ARQ - Arc Energy

[resourceboom]

It sounds like ARC have more potential acquisitions planned, especially if the Wandoo field is not able to be purchased. I think this is the positive news that has been needed to stop the bleeding in the SP.

 

[Ken]

Very little talk about arq, considering they have a share placement going on.

My thinking on these share placements is that the big fish try and keep the share price down, so they get the shares a lot cheaper.

At the moment i think the issue of new shares will be at around $1.29.


Margin loan on ARQ may provide some quick profits if you play this one right.

 

[quarky]

I bought ARQ at $1.75 about 10months ago.
The downward slide continued, and i began losing 4 figures.

The loss became 5-figures.

I was upset.

I'm trying to sell this now (@ $1.45 but with no buyers in the last few days), and cut my losses...because it was disappointing, when it showed promise.

I hope tomorrow shows the light about what's to happen.

Then, I'll dispose of ARQ and look at BMN (Bannerman) or AUZ (Australian Mines), as my mining/energy stock in my portfolio.

 

[Ken]

Its funny how we like to dispose of stocks for there lack of peformance in the past. Telstra prime example. T3 has been a great return thus far.

When really we should be looking at the future.

All things look good for ARQ.

Every stock does have its moment.

 

[Logique]

quarky,
depends on your own situation and style of course, but please think about it carefully, as Ken suggested. 1.25 has been strong and tested support.

 

[quarky]

quarky,
depends on your own situation and style of course, but please think about it carefully, as Ken suggested. 1.25 has been strong and tested support.

well, the thing is, i put in a lot of money and it was tied up for 10months, while i watched other shares have returns of about 20 - 40%.
so, this frustrated me. i couldn't pull out and incur a 5-figure loss.

in fact, i bought a significant amount at $1.38 in Feb. to try and prop my shares up but it took too long.

but now, since it's creeping up, i was still going to tolerate my losses and put it into something else...'cos i see other stocks having the potential to make gains, which i hope to offset with the tax return come July.


it's just that, financially i was tied for so long...that it would have been a sale out of frustration. i watched other shares (eg. CSL, MBL,) go nuts, while i looked at my money lose more than 30%. lost potential to make money.

anyway, i'll keep an eye on it.

thanks for your encouragement peeps.

 

[Agentm]

arq is being shorted, and for some time now..

i held arq, and saw them fly to amazing heights, then get pulled down for an extensive time, so i bailed.

quarky, keep in mind the ADI factor, they may well hold a position in SL that will bring some real value to ARQ..

happy investing

 

[quarky]

arq is being shorted, and for some time now..

i held arq, and saw them fly to amazing heights, then get pulled down for an extensive time, so i bailed.

quarky, keep in mind the ADI factor, they may well hold a position in SL that will bring some real value to ARQ..

happy investing

Agentm,
by ADI, do you mean 'Adelphi Energy'? and SL means "Sri Lanka"?
(i'm not so clued up on the ASX jargon!...and still learning. : )

well, ARQ is at $1.48 so it's put a smile on a little.

 

[cicak_kupang]

Fantastic to see ARQ up to a 6 month high today, and above the 210 day MA. Would be nice to see the momentum keep going, but i guess there will be profit taking at some point, and maybe a new upper resistance found. Happy for today.....

 

[Agentm]

quarky

arq holds 30% in a company called adi, adelphi energy.

sl is sugarloaf, in recent weeks adi has been very bullish on a gas discovery at sugarloaf, i was suggesting perhaps some upside to arq is on the cards as ADI are constantly updating and upgrading the size of the find and still maintaining their revised figures are possibly also way under the mark.. after leasing 80 square kilometers of prime texas land and still going after more, the play is looking very much like 100's of bcf and potentially tcf..

if you pull up the shorters list on the asx you can see how much arq is being shorted,, so there are real reasons for downward pressure on the sp.. but my belief is that arq is ultimately going to be a very attractive stock in the near term and with production increasing and new fields being explored, any new discoveries are going to bring significant strength to the sp..

i dont hold this share, sold out and went elsewhere short term,,, but i have followed this comapny closely for many years and invested at a very different phase to today..

 

[wintermute]

Hi Quarky, I can understand your frustration, but if you have held this long you might regret selling out at break even (or somewhat below)... I just went over break even... that was at $1.47 after I sold the parcel I bought at 2.22 for 1.31 (I bought the same amount at 1.29 during the march correction and then sold when it hit $1.31 cause I got jittery about it). actually if I consider that loss I'm probably not at break even quite yet...

It is a quite common mistake, people don't sell when they should, hold on, and when it finally gets back to break even sell out, only to see it rise to much greater heights.. I've done it as I'm sure many others have... The way I look at it, if I've held on because I believed in the company (rather than because I couldn't stand to take a loss, which I have done when I didn't see there was any other sensible option), why would I sell out when it is going up, basically validating the reason I held in the first place??

Anyway that's just my personal view. If I'd have sold ARQ last time it was at 1.75 (and I was in profit) and then bought something that was going up (which it may not have) and then bought ARQ at the bottom, THEN I would probably be better off now... but the thing is I didn't so who knows what might have happened!! I'm just happy that my patience seems to be paying off now, and I'm happy to wait and see it pay off even more

Tony.

 

[quarky]

Hi Quarky, I can understand your frustration, but if you have held this long you might regret selling out at break even (or somewhat below)... I just went over break even... that was at $1.47 after I sold the parcel I bought at 2.22 for 1.31 (I bought the same amount at 1.29 during the march correction and then sold when it hit $1.31 cause I got jittery about it). actually if I consider that loss I'm probably not at break even quite yet...

yeah, ARQ was one of the companies that i had 'believed' in.
i saw so many stocks do well, considering i put in most of money on ARQ...and it was just disappointing.
in the same time frame MBL and BHP went up ridiculous amounts, as an example.

besides ARQ didn't even pay dividends, so i had this financial noose around me for almost a year now.

anyway, i sold the portion of ARQ @ 1.48 that i had bought 3 months ago (1.38).
waiting until it hits around 1.55 or thereabouts, and i'll sell my majority of
ARQ buoght at 1.75, ten mths ago
declare the capital loss for this financial year.
not buy stocks for a while...because i heard somewhere some chinese fortune teller saying the market will crash in 'o7 ....the power of the 07s (1997, 2007...)

see what happens in about 25mins. when ASX opens.

 

[Ken]

Do we expect a price rise or fall from this trading halt?

I suspect the price was pushed up with shareholders trying to get a stake in cheaper shares in the capital raising. So I wouldnt be surprised if there was a pull back.

 

[quarky]

ARC's $380m Wandoo acquisition plans stymied by Vermillion
9-May-07 by Andrew Hobbs

West Perth-based petroleum explorer ARC Energy Ltd's plans to acquire the Wandoo Petroleum Pty Ltd Australian portfolio for $380 million have suffered a setback, with Canada-based Vermillion Oil & Gas exercising its pre-emptive rights to a major asset.

Vermillion held a pre-emptive right to Wandoo's 40 per cent stake in the Wandoo oil field, in the offshore Carnarvon Basin, and will now acquire that right under the same terms.

The total cost of the acquisition will now be, according to ARC, around $229 million, down around $151 million on its previous announcement.


The full text of a company announcement is pasted below

ARC Energy Limited (ASX:ARQ) announces that it has been notified that Vermilion Oil & Gas ("Vermilion") has exercised its pre-emptive right to purchase Wandoo Petroleum Pty Ltd's ("WPP") 40% interest in the Wandoo Oilfield. This pre-emption has been made under the terms of the joint operating agreement governing WPP's interest in permit WA-14-L, the permit that contains the Wandoo Oilfield. Vermilion will now purchase the Wandoo Oilfield on the same commercial terms as agreed between ARC and WPP.

As a result of this pre-emption, the Wandoo Oilfield will be excluded from the assets ARC has previously announced that it willacquire from WPP. ARC will proceed with the acquisition from WPP of WPP's interests in the BassGas and Cliff Head fields, together with associated exploration acreage,1 on the same terms as previously agreed and announced to the market.

The revised total consideration for the Acquisition is US$189.6 million as at the effective date of 1 January 2007. The net amount payable by ARC on completion of the transaction is now expected to be approximately US$180.6 million. The Acquisition remains competitively priced, with the revised total consideration for the Acquisition price representing a 2P reserves value of US$14.93 per boe3. This compares favourably with recent transactions in the E&P sector, which have averaged US$17.95/boe4 on a 2P basis.

The Acquisition of BassGas and Cliff Head will substantially increase ARC's oil and gas production and reserves. ARC's net 2Preserves will increase by 190% from 6.7 to 19.4 million barrels of oil equivalent ("mmboe").5 Net FY2008 production is forecast to increase by 72% from 1.9 to 3.2 mmboe.

Mr Eric Streitberg, Managing Director of ARC, said:
"While we are disappointed not to be able to acquire the Wandoo Oilfield interest, the fact that Vermilion chose to exercise their pre-emptive right vindicates our assessment of the value of the asset. We applied the same rigour to our assessment of the Cliff Head and BassGas assets and are confident that we are acquiring a suite of high quality assets at an attractive price. The revised transaction is extremely positive for ARC shareholders and, importantly, gives the Company the flexibility and financial reserves to take advantage of other opportunities we identify."

Acquisition Funding

As a consequence of the reduced size of the Acquisition consideration, ARC now proposes to fund the Acquisition via:

a placement of approximately 28% of its issued capital to institutional and sophisticated retail investors to raise A$90 million to A$100 million ("Placement");
a share purchase plan open to all ARC shareholders, intended to be underwritten by Macquarie Bank up to A$25 million ("SPP"); and
a senior debt facility with BOS International for the balance of the acquisition funding.
ARC now intends to complete the equity raising and be ready to draw down on the senior debt facility prior to completion of theAcquisition, removing the need for the previously announced bridge financing.

The Placement will be conducted by way of a bookbuild on Wednesday, 9 May 2007 and is expected to comprise two equal tranches:

Tranche 1 - an unconditional tranche equal to ARC's available 15% placement capacity; and
Tranche 2 - a conditional tranche, which will be subject to approval at an EGM of ARC shareholders, expected to be held in June 2007.
In recognition of the fact that only institutional and sophisticated retail investors will be eligible to participate in the Placement, ARC is undertaking the SPP under which each ARC shareholder will be able to apply for up to A$5,000 worth of shares at an attractive price.

Further details of the EGM and SPP, including pricing and application forms, will be sent to shareholders shortly.

 

[resourceboom]

From latest "Relief Under Section 708A(5)(e) of the Corporations Act" Announcement:

ARC has today become aware of preliminary results from the Oil Search Limited
operated Al Magrabah -1 exploration well, indicating the primary target to be low to prognosis and without significant hydrocarbons indications. ARC would not ordinarily release this information at this stage because it is insufficiently definite to warrant disclosure. ARC will make a further announcement once it has received further details on the results of the drilling program.

 

[Ken]

Any holders looking to take up the minimum $5000 worth of new shares that will be available?

Has ARQ turned the corner???

Up to $1.535 today....

Appears to have broken its downward trend but I am no chartist.

I find the volume most interesting in all this.

There is more buying than selling.

 

[cicak_kupang]

Any holders looking to take up the minimum $5000 worth of new shares that will be available?

Has ARQ turned the corner???

Up to $1.535 today....

Appears to have broken its downward trend but I am no chartist.

I find the volume most interesting in all this.

There is more buying than selling.

Hi Ken, For me it hasnt yet turned the corner, maybe 1/2 way there. Sure is moving in the write directon though, and yes, heaps more interest in this stock now, with volumes quiet often in the hi 1 mill to 2 mill ea day. since the wandoo takeover it has seemed to have awakened. I will wait till the 1.60 barrier has been reached before i feel 100% confident that it has turned the corner. Very happy all the same.

 

[Ken]

Well its hard to say, because all the oil stocks have fired up lately....

BPT looks to be back in again also. Smart Investor mag has it as the stock to watch in 2008....

 

[Logique]

Any holders looking to take up the minimum $5000 worth of new shares that will be available?

Has ARQ turned the corner???

Well it's had false starts before, let's wait and see on that one. Taking them up on the share offer, absolutely.

 

[Ken]

Heres a scenario:

I currently hold ARQ shares. I purchased them for $1.30 last month.

I purchased 2000 arq shares @ $1.30. I have made a small paper profit to date of aroud $400.

I am eligible to apply for more shares through the placement at $1.30.

Can i sell my current shares on market at $1.54, and then apply for the new ones at $1.30?

The prospectus says that you are eligible to participate in the SPP if you were registered as a a holder of fully paid ordinary shares in the company on the record date Thursday 17th of may! Now I believe I was definitely registered.

So what is stopping me from selling and then just applying for new shares?

Or do i have to own shares now.... or just when the record date was?

Surely they cant keep track of all the shares post record date, as that was the purpose of the record date???

I was just thinking it would be a way for me to buy in at $1.30 then sell at $1.54 and then I can buy back in through the plan at $1.30 then hopefully sell around $1.50 again, and keep some for long term.