HOG - Hawkley Oil and Gas

[isplicer]

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
- revenue can be increased to $5m per month when desirable
- own gas plant to be built early next year which will make OPC go from 45% to 60%
- 3 more wells to begin drilling this year
- extremely cheap compared to peers

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]

So who's taking up their allotment of 37c shares now that the resolution has passed?

 

[WRONG'UN]

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!

 

[Assasin]

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



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.

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.

 

[bennywizard]

Good to see HOG closing at the issue price today, it will be interesting to see where it heads over the next few days!

 

[novac]

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.

 

[Assasin]

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.

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.

 

[novac]

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]

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.

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?

 

[basilio]

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.

 

[novac]

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

 

[bennywizard]

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.

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

 

[novac]

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

 

[YELNATS]

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.

 

[traderclaude]

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.

 

[novac]

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.

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

 

[traderclaude]

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.

 

[Assasin]

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.

 

[Flipper]

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.

 

[Assasin]

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.