ADI - Adelphi Energy

[tck]

Or if you believe that the structure is geologically the same as the EME discovery then 4 times the upside.

I suppose my real point is that all of these companies are exploration plays and the majority of value in all of them is attributable to SL so if your an optimist on SL then AUT is the best leverage however ADI would have less downside if SL is not a positive outcome.

 

[nioka]

I am new to the site but am a shareholder in AUT and wanted to hear anyone's views on why there is such a disparity on relative values on all the listed SL JVP's.

AUT has the most exposure to the Sugarloaf area more that 17,000 gross acres (ADI has approx 4,000 acres) and sufficient cash to fund the next 6/7 wells.

However ADI is capped at $30m net of cash and AUT is capped at $43m net of cash.

Interested in any comment.

I have always valued AUT and ADI as almost equal as fas as SP goes. Every time I have been able to sell one and buy 12% more of the other with the proceeds I have done so. I have been back and forth a few times. That should show that when I say they are about equal I must believe it. When Sugarloaf looked as though it would pay off early I did value ADI higher than AUT.
I don't think you have the acreage correct.

 

[sam76]

I would have thought EKA was the best leverage (although riskier due to $$$ shortage)

12.5% of what AUT has for 13 cents (if you can get them)

considering AUT are 30+ cents atm this would be a better bet for leverage if you are risk adverse

 

[tck]

I have always valued AUT and ADI as almost equal as fas as SP goes. Every time I have been able to sell one and buy 12% more of the other with the proceeds I have done so. I have been back and forth a few times. That should show that when I say they are about equal I must believe it. When Sugarloaf looked as though it would pay off early I did value ADI higher than AUT.
I don't think you have the acreage correct.

AUT announcement 18th AUG states they have 17,600 net acres.

ADI have 20% (Gross) of SL 20,000 acres ie: 4,000 acres.

 

[tarzanhey]

Sugarloaf Block A Update




RNS Number:7251S
Empyrean Energy PLC
21 April 2008





Empyrean Energy PLC
("Empyrean" or the "Company"; Ticker: (EME))

Sugarloaf Block A, Texas USA
----------------------------

- TCEI JV Block A-1 well begins to flow at commercial rates direct to sales
line.
- Well was being prepared for a fracture stimulation program and was not
expected to flow without stimulation.
- Very early encouragement as the well is expected to be stimulated during
forward operations.

Empyrean, the AIM listed energy company with exploration and production assets
in Germany and USA today announces the following initial test results from its
TCEI JV Block A-1well on Block A at the Sugarloaf Project in Texas:

The TCEI JV Block A-1 well unexpectedly began to flow commercial quantities of
gas and condensate during operations to prepare the well for a fracture
stimulation and flow testing program. As of the latest report the well was
flowing at approximately 0.66 mmcfgpd (million cubic feet gas per day) with
approximately 130 bcpd (barrels of condensate per day) and 45 bwpd (barrels of
water per day) with a FTP (Flow Tubing Pressure) of around 2300 psi.

On the present day prices for condensate and gas whilst converting the
condensate to a gas equivalent, the most recent recorded equivalent gas flow
rate exceeds (using a 10:1 conversion) 2.0 mmcfepd (million cubic feet gas
equivalent per day).

The well will now be shut in for a pressure build up test. It is expected that
this well will be fracture stimulated during forward operations. The exact
timing of the program is not known and will depend on how the well performs in
the coming days without stimulation.

Commenting today, Empyrean Executive Director Tom Kelly said "This gas and
condensate flow has come as a very pleasant early surprise as the well was not
expected to flow without stimulation. We could see a multiple on these
production rates if fracture stimulation proves successful. This well also had
liner cemented in place whereas future wells are likely to be completed without
cement using perforated liner slotted into the open hole. We now have 2 wells
flowing commercially from the 5 wells already drilled to date (3 of which are
yet to be tested) further de-risking the project."

The information contained in this announcement was completed and reviewed by the
Technical Director of Empyrean Energy Plc, Mr Frank Brophy BSc (Hons) who has
over 40 years experience as a petroleum geologist.


For further information:
Empyrean Energy plc
Tel: +44(0) 207 182 1746

Rod Venables / Cecil Jordaan
HB Corporate
Tel: +44(0) 207 510 8600

Jonathan Charles / Ed Portman
Conduit PR
Tel: +44 (0) 207 429 6611 / +44 (0) 7791 892 509

 

[Agentm]

tck, there is an AUT thread,, maybe discuss it there.. or maybe understand AUT botched their capital raising and left bell potter holding the can.. the adi manangement wont do that to their shareholders..

back to the news that just came through..

two wells now commercial, the Kunde 3 well has yet to be fraced, but its flowing on its own right now..

the results of these wells just show you that even if you cement a chalks well, and prerforate its going to flow.. pretty impressive formation.

 

[Lucky_Country]

So is K1 after Kunde 3 ?
I certainly hope so as with these kind of results it bodes well for a great company maker !

 

[tck]

tck, there is an AUT thread,, maybe discuss it there.. or maybe understand AUT botched their capital raising and left bell potter holding the can.. the adi manangement wont do that to their shareholders..

back to the news that just came through..

two wells now commercial, the Kunde 3 well has yet to be fraced, but its flowing on its own right now..

the results of these wells just show you that even if you cement a chalks well, and prerforate its going to flow.. pretty impressive formation.

Agent M - Yes Great Result on Kunde

I am a supporter of the SL play in general and was endeavouring to illustrate the valuations that apply to all the ASX listed JVP co's which i don't think people fully appreciate.

AUT & ADI & EKA are in my opinion all undervalued

 

[Nigel Foolsack]

Agent M - Yes Great Result on Kunde

I am a supporter of the SL play in general and was endeavouring to illustrate the valuations that apply to all the ASX listed JVP co's which i don't think people fully appreciate.

AUT & ADI & EKA are in my opinion all undervalued

Thanks TCK I have been of the opinion for sometime that AUT offers the best leverage to this play.
IF SL is shaping up as prospective as we all think it is (as evidenced by todays EME announcement) then I belive AUT is best positioned to fund the exploitation of SL.
Keep up the good work TCK

 

[Lucky_Country]

AUT & ADI & EKA are in my opinion all undervalued

Not for much longer !
We could see a run greater than the one 18 months ago that took us over $1 mark.
The stock is more tightly held now than then and people have far greater confidence in what they think they have got.
The hard work done over this time and patience shown by all long term holders is too be rewarded on success which should soon be known hopefully.

 

[Agentm]

tck

eme are currently up 20% to .50p so they are about $1.05 a share

this is their value on the sugarloaf ami according to their website.

Texas Crude Energy remains the operator in Block "B" as does the 6% working interest earned by Empyrean by paying 7.5% of the costs under a previous agreement. In addition , under the terms of an additional agreement , Empyrean earns a further 12% by paying 20% of the costs. The first Block "B" well part of the 16 well programme will be Kennedy#1 located about 5.5 miles to the east of the producing Sugarkane gas-condensate field. It is anticipated to spud mid- September 2007.


so if you look at their share price and compare it to the ausiie jvp.. how do you see it?

a agree with you.. ADI EKA and AUT have outstanding value, and my own view is similar to yours, all undervalued.. AUT has a massive risk to go "all in" on the sugarkane, i am waiting to hear how they will get the operations happening on all their acreages..

but the news on kunde 3 demonstrates a lot about the sugarkanes ability to flow open hole regardless of what you do to it..

the announcement did not elaborate how much was perforated during its initial frac attempt.. so we have no real idea what section of the well is flowing.

 

[tck]

Agent M

I think the ASX listed co's are more of an appealing value on a relative basis because my understanding is that EME fund their participation on a well by well basis which could ultimatelty be more dilutive to share holders given the number of wells that need to be drilled.

 

[Agentm]

cant see that myself, these wells when built properly will be paying themselves off in a month or two imho.. 15 years after that is profit..

the sugarloaf ami would not allow the same deal they have with the conoco wells

the eme share is now .60p or $1.26

 

[sam76]

I'm now in the black with this share.

What a strange feeling it is....



Once again thanks to Agent M for helping me to keep the faith..

 

[Agentm]

the report from eme gave little away on what it was they perforated, but i am very encouraged that now 3 out of 3 wells have been commercial.. and if a vertical such as kunde 1 is commercial just on the extremely high matrix propsity, then the future of the play look very very promising..

"This gas and condensate flow has come as a very pleasant early surprise as the well was not expected to flow without stimulation. We could see a multiple on these production rates if fracture stimulation proves successful. This well also had liner cemented in place whereas future wells are likely to be completed without cement using perforated liner slotted into the open hole. We now have 2 wells flowing commercially from the 5 wells already drilled to date (3 of which are yet to be tested) further de-risking the project."

tom kelly is very upbeat right now, who wouldnt be.. he is correct on the derisking of the project.. if you look at the reasons for these wells being drilled (leases were running out) and not on the basis of most prospective targets.. then it will be very interesting to see these chalks drilled on acreages where they have the very prospective natural fractures..

for me i am never going to keep my eye off the outcome, the reason for the investment, and that for me is for our sugarloaf AMI jvp to open up kennedy and to put in place a forward well program..

 

[Agentm]

last few days has seen a lot of buying interest into adi.. its seemingly holding to a different value every day.

as yet none of the jvp's are releasing anything about the sugarkane, the kennedy well nor the forward plans,,, when will this so called "soon" announcement that AUT alluded to in their presentation happen?

 

[Sean K]

Was an outstanding breakout from the downward trend around the green circle. Need to see some higher highs and lows appearing on the long term chart for a definate change to up. Just coming up against some old resistance, next at 50. Looking like a definate change in sentiment.

 

[nioka]

Been a good day to get value switching from ADI to AUT. It has been easy to get 4 AUT for 3 ADI and still have some change after brokerage. I may lose out if the jump in ADI is not Sugarloaf related but I saw value in the change for me.

 

[resourceboom]

Hi Kennas, not trying to start a fight or anything but you seem to have changed your tune. Before you seemed very negative. The good news in regards to ADI's ground hasn't started.

Still plenty to prove up before the ADI reaches its potential share price wise. Hopefully the great news next door has helped derisk it a good deal.

& Prawny, hows H1 and H2 going...?

Was an outstanding breakout from the downward trend around the green circle. Need to see some higher highs and lows appearing on the long term chart for a definate change to up. Just coming up against some old resistance, next at 50. Looking like a definate change in sentiment.

 

[Sean K]

Hi Kennas, not trying to start a fight or anything but you seem to have changed your tune. Before you seemed very negative. The good news in regards to ADI's ground hasn't started.

Of course I was negative. Look at the chart up to 10 April ish. It was disasterous! Since it broke up, it's been outstanding. I'm only commenting on the chart, and as identified before there'll probably be resistance around this level. Hopefully not.