ADI - Adelphi Energy

Joe Blow said:

I certainly don't mind price targets made by brokers being quoted, as long as it is mentioned when they made it, so it can be verified. If it's on the web, then please link to it. This sort of stuff is in the public domain and is fine to post.

However, price targets posted by thread participants must be accompanied by some analysis that supports their point of view.

Don't want to make a huge issue of this, just wanted to remind people to support their assertions - especially price targets - with facts and analysis.

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One thing that reflects the factuality of some posts here is that three, possibly four, of the persons posting here are in the top twenty shareholder list. Putting your money where your mouth is should be some justification for suggesting a share value. ( Not that this post in any way is meant to criticise the ASF policy regarding ramping).

nioka said:

One thing that reflects the factuality of some posts here is that three, possibly four, of the persons posting here are in the top twenty shareholder list. Putting your money where your mouth is should be some justification for suggesting a share value. ( Not that this post in any way is meant to criticise the ASF policy regarding ramping).

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Agreed, sort of (it also gives them more motivation to ramp). At the very least it makes a nice change from those that don't back up their posts with hard cash.

nioka said:

One thing that reflects the factuality of some posts here is that three, possibly four, of the persons posting here are in the top twenty shareholder list. Putting your money where your mouth is should be some justification for suggesting a share value. ( Not that this post in any way is meant to criticise the ASF policy regarding ramping).

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I agree Nioka

IMO the ADI thread discussions and information exchanged are probably one of the best threads.

Personally I would like to see sometimes notes of encouragement from the Administrator and the Moderators. They behave like old school monitors. Always pull up negativity but world has changed. Taylor's scientific management theory of hire and fire is just not valid.

The philosophy is to have penalties for speeding but also reward good drivers.

Every one needs a bit of cuddle and hug. The dog in the house needs to be disciplined but also requires to be cuddled and appreciated. Not trying to lecture but for last two years never seen a complimentary note from the moderators or the administrator (sorry Joe but hope you would take it on board).

To conclude if every thread publishes information like ADI contributors ASF will have no doubt to be an outstanding site consistently. That means more advertisements and ROI for Joe

Correction : I just got a nice compliment for my positive posting from one of the moderators within 2 minutes . I felt good and sharing with you all. Thank you moderator for restoring the confidence.

estseon said:

Far, far better to have 10% of something producing revenues than 20% of hope buried over 2 miles underground.

It is also a point that seems to have been missed by the EME investors. The diluted interest is only 3% but it is all relative. 3% of something quite big for a company quite small is significant.

Incidentally, I noticed a slight dislocation in prices between ADI & AUT last night so I thought that I might dabble a bit in the latter and take a gamble on Longhorn & Ipanema.

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Yes i agree, and hopefully they can get Kowalik back on track with their skills.........

I wouldnt like to see them tinkering with kennedy till they have easly, weston online and morgan as well as rancho started.......

great posts by all

i totally understand where dr j is coming from and all here need to totally understand the adi share is HIGH RISK HIGH REWARD. and you always adjust your investment according to how you personally feel comfortable.. if you cant stand the heat then get the hell out of investing in this sector.. simple..

these shares fluctuate rapidly on sentiment and also gain value on the back of drilling results that are absolutely correctly reported. asf should color the shares by catagories.. bright red for high risk,, yellow for low risk etc,, then those reading these threads will understand the context of what the investment is able to achieve..

there are plenty of cowboy directors on the boards of many small caps, and the oil and gas sector has a lot of them.. i follow a great deal of them and oddly they dont get penny of my investment dollar. i have been to seminars, seen them talk the talk, but i dont see them walk the talk..

adi is doing everything they announced in their strategy for the last 12 months. even achieved a farm in partner.. their share dropped to record lows with the gfc and the price of oil

adi has achieved significant upside in the past months, being critical and sceptical of me for delivering the information on the share and its drive out its lows is just bad form imho.. claiming i am ramping is the share when i am primarily pointing out the eagleford was always a legitimate target and seeing the oil giants chase the same play hard.. it validates the play and validates what i am saying..

being critical of those investing into and discussing the possibilities and eventualities/ outcomes of the risked value of a share is just bad form imho

we are all here to live and learn and explore..

At this point me whining about and wishing I would have invested more back at the .11 range is equivalent to ADI wishing they could have done something to own more than 20% of this wonderful unkown (at the time) and now tremendously popular Texas shale play. Guess it's all about what your perspective is and which end of the stick you are on. Not to mention moeny involved.

There ain't no room for coulda, shoulda, woulda's here.

Agentm said:

adi has achieved significant upside in the past months, being critical and sceptical of me for delivering the information on the share and its drive out its lows is just bad form imho.. claiming i am ramping is the share when i am primarily pointing out the eagleford was always a legitimate target and seeing the oil giants chase the same play hard.. it validates the play and validates what i am saying..

being critical of those investing into and discussing the possibilities and eventualities/ outcomes of the risked value of a share is just bad form imho

we are all here to live and learn and explore..

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I hole heartedly agree.....

Whether people agree with you or not the constant flow of news and opinions on this stock has been invaluable to many...

It seeems the people who go around in here accusing others of ramping, if there accusations are unfounded should sustain a significantly heavier penalty then that of ramping......as its effectively downramping and defamation in one....

I have read every post in this thread and can honeslty attest you have never once been anything but objective and intelligent.....well done, thanks and keep it up...

In response to rambling, yeh we all have stories about shoulda....the point is what do you do now....even if you bought at 11 and sold at 14c.....if now its 26c and next month you feel it will be 30c then its a buy... (after youve DYOR and sought advice of course)....irrespective of time and what you coulda, should, done...... the only thing not making it a buy is if you have something better to buy....(thats if in your opinion its heading up fast)

Ramblin Round said:

At this point me whining about and wishing I would have invested more back at the .11 range is equivalent to ADI wishing they could have done something to own more than 20% of this wonderful unkown (at the time) and now tremendously popular Texas shale play. Guess it's all about what your perspective is and which end of the stick you are on. Not to mention moeny involved.

There ain't no room for coulda, shoulda, woulda's here.

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rambling

adi could get more acreages, and had plenty of opportunity to. some of its jvp partners have. there are others near by who have huge stakes in the eagleford.

adi would have never been able to handle the 20% and trying to handle 10% of it will be a task in itself.. if you believe a small cap can handle more than that, and invest into that share.. then by your simple misunderstanding of what it costs to be in a world class play (like the sugarkane) could place your investment in a real tail spin as the market corrects to the reality of the costs, and you will see every investor scamper for the exit and probably abuse their broker for completely missing the basics of economic modelling on the play.
i know of a few highly valued shares with share prices way way into the upside of the risked aspect of their valuations, (with no criticism by asf of the ramp crew on them) and they have no oil revenue at all coming in and are at the very beginning of an exploration into the eagleford and facing a monumental task to raise 100's of millions into billions needed to exploit their acreages. and without being the operator to boot!! and i cant see them doing it in a pink fit..

rambling,, adi has more than enough to deal with on the hilcorp expansion into their acreages,, 240 wells.. they are not being greedy, not overextending and they will not require an immediate takeover or face financial disaster for lack of funding like many i believe are facing in the eagleford in the very near term.. happily holding with the ones who are walking the talk

I'd suggest that it's probably valid to look at the quality of Hilcorp. Nothing to 4th largest private E&P company in 20 years. They didn't do that either by messing things up or by taking excessive risk.

Doing a search on RRC for district 2 threw up 1,084 permits (some will be varied permits), most since 2001.

ADI is involved with 240 wells ? Wow.

I know there are nothing but more leases and more wells being drilled in this area. All systems are go for profit and production !

Ramblin Round said:

ADI is involved with 240 wells ? Wow.

I know there are nothing but more leases and more wells being drilled in this area. All systems are go for profit and production !

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240 wells is what its about, thats why i invested rambling.. for the oil thats under your land...

adi aut and eka are killing them all on the stock market comp right now, first to third!!

the jvp have yet to report on ops this month.. we know weston is about to be reported on any day.. imho the share is looking for higher grounds and weston results may validate that claim.. theres been heavy speculation that the jvp is a leaky boat now that hilcorp is reluctant to have weekly updates on its acreages.. the 40% increase has not been questioned by the asx at all thus far.. but imho the vibe is very upbeat..

there are reports of the wells being 2 - 5 bcfe.. i think 5 - 8 bcfe will be used for our region myself

looking forward to hilcorp doing its thing. i look at who they employ, who they have hired in the recent months and my research is telling me they are financing and employing and hiring along a frame work that indicates expansion,,, waiting to see the indications of that research becoming publicly announced

good luck to all holders in the coming weeks.. hilcorp express imho left the station some time ago some 400% ago.. lol... and is gaining momentum

some got on the express early,, others will get on now and still have potentially an amazing journey..

all imho and dyor

AgentM,

I am not trying to rain on anyone's parade, but what do you base your 5-8bcfe number on? No well in this area that i know of points towards this number. 2-5 bcfe seems spot on to me.

With all due respect agentm, to be trumpetting a 400% gain on ADI is a bit rich considering you were calling ADI a screaming buy at 70c (yes 70c) back a few years ago.
Love your research but no need to be blinkered. Other companies will be successful in the Eagleford shale.

choppy

i think the oil aspect in some regions will tilt it up somewhat, the talk i hear from the conoco side of things was for the wells to be a lot higher than 5 bcfe.

adi are looking at deterministic rates like 5.5 bcfe, which is a lot higher than the rates predicted for the eagleford play to the west where petrohawk are in mcmullen etc.. and traditionally adi have always been conservative in their projections. the operators make them understate everything dramatically or commercial reasons.. i think its early days in the sugarkane and maybe some improvements in the design and fracs will deliver more.. its apparent that there is progression occurring in the play that has yet to plateau

slide 15 in the adi presentation in nov 09 is a good guide to how things were being seen last year..

http://www.adelphienergy.com.au/files/presentations/Adelphi AGM 25 Nov 2009 Presentation.pdf

banska bystrica said:

With all due respect agentm, to be trumpetting a 400% gain on ADI is a bit rich considering you were calling ADI a screaming buy at 70c (yes 70c) back a few years ago.
Love your research but no need to be blinkered. Other companies will be successful in the Eagleford shale.

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banska..

i think if you look at the companies in the eagleford, you would have to say they are doing pretty good.. and good on them i say!!

Rambling

As Agent said: "adi would have never been able to handle the 20% and trying to handle 10% of it will be a task in itself.. if you believe a small cap can handle more than that, and invest into that share.."

So EME proved! It took an additional 12% WI on specified wells at the early stage for assuming a staggering additional 20% of costs.

Shareholders get precisely nowhere if the company has to double its issued share cap in order to service a 2 x higher WI. They just have the agony of waiting for the next capital raising.

At a 10% WI, ADI has cash to contribute to drilling post the free-carry costing, perhaps, $45m gross. Drilling costs are paid in advance, production revenues are paid in arrears. Sure, receivables can be sold. ADI looks pretty comfortable with that cushion of cash in place to fund its WI obligations pending self-financing of the drilling programme from production revenues.

Looking at the various risk factors - they've not drilled a dry well or anything approaching; they've got the funding in place to pay their share up to the point of having revenues streaming from 8 or 9 wells (2/3 fracced, 3 free-carry, 3 post free-carry assuming 2/3 rigs in operation); they have an operator that has risen from nothing to being significant on the basis of success and private capital and that has significant cash at its disposal to fund 50% of the ongoing costs; and the operator has demonstrated that it can produce something significant from a damaged well.

This project seems to be considerably de-risked now compared to the situation pre-farmout. The SP movement reflects that.

You can't kick yourself for not having loaded up with more at the lower prices - the risk profile was different then. I did all of my loading up AFTER they announced the proposal to farm out and more than half of that AFTER they announced the new partner. Before they decided the farm out, the risk looked far too great. I could have paid less, but the risk was then too great for me.

So new investors should still be attracted. They might not make the same multiples but they will be buying into a considerably de-risked investment. There could be many waiting to see Kennedy replicated in Weston and/or waiting to see what Hilcorp can do with something designed by them from the outset.

Any doubters need only take a look at the JVP's graphs for the last 4 months. AUT is up 400% in 4.5 months....id imagine ADI and EKA are very similar....but have not checked...I posted the AUT one in the AUt thread so any doubters can go check.....

Time to buy mor IMO...im looking, for a temporary weakness to get in.

eosteon - they will still get great multiples, as its only just beginning...just not the same as you say..

Hey Rambling from seeking alpha today

Chesapeake Energy - chasing eagleford acerage...theres ya dinner date..

In the Bossier, we have 180,000 net acres and in Eagle Ford, we are now up to 150,000 net acres and hope to have 300,000 to 400,000 net acres before it’s all said and done.

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http://seekingalpha.com/article/189...-corporation-q4-2009-earnings-call-transcript
Disc no responsibility for external links by me or asf dYOr

Oh yeah I forgot about them. They've always been active around here. Thanks mate. This information really helps when it comes down to knowing how many companies are out to buy up land.

I just checked my ADIHF holdings and I am very pleased. Methinks it might be time to acquire more shares. Looks like others are thinking the same way since the price went up both yesterday and today.

News release.

Easley about to kick off lateral.

Weston completed successfully, plugs drilled out, now cleaning up.

No mention of blockages, ruptures, lost equipment etc. Just waiting on flow figures.

Speculation- because ADI previously stated (28 Jan) that we could expect to extrapolate flows from Kennedy results, they might be bound to issue a caution if they would expect materially less from Weston. That could mean 1,400bpd + 6mmcfgpd.