or two like Wednesday and we'll see!


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## Assasin (3 June 2011)

isplicer said:


> Post from "Novac" from another forum from a universe far, far away:
> 
> 
> 
> ...




I don't think it's a good idea to compare HOG with AUT. Completely different animals and totally different business models.
I think HOG will give a great return for investment like AUT but that is the only similarity.
Every stock needs to be taken on it's own merits.


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## bennywizard (6 June 2011)

Good to see HOG closing at the issue price today, it will be interesting to see where it heads over the next few days!


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## novac (7 June 2011)

Hi People

My first post here. I usually post on HC.
So what are peoples thoughts on the announcement today regarding the gas plant?

Will take 10 months to complete but it will be enormous for the company. The ability to produce 30mmcfpd will be enormous if that full capacity is reached. Throw in condensate of 1000-1500 barrels a day and we have ourselves a mid-tier oil and gas producer. To think this could all be achievable in 12 months is mind blowing.

As we know things don't always go smoothly in this sector but no one can complain with the start HOG has had.

Look forward to having discussions with you all going forward.


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## Assasin (7 June 2011)

novac said:


> Hi People
> 
> My first post here. I usually post on HC.
> So what are peoples thoughts on the announcement today regarding the gas plant?
> ...




Welcome Novac,

I think the building of a gas plant is brilliant especially when you consider the costs involved. Being able to control production and distribution is something I believe the market will react positively too.
The impatient side of me says why is it going to take 12 months plus delays but thats the price of doing business.
Great future ahead for HOG imo.


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## novac (7 June 2011)

Assasin said:


> Welcome Novac,
> 
> I think the building of a gas plant is brilliant especially when you consider the costs involved. Being able to control production and distribution is something I believe the market will react positively too.
> The impatient side of me says why is it going to take 12 months plus delays but thats the price of doing business.
> Great future ahead for HOG imo.




cheers Assasin

Well we have a selloff as expected. like you said it could be 12 months before this is completed and we won't get any increase in production before then. So some are using this opportunity to sell. if you ask me the sp is still cheap so i will avoid selling any. I guess this time next year we really could be on the verge of holding a mid-tier producer.

Patience is required here. the story is great, just need to sit tight


----------



## majorca (7 June 2011)

novac said:


> Hi People
> 
> My first post here. I usually post on HC.
> So what are peoples thoughts on the announcement today regarding the gas plant?
> ...




Welcome Novac, lets not forget the comments in the announcement regarding the increase in efficiencies, the actual cost of processing we are paying at present, and what would be reasonable for us to charge another operator if the requirement should arise?


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## basilio (7 June 2011)

The new gas plant does look like a no brainer.  I suppose what it has shown up are the inefficiencies of the current gas  cleaning and marketing system and also the rather ambitious income estimates from late last year.  If I remember correctly management was talking about 12 mmcfpd gas and 400 bb of oil.  It's clear now  that while the well may be able to produce these amounts  they won't get past the current levels (7.2 mmcfpd/ 250 bb) without the new infrastructure.  *This appears to have implications for the proposed second and third Sorochynska wells*

I also have a concern about the time frame for the development.  I wonder if government self interest will  come to the fore and slow down/prevent a new gas plant because basically it will reduce local income from the current gas plant.  (_On the other hand increased total gas/oil sales will result in higher local taxes ._.)

I also wonder what are the gas handling capacities around the Chernetska drill ?  It would seem to be many times larger potentially than the Sorochynska well so I think the same problems will also arise.

*I would really hope that management has recognised this and is ensuring that if /when the the Chernetska drill hits its targets they can run the well at full capacity quickly.  *

But it is still a very promising proposition. Current SP doesn't  adequately value the present restricted production let alone volumes and profits  from extra wells.

IMO in 12 months time we should see  an exceptionally profitable and valuable operation.


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## novac (7 June 2011)

majorca said:


> Welcome Novac, lets not forget the comments in the announcement regarding the increase in efficiencies, the actual cost of processing we are paying at present, and what would be reasonable for us to charge another operator if the requirement should arise?



Howdy Majorca

Yes there presents a saving of $3.6m a year from owning own plant.
I surely hope HOG can be operate at full capacity and not have to lease out any of it's capacity lol


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## bennywizard (7 June 2011)

novac said:


> Hi People
> 
> My first post here. I usually post on HC.
> So what are peoples thoughts on the announcement today regarding the gas plant?
> ...




I must say I am stoked with this announcement, lets hope that the stars align as far as govt approval and permits etc are concerned so that it can built asap. A saving of 3.6MIL per year alone will be awesome, I hope they go for the more "risky" option of the larger capacity plant in the middle of the arrearage rather than the safer option close to the current wells


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## novac (8 June 2011)

HAWKLEY OIL AND GAS (ASX:HOG)

Hawkley Oil and Gas (ASX:HOG) continues to show up the rest of the junior ASX-listed oil and gas groups with the cashflow generation capability of its Ukraine project.

It?s just done what was expected by committing to spend no more than $3 million building its own gas processing plant for its Sorochynska production licence.

Apart from saving some $300,000 a month in processing fees ? giving the project a 10 month payback ? the standalone plant will remove the restriction on Sorochynska?s current daily production of 7.5 million cubic feet of raw gas and 200 barrels of condensate (light oil).

Daily capacity will grow to of 30 million cubic feet, with attendant condensate. That means Hawkley will be able to take greater advantage of the reserve base at Sorochynska which was recently upgraded to 46 billion cubic feet of gas and one million barrels of condensate.

In the meantime, Hawkley is planning a repeat performance to its reworking of Sorochynska with the current drilling of the Chernnetska prospect. The primary target should be tested in August.

Ahead of the decision to build the standalone gas plant, but with the expectation that it would go ahead with the project, Hawkley was the subject of a 3 month price target by stockbroker Hartleys of 66 cents a share. Yesterday it closed at 34 cents a share.

bfitzgerald@theage.com.au


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## YELNATS (8 June 2011)

Just received a phone call from a lady representing HOG asking if I will be taking up the priority offer of more shares which closes on June 15. I explained that HOG was currently selling below the offer price of 37c and I would probably not as I could source more shares cheaper on the market.

She also asked where I receive my market intelligence in regards to HOG and whether I had any advice for management.

It is fairly unusual to receive such a call in response to a share placement, unless you're a huge holder which I am not, but I welcome it, and I may change my mind regarding the share offer if HOG can improve over the next few days.


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## traderclaude (8 June 2011)

Makes no sense to take the share purchase plan up if it is trading below the offer.

I could give then some advice, 

1. Don’t have a CEO going on record saying no need for a big capital raising and then do the 15% maximum they are aloud (he was since been replaced that CEO). 
2. Do not allow sophisticated investors to sell off with knowledge of a capital raising when no one else knew. 
3. More announcements. 

Having said that the company has down really well, and appear seriously undervalued because people got a bit pissed off with them for the reasons above and sold off, also think stop losses were taken out.  

Glad they are looking to improve management, this is a multi bagger still, over sold.


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## novac (8 June 2011)

traderclaude said:


> Makes no sense to take the share purchase plan up if it is trading below the offer.
> 
> I could give then some advice,
> 
> ...




Have to agree with everything you said. I kept wating it get knocked down in the 40's and it was evident someone was selling for a good reason. What it has done is knock down the price of a company that's doing very well. They have;

1. $20m in the bank
2. $3m revenue coming in a month

This is very important that they don't have to go to the market for anymore money as markets are looking weak at the moment.

When you do a peer comparison HOG is very cheap. 
I too got a call yesterday about the placement. i said i was too busy topping up at 32-33c and I don't need anymore.

New CEO has come out firing


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## traderclaude (9 June 2011)

It looks obvious if you look at the daily trading orders on low volumes to see the accumulation.

A big day is close by the looks.


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## Assasin (12 June 2011)

This was a first for me to see a spp taken out above the sp. No wonder we all got phone calls. However, it's pretty frustrating to see where the sp was driven down to as it's a long way back to .50c
The other factor that affected me was that due to all small caps oilers like EKA, SEA, AUT, and TXN which are all popular holdings with many on these threads also retraced to a level where topping up was very enticing.
My problem was which one to top up with as only had limited extra funds. So currently i'm up to my ears in stock. Very risky. Do not recommend in current climate.
What will save me is if the US can keep their economy in check and just ticking over.
Good luck to all HOG holders.
Just my ramblings on a Sunday night with a Bailey's on Ice.

Holding, AUT, EKA, TXN, HOG, MHM, and my little beauty GGP.


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## Flipper (13 June 2011)

G'day Assassin hope your enjoying your long weekend. I'd like to pick your brain if you'll allow me the opportunity? 

Your obviously quite heavily invested in Oil and Gas companies currently. Like HOG most of them have good fundamentals and a bright future. However, as you've mentioned the risk involved in holding them all in this current climate, what do you do to minimise your risk exposure. Have you diversified some of this risk? If so to what proportions and which stocks do you believe offer decent investment and diversifying opportunities at this time? 

Sorry if this is a little off topic guys. Trying to gather some information for a University assignment and obviously for my future investing.


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## Assasin (13 June 2011)

Hi Flipper,
First of all, this isn't advice, but what I meant when I said that I was up to my ears in stock was that if there was any sort of correction in the near future, I'm really exposed. I havn't any cash left so I am taking quite a risk which I wouldn't recommend.
Every investor/trader is different and live life with completely different circumstances so differing strategies apply. So the need to weigh up the risk/ reward differs between different people.
I invest to make money, not save money, but this can be risky.
I am very comfortable with my holdings and believe they will return great profits over the next 12 months but, things can change quickly and I'll need to keep an eye out but that's part of the fun.
Flipper, there are far more experienced people to talk to than me but if you want to PM me I could perhaps assist with assignment.
Cheers.


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## basilio (21 June 2011)

What a wonderful bargain the flying pig is !!

28c and friendless. Really think it has to be bargain - but then I'm sure a score of other shares are looking like special value. Anyone have any extra information on HOG's current progress ?


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## basilio (1 July 2011)

HOG released a report on oil and gas production and the drilling of the Chernnetska prospect.  Looks like that is actually ahead of schedule and should strike  paydirt in August.

Nice little run on the back of the report. Still way to low given the substantially derisked nature of the company.

http://newsstore.fairfax.com.au/app...theage.com.au/apps/qt/quote.ac?code=hog&f=pdf


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## tradefill (3 July 2011)

after the recent hammering its got a way to go before im above even again. Not to worried, just sittin it out and im pretty confident that eventually we will be up around 50c again.


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## bennywizard (5 July 2011)

agree and the next well results if anywhere near the first will make this company too good to ignore and I'd say show up on on some radars. Price edging up though which is good to see.


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## yma (24 July 2011)

Expecting the progress update on 29/07 which is the last business day for July, as on the current performance the well should tag the B20 interval during August, IMO this should result a good buy opportunity.

Do your own research...


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## emile33 (26 July 2011)

Update is to be expected soon about the drilling progression. Expecting news also 
about the 2nd drilling well Sorochynska to take place too .....
in the 30 ´s is very cheap imo and may not last that long .....


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## emile33 (4 August 2011)

*Hartley update 29 july*

http://www.hawkleyoilandgas.com//me...ch-note-171/Hartleys-research-note-july29.pdf


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## yma (4 August 2011)

3 months target 67c, looks good to me.


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## basilio (4 August 2011)

It's all a puzzle isn't it ?  Hartleys has been detailing the value of HOG since January. At that stage the SP was 39c and they were predicting a 3 month value of 68c.   The July 29th update is the  *sixth t*his year expanding on the same theme - excellent oil, gas and cash flows, big reserve upgrades and fresh drilling that will/should see a marked increase in gas and oil sales.

Obviously at 28c this has to be the best bargain since the Eiffel Tower was up for sale.


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## emile33 (5 August 2011)

Obviously at 28c this has to be the best bargain since the Eiffel Tower was up for sale.

So we buy more @ these bargain prices....


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## basilio (6 August 2011)

emile33 said:


> Obviously at 28c this has to be the best bargain since the Eiffel Tower was up for sale.
> 
> So we buy more @ these bargain prices....




So obviously you are buying with your ears pinned back at 24c!! 

Seriously though  the market meltdown is taking my breath away. It is seemingly easy to say that  HOG is cash positive and looking exceptionally good value. But in the bigger picture trying to see how all countries will come to terms with  out of control debts without destroying many viable and thriving operations is  a tough call.


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## tradefill (8 August 2011)

i dont understand how the U.S could get into so much debt in the first place, with all these "professionals" how could they let it get so out of control. Sure they would want to maintain growth but you'd think they would have realised that all that debt is not sustainable and some drastic measures will have to be taken to control financial markets. Need to see some action to stabilise falling markets. All this panick is creating amazing bargains though, IMO. I agree with above though- its difficult to predict the effects of everything on HOG's share price and drilling activities. Hopefully the governments get their act together, once (if) they do im sure those who are buying now will reap the rewards.


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## bennywizard (10 August 2011)

HOG has been my pick of the oilers since the crash, picked up a nice packet over the last couple of days, great potential and with the cash flow from the first well there is a buffer if the next one is not as successful.
At these levels we are at 50% of their peak but we are much more advanced in development. I thought they were cheap at just under 50c...exciting times with the next well not far off now!


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## yma (12 August 2011)

No debt, cash in the bank, regular income every month, new well coming at the end of the month, IMO if the SP don't go up then HOG would be a very good take over target


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## basilio (12 August 2011)

yma said:


> No debt, cash in the bank, regular income every month, new well coming at the end of the month, IMO if the SP don't go up then HOG would be a very good take over target




That would be a real worry. There is just too much value in HOG to see it snapped up for a song. Be interesting to see who the main shareholders are.


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## ParleVouFrancois (12 August 2011)

Loved this company back when it was still testing it's oil flows on it's initial #201 well, and still love it now, however the price is BELOW when I bought in ages ago (having since sold). Anyway with that bit of background out of the way, is anyone else worried about the lack of progress on the drill hole, or is it just the tough Ukrainian rock that was present in the #201?

DISC: Used to hold but not anymore, might be getting back in pending good news.

JM.


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## yma (12 August 2011)

It just need more time for people to the real value of HOG, just same as AUT before it became a 10 bagger


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## WRONG'UN (12 August 2011)

Well good luck to all stayers - I'm one - I've actually been buying a few more.

It is interesting that HOG are only talking about three wells at present - a pretty modest goal considering the potential as detailed in the Moyes report of 5 June 2010. I'm sure they ultimately have more up their sleeve than three.

Key points in that report are:

16 Sorochynska wells
34 Chernetska wells

$400m peak annual net cash flow - OK, it depends on lots of things, like gas price and exchange rate, but if the assumptions are anything like the current, then the $400m represents a P/E of way under 1 - if it ever gets to a more normal 10, then we will be smiling.

Hey, Condog, where are you?


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## tremmas (31 August 2011)

Monthly update released this morning.

http://www.asx.com.au/asxpdf/20110831/pdf/420ry6yjrdznht.pdf

Looks like they got through the Bishophite without issue and are planning on ramping up drilling over the next month to get it finished.

Also mentioned that they trialled a slightly larger choke size for increased gas production on the first well - do any O&G experts have any comment on this?

Still chugging along with neutral cashflow and plenty left in the bank and I love the fact that it's pretty tightly held.


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## basilio (1 September 2011)

Quite a significant jump today from 24c to 27c. on the back of the monthly drilling report. I  think there are few desperate sellers.

As mentioned they have successfully negotiated the tricky Bishopite section of the drill  and should hit some quite decent oil and gas reservoirs within a few weeks. (Given that the the site was successfully tested some years ago.)

The current  SP  doesn't even reflect the already successfully producing well and positive cash flow.  Can't wait for the market to realise this pig will fly.


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## poverty (1 September 2011)

After months and months of NO BUYERS finally some buying pressure on the SP


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## basilio (15 September 2011)

Looks like more shareholders have decided to bail out of HOG. Some big sales yesterday pushed the SP to 20c 

The new timeline for the Chernetska drill to hit the oil/gas zone is now October. Obviously the drill through the Bishopite section was trickier and took longer than expected.  

It will be interesting to see if any positive news makes a lasting impact in this market. We might just have bottom trawlers  and day traders left which probably won't be enough to get a sustained lift in SP.

Perhaps if there is a decent strike in Chernetska then declaration of a small dividend when production is established might do the trick.


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## kermit345 (15 September 2011)

If they have success at Chernetska i'd want them to start drilling the next planned hole and fast-track the gas plant development if possible.

They are basically running at break-even while paying to drill this hole out, if there is success then that instantly goes to the bottom line plus they won't be drilling anymore so it free's up cash-flow as well.

I have my fingers crossed for success as I think that could really make or break the share price.


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## Wombus (15 September 2011)

basilio said:


> The new timeline for the Chernetska drill to hit the oil/gas zone is now October. Obviously the drill through the Bishopite section was trickier and took longer than expected.
> 
> Perhaps if there is a decent strike in Chernetska then declaration of a small dividend when production is established might do the trick.




The well was commenced on 05 May, and at that time they said the well will take about 5 months to drill and complete. May + 5 months = October, so they are on schedule

And why would you want them to consider paying a dividend? as things stand they've got enough cash/cash flow to drill to two wells in the short term and build that Gas plant at Sorochynska. I say keep the money and spend it on field development! The last thing we want is more capital raisings or the company to start looking at debt options. Especially if an opportunity comes along for an acquisition (which they have mentioned a number of times as they're looking out for)!

I would like to see more updates about 2nd Soro well, the gas plant and a more detailed development plan and timeline. I certainly feel management could be communicating better, and more often.


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## basilio (15 September 2011)

Wombus said:


> The well was commenced on 05 May, and at that time they said the well will take about 5 months to drill and complete. May + 5 months = October, so they are on schedule
> 
> And why would you want them to consider paying a dividend? as things stand they've got enough cash/cash flow to drill to two wells in the short term and build that Gas plant at Sorochynska. I say keep the money and spend it on field development! The last thing we want is more capital raisings or the company to start looking at debt options. Especially if an opportunity comes along for an acquisition (which they have mentioned a number of times as they're looking out for)!
> 
> I would like to see more updates about 2nd Soro well, the gas plant and a more detailed development plan and timeline. I certainly feel management could be communicating better, and more often.




I realise my suggestion of a small dividend was an unusual comment in relation to almost all mining companies and in particular companies just starting develop their operations.

As I see it, mining companies  traditionally pay SFA in dividends and tell the market that continual development and increasing SP as a result of these earnings is sufficient return for investors. Meanwhile management usually make sure they get  top salaries which could conceivably be a large part of total earnings.  As one example BHP is currently sitting on a $30billion cash box and refuses to make any extra dividends to shareholders.

I think we are now entering quite difficult times economically and that  stocks will not rise anywhere near as traditional earnings ratios would suggest. In this scenario I could see many profitable mining companies just paying the directors and staff and shareholders  struggling. For example I think HOG is staggeringly undervalued given it's current positive cash flow and extremely good prospects. 

A small 2c a share dividend would cost HOG  less than  $4m (191m shares on issue) . Spread across the year it would offer a immediate yield of almost 10%  on the current SP  (_this would have to jump with a strike surely!) _and should certainly underpin the SP and signal investors that the company is serious about returning profits to all participants.

If the Chernetska drill is as successful as predicted $4m would be very doable while still allowing plenty of development funds.

And I agree - it would be good to have more information about  reserves, the situation with the gas plant and the extra drills. I suspect  however the locals are just not that efficient or  we are just unrealistically impatient.


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## tothemax6 (16 September 2011)

basilio said:


> As one example BHP is currently sitting on a $30billion cash box and refuses to make any extra dividends to shareholders.



Actually BHP has raised its dividends recently (http://dynamicdividend.com/bhp-billiton-dividend/), in excess of the expected raise, and Kloppers has made statements regarding his intention to continue raising the dividend in the future. 


basilio said:


> For example I think HOG is staggeringly undervalued given it's current positive cash flow and extremely good prospects.



Then hold on and stop worrying.


basilio said:


> A small 2c a share dividend would cost HOG  less than  $4m (191m shares on issue) . Spread across the year it would offer a immediate yield of almost 10%  on the current SP  (_this would have to jump with a strike surely!) _and should certainly underpin the SP and signal investors that the company is serious about returning profits to all participants.



HOG returning $4m a year to shareholders when it is an early stage oiler, expanding hell-for-leather to increase its oiling infrastructure, would be madness. If anything it would scare shareholders away once they collect their dividend. It would indicate that rather than being a dynamic expanding project, the directors can't see any better use for $4M than to simply give it back. 
This is simply not how oil projects work, and it won't happen. Only when oil is spewing in all directions and there is no more room for expansion, will the profits then be diverted into dividends. HOG is not at that stage.


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## basilio (16 September 2011)

I see your point Max and understand that investors would expect surplus funds to be put into further exploration and development.

I was making two points. Firstly that traditionally mining companies put dividends for shareholders a distant last in priority. The BHP example was the most recent and most obvious. Yes the dividend has increased but BHP is still sitting on a mountain of cash.

Secondly I am questioning the overall cash flow priorities of companies. Just how much are CEO's and directors worth ? How much of the profits should they take versus wages to staff and dividends to the company owners ie shareholders. 

I'm not suggesting that HOG management are taking too much of the cake (*it isn't there yet *! ) I was suggesting that setting some dividend guidelines ahead of big bonuses to management would be a good signal and that this action could also strengthen investor interest in the company in harder times.


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## Flipper (21 September 2011)

Nice to see the SP close up 3c or 13% today despite wider market struggles. An amazing feat but does anyone know why??? Is there information about to be released?


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## ob1kinobi (21 September 2011)

Flipper said:


> Nice to see the SP close up 3c or 13% today despite wider market struggles. An amazing feat but does anyone know why??? Is there information about to be released?




Someone with deep pockets, seems to be accumulating? 

This isn't the first time there has been a volume spike and a largish % gain. However most of these gains have been sold off within two weeks or so.

my


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## basilio (21 September 2011)

Volume was significantly higher yesterday than  previously and I think it was all real buying pressure with no immediate trading sales.

The  current Chernetska drill has to be getting very close to reaching the expected oil/gas  profile. (This has already been proven years ago ) HOG is cash flow positive on it's current well and the new one is expected to be many times larger - again on the basis of the previous drill.

The current SP doesn't even reflect the value of oil and gas already flowing let alone  what should be accessed in a few weeks. On company fundamentals HOG should be doing much better but the market as a whole is in a funk hence the recent collapse.

One would hope that if/when the drill strikes home analysts will do their sums and investors will re recognise the value.


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## RNI (28 September 2011)

Has anyone read the recent announcement regarding the presentation they did in Freemantle in September 2011. They also presented in Singapore more recently about the same time as the share price rose. Anyone care to comment on the September presentation? Share price has dropped since?? or is it just the general market.


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## emile33 (1 October 2011)

Another 2 weeks or so before the target depth has reached.
now we wait for hopefully another good well ....


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## basilio (5 October 2011)

Something to think about.

The Chernestaka drill is about 2 weeks away from intersecting the first horizon. It seems highly likely from earlier  drills (through not certain) that it will strike a nicely profitable oil/gas  seam which should make the current SP look even more ridiculous.

Does anyone think  that in this market a reasonable strike will actually boost SP for any significant time ? 

Or is the overall market just too depressed and negative ?


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## WRONG'UN (6 October 2011)

Well, Basilio, how would you know what depressed and negative people might do to a share price - I try to just stick to the facts, which are as you have noted, and remain optimistic - this one has required a lot of patience!

In the meantime, for inspiration, I look at some of the gains made after the 2009 market low - the 10 baggers start from humble beginnings.


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## RNI (8 October 2011)

They are presenting at  more and more O & G conferences all around the world and really getting noticed. That is why the share price had had several quick rises. People are really starting to find out about it and want in, which is great, and the publicity is vital. There is another coming up soon also, so watch the sp, and of course the results of the Chets well, which we are all holding out to know.

Another point of interest is that Shell is soon to commence drilling in the Ukraine and in the same basin at hog, which is great news. Shell will bring to Ukraine all the latest equipment and technology and there will possibly be a lot of interaction between the various companies, and sharing of information etc, which our hog gang will possibly gain from.

They are also working on getting all the paper work ready and passed, so they can start tendering for the building of the gas plant, which they think will bring a big improvement in the production amounts, as the gas plant they are using is very old and not functioning as well as a new one.


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## basilio (18 October 2011)

HOG is starting to move ahead of reaching the money spot in it's Chet's drill. Has added 6 cents in a couple of days and now pushing 28.5c.

Trading Halt has been called until Thursday. The report be will about upgrading the reserves rather than the Chets drill.  Be really good to see what comes up...


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## ChrisJH (18 October 2011)

Finally some positive price movement. How does a trading halt work? Is it put in place by the company? And it means either really bad news, or really good news, yeah?


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## AngusSmart (18 October 2011)

ChrisJH said:


> Finally some positive price movement. How does a trading halt work? Is it put in place by the company? And it means either really bad news, or really good news, yeah?




Price sensitive announcement to come out (put in place by the company).. about reserves report.. can go either way! but you'd think its positive news!


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## emile33 (19 October 2011)

*Re: HOG - Hawkley Oil and Gas Trading halt*



AngusSmart said:


> Price sensitive announcement to come out (put in place by the company).. about reserves report.. can go either way! but you'd think its positive news!





http://www.proactiveinvestors.com.au/companies/news/20882


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## Wombus (19 October 2011)

*Re: HOG - Hawkley Oil and Gas Trading halt*

Summarised from the company's 30 Sep 11 Announcement:

As of 29 September, the well was at 3,158m drilling at approx 90m a day.

With an expected TD of 4600m, this put an approximate time to reach TD of 16 days, or 15 Oct. Noting we are now 4 days past that, anyone want to wager there will be a drilling announcement accompanying this Reserves Update?

looking back at Soro, it took about 7 days after hitting TD to conduct open hole tests. For comparison open hole test flow rates were about 4.3 mmcfg/d and 160 bbls condensate.


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## basilio (19 October 2011)

I agree that it looks as if there will be a drilling announcement if you use the Sept 30th information.

However  according to later reports  (Oct 6th) they expect the drill to hit the anticipated oil zone at end Oct/early November.  Also the announcement  made specific mention of the reserves as distinct from drilling info.

So we should see 2 distinct events. Reserves  info tomorrow and drilling info in 2 weeks

Cheers

http://www.hawkleyoilandgas.com//me...arch-note-180/DJ-Carmichael-research-note.pdf

http://www.hawkleyoilandgas.com//me...-note-179/Hartleys-research-note-October6.pdf


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## basilio (20 October 2011)

Reserves upgrade out for Sorochynska field. *300% increase in 2P reserves.* Looking at $567 m production from the Soroch field alone.  Like to think that causes some  review of the SP...

Now lets see what happens with the Chets drill.
http://newsstore.fairfax.com.au/app...rkets.theage.com.au/apps/qt/quote.ac?code=hog


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## basilio (20 October 2011)

basilio said:


> Reserves upgrade out for Sorochynska field. *300% increase in 2P reserves.* Looking at $567 m production from the Soroch field alone.  Like to think that causes some  review of the SP...
> 
> Now lets see what happens with the Chets drill.
> http://newsstore.fairfax.com.au/app...rkets.theage.com.au/apps/qt/quote.ac?code=hog




So it's now *below* opening price after a 300% increase in reserves. God help us if Chets proves to be a gusher ! It will probably fall through the floor.


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## alexc2005 (20 October 2011)

Well, this stock is purely mystifying.

I had a grin from ear to ear as i watched in the preopen the price soar 12%.

Had thoughts of putting in a sell for 35c but was sadly distracted by a course im doing at the moment.

Then such a massive fade?

What the hell? Trippling of reserves = price down?

Crazy talk!


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## basilio (20 October 2011)

I think today is another confirmation that is market is seriously spooked. It looks as if the moment there is a dollar on the table it gets whipped off regardless of the future prospects.


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## poverty (20 October 2011)

basilio said:


> I think today is another confirmation that is market is seriously spooked. It looks as if the moment there is a dollar on the table it gets whipped off regardless of the future prospects.




HOG just continues to be a dog of a stock, I'm not sure what kind of news it will take to turn it around.  I hold in hope.


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## Starcraftmazter (21 October 2011)

Oil stocks have not done well in the last few months; their success depends largely on economic growth. I would say wait until some economic good news, then the stock will have a nice little rally.


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## RNI (21 October 2011)

The latest Hartleys report is pretty encouraging in the LONG TERM. They state 'the unrisked potential...is for 600cps!!

How amazing is that.
Read the report on the HOG  website.


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## yma (1 November 2011)

We suppose to have announcement yesterday, any thought?


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## WRONG'UN (1 November 2011)

Well, 29 Oct, their scheduled monthly progress report day, was a Saturday, so I'd say today is near enough.

More to the point, they now have nearly $2m more cash than at the start of the quarter ($17.1m v $15.2m), in spite of the Chernetska-1 costs. At that rate, even if Chernetska is a duster, they should be able to drill Sorochynska-202 without running down their cash reserves. And, being only 400m from Sorochynska-201, 202 is odds-on to be a producer as well, so Chernetska would be a bonus.

Well that's the way I see it - I'm sticking around.


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## nchardon (2 November 2011)

WRONG'UN said:


> Well, 29 Oct, their scheduled monthly progress report day, was a Saturday, so I'd say today is near enough.
> 
> More to the point, they now have nearly $2m more cash than at the start of the quarter ($17.1m v $15.2m), in spite of the Chernetska-1 costs. At that rate, even if Chernetska is a duster, they should be able to drill Sorochynska-202 without running down their cash reserves. And, being only 400m from Sorochynska-201, 202 is odds-on to be a producer as well, so Chernetska would be a bonus.
> 
> Well that's the way I see it - I'm sticking around.




I agree with wrong'un stick around and watch this baby's SP rise over the coming months


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## basilio (4 November 2011)

Well HOG finished down again today. 

Really interesting watching the play on the market. On almost any rational basis it is undervalued purely on what has been discovered and brought to production. It is making good profits with its current well and there is $560m + proven  reserves on that profile.

The Cherneska drill is  within a couple of weeks of striking paydirt. Not certain of course but  probably 75% chance. If it does confirm the original results the value has to go up at least 100% - probably more.

*And yet at 3.55 today someone dumps 200,000 shares at market and the buyers are essentially bottom feeders * Someone won't wait for 2 weeks.

Then you look at AUT which is certainly a couple of years ahead but it is going gang busters. I suppose there is a far more committed and fervent  group of punters on the  AUT bandwagon. Interestingly enough  AUT has been marked as a reduce by the analysts. They think it is overbought at the current price ...

Lets hope that Europe doesn't go up in puff of smoke.


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## WRONG'UN (5 November 2011)

75% sounds reasonable, and makes the whole thing worth waiting for in my book.

Time will tell whether dumping 200,000 shares was a smart/inspired move -there could have been a number of reasons, including playing games.


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## basilio (19 November 2011)

A few more punters bailed out of HOG yesterday forcing the SP down again.

Seems from the most recent  investor note that the Cherneska drill is now going to hit the oil zone in late Nov/early Dec.. It seems the replacement of the  down hole motor in the drill took longer than expected. 

http://www.hawkleyoilandgas.com//me...-Carmichael-research-note-192/DJ-research.pdf


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## nchardon (21 November 2011)

basilio said:


> A few more punters bailed out of HOG yesterday forcing the SP down again.
> 
> Seems from the most recent  investor note that the Cherneska drill is now going to hit the oil zone in late Nov/early Dec.. It seems the replacement of the  down hole motor in the drill took longer than expected.
> 
> http://www.hawkleyoilandgas.com//me...-Carmichael-research-note-192/DJ-research.pdf




Down to 21.5 today, how depressing  wish I had some more cash though because I would load up on some more.


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## basilio (21 November 2011)

nchardon said:


> Down to 21.5 today, how depressing  wish I had some more cash though because I would load up on some more.




EXACTLY how I felt ! Actually I'm  peeded off because I thought from the Oct drilling report that they would hit paydirt around 15-18th Nov. So I went back in a week ago and used up all my juice.

If I had known about the late Nov/early Dec timetable I would have waited another couple of weeks. In fact I think there must be punters who are simply unaware of the change in drilling  timetable and are "panicking" - hence the sales today and yesterday.

Truly HOG is an absolute bargain at todays prices given the established cash flow and current reserves.


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## Starcraftmazter (21 November 2011)

WTI dropped below resistance, and there was some volume selling today. If this gets to 0.2, that could be a heck of a buying opportunity.


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## nchardon (22 November 2011)

Just got my order in for a few more shares, cant resist at these prices! Guess my bills will have to wait heh heh 



Starcraftmazter said:


> WTI dropped below resistance, and there was some volume selling today. If this gets to 0.2, that could be a heck of a buying opportunity.


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## nchardon (22 November 2011)

nchardon said:


> Just got my order in for a few more shares, cant resist at these prices! Guess my bills will have to wait heh heh




hmmm my luck I buy at .220 and then it drops 1.5 cents straight after  better buy some more to even it up


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## Starcraftmazter (22 November 2011)

The thing I really dislike about this stock, and what keeps me from buying, is the complete lack of liquidity. I can't even buy any significant amount of shares without significantly affecting the SP, which seems just insane


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## poverty (22 November 2011)

Starcraftmazter said:


> The thing I really dislike about this stock, and what keeps me from buying, is the complete lack of liquidity. I can't even buy any significant amount of shares without significantly affecting the SP, which seems just insane




I think there's a lot of people sitting on losses with this one (including me) and are waiting for Chets results, not much more you can do with it really.


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## basilio (22 November 2011)

Poverty has nailed it with HOG. There has been a long drawn out end game with the Chets drill which seems to have  exhausted some peoples patience. Hence the exits in the last few days.

On the other hand anyone who wanted to buy in has probably already done so and can't/won't put more money in. 

On its current price it's an absolute steal. It is currently cash flow positive and could comfortably support another drill into the Sorochynska field which will double returns inside 6 months. The Chets drill has 4 high probability oil bearing profiles - B20, B24,B25 and B26.  What is the likelihood that all of these profiles will be dry ? The risks at the moment seem to be the difficult drilling situations which seem to have been handled effectively if a little slowly. And from a investors POV there isn't a "buzz" around the stock which one might expect in a more ebullient market.

But it is making very good returns that should only(IMHO)  get  much better much sooner.


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## nchardon (28 November 2011)

A rather bad day for HOG, equaling a 52 week low  a lot of shares were dumped today, and with the monthly announcement due in a few days got me worrying. Fingers crossed for good news!


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## basilio (28 November 2011)

nchardon said:


> A rather bad day for HOG, equaling a 52 week low  a lot of shares were dumped today, and with the monthly announcement due in a few days got me worrying. Fingers crossed for good news!




I think many investors have badly lost their nerve in exiting at this stage. Just on current cash flow and proven reserves HOG is very cheap. After re visiting the analysis of the Chets field I can't see how the current drill won't strike oil at either the B20 or lower horizons.( But this is not an infallible pronouncement ..)

Mind you if enough people want to sell regardless of proven value the SP can still fall ; in exactly the same way as the SP can rise regardless of facts on the ground


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## WRONG'UN (28 November 2011)

Well about 600,000 went through at 20c - if there was a nervous or impatient seller, there must have also been a willing buyer.

I prefer to ask what is the likely scenario in mid 2012? Two producing wells at Sorochynska, a gas plant in the pipeline, and maybe something from Chernetska.

Monthly drilling report due tomorrow - it would be nice if they are into the paydirt - anything less would be bound to dislodge a few more impatient holders. We shall see.

Two day 5 min chart:

Dare I mention the bullish divergence in the MACD?


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## Starcraftmazter (28 November 2011)

I was contemplating buying today but the volume is just so damn low on this constantly,  I can't get over this worry.

And why would someone dump so many shares ahead of the announcement anyway? Just seems very fishy 

If that report turns out to be negative, I would expect the ASX to take action on insider trading....


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## basilio (28 November 2011)

Starcraftmazter said:


> I was contemplating buying today but the volume is just so damn low on this constantly,  I can't get over this worry.
> 
> And why would someone dump so many shares ahead of the announcement anyway? Just seems very fishy
> 
> If that report turns out to be negative, I would expect the ASX to take action on insider trading....




I suggest that the lack of volume is because

1) There are no institutional buyers and very few private investors chasing stock
2) There is little speculatative share trading activity

Doesn't leave much else does it ?

I don't think the end of month  drilling report will be conclusive. I suggest they are still drilling or possibly evaluating a core. But we'll find out soon enough. (The Nov 7th note said a late Nov/early December strike.)

It does seem strange that people would sell out so close to the end of the Chets drill. However as I and Wrong Un point out HOG already represents excellent value at the current price.


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## nchardon (29 November 2011)

basilio said:


> I suggest that the lack of volume is because
> 
> 1) There are no institutional buyers and very few private investors chasing stock
> 2) There is little speculatative share trading activity
> ...




Another positive announcement today from HOG! Hopefully will see a rise especially with the overall market up. Looking forward to when Chets drill finally hits its target and we get some solid information on how its going to turn out!


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## basilio (30 November 2011)

Just reading through the investor presentation for 29th Nov.

I'm puzzled by it. In my eyes it seems very, very cautious in its outlook. It highlights the dependence to date of only one well. But that well is quite profitable and if the current SP is measured against the  income from the Sorochynska well alone the company is underpriced. The fact that they can drill a second and subsequent wells with 100% certainty of doubling and trebling income doesn't seem to be acknowledged.

I'm also surprised that they havn't waited for the 1-2 weeks to identify the results from the Chets drill. They are literally 80 metres away from the first profile. I assume a couple of weeks should be sufficient to determine the size of any returns.

One point that does bear noting is the the long wait between drills. It would be great if somehow

1) There was  a way to improve drilling technology to cut drilling times and hopefully costs and thus speed up development.
2) There was sufficient cash, investment or earning capacity to enable  2-3 drills to be undertaken simultaneously. 

*Going at basically one drill a year just seems archaic.*

The report suggests that HOG is not a glamour company because it is not into exploration merely production. 

I'm so surprised at this statement. The indications from the initial geological reports were that there was both certainty of oil and gas in the leases they have acquired and the possibility of substantially higher reserves than previously indicated. To date the three fold improvement in the Sorochynska field and larger than anticipated gas and oil flow rates bear this out.

IMO HOG and its shareholders should do very, very well if development can be smartened up in the next few years. And even if just tiddles along earnings next year should at least double. Not shabby at all..


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## Starcraftmazter (30 November 2011)

Well they did say they want to look for more oil in the mediterranean. I agree they don't seem to be very confident, and hoarding quite a bit of cash while not planning to do much with it?


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## reeftip (30 November 2011)

One of the reasons that HOG have been drilling so slow is they are relying on Legacy Imaging data. This brings Structure into play when drilling – Thus increasing risk and decreasing speed.

I see that Exxon  Mobil and Shell have just signed on to develop Shale in the Ukraine. Hopefully HOG can get a hold of whoever is going to be doing their imaging and get some good digital data on their future wells. They could also pay attention to the new drilling techniques that have been developed lately in the Shale area.


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## WRONG'UN (1 December 2011)

I agree, Reeftip, modern techniques have to add value to their licences. From what I have read over the past year, the company are onto all the clever stuff, while balancing costs and benefits eg Western drilling gear from Romania is faster than Russian but costs more.

As far as speed of drilling is concerned, sure, time costs, but in the end what really matters is whether they hit commercial paydirt or not. Selling because the drilling is "too slow" is a recipe for kicking oneself.


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## basilio (1 December 2011)

Monthly report out today.  Almost there with the Chets drill. It will take another month to determine the amount and viability of any oil finds. (although given they found it 30 years ago we should assume it has gone away.

The next Soroch drill will start in January rather than December as planned. I think these delays are irritating rather than disastrous. Yes it would be great to "blast through" perceived inefficiencies. But as was pointed out the current drill is only 14 days behind the original projection. Everyone just hoped it could be done better.

But in the end HOG is producing $24m a year net from its first production well with around $560m of reserves already booked. It's currently valued at $61m. I think it is excellent value

http://newsstore.fairfax.com.au/app...te.ac?get_prices=Get+prices+&+charts&code=hog


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## nchardon (9 December 2011)

Chets has reached target should know in a month how it will pan out *fingers crossed all is good*


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## basilio (10 December 2011)

There will regular updates over the next  few weeks as the Chets drill is  evaluated. Because it is so close to distribution lines it should start paying off quite quickly.

It will be interesting to see how the market responds in the current circumstances. It's  a fairly simple business pumping and selling oil/natural gas after establishment and infrastructure is done.


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## nchardon (23 December 2011)

HOG Just took a **** and it smells!

Any thoughts on the new release and the huge market dump?


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## Starcraftmazter (23 December 2011)

nchardon said:


> HOG Just took a **** and it smells!
> 
> Any thoughts on the new release and the huge market dump?




Yes; I'm very happy I decided not to buy in due to low liquidity 

Not knowing anything about drilling for oil, I have absolutely no idea what they mean in their announcement (they should really have a more general explanation - perhaps that is why the announcement spooked the market?).


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## nchardon (23 December 2011)

Starcraftmazter said:


> Yes; I'm very happy I decided not to buy in due to low liquidity
> 
> Not knowing anything about drilling for oil, I have absolutely no idea what they mean in their announcement (they should really have a more general explanation - perhaps that is why the announcement spooked the market?).




From my understanding their first target was a dud, so they will continue to drill deeper which will take another 2 weeks or so. And it is also my understanding the next target and its potential oil results should be totally independent from the firsts dud results.


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## ChrisJH (23 December 2011)

Does anyone have a link? It's dropped, what, 25%? Seems to be a bit of an overreaction.


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## suhm (23 December 2011)

no oil, enough said, diasppointing


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## junhan (23 December 2011)

attached report


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## basilio (27 December 2011)

*That *was a disappointment!!

The next stop is the B24/25 horizon which according to the original Moyes report should be one of the richest gas/oil lodes in the lease...

Lets hope reality mirrors the report....

Of course if it does then HOG should scream out of the blocks.  If it doesn't

1) It would  severely test investors faith in the original  reports
2)* BUT * at current prices  the stock is still heavily undervalued recognising the existing cash flow and recognized reserves in the Sorochynska field. And lets remember there will be a second drill that will double cash flow in around 8 months. And there is ample funds for this drill. Rationally it just couldn't fall any further. (But it almost certainly would..!)

I suggest the real bargain for HOG could be if there is a sizable strike in the B24/25 /26 horizons and the market doesn't adequately recognize the value. HOG is currently 18c. A jump to say 30-34c would appear exceptionally good percentage wise but would leave the stock at unbelievably low PE ratios.

All IMHO of course . 

Lets look forward to a good New Year .


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## trendline89 (28 December 2011)

29th Nov Investor Presentation says:

B24/B25 carbonate section
Flowed gas at *non-commercial* rates in 4 wells in the area

I doubt this hole will produce.

Also they will need to fund a gas plant at some point. Will we see a cap raise soon?




basilio said:


> *That *was a disappointment!!
> 
> The next stop is the B24/25 horizon which according to the original Moyes report should be one of the richest gas/oil lodes in the lease...
> 
> ...


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## basilio (28 December 2011)

trendline89 said:


> 29th Nov Investor Presentation says:
> 
> B24/B25 carbonate section
> Flowed gas at *non-commercial* rates in 4 wells in the area
> ...




I think you have the wrong end of the stick here trendline. According to the initial studies  and repeated through the various research notes the B24/25 horizon is anticipated to have the biggest reserves. (Or course they actually have to find them .)

The gas plant is relatively cheap. A few million I believe. HOG has $15m in the bank and is cash flow positive  even while paying for the Chets drill. They make a point of saying they have sufficient funds for the 2012 drill and construction program.

Cheers

http://www.hawkleyoilandgas.com//me...note-184/Hartleys-research-note-October20.pdf


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## trendline89 (29 December 2011)

HOG has clearly said surrounding wells near Chernetska-1 are non-commercial. 

http://www.hawkleyoilandgas.com//me...sentation-194/Investor-Presentation-Nov11.pdf

Also this drill location was  selected for the B20 not the B24/25 and this adds to my view this well won't be a producer.



basilio said:


> I think you have the wrong end of the stick here trendline. According to the initial studies  and repeated through the various research notes the B24/25 horizon is anticipated to have the biggest reserves. (Or course they actually have to find them .)
> 
> The gas plant is relatively cheap. A few million I believe. HOG has $15m in the bank and is cash flow positive  even while paying for the Chets drill. They make a point of saying they have sufficient funds for the 2012 drill and construction program.
> 
> ...


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## nchardon (29 December 2011)

trendline89 said:


> HOG has clearly said surrounding wells near Chernetska-1 are non-commercial.
> 
> http://www.hawkleyoilandgas.com//me...sentation-194/Investor-Presentation-Nov11.pdf
> 
> Also this drill location was  selected for the B20 not the B24/25 and this adds to my view this well won't be a producer.




Hey Trendline re-read the presentation of the 29/11, its in the  Sorochynska license where four wells in the area at the B24/25 carbonate section did not flow at a commercial rate, Chets is over 80km away and independent from Sorochynska. Also according to the report the B24/25 is where its expected to be most profitable as Basilio mentions.


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## suhm (29 December 2011)

They look like they are in the chets license to me, and only lak-2 and lak-7 showing flow rates


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## WRONG'UN (29 December 2011)

C'mon, guys - p22 of the Nov presentation is quite clearly placing the 4 non-commercial B24/25 gas wells within the Sorochynska licence area.
As nchardon rightly says, Chernetska is over 80km away - anything can happen in between.
I also concur with what Basilio is saying.

Edit: Hawkley apparently regard 4 non-commercial wells, no matter where they are, as a positive.


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## prawn_86 (29 December 2011)

WRONG'UN said:


> Edit: Hawkley apparently regard 4 non-commercial wells, no matter where they are, as a positive.




Not commenting specifically on these 2 wells but i know a lot of explorers/producers classify "non-commercial" wells as a good things as they were previously non-commercial back in the 60's, 70's, 80's when there was no real market/demand for gas when it was drilled and shut in. This has changed now so it means they well may be commercial...


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## suhm (29 December 2011)

Given 2 holes drilled <1km apart can cause the drill team to completely miss a structure or hit paydirt why would you be as interested in what happened is sorochynska vs what happened in chets look at slide 23, with lak 2 & 7 supposedly flowing from the b24/25 layer but at low flow rates. No details given for the other 5 holes so either they don't have the data or was <1.5mmcf/d which is poor anyway.

Referring to diff slides, yes they comment about 4 uncommercial b24/25 wells in sorochynska but give details about some holes drilled in or near chets.

I hold by the way just being realistic.


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## WRONG'UN (30 December 2011)

Slide 23 attached, along with details of the other wells in the licence area and nearby (from the April 2009 Moyes report).


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## nchardon (6 January 2012)

We need some good news from Chets, HOG's SP is not looking the best at the moment


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## tech/a (6 January 2012)

Another disastrous stock followed by fundies looking for the slightest bit of positive spin.
Trading/investing on hope wont return consistent profit.

Technically HOG shows no signs of reversal to the up side.


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## nchardon (6 January 2012)

tech/a said:


> Another disastrous stock followed by fundies looking for the slightest bit of positive spin.
> Trading/investing on hope wont return consistent profit.
> 
> Technically HOG shows no signs of reversal to the up side.


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## poverty (11 January 2012)

Disastrous alright.  Closed at 0.165 today.  Shameful.


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## trendline89 (11 January 2012)

poverty said:


> Disastrous alright.  Closed at 0.165 today.  Shameful.




Not looking good does it? 'HOG' should be renamed 'DOG'.


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## nchardon (13 January 2012)

trendline89 said:


> Not looking good does it? 'HOG' should be renamed 'DOG'.




I plan to sacrifice a goat tonight as a blood offering to the trade gods for oil in CHETS B24/25 targets


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## poverty (13 January 2012)

Announcement out and a few buys going through.

Sorochynska Licence B18 Reserves Report


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## nchardon (13 January 2012)

poverty said:


> Announcement out and a few buys going through.
> 
> Sorochynska Licence B18 Reserves Report




No mention of chets, perhaps that isnt such good news..


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## trendline89 (20 January 2012)

nchardon said:


> No mention of chets, perhaps that isnt such good news..




Slip-sliding away. Other stocks are roaring away and this one is stuck in reverse.


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## RNI (21 January 2012)

There has been one piece of good news out recently, that was the results of the Moyes report (reported via a company update recently in January 2012). It backed up the earlier much higher reserves in Soro 201 well and will need 4 more wells for get it all out eventually.

Moyes report has assessed Soro reserves NOW at 56Billion up from initial report assessment of 13 Billion, which is HUGE. Some now used and sold on, but 51 Billion still there and needing the extra 4 wells to get it.

Soro-202 is very soon to be spud and this will double the output with these two wells draining together.

Old gas plant can cope with this amount, but will be needed when 3rd well is drilled and producing.

So all in all good news. Also they are getting 2D AND 3D seismic done over Soro and also Chets which will give more accuracy in where to drill wells.

Patience needed on this one and many not understanding full value and also not willing to wait the long stretches it takes to drill wells etc.

I'm keeping all mine for sure and understand the long stretches will continue UNTIL they really begin growing and production increases revenue and have new gas plant etc
and they are hopefully, able to get more modern equipment which will take less time and reduce chances of breakdowns with equipment etc.


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## basilio (22 January 2012)

I think RNI has accurately summed up HOGs position.

I'm quite disappointed (very!) that the Chets drill seems to be a dud. But with a healthy cash flow, $15m in the bank and another Soro drill within 8 months in a now proven field HOG is not a dead duck by any means.

At 16c I think it is  severely  undervalued.  Capitalization is $45m yet it is currently netting $2m a month  after taxes ! (See December  report). 

This is not an explorer trying to find the value of the next drill but a significant oil producer with quite clear upsides


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## basilio (1 February 2012)

A lot of stop losses have been hit on HOG. Heavy sales and now 14.5c

I think this is irrational given the positive cash flow from the first Soro well and the proven reserves in that field.  It will be interesting to see if confidence can be recovered over the next 12 months. Obviously if the next Soro drill doubles income as anticipated  we would see a $42m company with a $40m + income !!


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## nchardon (1 February 2012)

basilio said:


> A lot of stop losses have been hit on HOG. Heavy sales and now 14.5c
> 
> I think this is irrational given the positive cash flow from the first Soro well and the proven reserves in that field.  It will be interesting to see if confidence can be recovered over the next 12 months. Obviously if the next Soro drill doubles income as anticipated  we would see a $42m company with a $40m + income !!




I hold


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## WRONG'UN (1 February 2012)

Well I hope the last vestige of negative Chernetska sentiment has been wrung out of the sp so it can get on with appreciating the value of Sorochynska.

Sooner or later a vulture will swoop on the carcase (like SEH and JPR), but who knows when that will be. Whatever, I'm not risking missing out - I (still) hold.


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## Dinipants (3 February 2012)

Oh man, 13c. Didn't think I'd see it back down here again.

Pretty much everything's been said that needs to. Good post by RNI. Shame about chet but that doesn't change any of the company's fundamentals. I hold and intend to hold.

Gl to all involved.


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## poverty (3 February 2012)

The board won't buy any shares even at these prices.  They're spending 2 million a quarter on administration - this company is having a fantastic time on our dime.


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## trendline89 (3 February 2012)

WRONG'UN said:


> Well I hope the last vestige of negative Chernetska sentiment has been wrung out of the sp so it can get on with appreciating the value of Sorochynska.
> 
> Sooner or later a vulture will swoop on the carcase (like SEH and JPR), but who knows when that will be. Whatever, I'm not risking missing out - I (still) hold.




Sometimes you just have to bite the bullet and cut the dog loose. I did and I have already recouped back my loses.


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## WRONG'UN (6 February 2012)

You are right, Trendline - this is the last time I give the fundamentals so much of the benefit of the doubt.

I see the vultures are circling!


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## basilio (6 February 2012)

HOG at 13c is quite depressing.  It is way undervalued at current earnings and reserves. But obviously sentiment and momentum are kicking the sxxx out of the SP.

As I see it this has happened because :

1)* There just hasn't been any focused marketing of the company  in the last few months. *That has meant a gradual deterioration of the SP which has then become self reinforcing.

2) *There have been a series of missed  deadlines. *The last oil drill kept getting delayed. So did the start of the next one. We seem to have lost the new gas plant. These don't give confidence to the market.

3) *The failure of the Chets drill*. The market could probably have handled the other disappointments better if there had been a positive result on the Chets drill. And if the SP had been somewhere in the high 20's range then it may have fallen only a few more cents - unlike the present situation.

4) *The lack of any prospective news for at least 5 months.*  Hopefully the new Soros drill will boost production if/when  it bears fruit. But that is at least 5 months away and after the last disappointments you wouldn't be betting the house on the timing or the result. With that time frame why would anyway hang around with a stagnant stock ? And what else is there to look forward to ?  

I suspect the  Russian oil industry culture and skills may be behind the continual failures of deadlines. I'm not sure how this can be effectively addressed by the company.

*One thing is for sure. While the currently SP is so low and targets being missed the management should not be taking more than very basic returns.!!*

________________________________________________________________

That $2m a quarter administration cost seems very high with no breakdown of it's constituents.


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## vas77d (8 February 2012)

so much negatativity around this company.


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## basilio (8 February 2012)

> so much negatativity around this company.




Vas it really doesn't deserve such a bad wrap - which makes it all the harder to understand. After all it is still quite solidly profitable and short of catastrophe  seems very unlikely to collapse. Thats something that can't be said about most of the other mineral explorers.

It has proven  excellent reserves in the Soris  oil field and hopefully better seismic testing will identify where the gas/oil reserves are in the Chets field.

The downsides seem to be in the constraints of the local Ukraine workforce and technology, perhaps the lack of promotion of the companies prospects and the slow progress.

I also have another fear. At present HOG is making a comfortable $24m plus a year. One drill just pumping out oil and gas. Management costs are  currently $8m a year . That seems prettygood to me for just ticking off the operations of an operating  oil and gas  field. 

Perhaps its too comfortable ?


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## prawn_86 (8 February 2012)

basilio said:


> Perhaps its too comfortable ?




Reminds me a little of PPP (i think). They had good cashflow but their SP never really went anywhere. Although they did pay a dividend.

If management if happy just being comfortable then they should at least return some of that 'comfort' to the shareholders also


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## basilio (12 February 2012)

Interesting to see some actual buying pressure in the last few days.

At 15c HOG is grossly undervalued.There is an updated research report on the HOG website (Feb 7th)  which  outlines how cheap it is given it's production,  proven reserves and a comparison to other oilers. I reckon there have to be a few new investors who think it is worth jumping in at the current price.



http://www.hawkleyoilandgas.com//me.../DJ-Carmichael-Research-Report-7-Feb-2012.pdf


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## basilio (13 February 2012)

Looks like the Chets drill might not be as barren as we thought. 

Latest announcement from HOG is that they are casing the well and will be testing the gas they found in the wireline logs.  Given that the current SP has no value for the current drill and vastly undervalues the existing production there should be a strong rebound in the next few weeks .

First in best dressed !

https://onlineinvesting.westpac.com...mpanyProfile/Announcements.aspx?stockCode=HOG


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## reeftip (13 February 2012)

Yes, it looks like it might not be a 'Duster' after all.

The drill crew must get paid by the hour - as they have got to be the 
slowest I have ever heard about.

There are 60 year old rigs around that can drill down to their TD in around 3 weeks.

Might be time to go recruit an experienced crew from somewhere else to show the locals how it should be done.

Even if the drill rig is crap they could always lash out a few extra dollars for a 'Smith' drill bit. 

Anyway that's my Monday morning whinge about an underpreforming company that I have shares in.


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## poverty (13 February 2012)

reeftip said:


> Might be time to go recruit an experienced crew from somewhere else to show the locals how it should be done.




Apparently there is a lot of local politics and bribery you need to tip-toe around to operate in the Ukraine and I'm guessing the slow moving local donkey-drilling crew is not something up for negotiation


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## todster (13 February 2012)

reeftip said:


> Yes, it looks like it might not be a 'Duster' after all.
> 
> The drill crew must get paid by the hour - as they have got to be the
> slowest I have ever heard about.
> ...




I wouldn't even go outside in that weather.


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## basilio (13 February 2012)

I think Todster put his finger on the  realities of working in  blizzards and very hostile environments.

On the bigger  picture it would be interesting to find any comparisons between times and costs for other oil companies working  in the Ukraine and in this  region.  Any contributions ?


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## RNI (13 February 2012)

Great to see the Chets results out today which have finally given us hope with the proof there are hydrocarbons down there in B24/25 and possibly in B26 as well..... 

'the B26 formation was also interpred to be gas saturated'

They are taking a cased hole test to obtain..... 'better understanding of the productivity of the reservoirs'. These results should  be out (hopefully) by mid April and will help t identify  areas with the largest amounts of gas and equally important those areas where the permeability is such to enable them to produce commercially, so thank goodness for that good news after all the doom and gloom and the share price at a shockingly low price.

Yes, exactly basilio...'First in best dressed'.... is hopefully correct. Will be great to see the share price gradually start to head North again instead of South, and soon I think.

Also Poverty, you are correct regarding the need for them to keep the  local drilling crew. They employ the locals as they not only know the local area, but just as importantly, to keep the peace with the Ukraine Government, which is still known to be at times very difficult to work with. and there is still corruption occurring in that country. This at least helps them to be accepted and they are seen to be helping Ukraine by giving employment to it's people.

Anyway, good news at last, just when we all had accepted (reluctantly) that Chets was a duster!!!!


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## trendline89 (20 February 2012)

RNI said:


> Great to see the Chets results out today which have finally given us hope with the proof there are hydrocarbons down there in B24/25 and possibly in B26 as well.....
> 
> 'the B26 formation was also interpred to be gas saturated'
> 
> ...




Nearby wells has shown there is gas in the region but with very low flow rates. It would not surprise me that this well too will have a low flow rate and won't do much to the SP.


----------



## Dinipants (23 February 2012)

trendline89 said:


> Nearby wells has shown there is gas in the region but with very low flow rates. It would not surprise me that this well too will have a low flow rate and won't do much to the SP.




Yeah true. Probably not gonna be much happening until new SOR in August .


----------



## McCoy Pauley (27 February 2012)

Dinipants said:


> Yeah true. Probably not gonna be much happening until new SOR in August .




Except the CEO, Chairman and a non-executive director resigning with immediate effect, as announced to the market this morning.

The founding CEO and another founder of the company step in as CEO and Executive Chairman respectively.  Both will be based in London.

Seems like a coup was executed at the board level.


----------



## basilio (27 February 2012)

McCoy Pauley said:


> Except the CEO, Chairman and a non-executive director resigning with immediate effect, as announced to the market this morning.
> 
> The founding CEO and another founder of the company step in as CEO and Executive Chairman respectively.  Both will be based in London.
> 
> Seems like a coup was executed at the board level.




Well it certainly can't hurt their SP ! In retrospect this was an obvious and necessary decision.  There just hasn't been sufficient confidence or promotion of HOG in the last 8 months with the result that the SP has been  trashed. I think the fundamentals of current production and longer term success are still there.

Given that the original founders hold large slabs of the company they would want to see a quick reversal of the SP.  I think there will be some good rebounds in the next few months.


----------



## poverty (27 February 2012)

Great news!  If only we could do the same with the Labour/Green government.


----------



## nchardon (27 February 2012)

They mention dual listing HOG to open it up to other international investors, what usually happens to a company's share price when this happens?


----------



## basilio (27 February 2012)

Good jump in HOG today on the back of the management changes. I think it has been way under priced for months and  on current reserves and production should be at least in the mid 20's. The last stocker broker analysis on Feb 7th  suggested 31c as a 12 month target and identified the current value of the Soroch reserves as 24c a share.

There will also be a reserves upgrade by the end of the first quarter and if it is as good as suggested (see announcement today ) there should be another boost to the SP.

http://www.hawkleyoilandgas.com//me.../DJ-Carmichael-Research-Report-7-Feb-2012.pdf


----------



## basilio (27 February 2012)

nchardon said:


> They mention dual listing HOG to open it up to other international investors, what usually happens to a company's share price when this happens?




I imagine that the promotion and launch of the company will attract fresh investors. At this stage the company has proven reserves and a profitable well and yet is selling at less than its original IPO ! I believe it will force up the SP.  (which is obviously in the interest of the majority shareholders)


----------



## nchardon (21 March 2012)

Share price up to .22 today I was almost in the green for the first time in many months  perhaps we might see a trend up now instead of down which has been the case for oh so long, might load up on a few more shares if it dips down tomorrow.


----------



## ChrisJH (23 March 2012)

Holding steady at 0.21. Not quite in the green myself, but just about  What's the time frame for things happening at HOG over the next little while? When are we going to see some action that will affect the share price (either up or down). My trigger finger is on the sell button, but the way it has recovered over the last few weeks since just a change in management I wonder if it is possible for it to return to 0.30-0.50 this year at all.


----------



## basilio (23 March 2012)

ChrisJH said:


> Holding steady at 0.21. Not quite in the green myself, but just about  What's the time frame for things happening at HOG over the next little while? When are we going to see some action that will affect the share price (either up or down). My trigger finger is on the sell button, but the way it has recovered over the last few weeks since just a change in management I wonder if it is possible for it to return to 0.30-0.50 this year at all.




HOG is a funny stock.  It burst out of the blocks in 2010-11 with an excellent first drill which in fact has ensured its survival. Great start.

Unfortunately through 2011 it just seemed to slow down in terms of marketing its potential as well as completing the second drill.  It really does take far to long to get anywhere at the moment.

Given the 3 fold increase in reserves in the Soroch field it was way oversold at 13-14c. Just ridiculous. The change of management has put some ginger into the stock.

Coming up there are imminent reserve upgrades and the ongoing 2nd Soroch drill which will/should improve profitability. These should be worth another 20c a share

But to really fly(IMHO) I believe HOG has to successfully complete at least 2-3 drills a year. Otherwise it will just drag on.


----------



## mr. jeff (23 March 2012)

Hi Basilio,

I hear what you're saying but I think there is a change in tempo underway if only because of the oil price. 





This is a 3 year chart with weekly bars. You can see the volume picked up at the end of the downtrend, and further that the downtrend has been clearly broken.




Then looking at the 3 month daily chart, you can see a good pickup in volume and the good break up that has occurred. 

This is not yet completely confirmed but so far it is looking good and has shown strength with these down days.

I entered on the break of 19c and am waiting for further action.


----------



## ChrisJH (27 March 2012)

basilio said:


> Coming up there are imminent reserve upgrades and the ongoing 2nd Soroch drill which will/should improve profitability. These should be worth another 20c a share




This isn't a definite though, is it?

After the last drill and they didn't find what they wanted, the share price dropped 25+%. 

Nice momentum today, btw, though.


----------



## basilio (27 March 2012)

ChrisJH said:


> This isn't a definite though, is it?
> 
> After the last drill and they didn't find what they wanted, the share price dropped 25+%.
> 
> Nice momentum today, btw, though.




The Soroch drill is into a known field and  will be increasing the amount of oil and gas they can  sell. I think there is a 99% plus certainty of finding the target.

*Of course there are always risks with the drilling side which can't be discounted.*

The reserves upgrade  and 3D seismic studies should also sharpen up the volume/ accessibility of oil and gas deposits and identify  (hopefully) the best locations to drill.

I'm still not happy with the rate of exploration.


----------



## nchardon (28 March 2012)

A nice rise today, I am finally in the green and hopefully the sp still has a way to go, reading the report today 100million revenue predicted 1st quarter 2014 sounds good, I definitely won't be selling this just yet


----------



## basilio (28 March 2012)

It will be interesting to see if the first Chets drill results in some actual production of gas/oil.  Todays report says there is imminent news and notes the oil traces in the drill. It could be a nice little surprise.

I noted that they were  anticipating 3-4 drills a year from 2013-4.  I can't quite see how they intend to fund this effort or source the hardware. 

Anyway at 24c I think HOG is still under priced  on it's current production and reserves let along any upgrades. And from steadily increasing buying pressure other investors are taking the same view.

I have posted a link to todays investor presentation.

http://newsstore.fairfax.com.au/app...theage.com.au/apps/qt/quote.ac?code=hog&f=pdf


----------



## Dinipants (4 April 2012)

Haha yes...except that.... :

Good to see SP heading north. Eager to see how drilling goes


----------



## nchardon (4 April 2012)

Dinipants said:


> Haha yes...except that.... :
> 
> Good to see SP heading north. Eager to see how drilling goes




Being awarded a 20 year production license, and now the ability to build their own gas processing plant is excellent news! The opening of their third well in a proven reserve in August/September I only see the SP heading north from here! Woot!


----------



## nchardon (5 April 2012)

Whats HOG going to do next Tuesday go up or down? I wish I knew the answer I would be a rich man


----------



## Starcraftmazter (5 April 2012)

nchardon said:


> Whats HOG going to do next Tuesday go up or down? I wish I knew the answer I would be a rich man




Don't get too excited too early. HOG has had a very nice run up on strong volume, however since the Fed minutes were released earlier this week, gold and oil have gone down somewhat, and this could well signal a reversal in HOG.

Right now, HOG needs to get past the 30c high reached last October on good volume if it wants to continue the rally. If it does, prospects will definitely be better


----------



## nchardon (10 April 2012)

Whenever HOG has a good rise, the overall market seems to immediatley go down dragging hog back down with it.  

Well I am in it for the long haul and always have been


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## RNI (23 April 2012)

HOG has been getting some good publicisity lately, one being from Alan Kohler's Eureka report where one of the articles analysed approx 111 junor oil & gas coys (from memory) with the first requirement being that they were finacially secure. HOG came 2nd best from all these, losing the top position only because of it's tenements being in the Ukraine and the still (presumed) higher political risk there. However we have had access to the latest news on this factor where the new management have stated that issue has moderated somewhat due to the change of government and also the strong need/desire to become self sufficient in supplying the country with their own gas (as against being dependent on Russia) and this factor was opening more doors for the o&g companies which operate there. 

Today's rise was good to see and is much closer to the magic $30 mark

Presume we will have to wait for the end of month report for any news, but good to see todays effort.


----------



## basilio (24 April 2012)

> Today's rise was good to see and is much closer to the magic $30 mark




Yes indeed RNI !! I'll see you in the Bahamas when the flying pig reaches this point ..

I'll settle for $3...

________________________________________________________________________

Still at 28c it is still way below the gas/oil pre production SP. On reserves and production  should be much higher.


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## mr. jeff (25 April 2012)

I don't like making public predictions, but in this case I thought I would open myself up to being completely wrong. 






I expect to see HOG keep it's momentum upwards (first biased opinion for the post!) and head for that 30c level with hesitation, particularly after the selling we saw yesterday. 
Looking for a low volume down day to confirm a re-entry, (this will hinge on action in the US tonight - hopefully a down day so that we can see where HOG is at ) then after this, I would expect to see (after a positive US session) an upthrust, most likely with a gap up through that level. It probably won't stick short term.

Anyone here who knows the background could probably suggest what news there is that may aid this process. 

In the meantime I am watching for a resumption after selling at 28c on that high volume. I am quite happy to admit that any and or all of this is utterly baseless, incorrect and unfounded, but thought some may like a fancy chart to stare at. If it entertains 1 person it's a success. 

(Further to that, I recommend not trading according to this, as it is almost definitely wrong in some or all ways and is only meant for entertainment value).

Cheers.


----------



## Chasero (25 April 2012)

mr. jeff said:


> I don't like making public predictions, but in this case I thought I would open myself up to being completely wrong.
> 
> 
> View attachment 46852
> ...




HOG has been given some publicity recently by Haspete, Eureka report and the article "from "Sunday Times Perth 'hot stocks' page of the business section, the analyst from Hartleys has HOG as a BUY."

Might explain the recent momentum. I believe Haspete picked AUT years ago.

Now he has picked HOG. I am too looking for any retrace, though if it breaks 28c on high volume I may be in this stock too.


----------



## RNI (25 April 2012)

OOPS.....that was a bluey wasn't it !!!  :bonk::bonk::bonk:

Meant 30c of course!! Yes would settle for $3 also in perhaps a few years. Not impossible.

.The next news due is the independent reserves report on Soro, expected soon.
.Results of the testing on Chets. Even though it seems to have been a duster, they hope to gain some knowledge from the tests done on it, one being for the presence of gas in B19.
.Info regarding progress on the preparations for the new gas plant.
.Progress with Soro #202.

So a few bits of good info ahead hopefully.


----------



## Chasero (26 April 2012)

Looks to be retracing.

At 27c now... depending on how it'll close.

It opened very high and reached 29c, but this is very usual after public holidays/ Mondays to make you feel you have to 'buy'. Resistance at 28c too strong.

I am always wary of buying in the first hour of trading, as it always seems market makers/eager buyers are manipulating the price.

Anyway, will look for entry in next few days depending on close today.


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## basilio (9 May 2012)

Like (almost) everything else in the market HOG  has fallen again.  And just when we thought it might break the magic 30c..

Hartleys has come back with another story evaluating the reserves, risks ect.  It's not hard to see how they are trying to ignore the previous multiple  analysis which should have seen HOG at at least 50c at this stage and convince us that this time it really is going to happen. It does make sense -  but then again it always seemed/seems like a good prospect.

There is also the monthly production  report which reports a reduction in output as a result of maintenance work on the gas processor. Another good reason to build their own plant. (which is  gathering steam.)

http://newsstore.fairfax.com.au/app...theage.com.au/apps/qt/quote.ac?code=hog&f=pdf
http://www.hawkleyoilandgas.com/med...ote-237/Hartleys-Research-Note-2-May-2012.pdf


----------



## Clansman (10 May 2012)

RNI said:


> HOG has been getting some good publicisity lately, one being from Alan Kohler's Eureka report where one of the articles analysed approx 111 junor oil & gas coys (from memory) with the first requirement being that they were finacially secure. HOG came 2nd best from all these, losing the top position only because of it's tenements being in the Ukraine and the still (presumed) higher political risk there. However we have had access to the latest news on this factor where the new management have stated that issue has moderated somewhat due to the change of government and also the strong need/desire to become self sufficient in supplying the country with their own gas (as against being dependent on Russia) and this factor was opening more doors for the o&g companies which operate there.
> 
> Today's rise was good to see and is much closer to the magic $30 mark
> 
> Presume we will have to wait for the end of month report for any news, but good to see todays effort.




I'd be interested to know which stock was ranked above it?


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## RNI (25 May 2012)

It was SUR


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## basilio (31 May 2012)

Hmmm.. Some interesting action brewing on the Flying Pig front.

There was a sharp rise yesterday in the last minutes of trading yesterday .  Up 1.5c from 18c.

The market at the moment has a horde of buyers looking to push the opening price to 21c !  Suggests some strong imminent announcement. Possibly reserve upgrade ? 

Given the precarious nature of the stock market overall this is going against the trend.


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## Flipper (27 June 2012)

Anyone buying more of HOG at 16c?


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## RNI (21 July 2012)

Flipper said:


> Anyone buying more of HOG at 16c?




Yes I certainly am buying heaps and must admit I am trading it between 16c and selling at 18c which is giving me more and more as I believe when ever the whole global situation EVENTUALLY sorts itself out and the markets return to some sort of normality, and also the gas plant is built and Soro 202 is completed and 203 also, and  production is tripled and they sort out what to do with Chets, THEN AND THEN ONLY WILL hog show it's true colours. I think it is a ripper of a stock, hence getting more and more.

The world situation, Europe, China America Japan and on and on.... is very bad and playing havoc with normal trading, people do not know what is going to happen next and are scared. One bit of bad news and everythimg collapses, but this has also happened time and time again, even worse with wars etc, and eventually it sorts itself out and the market recovers. We are going through that and the hard part is we don't know how long it will last. THAT IS THE PROBLEM so good stocks are not acting as they would normally do, and why I am biding time and taking the opportunity to trade hog and thus get piles more for when the tide turns.


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## basilio (29 August 2012)

HOG should be up for some very positive news in the next few days.  SORO 202 has hit paydirt and it will be a question of how much gas and oil production will increase with the second well. 

Current gas and oil productioon will rise anyway because the local gas plant has finished its maintenace program which was reduced output by approx 30%.

The current SP of 23.5c is barely above its list price before they found gas/oil and begain production! Has to be a rerating soon.


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## prawn_86 (29 August 2012)

basilio said:


> The current SP of 23.5c is barely above its list price before they found gas/oil and begain production! Has to be a rerating soon.




Yes i bit the bullet and bought more recently (last week). I just can't see why it is so under-rated and it seems as though management have been hitting all their targets so i'm happy to go with my instincts


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## poverty (29 August 2012)

I've been holding a long time with an average price of 34c. Starting to think i may be in positive territory soon, but i've been let down before.  More wells + their own gas plant over the next 12 months should see some big gains IF all goes well.


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## RNI (5 September 2012)

Great news out last week. They have reached the target depth for soro 202 safely and run casing, so that automatically means double production with now 2 wells draining the B18, so great news there, and also they have successfully reached B19 which they were appraising during this last drill which is said (by moyes & co) to hold more gas than all of soro B18, so more good news there.

Then there is more still. They also found EXTRA GAS from another section of B19 which , if commercial could mean a whole lot more resourse not accounted for as yet. This is BIG news indeed. Read the latest ann out recently.

If it wasn't for the depressed share market conditions due to the Euro situation plus the US and China too, then this would have flown on that latest report possibly to about 30cps.

Needs to be watched closely as we await results from more testing to confirm this extra GREAT discovery.


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## basilio (6 September 2012)

RHI I agree that the announcement looks potentially very good. And in another market the SP would have already reacted sharply.

Somehow very few investors are leaving any money on the table at the moment. If there is a profit no matter how small its taken. Very discouraging.  Lets see what happens here. ..


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## RNI (9 September 2012)

Basilio

I have a lot of faith in HOG. I really think that now they have 2 wells and plans for soro203 for last quarter 2012, also the start of the new processing plant, also the good discovery with B19, and to cap it all off if the EXTRA discovery in the lower/B18/B19 which has not yet been accounted for in the Moyes report is very exciting. Of course it needs to be tested to see if flows are sufficient to be commercial, but if they are this is going places imo. Without that the latest valuation is 67cps so that gives an idea of maybe what it could be then valued at all being well. I have a heap of them and have been accumulating over a good while now so I think if all testing is positive, it won't be ignored for too much longer, even with the world situation as it is.


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## basilio (11 September 2012)

Hi RNI

I once had a lot of hope for HOG and still have a holding.  As I said on paper it seems very undervalued - in particular considering the current Soroch 2 drill.

*So in light of all this why is the SP so soft?* There seems to be complete disconnect between supposed valuations and what people are prepared to pay for shares and their willingness to actually stay in the sharemarket.  The other troubling factor is that we actually havn't had a real crash in the market. But HOG and a hundred other similar spec shares are just falling away day by day and refuse to rise on almost any news.


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## mr. jeff (11 September 2012)

basilio said:


> Hi RNI
> 
> I once had a lot of hope for HOG and still have a holding.  As I said on paper it seems very undervalued - in particular considering the current Soroch 2 drill.
> 
> *So in light of all this why is the SP so soft?* There seems to be complete disconnect between supposed valuations and what people are prepared to pay for shares and their willingness to actually stay in the sharemarket.  The other troubling factor is that we actually havn't had a real crash in the market. But HOG and a hundred other similar spec shares are just falling away day by day and refuse to rise on almost any news.




I understand your frustration. It is meandering along with no clear direction. I have left it alone and am watching for some re-invigoration possibly in the way of a takeover by a company looking for that Ukraine area exposure which is valuable, but difficult to work with. Too much work, not enough headlines!

Greener pastures at the moment.


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## basilio (2 October 2012)

So how long does it take to measure gas and oil flows? And what are the flows in the B19 horizon? 

Its been over three weeks since Soros 202 hit paydirt and we havn't had a peep. Perhaps of more concern is the SP has steadily fallen despite the promise of a significant jump in production  and reserves. 

I remeber when the first well hit paydirt there were quite quick oil and gas flows reported which certainly encouraged interest. Any thoughts ?


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## basilio (2 October 2012)

Can't believe this...

I have a little bleat about the slow mo collapse of HOG's SP and lack of activity.

30 minutes later there is a flurry of buyers and the SP goes up 11%.  Is there an announcement in the wind or have I just jogged a few peoples memory of what should be happening soon ?


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## nchardon (5 October 2012)

Announcement released today - HOG is buying the gas plant near Sorochynska total expected expenditure approx 2.5 million as opposed to 5.5 million for building their own. Expected cost savings of 200k to 250k a month = 2.4 - 3 million saved a year! It will pay for itself in the first 12 months. 

I think I will top up today.


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## WRONG'UN (5 October 2012)

Sounds great - say $2.7m average savings, for 20 years, at a 5% discount rate = an NPV of about 12c per share. More that half the mc on the savings alone!


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## WRONG'UN (9 October 2012)

Putting it another way, the NPV of $2.7m annual savings for say 20 years, at 5%, = around $40m. Buying $40m worth of savings for $2.5m sounds like a good deal to me.

And the company hasn't actually said what production the savings are based on - if it's current production you would think there would be even greater savings as production increases.


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## basilio (22 November 2012)

So its now Nov 21st and HOG announces they have cleaned up the Soros 202 drill and will start to do flow tests.... 

*They hit paydirt on Sept 5th almost 10 weeks ago.*  I hope I'm wrong but the slowness of news and total lack of enthusiasm from the company suggests this could be a very ordinary well with marginal gas flow. I remember that the original belief was that production would be substantially boosted with  possible extra large reserves identified in the lower horizons.

On the strength of the very limited information date that seems so unlikely. And the SP has dropped from 23c at the time of the strike to its current 19.5c . Merde !!

Anyone else have any ideas on this ?

http://newsstore.fairfax.com.au/app...theage.com.au/apps/qt/quote.ac?code=hog&f=pdf


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## WRONG'UN (22 November 2012)

Trying to be optimistic, what about about the gas plant they are buying - not much point rushing Soro 2 into production and then paying through the nose to get the gas processed at the present plant - may as well keep it in the ground and put it through their own plant when it is available.

There may also be a cash flow issue - mitigated by banking the regular income from Soro 1, while adopting a go-slow cash burn rate at Soro 2.

That said, the "in due course" reference is a bit nebulous - surely they know roughly how long the testing is expected to take, and after that how long it would take to get the well on stream , assuming it is commercial, and also how long it will be before their gas plant is processing. In others words, what is the programme?

I put the sp performance down to the general market sentiment - and there are a lot of energy charts that are a lot worse.

Just some thoughts.


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## WRONG'UN (22 November 2012)

ps

Instead of "a cash flow issue", it might be better to say "sound commercial reasons".

Also remember that they took a lot of care with Soro 1, which paid off with enhanced production rates. It would be fair to assume they are taking the same care with Soro 2.


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## nchardon (28 November 2012)

New announcement, what do people think? Is there commercial quantities of gas?


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## nchardon (5 December 2012)

I am a bit confused, isnt Well 202 flowing at a commercial rate good news? Why the massive falls in SP? I understand they havent been able to give an accurate assessment on average rates, but from what I understand it is still commercial ie extra $$$


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## WRONG'UN (6 December 2012)

It looks to me like it's got 12c in its sights - I guess that will happen when they announce stable gas flows similar to or better than Soro 1, and an early on-stream date for their gas processing plant!


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## WRONG'UN (11 December 2012)

Chink goes another half cent in the remorseless slide to oblivion! A princely $32,000 odd changed hands today, almost a staggering 0.1% of the mc of the company! The big spenders are out in force!

I wonder what is happening (not happening?) about that gas plant they said they were buying?

Seven days since the last gas flow non-report - I thought they were doing 24 hour flow tests? - there have been seven days in the last week as far as I know - I suppose (hope) we'll hear some results "in due course".

I'm still giving them the benefit of lousy sector bias, but the patience is getting thin!


----------



## nchardon (12 December 2012)

WRONG'UN said:


> Chink goes another half cent in the remorseless slide to oblivion! A princely $32,000 odd changed hands today, almost a staggering 0.1% of the mc of the company! The big spenders are out in force!
> 
> I wonder what is happening (not happening?) about that gas plant they said they were buying?
> 
> ...




I hear what your saying!!!!! They are certainly taking their time to announce their gas flow rates and let the share holders know what progress has been made with the gas plant, meanwhile confidence is waning and people have been selling out.


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## WRONG'UN (12 December 2012)

Oh well, if it's any consolation, at the beginning of August the LNC chart was looking like the current HOG chart - heading into oblivion - since then it's more than doubled!

So you never know!


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## nchardon (16 December 2012)

WRONG'UN said:


> Oh well, if it's any consolation, at the beginning of August the LNC chart was looking like the current HOG chart - heading into oblivion - since then it's more than doubled!
> 
> So you never know!





The company is frustratingly slow in releasing details concerning this new well.


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## nchardon (18 December 2012)

And the downward trend continues... with no sign of recovering despite the moderatley positive announcements from management.


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## WRONG'UN (18 December 2012)

Looks like it's you and me, mate! Any other holders out there?

There's an old adage - the only good stock is rising stock! I know, I should be in something else - there are enough to choose from!

But there's only one thing worse than seeing a stock slide like this, and that's selling out in disgust, and then seeing it rocket up! It's real frying pan into the fire stuff!

Being positive, that was a comprehensive enough announcement - it sounds like the well will be on stream within a relatively short time frame, with more to come down the line.

In the meantime, I wonder what is happening with the gas plant purchase.


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## nchardon (20 December 2012)

WRONG'UN said:


> Looks like it's you and me, mate! Any other holders out there?
> 
> There's an old adage - the only good stock is rising stock! I know, I should be in something else - there are enough to choose from!
> 
> ...





I agree, nothing worse than selling out and watching it climb back up, been there and done it before. I am confident in the HOG share price rising after the second well is onstream and the physical cash starts flowing into the coffers. The price dropped down to .12 around this time last year with the chets failure, where it remained for a month or so before climbing up to the high .20's.

So as long as the company continues to turn a profit, and 202 is a commercial well which the company has indicated, the aquisition of the gas processing plant which will save upwards of $2 million a year (essentially paying for itself in the first twelve months) I see no reason to drop out of HOG and sell my stock at a loss, because others only in it for a quick buck bail out when they see their holdings dip into the red. It is times like this which is perfect to top up on cheap stock as I continue to do.

I predict an SP rise over the next 6 months, so wont be bailing out just now. It takes time (years) to drill wells, bring them online and build a company up from practically scratch as HOG has done over the last couple of years. So I am in it for the long haul. And I do believe it will pay off in the end.


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## WRONG'UN (22 December 2012)

So I am in it for the long haul. And I do believe it will pay off in the end.

In spite of my grumbling, that's how I see it too.

The recent volume has been pretty tiny - most of the 287million shares on issue are sitting tight.

Merry Xmas to all holders, and may 2013 be the year our patience starts to pay off.


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## Garpal Gumnut (22 December 2012)

WRONG'UN said:


> So I am in it for the long haul. And I do believe it will pay off in the end.
> 
> In spite of my grumbling, that's how I see it too.
> 
> ...










If it drops further I would get out, it needs to find support on the charts as it did in Feb 12. The weekly volumes are small on the chart above, so if it drifts lower on low volume it means nobody wants to buy, and if it goes lower on high volume it means the last sellers are getting out.

I don't hold but would buy on a reversal on high volume, planning to sell at 25c with the poor bastards who bought at that price or higher in April 12.

gg


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## poverty (25 December 2012)

http://www.hawkleyoilandgas.com/med...10-72/well-test-exceeds-expectations-30-8.pdf

http://www.hawkleyoilandgas.com/med...orochynska-202-Completion-Update-17-12-12.pdf

There's something very very fishy about this company 

Props to the HC poster who discovered this.


----------



## prawn_86 (25 December 2012)

poverty said:


> http://www.hawkleyoilandgas.com/med...10-72/well-test-exceeds-expectations-30-8.pdf
> 
> http://www.hawkleyoilandgas.com/med...orochynska-202-Completion-Update-17-12-12.pdf
> 
> ...




What are you trying to say? Simply linking 2 anouncements made 5 months apart doesnt seem to indicate anything fishy to me


----------



## poverty (25 December 2012)

prawn_86 said:


> What are you trying to say? Simply linking 2 anouncements made 5 months apart doesnt seem to indicate anything fishy to me




Have a look at the picture in each ann.  the supposed pic of well 202 cleaning out is the exact same pic they used in 2010 from another well.  They've changed the date on the timestamp but even left the time 22:41.  They some funny guys over at HOG.


----------



## prawn_86 (27 December 2012)

Announcement out today witht he supposed correct photo. No explanation as to why they doctored the date on the time stamp, just said it was an 'administrative error'


----------



## WRONG'UN (4 January 2013)

Notwithstanding the downright incompetence in posting the wrong photo, the absence of an explanation as to why the date was altered is inexcusable.

Why hasn't the ASX demanded a satisfactory explanation? They are very quick to issue "speeding tickets" for minor surges in a share price - how about some action when there is a serious credibility issue?


----------



## basilio (4 January 2013)

Looks really dodgy doesn't it ? 

Very hard to understand why the SP has fallen so low - unless there is some significant problem that we havn't heard about.

The first well should still be producing good gas and oil. There should be progress with the new gas plant.  The seeming failure of the second drill is a mystery. There appears to be little confidence in the stock.


----------



## nchardon (7 January 2013)

prawn_86 said:


> Announcement out today witht he supposed correct photo. No explanation as to why they doctored the date on the time stamp, just said it was an 'administrative error'




I think someone got fired LOL

I understand a photo mix up and using the wrong photo but doctoring the time stamp!? This is a grave breach!!!! Makes you wonder what else is doctored.


----------



## WRONG'UN (7 January 2013)

I'm out.


----------



## Garpal Gumnut (7 January 2013)

WRONG'UN said:


> I'm out.



Why mate?

gg


----------



## WRONG'UN (8 January 2013)

The altered date on the photo, and no explanation.


----------



## Garpal Gumnut (8 January 2013)

WRONG'UN said:


> The altered date on the photo, and no explanation.




Fair enough. Good reason.

It's been in a tight trading range since 11 Dec 2012 on very low volume.

This may surprise.






gg


----------



## Sdajii (9 January 2013)

WRONG'UN said:


> The altered date on the photo, and no explanation.




I would find it impossible to accept that level of deception and dishonesty too. A company won't do that unless there are some big problems, and they won't be that blatant and obvious unless they're desperate and/or completely incompetent.


----------



## prawn_86 (18 January 2013)

Up nearly 18% today and closing on the high on increased volume ofver the last 2 days. No news released, looks as though you may have been right GG.

From a fundy perspective this co is still making enough money to cover drilling and should have its own gas plant coming online soon which will reduce costs even further.


----------



## nchardon (22 January 2013)

prawn_86 said:


> Up nearly 18% today and closing on the high on increased volume ofver the last 2 days. No news released, looks as though you may have been right GG.
> 
> From a fundy perspective this co is still making enough money to cover drilling and should have its own gas plant coming online soon which will reduce costs even further.




HOG is finally getting some wind back into it's sails! I expect a company announcement soon as we near the end of the month.


----------



## prawn_86 (23 January 2013)

nchardon said:


> HOG is finally getting some wind back into it's sails! I expect a company announcement soon as we near the end of the month.




On the money there. Ann today that their latest well is flowing at commercial rates and their gas plant should be ready mid Feb which will decrease costs and increase cash-flow evern further.

Looks as though someone had this news a few days early...


----------



## nchardon (24 January 2013)

prawn_86 said:


> On the money there. Ann today that their latest well is flowing at commercial rates and their gas plant should be ready mid Feb which will decrease costs and increase cash-flow evern further.
> 
> Looks as though someone had this news a few days early...




Has anyone heard of any further development plans such as new wells?


----------



## basilio (24 January 2013)

Doesn't seem as if any significant players are taking HOGs announcements seriously.

The announcement of a commercial gas flow from Soros 202 and the near completion of the company owned gas plant should increase real cash flow by at least 30%.  And it was already doing well. 

And yet the SP is looking sicker than a mangy dog !! Perhaps there is just no confidence in the whole HOG picture.


----------



## nchardon (24 January 2013)

basilio said:


> Doesn't seem as if any significant players are taking HOGs announcements seriously.
> 
> The announcement of a commercial gas flow from Soros 202 and the near completion of the company owned gas plant should increase real cash flow by at least 30%.  And it was already doing well.
> 
> And yet the SP is looking sicker than a mangy dog !! Perhaps there is just no confidence in the whole HOG picture.





Looking at HOG's chart history over the past year concerning SP rises there is always a small sharp rise of several cents followed by a slight fall in share price over a few days before another rise exceeding the initial.

The initial rise usually comes a few days before a positive announcement (I assume people privy to the good news is my only guess), upon the announcement the share price flatens or drops, before rallying again and soaring past the initial high of the preceeding days.

I imagine with Hogs history a lot of people are waiting to see where this goes, whilst balking at putting any money of their own into the stock. I think we will need a concrete financial statement from the company showing the exact dollar figures before the big players put any money in, which hopefully will be out end of March (considering the mid Feb connection date to the Gas facility).

Again I am remaining patient on this one and holding, whilst anticipating a rise to the 18c - low 20c levels over the next few weeks leading up to Mid Feb, with anyones guess to how high or low it goes upon commercial production of 202 and the new gas facility being brought online.

No matter the case the SP is way under valued considering company assets.


----------



## nchardon (24 January 2013)

http://seekingalpha.com/article/110...t-could-profit-in-a-topsy-turvy-global-market

Target price of .72 sounds nice


----------



## basilio (24 January 2013)

We saw lots of interesting target prices for HOG Nchrdon... but it has just tanked all the way. And I agree it is way undervalued. 

Something I did notice at close of trading. It had slumped to 15c during the day. Then someone put in a 10000 share bid at 17c which just managed to lift the SP by a hefty 14% in a little stroke.  Some nice managing of the price I suggest.


----------



## ColB (24 January 2013)

basilio said:


> We saw lots of interesting target prices for HOG Nchrdon... but it has just tanked all the way. And I agree it is way undervalued.
> 
> Something I did notice at close of trading. It had slumped to 15c during the day. Then someone put in a 10000 share bid at 17c which just managed to lift the SP by a hefty 14% in a little stroke.  Some nice managing of the price I suggest.




It's quite odd Bas.  A market release in the past day or so confirming HOG's own gas processing plant coming on line soon to add to their profit margin and the Sorochynska 202 well seems to be going ok too.  Someone was bailing out today and you are right about the controlled buy at market end to prop the SP back up.

At least our LNC shares are going good!


----------



## nchardon (25 January 2013)

ColB said:


> It's quite odd Bas.  A market release in the past day or so confirming HOG's own gas processing plant coming on line soon to add to their profit margin and the Sorochynska 202 well seems to be going ok too.  Someone was bailing out today and you are right about the controlled buy at market end to prop the SP back up.
> 
> At least our LNC shares are going good!




with a .13c to .19c rise in the last week it is possible someone was profit taking, the drop was on relatively low volume compared to the rise.


----------



## nchardon (31 January 2013)

The price continues to wittle itself down after the dramatic rise of two weeks ago


----------



## ChrisJH (1 February 2013)

I can't see anything positive for the SP of HOG. Announcement of gas plant to be commissioned within just a few weeks, more gas flowing, and the SP is struggling to maintain 0.15c. I'd like to be positive and think that once the plant is actually going, and more gas flowing, that the SP may have a resurgance; but I do not believe that there is much faith in this company. Besides what happens if they don't successfully find anything additional to what is flowing now?

I'll be ditching this stock if it goes up a little with the new gas plant.


----------



## nchardon (1 February 2013)

ChrisJH said:


> I can't see anything positive for the SP of HOG. Announcement of gas plant to be commissioned within just a few weeks, more gas flowing, and the SP is struggling to maintain 0.15c. I'd like to be positive and think that once the plant is actually going, and more gas flowing, that the SP may have a resurgance; but I do not believe that there is much faith in this company. Besides what happens if they don't successfully find anything additional to what is flowing now?
> 
> I'll be ditching this stock if it goes up a little with the new gas plant.




I see where you are coming from, HOG is a very speculative stock, but that is the beauty of it, its high risk, therefore the potential to make a lot of money or loose your money. So it is a gamble. 

Finding Oil & Gas, Drilling for it, aquiring new leases etc takes a lot of time and money, and things dont happen over night. With a couple of hundred million shares on offer, and only half a million or so of these making the big changes in price I am not to worried yet. It is when the big guys start off loading their shares that is when I will be worried.

For now I wait and occassionally pick up some more stock at bargain prices, as I have said and a few others .15c is way under valued and I think it will take time to build up the SP again.


----------



## ChrisJH (3 February 2013)

I see and understand what you are saying, Hardon, but people are always harping on about how this speccie, or that speccie is underavalued. People were going on about HOG being undervalued when it was 38 cents, and it's done nothing but lose value since. 

The problem I see with HOG (and yes, I own it) is that it barely moves up when there is positive news for the business, and it drops dramatically when there is bad news. It is a gamble, yes, but... what does HOG have going for it that is going to encourage an increased SP?


----------



## WRONG'UN (3 February 2013)

A plausible explanation for the altered date on the photo might help - I'm still out.


----------



## Clansman (4 February 2013)

WRONG'UN said:


> A plausible explanation for the altered date on the photo might help - I'm still out.




The replacement photo had no date.:1zhelp:


----------



## RNI (4 February 2013)

I am still keen on HOG. Once S202 is up and running and the new gas plant is all joined in to them that should make a difference. Having the gas plant will save them $$$$ and also help with some increase in production too, so all in all they are doing ok all things considered. The are managing the financial side well really and have to cope with working with very old equipment and at times freezing conditions, and to keep the peace with locals they are using locals also.

When S203 comes along and if it is successful then is the time I would expect to see a marked rise in the sp and a stabling at that new level. They have also discussed purchasing more acreage in Ukraine so they are also growing the company too which will also help if and when that occurrs. At least it is not back to 10-12cps!!!


----------



## nchardon (5 February 2013)

RNI said:


> I am still keen on HOG. Once S202 is up and running and the new gas plant is all joined in to them that should make a difference. Having the gas plant will save them $$$$ and also help with some increase in production too, so all in all they are doing ok all things considered. The are managing the financial side well really and have to cope with working with very old equipment and at times freezing conditions, and to keep the peace with locals they are using locals also.
> 
> When S203 comes along and if it is successful then is the time I would expect to see a marked rise in the sp and a stabling at that new level. They have also discussed purchasing more acreage in Ukraine so they are also growing the company too which will also help if and when that occurrs. At least it is not back to 10-12cps!!!




I tend to agree with RNI, time shall tell


----------



## WRONG'UN (5 February 2013)

Clansman said:


> The replacement photo had no date.:1zhelp:




Quite right - it's predecessor had the funny date - still no explanation as to why.

In the meantime, the market depth looks bullish - hmm.


----------



## nchardon (6 February 2013)

WRONG'UN said:


> Quite right - it's predecessor had the funny date - still no explanation as to why.
> 
> In the meantime, the market depth looks bullish - hmm.






 ¿Ukrainian contractor to lazy to go out in -20c to photograph the new well?


----------



## WRONG'UN (6 February 2013)

nchardon said:


> ¿Ukrainian contractor to lazy to go out in -20c to photograph the new well?




That's the best (only) explanation I've heard so far.


----------



## nchardon (20 February 2013)

Nice to know Roger Montgomery has HOG as a stock to watch

http://www.youtube.com/watch?feature=player_embedded&v=HKiFVdPlcsA#!


----------



## basilio (1 March 2013)

March 1st.  HOG still hitting new lows and not a peep about the new gas plant , production from Soros 202 anything.

The damn dog must be totally obese eating all that homework :frown:

It will be so fascinating to see what the end of month report looks like...


----------



## poverty (3 March 2013)

Pepper your angus for the usual exorbitant administration costs.  This company is fleecing shareholders dry.


----------



## McCoy Pauley (6 March 2013)

nchardon said:


> Nice to know Roger Montgomery has HOG as a stock to watch
> 
> http://www.youtube.com/watch?feature=player_embedded&v=HKiFVdPlcsA#!




To me, that is a sign to stay clear.


----------



## basilio (8 March 2013)

I fear something ugly is going to be announced by  the  stuffed pig.... :frown::frown:

The SP is falling relentlessly when we are supposed to waiting on confirmation of a new producing well and a cost efficient new gas production system.  IMO if these were actually on track we would have either heard about their success or insider buying would be supporting the price.

It looks as if there is a substantial loss of confidence in the company.


----------



## ChrisJH (8 March 2013)

basilio said:


> I fear something ugly is going to be announced by  the  stuffed pig.... :frown::frown:
> 
> The SP is falling relentlessly when we are supposed to waiting on confirmation of a new producing well and a cost efficient new gas production system.  IMO if these were actually on track we would have either heard about their success or insider buying would be supporting the price.
> 
> It looks as if there is a substantial loss of confidence in the company.




WTF? 10.5 cents? What's up with this dog of a company? Gas plant explode before commission?


----------



## slipage (11 March 2013)

ChrisJH said:


> WTF? 10.5 cents? What's up with this dog of a company? Gas plant explode before commission?





Seems like we will know later in week by today's update..


----------



## basilio (13 March 2013)

slipage said:


> Seems like we will know later in week by today's update..




Its a puzzle..If the gas plant is running at the very least the gas from Soroch 201 is now 30% more valuable.

Surely there has to be some extra gas/condensate flow from Soroch 202.  And the SP is still at all time lows. It will be be fascinating to see the story.


----------



## nchardon (13 March 2013)

I concur, very interested in where this goes


----------



## skivvy (13 March 2013)

Technically the chart looks weak to me and the increased volume with the drop from support at 13 c is concerning, holding above 11c waiting on news. It is evident that no recent news on the 2nd soro well is hurting the stock.  It is tempting to buy more at this level but i have lost a bit of faith in mgmt of late and trying to catch a falling knife is risky! I agree that the initial flow rates for this well were inconclusive but still hopeful that we will see a positive Ann soon re the flow from the upper B18 once the formation fluid and slugs are cleaned out.  The production facility should be commissioned by now, so maybe two pieces of info in the one announcement.  things happen slowly with this stock from drilling wells to releasing info????

disc: stock held


----------



## emile33 (14 March 2013)

Some things changed in the past year.
1. Management out and in. Changes.
2. The monthly update miss that one (not many company ´s have that open communication)
3. IR gone or at least far away.
4. News flow is low.
5. Investors are waiting for the 202 results and the gasplant commissioning (should be by mid feb...)

- On the other hand we might have the combined (or quick followed up) news the 202 is in production and 
the commission of the gasplant. Should be good for the cashflow.
- Shareprice is near a low.

I think we have to wait for the news to come in soon and hope it is possitive.

GLTA 

discl: stock held


----------



## skivvy (14 March 2013)

The reply by hog to the price change query on Monday from the asx indicated an expected announcement this week on flow rates from soro 2?  Well tomorrow is the last day of the week, so lets see if that comes to fruition.  I will be watching the news feeds with anticipation.  There hasn't been any volume peaks this week so no leaks from the company it would appear.

GLTA


----------



## emile33 (15 March 2013)

skivvy said:


> The reply by hog to the price change query on Monday from the asx indicated an expected announcement this week on flow rates from soro 2?  Well tomorrow is the last day of the week, so lets see if that comes to fruition.  I will be watching the news feeds with anticipation.  There hasn't been any volume peaks this week so no leaks from the company it would appear.
> 
> GLTA




Be advised they may need the full friday too in the field, in that case you see the NR not today.

cheers


----------



## nchardon (15 March 2013)

Where is our update?


----------



## basilio (15 March 2013)

nchardon said:


> Where is our update?




Still down the hole.... that took our last X00K


----------



## nchardon (15 March 2013)

basilio said:


> Still down the hole.... that took our last X00K




LOL tis true


----------



## skivvy (15 March 2013)

emile33 said:


> Be advised they may need the full friday too in the field, in that case you see the NR not today.
> 
> cheers




Good point emile33! Well let's see what happens next week. Only seven trades today for less than 100k shares traded, no leaks yet!


----------



## emile33 (15 March 2013)

Well the anwers are partly in the latest release of today.
Gasplant should be online before end march if you read that.


----------



## basilio (18 March 2013)

The HOG Press release certainly explains the weakness of the SP>  

Yes the gas plant is up and running but Soros 201 is at reduced output and Soros 202 is still not producing.  The underground oil fields  are  "complex" - basiclaly not doing what they thought they would do.

I suppose at 11c HOG is at close to rock bottom. It is still producing cash and in theory could do much better .  

Maybe..

http://newsstore.fairfax.com.au/app...code=hog&get_prices=Get+prices+&+charts&f=pdf


----------



## poverty (18 March 2013)

Pepper your anguses for a capital raising, then it'll hit rock bottom.


----------



## prawn_86 (18 March 2013)

poverty said:


> Pepper your anguses for a capital raising, then it'll hit rock bottom.




I dont see why they need a capital raising, they are still CF positive and now that the expenses for the gas plant are out of the way this should increase even further.


----------



## nchardon (18 March 2013)

prawn_86 said:


> I dont see why they need a capital raising, they are still CF positive and now that the expenses for the gas plant are out of the way this should increase even further.




The latest announcements did not appease shareholders, people are selling out. This might go down further


----------



## prawn_86 (18 March 2013)

nchardon said:


> The latest announcements did not appease shareholders, people are selling out. This might go down further




I didnt say it wouldnt go down, i said i dont see the need for a capital raising (especially at these lows) when they are CF positive.


----------



## skivvy (18 March 2013)

I guess now we know why the delays in news on soroch 2, link the news in with the gas plant commissioning to reduce the impact on the sp.  still the troubles with the flow from the upper b18 is a problem, how big I am not yet sure.  Would like to hear from any oil/gas gurus on their interpretation of the issues with the lack of flow, poor pressure didn't seem to be an issue when shut in so not yet sure what it all points to.  Time will tell and with the macro economic situation the downward pressure on The sp is evident.
I agree no pressing need for a capital raise as the reduced costs with the new plant on line will be quickly realised, however I would like to see an increase in drilling activity to make the most of the gas plants capacity, cap raise or otherwise I would be considering it?


----------



## emile33 (20 March 2013)

skivvy said:


> I guess now we know why the delays in news on soroch 2, link the news in with the gas plant commissioning to reduce the impact on the sp.  still the troubles with the flow from the upper b18 is a problem, how big I am not yet sure.  Would like to hear from any oil/gas gurus on their interpretation of the issues with the lack of flow, poor pressure didn't seem to be an issue when shut in so not yet sure what it all points to.  Time will tell and with the macro economic situation the downward pressure on The sp is evident.
> I agree no pressing need for a capital raise as the reduced costs with the new plant on line will be quickly realised, however I would like to see an increase in drilling activity to make the most of the gas plants capacity, cap raise or otherwise I would be considering it?




But this is the 2nd well that did nt go well...


----------



## nchardon (20 March 2013)

emile33 said:


> But this is the 2nd well that did nt go well...




Third Time Lucky


----------



## emile33 (21 March 2013)

nchardon said:


> Third Time Lucky




I hope so because not much went by the plan so far...


----------



## emile33 (25 March 2013)

*News out new property*

Paid and 20 year license 100%  hog

Now bring all the stuff online. 

Cheers


----------



## nchardon (26 March 2013)

*Re: News out new property*



emile33 said:


> Paid and 20 year license 100%  hog
> 
> Now bring all the stuff online.
> 
> Cheers




Amen


----------



## emile33 (27 March 2013)

*Re: News out new property*



nchardon said:


> Amen




202 well update now out.


----------



## basilio (27 March 2013)

Not a good look for Soros 202.  Still stuffed up and no certainty that it will actually produce.

I believe Soros 201 is also declining in production so teh savinsg from the commissioning of the gas plant will be essential.


----------



## basilio (28 March 2013)

Seems like a large scale bailout of HOG at the moment. SP down to 8.7c.  The (alleged) fact that it is still producing gas and oil and making a profit appears lost.

IMO the company needs to provide an update on current production rates and returns to offer some assurance that it will stay solvent.


----------



## poverty (28 March 2013)

basilio said:


> Seems like a large scale bailout of HOG at the moment. SP down to 8.7c.  The (alleged) fact that it is still producing gas and oil and making a profit appears lost.
> 
> IMO the company needs to provide an update on current production rates and returns to offer some assurance that it will stay solvent.




Is it possible that 202 is not only a failure but has stuffed the pressure in the reservoir or something and sabotaged 201?  There must be something to the current share valuation.  Non-holder, rode this dog from 40c to 15c, thank christ I got out.


----------



## WRONG'UN (28 March 2013)

basilio said:


> Not a good look for Soros 202.  Still stuffed up and no certainty that it will actually produce.
> 
> I believe Soros 201 is also declining in production so teh savinsg from the commissioning of the gas plant will be essential.




You are right, Basilio. The the last histogram of production that I have seen was up to 30 June 2012 (this was in the last annual report) - it showed a declining trend. There were then the average daily Q4 2012 figures in the 31 Jan 2013 report. If you plot those figures on the histogram and extrapolate the trends to the present you get about a 50% decline from the peak flows of early 2011. And I recall mention of a bigger choke on recent flows than on the early ones. Notwithstanding the mitigating factor of the temporary slowdown at the third party gas plant, they need to get something out of S 202, and soon.

I've been out of HOG since 14c, but still keep it on the watch list - you never know, something good might still happen!


----------



## emile33 (29 March 2013)

WRONG'UN said:


> You are right, Basilio. The the last histogram of production that I have seen was up to 30 June 2012 (this was in the last annual report) - it showed a declining trend. There were then the average daily Q4 2012 figures in the 31 Jan 2013 report. If you plot those figures on the histogram and extrapolate the trends to the present you get about a 50% decline from the peak flows of early 2011. And I recall mention of a bigger choke on recent flows than on the early ones. Notwithstanding the mitigating factor of the temporary slowdown at the third party gas plant, they need to get something out of S 202, and soon.
> 
> I've been out of HOG since 14c, but still keep it on the watch list - you never know, something good might still happen!




Well i am not amused at all by this it looks verry amaturistic to me first a photo with a wrong date etc.
Mr. Paul Morgan please return you did well some years ago.


----------



## skivvy (1 April 2013)

202 looks to be in trouble and this does not bode well at all for increases in production in the short term. The recent Ann on the 18/3/13 did mention something about they believe that 201 and 202 may not be in direct communication so I don't believe that 202 is affecting the production rates from 201. 202 did flow initially on a 6 mm choke befor problems with the well, just not sure if they can clean it out or if there is something else going on like lack of formation pressure?  Other than this well, my immediate concern is the time it takes to drill another well and boost production although 201 looks to be producing ok to me. So if 202 is a fizzer, 203 might take another 6 months or more to complete.
Frustrating very frustrating.


----------



## WRONG'UN (2 April 2013)

I have complied the attached chart from reported company data - it shows more obviously the rapid decline in production from Soro 201.

The minimal effect of increasing the choke from 9mm to 10mm in Dec 2011 is apparent - if anything, after an initial spurt, it has accelerated the rate of decline! The original choke size was 8mm - it went up to 9mm about Sept 2011.

In the absence of any production data for 2013, and with the Dec 2012 production merged with the Q4 2012 figures, the last four months have been inferred by extrapolation - where are the monthly reports that the company used to put out when the well was churning it out?


----------



## skivvy (2 April 2013)

Nice post, thanks wrongun. Not trying to doubt your figures but in the qty update in jan 13, soro 201 produced 4.1 mcfgpd avge for the Dec qtr and in the gas plant commissioning Ann in march, they stated an avge of 3.6 on a 10mm choke prior to connecting to the new plant so the decline figures might not be so bad??
 Regular updates would be nice to see again, no arguments there.


----------



## WRONG'UN (3 April 2013)

Thanks Skivvy

I've replotted with 4.1 for Nov ("average" month for Q4 2012 - I had used 4.0), and 3.6 for March 2013. No March figures for condensate, so I've twisted that line up a bit to follow the trend in gas production.

It's still declining.

Cheers


----------



## skivvy (3 April 2013)

Yep it's still declining just like the sp
Hopefully the decline will settle and flatten out around 3 - 3.5 avge and the sp will move back up again!


----------



## skivvy (4 April 2013)

Wrongun, do you think the third party gas plant issues also impacted the production figures from soro 201? In my research last night the company did mention that over the last few months the third party gas plant restricted their output due to mtce issues and downtime at the production facility.  I guess next week we may find out as the company were planning to increase the choke from 8mm to 10mm on the new 100 percent owned plant as per their Ann on march 18th?  Would be nice to get a figure of high 3's on a 10 mm choke and some pos news on 202!!!!!


----------



## nchardon (5 April 2013)

skivvy said:


> Wrongun, do you think the third party gas plant issues also impacted the production figures from soro 201? In my research last night the company did mention that over the last few months the third party gas plant restricted their output due to mtce issues and downtime at the production facility.  I guess next week we may find out as the company were planning to increase the choke from 8mm to 10mm on the new 100 percent owned plant as per their Ann on march 18th?  Would be nice to get a figure of high 3's on a 10 mm choke and some pos news on 202!!!!!




Fingers crossed you are right skivvy!


----------



## WRONG'UN (5 April 2013)

You could be right Skivvy - time will tell. Let's hope they publish the April figures promptly, so we can see what's really happening with S 201's productivity.

I gleaned from the earlier reports that there was a maintenance period for the third party gas plant from 9 April 2012 until 17 July 2012. This hardly shows up in the monthly production over that period.

The last month on my chart was for the 10mm choke.

I had missed the fact that there were still issues with the third party gas plant "over the last 3 months". I wonder how significant they have been? The April production will answer that question.

In the meantime I'm still seeing a declining revenue stream from S 201, no revenue from S 202 (costs yes), $2.6m costs for the Stoliarovska licence and $4.8m in the bank as at 31 Dec 2012. It would be interesting to know if they can get through this without a CR.


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## skivvy (5 April 2013)

CR is on my mind as well, not the best time to go to the market for funding however.  Definitely need cashflow to come from 202 real soon!  
Interesting trading on the sp today, a lot of bot trading for small parcels but still some larger parcels went through as well, missed a buying opportunity today so will wait and see how things go next week.


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## basilio (16 April 2013)

The announcement  on Soros 202 was pretty sad.  No production from the Upper 18 so they are now looking at some value from the Lower 18.  But this will take at least 2 months or probably 5 months in HOG time.

So the SP continues to tank and is now .053 valuing the company at $15m.

The upside ? Soros 201 is still producing and with the advent of the HOG owned gasifer revenue should be up 30%.

I really wish management would make a clear statement about production and revenue and hopefully provide assurance that it is still solvent.

http://newsstore.fairfax.com.au/app...Type=0&submit=Search&section=summary&sortBy=0
 _____________________________________________________________

I had great hopes for the flying pig when it first burst on the scene.  I have long  since downsized my holdings but it still irks me to see the last bits steadily decimated.


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## skivvy (16 April 2013)

Basilio,
Agree the Ann on soro 202 was very disappointing, the upper b18 just doesnt have commercial rates in this location.  I have to say the lower b18 looks to have some issues with water penetration from behind the well casing and it is unproven as well.  I am very doubtful that this well will add any value to the company. I hope I am wrong?  The company will remain solvent in my opinion and with an update on production figures from 201 overdue, we need to see how they are going to move this little pig forward???
Some positive facts:
No debt
Own their own gas plant capable of rates of 11mmcfgpd currently and up to 90 with expansion
Low number of shares on issue relatively
100 percent own & operate sorochynska and stoliarovska production licences, add in Chernetska exploration acreage

Negative facts
One producing well on decline
Doubt over 202 producing
Drilling takes a long time to complete
Need additional cashflow / funds to ramp up drilling
Soro acreage needs further seismic analysis to understand the geology

Where to from here, down until some positive news!


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## emile33 (12 August 2013)

Still cashflow.... wonder if they can move the train forward again.... 

Shareprice very depressed now... perhaps to much.


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## Sdajii (14 August 2013)

Maybe they can change the date on a picture and reuse it to make things look good.


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## nchardon (16 August 2013)

Sdajii said:


> Maybe they can change the date on a picture and reuse it to make things look good.




LOL

I should have got out when that happened... no point in me selling out now I have already lost to much.


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## WRONG'UN (16 August 2013)

They need another producing well, and I doubt if they can finance one from the depleting Soro 1, so I'd be worried about a CR.

I don't want to sound like I'm rubbing salt into the wounds, but I got out at 14c, because of the photo debacle - it was an issue of trust and confidence. I took the loss and moved on - the loss was history, but I still had a choice regarding the future.

I invested the proceeds in SEH.

Good luck!


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## Sdajii (19 August 2013)

nchardon said:


> I should have got out when that happened...




I sure would have!



> no point in me selling out now I have already lost to much.




I really don't think that's a wise mentality for someone who trades or invests in stocks.


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## nchardon (14 December 2013)

On the rise again


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## basilio (16 February 2014)

Ah the flying pig has soared again!!  Up a massive 65% on Friday!!  
Naturally the management know nothing about the rise.

(_After a very promising and seemingly profitable beginning this has been an absolute disaster.  Closing price on Friday 3.7c up 1.4c on day. Three years ago it ran to 50c plus.. _.)


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## WRONG'UN (16 February 2014)

I dumped this dog over a year ago, at 14c, and have no regrets.

Speeding tickets by the ASX are a joke, I don't know why they bother.


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## easylikesunday (17 June 2014)

Sorry in advance, I'm a stock novice, but what is this deal with this stock?

Back in the AUT days I remember a wise man by the name of Condog who held this stock and praised its potential future.

It then ran to 50 cents. Can somebody shed some light into what went wrong? Its my understanding that this company still makes money? Does it make the same as it did in the 50 cent days?

It just seems very cheap for such a small company that has a reasonable turnover?

hmm, maybe Im just tired, Im on nightshift


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## basilio (17 June 2014)

HOG  has  been  very frustrating  and costly stock.

It did start out with a bang proving up a profitable first drill in its Ukrainian holdings in 2011. This well was producing oil and gas from day one and the company was cash flow positive. As you noted the shares shot to 50c with the promise of even better times when the next drills hit paydirt...

But the next drills didn't hit paydirt. There were long delays and then disappointment after disappointment as the so called "certain" oil /gas profiles failed to produce any commercial quantities. 

In 2014 it still has it's original oil/gas producing well and hopes that it will make another successful strike.  It's probably undervalued  given it is actually producing cash but my guess is that all the original investors (myself included) have learnt a bitter and expensive lesson.

Incidentally all the original stories and promises for HOG are still on their website.


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## junior share (18 June 2014)

Compressor works fine. Hope they can close some sort of a pre/production deal soon to generate more cashflow.
It is cheap indeed.
GLTA


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## WRONG'UN (18 June 2014)

At their last report they had $726k cash, as at 31 March. Their cash flow for the previous 3 months was negative $909k. At that rate of depletion they should be just about out of cash, right now.

The current rise could be a pump followed by a capital raising.

On the other hand, if Russia turns off the gas, local product could be a good thing to have.

Too risky for me.


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## junior share (19 June 2014)

Don't think it is a pump and dump... More like a oversold stock recovering some what.


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## easylikesunday (19 June 2014)

Running an amateur eye over the charts etc, it doesn't look too bad. Hopefully it can turn around. Maybe see 0.035 soon? 

The volume is starting to creep up and the buyers are heavy (9.2 million) to sellers (2.4 million)

Hopefully, I use that word a bit, well 202 is a goer. Fingers crossed.


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## WRONG'UN (20 June 2014)

Well it looks like Russia have turned off the gas.

http://www.wallstreetdaily.com/2014/06/18/gazprom-cuts-off-ukraine-gas-supply/


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## easylikesunday (20 June 2014)

WRONG'UN said:


> Well it looks like Russia have turned off the gas.
> 
> http://www.wallstreetdaily.com/2014/06/18/gazprom-cuts-off-ukraine-gas-supply/




Do you see this having any impact on HOG? Considering they are only a small player in the gas game?

Good crystal ball ya got there too mate!


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## WRONG'UN (20 June 2014)

It's probably worth doing a sensitivity check on the effects of a change in the gas price on their cash flow - going back through the recent reports and doing some sums with say a doubled gas price.

Very roughly, they had an income of $1.8m last quarter, about 75% of which was gas (the rest was condensate), or $1.35m
They had negative cash flow of $909k over the same period.
So, all other things being equal, if the gas price doubled (and condensate stayed the same), they would have an extra $1.35m, so they would have positive cash flow of about $400k, or $2m for a year, compared with their MC of c$5.5m, or a rough P/E of 2.75.

Of course, there are a few of assumptions made above, and it's all very "what say" - who would know what will happen next. Having said that, prices can spike rapidly if external factors put the squeeze on - you never know.

Maybe HOG is already moving up on speculation?

By the way, there are plenty of other stocks on the market that would also do very well if their underlying product doubled in price e.g. BMN.


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## junior share (21 June 2014)

The future is hard to predict. Management will  continue to look for a deal imo.


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## easylikesunday (21 June 2014)

WRONG'UN said:


> It's probably worth doing a sensitivity check on the effects of a change in the gas price on their cash flow - going back through the recent reports and doing some sums with say a doubled gas price.
> 
> Very roughly, they had an income of $1.8m last quarter, about 75% of which was gas (the rest was condensate), or $1.35m
> They had negative cash flow of $909k over the same period.
> ...




Hypothetically, if HOG was earning $2 million a year then it 'should' be worth somewhere around $31 million, or .10 cents a share, using a sector average P/E of 15.76 (http://www.reuters.com/finance/stocks/financialHighlights?rpc=66&symbol=HOG.AX)

Obviously this doesn't take into account public sediment, which has had a huge effect on this stock.

Anyway, I'm just sticking my nose in as I'm dabbling in shares again (found some money in a shoebox ) and I have always had an attachment to HOG. That and they made me a bit of money in the .55c days.

Thanks for the info fellas.


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## junior share (21 June 2014)

easylikesunday said:


> Hypothetically, if HOG was earning $2 million a year then it 'should' be worth somewhere around $31 million, or .10 cents a share, using a sector average P/E of 15.76 (http://www.reuters.com/finance/stocks/financialHighlights?rpc=66&symbol=HOG.AX)
> 
> Obviously this doesn't take into account public sediment, which has had a huge effect on this stock.
> 
> ...






Thats the spirit.... I be the buyer too....


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## WRONG'UN (21 June 2014)

easylikesunday said:


> Hypothetically, if HOG was earning $2 million a year then it 'should' be worth somewhere around $31 million, or .10 cents a share, using a sector average P/E of 15.76 (http://www.reuters.com/finance/stocks/financialHighlights?rpc=66&symbol=HOG.AX)
> 
> Obviously this doesn't take into account public sediment, which has had a huge effect on this stock.
> 
> ...




Quite right, Easy - and that's just on the production from their one producing well - they also have the value of their other licences, including the associated geotech from the two non-productive wells they have drilled, or is otherwise available. They need more cash than they have got to put down another well, but a farmout is on the cards.

Good luck


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## junior share (9 July 2014)

WRONG'UN said:


> Quite right, Easy - and that's just on the production from their one producing well - they also have the value of their other licences, including the associated geotech from the two non-productive wells they have drilled, or is otherwise available. They need more cash than they have got to put down another well, but a farmout is on the cards.
> 
> Good luck




Wonder what takes them so long to get a good farmout partner and close the deal...


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## junior share (30 July 2014)

*update*

Q2 numbers and update this week...


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## junior share (30 July 2014)

*Re: update*



junior share said:


> Q2 numbers and update this week...




In the green again....


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## WRONG'UN (15 August 2014)

*Re: update*

Just noticed this - I doubt if HOG will like it!

http://www.mining.com/web/who-needs-russia-ukraine-will-destroy-itself-with-new-gas-tax/


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## junior share (15 August 2014)

*Re: update*



WRONG'UN said:


> Just noticed this - I doubt if HOG will like it!
> 
> http://www.mining.com/web/who-needs-russia-ukraine-will-destroy-itself-with-new-gas-tax/




No i don t think they will....


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## junior share (11 October 2014)

*Trading halt*

....


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## easylikesunday (14 October 2014)

*Proposed Sale of Hawkley Oil and Gas Limited **Subsidaries to Black Star Petroleum Limited *

Hawkley  Oil  and  Gas  Limited  (“Hawkley”  or  “the  Company”,  ASX: 
HOG) announces that it has entered into a binding terms sheet for the proposed sale ("Proposed Sale") of Hawkley's four wholly owned subsidiaries:  Janita  Global  Limited,  Ukraine  Investments  Pty  Ltd, Ukraine  Gas  Investments  Pty  Ltd  and  Prime  Gas  LLC  ("the Subsidiaries")  to  Black  Star  Petroleum  Limited  ("BlackStar",  ASX: BSP). 
The Subsidiaries control all of Hawkley's Ukraine operations. 

The  consideration  to  be  paid  by  BlackStar  to  Hawkley  will  be 600,000,000  fully  paid  BlackStar  ordinary shares,  which  will  be distributed directly to Hawkley shareholders.

Following  completion  of  the  sale,  one  Australian  based  nonexecutive  director  nominated  by  Hawkley  will  be  appointed  to  the board  of  BlackStar.  Hawkley’s  Executive  Chairman,  Mr.  Glenn Featherby, will not be nominated for the board of BlackStar.


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## junior share (15 October 2014)

Merger has potential i think.


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## prawn_86 (15 October 2014)

junior share said:


> Merger has potential i think.




HI JS,

What potential do you think it has and why do you think that? The more info you provide the more likely you are to generate further discussion

Thanks


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## junior share (15 October 2014)

Black stars Nebraska Oil Project is within the Niobrara Formation and what i see correct me if i am wrong is they have to finish 3th drilling well do one frack on all three wells and than it could be a producer also. If this is all going to happen we have both production in the Ukraine (201) and the USA (more investor friendly and no war in the area)
There are risks of course but thats live and since the ukraine is a bit unpredictable spreading the risk is best i ques.


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## junior share (3 November 2014)

junior share said:


> Merger has potential i think.




However it is not a  merger. Spreading the risk is a good thing for the company.


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## junior share (24 November 2014)

is bad luck ever coming to an end here?
Trading halt again 201 production decrease.


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## junior share (24 November 2014)

*blackstar cancels the hog deal...*

no many of the hawkleys nr's had been finalised iaw what they had in mind last year or so.


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## basilio (24 November 2014)

The HOG has been barbecued....

Seems like the well has dried up and there ain't nothing left to sell. Sad.


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## junior share (11 December 2014)

*Trading halt*

again.... 
If this is in line with all the bad news they released in the past year it can't be good this time too.... Hope i am wrong.


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## junior share (4 February 2016)

*HOG - Hawkley Oil and Gas news*

http://203.15.147.66/asx/research/company.do#!/HOG


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## junior share (1 October 2016)

Gave up the hope here glta


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## easylikesunday (28 March 2017)

Ok followers.. This one worth a punt? New board, $2mill market cap, in 'talks' with potential deal.

I have been a long time follower/investor of old HOG, and I'm back in. I heard a heartbeat....


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## basilio (3 April 2017)

easylikesunday said:


> Ok followers.. This one worth a punt? New board, $2mill market cap, in 'talks' with potential deal.
> 
> I have been a long time follower/investor of old HOG, and I'm back in. I heard a heartbeat....



Certainly you heard a heartbeat. It was the pitter patter of the new/old Board looking for some fresh meat. Perhaps they can dust off some old promising oil wells....


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## peter2 (3 April 2017)

That heart beat was just an electronic blip as the overnight cleaner unplugged the life support to use the plug for the vacuum cleaner. No need to get excited here. The patient is just as dead as before.


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