FDM - Freedom Oil and Gas

[Chief Wigam]

Re: MAD - Maverick Drilling & Exploration

Nice price action in last week.

Over $50m (11c) in the bank and production now over 1500 BOPD and increasing. I estimate revenue of $9-11m per quarter versus costs of around $2.5-3.5m per quarter. Even if production stays flat (which is extremely conservative) that's a PE of 4-5 at current prices, after stripping out the cash. Seems extremely cheap for a company that has an excellent track record of increasing production. This is an extremely conservative way to value a company. If on the other hand you do an NPV type calculation like RBS Morgans has you get $1.01 just for the 1P 'fairway production', and $1.42 if you include the 2P numbers.

So a valuation of 80c-$1 is pretty conservative it seems.

 

[pixel]

Re: MAD - Maverick Drilling & Exploration

After a great recovery the last couple of weeks, MAD has requested a trading halt, pending the appointment of a new executive. Haven't seen many occasions that has necessitated a TH. Can't wait for the whizkid to be named - and the Market's subsequent reaction ...

 

[batgirl]

Re: MAD - Maverick Drilling & Exploration

Anyone got thoughts on today's plateau? Where to tomorrow? Thought data was strong today - guess charts v's company info - charts are clearly not my strength!!!

 

[adds4]

Re: MAD - Maverick Drilling & Exploration

Geez this company has really gone through there cash pile. Yes production has gone up, but it certainly has cost them a lot to do it, considering they are such a low cost driller, its really puzzling

The real worry for me is the company has drilled numerous wells in nash and boiling domes, as so called production wells, when in fact all of them have turned out to be dry wells. The reserves related to boiling and nash dome, really should be ignored, and the true reserve figure of the company is blue ridge dome, which would be between 20 and 50m barrels, (had dry wells too, and success in unreported zones, so just guessing they cancel each other out). Would be nice of the company to update the reserves at blue ridge dome

 

[adds4]

Re: MAD - Maverick Drilling & Exploration

quarterly is out, and it is not to bad, The new ceo acknowledges there are positives and negatives, and that they are going to review operations in the months to come. Good on him. He has also hinted that the company is going to look for more acerage, in more economic fields. I recon the companies strategy has changed now. No more just drilling for the sack of drilling in blue ridge dome. Drilling practices are going to change, and the cash burn is finally going to stop.

disappointing that sales revenue is still below development costs + production costs, has been like this for 4 yrs. With out the $6.5m prepayment by gulf south, the cash balance would have been down significantly again. Geez the company is lucky to find gulf south, who are no doubt paying mad a premium price for % in wells.

 

[adds4]

Re: MAD - Maverick Drilling & Exploration

Been nearly a couple yrs and mad hasn't bought any oil assets, even though it has a 500m facility at call. The share price has been smashed in the meantime, and the massive cash pile it once had is going to be finished in the not to distance future. Time for a management shakeup again soon if nothing changes

 

[oldblue]

Re: MAD - Maverick Drilling & Exploration

On the contrary, management seems to have read the tealeaves accurately - avoiding buying overpriced assets as prices - and asset values - tumbled last year!



Disc: Not currently holding.

 

[System]

On November 10th, 2016, Maverick Drilling & Exploration Limited (MAD) changed its name and ASX code to Freedom Oil and Gas Limited (FDM).

 

[greggles]

Freedom Oil and Gas announced on 5 August that it has completed a $25 million placement via the issue of 166,666,667 shares at 15c per share.

It was suspended prior to the open on 2 August pending the announcement. What is interesting is that a sell off began on 31 July and continued on 1 August prior to the suspension. On 30 July the FDM share price closed at 26.5c. By the close on 1 August it was trading at 20.5c after having reached an intraday low of 16.5c. Given the high volume on both 31 July and 1 August it seems to me that some holders were aware of the details of the placement and sold out knowing that they would be able to buy back in at a much cheaper price after it was announced. I can't conceive of any other explanation for the trading on 31 July and 1 August.

I'm not going to comment on the company's projects and prospects just yet as I'd like to have a closer look, but thought I'd comment on the suspicious trading immediately prior to the company entering a voluntary suspension before the announcement concerning the placement was made. It looks pretty obvious to me what was happening here.

 

[Dona Ferentes]

Freedom to bet the farm but blew it up, instead

Freedom Oil and Gas, backed by former BHP petroleum boss Mike Yeager, has plunged into administration. The US shale sector junior appointed administrators on Monday saying it had failed to pull off a recapitalisation due to the crude rout and volatile global equity markets.

“The current oil price environment combined with Covid-19’s impact on the global equity markets has impacted the company’s opportunities to recapitalise and contributed to the director’s decision to put the company into voluntary administration,” Freedom said in a statement.

US shale producers have been racing to cut costs with the plunge in crude to $US22 a barrel placing companies in peril with many suppliers needing a $US40 a barrel price to turn a profit.

However, Freedom struggled in the last few months even before the oil price crisis. It entered a forbearance deal with lender Wells Fargo in December over an $US18.5m debt and then in January struck a $US30m loan note deal at 12 per cent interest with Ramas Capital Management to try and pay off Well Fargo.

Freedom then issued a bombshell on February 3 saying Ramas had not funded the initial $US14m tranche for the loan deal, meaning it couldn’t pay Wells Fargo.

easy to blame da virus, easy to hope for leveraged payday, hard to actually run a rational business

 

[finicky]

The Mike Yeager magic touch - guess he's still rich though. Fun going from one demolition derby to the next.

January 15, 2016

BHP posts $US4.9billion oil and gas impairment

Shareholders in BHP Billiton must have shuddered when Mike Yeager announced he had bought more US shale assets on Thursday.

The acquisitive Yeager, now running microcap Maverick Drilling and Exploration*, was the original architect of BHP's $US20 billion ($28.8 million) punt on US shale in 2011.

*FREEDOM OIL AND GAS LTD - previously known as; MAVERICK DRILLING AND EXPLORATION LIMITED.