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Sounding good. Holding at 0.43!
HOG - Hawkley Oil and Gas
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Hawkley Oil & Gas Limited (ASX:HOG) is pleased to announce that commercial production from Sorochynska Well #201 in Ukraine’s Dnieper Donets basin has begun.
Completion of commercial flow tests with flow rates three to five times original expectations. These results were achieved through the employment of higher quality completion techniques than wells drilled in the past,
Well #201 is expected to generate significant cash flow for Hawkley. More information on exact flow rates and revenue received will be released once production is stabilised.
The Company is also ahead of schedule for the spud date for the first well at Chernetska, Hawkley’s second licence....
http://imagesignal.comsec.com.au/asxdata/20110217/pdf/01151748.pdf
Announcment out:
Sorochynska Well production update !
Cant paste yet, but they are selling on a 6mm choke with 5.2mmcfg/pd and 176bocpd
Expect significant cash flow. OPEX 30-33%
They have enough tax credits to pay no VAT for approx 4 months.
Sales price $9.32 per thousand cubic feet of gas.
Plus $104 per boc
Performance so far indicates we will be able to run much higher then current rates.
They are drawing up a full field development plan in the next few weeks. So my opinion is expect a CR in approx 4-6 weeks time. This is good news imo as it obviously proves they are expecting far more revenue then what suits thier current business plan. Perhaps an acqusition or two as well.
Sorochynska Well production update !
Cant paste yet, but they are selling on a 6mm choke with 5.2mmcfg/pd and 176bocpd
Expect significant cash flow. OPEX 30-33%
They have enough tax credits to pay no VAT for approx 4 months.
Sales price $9.32 per thousand cubic feet of gas.
Plus $104 per boc
Performance so far indicates we will be able to run much higher then current rates.
They are drawing up a full field development plan in the next few weeks. So my opinion is expect a CR in approx 4-6 weeks time. This is good news imo as it obviously proves they are expecting far more revenue then what suits thier current business plan. Perhaps an acqusition or two as well.
Yep, my calcs using those numbers gave around $38m a year NET cash flow. Nice considering their MC is only around $60m atm
I'm loading up as I still have that comparison with AUT in my mind with a potential 20-bagger holding my attention!!Yep, my calcs using those numbers gave around $38m a year NET cash flow. Nice considering their MC is only around $60m atm
Happy to oblige, but think your better of being conservative and being surprised to the upside. By the way mcap is approx $125m, as they have shares in escrow, which i forgot about as well, till i was reminded above.
Its still a rediculously low mcap for what they have just achieved with well #201. But i guess people are waiting for a second gusher before jumping in boots and all.
Note this scenario below does not show further production expenses. ie if they spend $8 million on a well, its not shown. But you can just presume thats going to happen as soon as cash flow allows each well to start.
Tried to provide a few scenarios for discussion
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Just cause it looks flash in a spreadsheet, doesnt make it likely to happen, so be sure to DYOR , seek good advice and never act on forum posts. Happy hunting. Having said that most investments turn out far better then spending money on consumer items.
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Just cause it looks flash in a spreadsheet, doesnt make it likely to happen, so be sure to DYOR , seek good advice and never act on forum posts. Happy hunting. Having said that most investments turn out far better then spending money on consumer items.
Tried to provide a few scenarios for discussion
.
Just cause it looks flash in a spreadsheet, doesnt make it likely to happen, so be sure to DYOR , seek good advice and never act on forum posts. Happy hunting. Having said that most investments turn out far better then spending money on consumer items.
View attachment 41651
No time to look into the fundamentals but technically 20% in the next month wouldnt suprise.
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HOG has just released Huntleys update after the confirmation of initial well flow and sales.
Very, very bullish indeed. It is really hard to see any downside on HOG at current prices. The current well production alone more than justifies the present price. And there is much more to come.
Development at Sorochynska Could Increase Revenue by 80%
The Company has also flagged that an additional development well is possible
in the Sorochynska license at the #201 discovery. The decision to commit to this
will be made once additional production information can be used to update the
reservoir model. A second well could result in an 80% increase in production
over and above the expected 10 million cubic feet of gas level. This would imply
production of 18 million cubic feet of gas and 800 barrels of condensate per day.
At current spot prices, this would represent revenue of US$90m per annum with
earnings of ~US$40m.
http://www.hawkleyoilandgas.com//me...s-research-note-117/Hartleys-reseach-note.pdf
Very, very bullish indeed. It is really hard to see any downside on HOG at current prices. The current well production alone more than justifies the present price. And there is much more to come.
Development at Sorochynska Could Increase Revenue by 80%
The Company has also flagged that an additional development well is possible
in the Sorochynska license at the #201 discovery. The decision to commit to this
will be made once additional production information can be used to update the
reservoir model. A second well could result in an 80% increase in production
over and above the expected 10 million cubic feet of gas level. This would imply
production of 18 million cubic feet of gas and 800 barrels of condensate per day.
At current spot prices, this would represent revenue of US$90m per annum with
earnings of ~US$40m.
http://www.hawkleyoilandgas.com//me...s-research-note-117/Hartleys-reseach-note.pdf
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This looks a great stock, undervalued with a lot of potential.
Seems to be still affected by the day traders.
Still flying under the radar, there probably some apprehension about the Ukraine, but the reserves there would appear to have been under exploited. With better equipment these days the area could take off.
If HOG gets this right they are on winner. The news over the next few months will be key and they should get this out there.
Seems to be still affected by the day traders.
Still flying under the radar, there probably some apprehension about the Ukraine, but the reserves there would appear to have been under exploited. With better equipment these days the area could take off.
If HOG gets this right they are on winner. The news over the next few months will be key and they should get this out there.
Just spent some time digesting the Huntley's update and one thing that doesn't make sense to me is the Gas in place numbers they are assuming - on page 3 they say "B18b reservoir horizon alone, which we estimate at up to 50 billion cubic feet of gas"...
In the very next table, they state that Moyes & Co and RISC both agree on only ~13.5 Bcf (2P).
I think we need 50 BCF to get the stated objective of 8-9 year plateau @ 10 mmscf/d (this rate equates to 3.6 BCF per year production)...
On the other hand, the great things about the HOG Well #201 production update are:
1. Rates and condensate ratio match the original welltest
2. well head pressure of a constant 3,750PSI.... I don't know much about this field but that sounds like there's a lot of energy in this reservoir to get such a high flowing pressure.
My points: a) I think it's going to be critical to see what decline if any they get in the early stage of well #201 production - if it holds in there, then maybe we are looking at more like 50Bcf GIP
b) If so, then a second development well in 18b must be on the cards.
Any comments ?
Disc - I am a holder.
In the very next table, they state that Moyes & Co and RISC both agree on only ~13.5 Bcf (2P).
I think we need 50 BCF to get the stated objective of 8-9 year plateau @ 10 mmscf/d (this rate equates to 3.6 BCF per year production)...
On the other hand, the great things about the HOG Well #201 production update are:
1. Rates and condensate ratio match the original welltest
2. well head pressure of a constant 3,750PSI.... I don't know much about this field but that sounds like there's a lot of energy in this reservoir to get such a high flowing pressure.
My points: a) I think it's going to be critical to see what decline if any they get in the early stage of well #201 production - if it holds in there, then maybe we are looking at more like 50Bcf GIP
b) If so, then a second development well in 18b must be on the cards.
Any comments ?
Disc - I am a holder.
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The trade volumes are still quite low, can't see it going down to much unless that first well fails.
Friday was 47 cents from memory, but what is 2 cents compared to 20 cents in 3 months. We will have to really keep an eye on the data updates.
Sometimes seems a good idea at the time to sit on the bench.
Friday was 47 cents from memory, but what is 2 cents compared to 20 cents in 3 months. We will have to really keep an eye on the data updates.
Sometimes seems a good idea at the time to sit on the bench.
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Just noticed they put a marker on the asx charts tonight.
Also first time news has shown up on a google search.
What a day tomorrow to see what happens.
http://www.oilandgaseurasia.com/news/p/0/news/10708
Also first time news has shown up on a google search.
What a day tomorrow to see what happens.
http://www.oilandgaseurasia.com/news/p/0/news/10708
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Hey nice link posted. Any thoughts on the production?
I'm loading up on these while the buying interest is staying low!! To be able to continue picking up shares at pre $1 is pretty amazing, or at least it will be once the 9mm choke is fitted and we see double the initial flow rates and revenue
Even if wells are expensive as has been mentioned previously, with free cash of around $35m a year, they should be able to get another 3-4 wells drilled within a year, and even if they only succeed with one of them - assume that gives equivalent flows to 201 - then next year they'll have net cash of $70m!! Even with shares in escrow, HOG only has a market cap of $100m at current share price, so it's blatantly obvious that this is undervalued IMO.
I'm putting my money where my mouth is anyway
Even if wells are expensive as has been mentioned previously, with free cash of around $35m a year, they should be able to get another 3-4 wells drilled within a year, and even if they only succeed with one of them - assume that gives equivalent flows to 201 - then next year they'll have net cash of $70m!! Even with shares in escrow, HOG only has a market cap of $100m at current share price, so it's blatantly obvious that this is undervalued IMO.
I'm putting my money where my mouth is anyway
Simple question folks do the maths on just well #201. That in itself is ample to have sp well above current level. I only typed current once, but it appears twice ???? UFO ??
Lord help us if Chets is good as well. This thing will be far better then the next AUT. Nothings safe, nothings assured, but its a risk/reward play that right now to me is simply enticing.
All opinion so DYOR and seek good advice if you can manage to find it. Beware of ill informed overpaid morons charging you for poor advice.
Lord help us if Chets is good as well. This thing will be far better then the next AUT. Nothings safe, nothings assured, but its a risk/reward play that right now to me is simply enticing.
All opinion so DYOR and seek good advice if you can manage to find it. Beware of ill informed overpaid morons charging you for poor advice.
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The general market seems to be disagreeing with you condog. However, for every stupid seller there is another buyer.... hope you are correct with this one though. I only have small package in HOG but am now starting to track it since it has started falling in the last few weeks. I have alot of trust in your research though and love reading your opinions.
Let's hope we gain from here towards the end of the month.
