BPT - Beach Energy

[Porper]

View attachment 100593

Given the latest comments by @Trav. and @jbocker I decided to post some thoughts on where Beach Energy is at currently!
QUALIFICATION:- These are just my thoughts and could well be way off track and I do not hold.

BPT would appear to be in a 5 wave downward move ( waves 1 to 4 having formed) with wave 5 destined to end in a zone of reasonably strong support.
That support could likely result in an a-b-c wave move higher (providing a low risk entry).
Lets see what pans out. Unfilled Gaps are shown on the chart.

Interesting chart rnr.

Agree, a 5-wave move lower looks likely. Wave-4 could take longer to unfold, allowing the guideline of alternation to be adhered to. (The 2 corrections should be different). If the current bounce completes around these levels another leg down should follow.

Wave-3 extended, which is normal. Infact it was almost exactly 1.618x the length of wave-1. A textbook extension!

When this happens the first and final legs will usually be the same length. The target is $1.81. If your shown support gives way, the deeper correction is likely. That lower target aligns with multi-year support as well. Could be a good bounce from support. You are correct though, an A-B-C correction only. Just my thoughts from an Elliott wave perspective.

 

[rnr]

Hi @jbocker

[QUOTE I am not a chartist and I wont put the energy and time required at this time in life, but it does fascinate me when I see some charting, but to be truthful emotion is too big a blocker for me to overcome before I started making any headway being a chartist.

Could add some more but my pants are down far enough. [/QUOTE]

No problems, just add an "l" to your tag and we will all understand as @jblocker has a similar ring to it.

 

[rnr]

Interesting chart rnr.

Agree, a 5-wave move lower looks likely. Wave-4 could take longer to unfold, allowing the guideline of alternation to be adhered to. (The 2 corrections should be different). If the current bounce completes around these levels another leg down should follow.

Wave-3 extended, which is normal. Infact it was almost exactly 1.618x the length of wave-1. A textbook extension!

When this happens the first and final legs will usually be the same length. The target is $1.81. If your shown support gives way, the deeper correction is likely. That lower target aligns with multi-year support as well. Could be a good bounce from support. You are correct though, an A-B-C correction only. Just my thoughts from an Elliott wave perspective.

Hi Porper,

Thanks for dropping by and sharing your thoughts on my chart as I always appreciate your comments. Still trying to improve my EW skills although generally I'm so far behind the eight ball it's not funny.

Cheers,
Rob

 

[jbocker]

That might be more appropriate J Blocker.
A Blocker to my J Curve.

 

[Porper]

Hi Porper,

Thanks for dropping by and sharing your thoughts on my chart as I always appreciate your comments. Still trying to improve my EW skills although generally I'm so far behind the eight ball it's not funny.

Cheers,
Rob

You were spot on with your wave count Rob. Just keep on doing what you are doing. It's a continual learning process for all of us...no matter what type of analysis is used.

 

[rederob]

Hi Skate. I already hold BPT with a fair profit even at todays price. I like the gas/oil game, grew up with it. I offloaded several poor and stagnant performers and wanted to hold it an a stock I am more comfortable with, and BPT has retraced a fair bit recently. I wanted to simplify my holdings.


Clearly I am not a chartist and my comment was a interpretation stab after a LITTLE research of what rnr chart was showing us (me).

As a final note I am in a turmoil of thought about exiting share investments altogether. I am far too emotive as an investor, probably because I am passionate about potential new good business and love to invest in such. But it is a fickle game and did my best to support the Green Energy start ups initially.
I am not a chartist and I wont put the energy and time required at this time in life, but it does fascinate me when I see some charting, but to be truthful emotion is too big a blocker for me to overcome before I started making any headway being a chartist.

Could add some more but my pants are down far enough.

BPT will move closely with oil prices, as most producers do.
In that light WTI is likely to continue trading within a $15 range - roughly from $50/bbl-$65/bbl.
The current WTI decline was predicated on the coronavirus impact, although cyclical declines are part and parcel of the mechanism.
I hold BPT and waited for the recent report rather than selling when it ran to $2.90 in January. Not the smartest of moves, but I am not a trader so don't feel inclined to worry about missed opportunities.
Anyhow, while I reckon it might be a long while before BPT gets back to $2.90 the company is operating at a completely different level to the past, so dips below $2 represent buying opportunities. I see the stock climbing back to well over $2.40 this year, which is an easy +10% profit as I see it.

 

[Dona Ferentes]

Victorian government has lifted a ban on onshore gas exploration from July 2021, paving the way for the state to boost production as supplies decline from the offshore Bass Strait fields.

Following a three-year investigation, Premier Daniel Andrews said there will be an “orderly restart” of onshore conventional gas exploration and development from July 1 next year while a temporary ban on fracking and coal seam gas exploration will be made permanent.

The state has faced significant pressure to ease the gas ban amid forecasts of gas supply shortages looming by 2022 partly due to production drying up from the once prolific Bass Strait.

Big industrial users have been among vocal critics of the government’s move saying it had pushed up the price of locally priced gas and made it more difficult to compete with their inter-state and international rivals.

Potentially significant onshore gas resources could be extracted from the state’s Otway Basin which stretches into South Australia where an industry already operates.

 

[jbocker]

Ok read there 1/4ly report. They are in the black with $80M, up 20M for the quarter, their operating costs (from the 1/2 yearly report) $9.1/bbl. Are they in a good position? A lot better position than 12months ago with a 200M+of debt. Are they well placed to ride out the storm?

 

[So_Cynical]

Are they well placed to ride out the storm?

They have cash and cash flow, sell lots of gas into the domestic market, if they get super conservative and do the absolute minimum CAPEX and exploration they wont run out of money for a couple of years.

 

[aus_trader]

Ok read there 1/4ly report. They are in the black with $80M, up 20M for the quarter, their operating costs (from the 1/2 yearly report) $9.1/bbl. Are they in a good position? A lot better position than 12months ago with a 200M+of debt. Are they well placed to ride out the storm?

Yes a better position than last year. jb, where does it say their production cost is $9.1/bbl?

My concern is, currently they are selling oil at $74/bbl which is only 30% less than before. But now Oil price has absolutely collapsed, so going forward they may have to sell for a much lower price unless they have some hedging in place.

 

[jbocker]

Yes a better position than last year. jb, where does it say their production cost is $9.1/bbl?

In the half yearly (not the 1/4ly just released). Operating costs page 5
https://www.asx.com.au/asxpdf/20200211/pdf/44dzjwmpgtlzcf.pdf

 

[rederob]

Yes a better position than last year. jb, where does it say their production cost is $9.1/bbl?

My concern is, currently they are selling oil at $74/bbl which is only 30% less than before. But now Oil price has absolutely collapsed, so going forward they may have to sell for a much lower price unless they have some hedging in place.

BPT's oil component comprised only 27.5% of BOEs, and the gas component is largely protected by existing sales contracts to end of FY20.
The coming quarter will be harsh, but by the time we have that data the POO is likely to have resurrected itself to a sustainable figure.

 

[aus_trader]

BPT's oil component comprised only 27.5% of BOEs, and the gas component is largely protected by existing sales contracts to end of FY20.
The coming quarter will be harsh, but by the time we have that data the POO is likely to have resurrected itself to a sustainable figure.

Agree, at current unsustainable oil price levels many high cost producers are likely to go under. Especially the very high cost US shale oil producers and possibly Canadian Tar Sand oil producers.

 

[grug85]

Hi Guys
Looks to me like a reasonable set up has occurred for a little swing trade on BPT with the retest of the rising wedge breakout

 

[Trav.]

@grug85 welcome mate.

BPT definitely has had a nice run over the last couple of months, testing that support level ~$1.56 and hopefully it can bounce back up

 

[grug85]

Thanks @Trav. , I've been lurking for a few years now, thought this looked too textbook not to share

 

[aus_trader]

Thanks @Trav. , I've been lurking for a few years now, thought this looked too textbook not to share

Thanks for sharing grug85. Yes text-book type of rising wedge break out, now pulling back to retest.

Disclosure: I currently hold BPT in Speculative Stock Portfolio.

 

[Dona Ferentes]

FY20 Highlights
 Ended the year with $50m Net Cash, highlighting Balance Sheet strength
 ROCE > 19% because of high-margins from onshore oil and diversified pipeline gas business
 No write down of producing assets at reduced commodity prices
 214% 2P organic reserves replacement ratio and 352 MMboe of 2P reserves
 178 wells drilled at a success rate of 81%
 Underlying NPAT $461 million and Statutory NPAT $501 million
 Final Dividend 1 cent per share


Revised Growth Strategy
 Same plan at a prudent pace to manage the impact of COVID-19 and oil prices
 Waitsia Stage 2 FID anticipated in December 2020 quarter, gas from new 250 TJ/d facility to be processed into LNG at North West Shelf Facilities
 Waitsia Stage 1 expansion being commissioned, Beach Perth Basin joint ventures providing 40 TJ/d to WA domestic gas market in FY21 and seeking further domestic gas sales opportunities
 6+ well offshore Victorian Otway Basin drilling campaign to commence by March 2021 via a new rig contract signed with Diamond Offshore
 Revised low-risk investment profile targeting 37 to 43 MMboe production in FY25 from existing portfolio
 5-year outlook generates >$2 billion of FCF at lower price assumptions
 Significant Carnarvon Basin prospect, Ironbark, to be drilled by BP in Q2FY21

(Hold)

 

[jbocker]

Enterprise 1 Gas Discovery in the Otway Basin announced today is a neat discovery drilled from a land base. That will make it hugely less costly to get to production to the Otway Gas Plant which is less than 10km away. Nice start to their drilling program.

 

[So_Cynical]

Enterprise 1 Gas Discovery in the Otway Basin announced today is a neat discovery drilled from a land base. That will make it hugely less costly to get to production to the Otway Gas Plant which is less than 10km away. Nice start to their drilling program.

10 clicks from the gas plant, 5km long/deep direction drill from the land to under the sea, super smart stuff. Up 13% so far today.