KAR - Karoon Energy

[GreatPig]

Pushed up to a new all-time high today.

Cheers,
GP

[I hold]

 

[Smurf1976]

What happened to this one yesterday? Down nearly 20% but the only news I could find was that they'd signed a contract for a drilling rig. Am I missing something here?

 

[grace]

This one is on my buy list. Am just waiting for some weakening in price as the oil drill rigs are running late and will not start until Q3 08. I can't see why there is any reason to buy until next year closer to drilling timetable.
Charlie Aitken's has given this a ramp - expects this one to go 500 - 1000% within 5 to 10 years ie a $20 to $40 stock. Not many people following this one yet???

 

[sheepdip]

I'm with you Grace. I've had this sitting in my watchlist for a while now but don't see any major reason to rush in and buy just yet. Future looks very rosy for this one though.

 

[morton_mains]

Current mkt seems to undervalue prospects -
Cash at bank 31/12/07 $124M or 94c of current $2.10 price - last raised $51M in Nov07 @$3.45 to sophisticates.

 

[morton_mains]

Well what a difference 3mths makes.
Now $3.36 up 44% glad I took my own advice; seemed logical for SP to re-rate. Still more to come - quality shows in the $443M mkt cap.

 

[grace]

Well what a difference 3mths makes.
Now $3.36 up 44% glad I took my own advice; seemed logical for SP to re-rate. Still more to come - quality shows in the $443M mkt cap.

Been on my watchlist for some time. What's happening going forward? Is drilling on schedule for q3 08?

 

[wipz]

Any chance of this stock getting taken out by woodside, BP, chevron, BHP or shell considering the proximity to brecknock, calliance and torosa?
Would make sense....

wip

 

[grace]

Any chance of this stock getting taken out by woodside, BP, chevron, BHP or shell considering the proximity to brecknock, calliance and torosa?
Would make sense....

wip

You could be on the money there. What's been happening with this one? When are they drilling? I haven't been following for a few months.....

 

[Lachlan6]

KAR is offering no immediate hope that it will undergo some major new uptrend. However it may continue to bounce in the shorter term. I have provided the Elliott Wave interpretation which suggests that the stock is in the corrective wave 4 of the larger wave (C). Remember the wave (C) should take the form of five seperate waves, meaning that after we have this likely bounce, a final move to the downside should occur. Friday's positive close suggests some buying is coming into the stock however I wouldn't expect too much but probably back into the typical retracement area around $3.00.

 

[hedge30]

I believe this went into the Australian top 200 today?? Could def be one to watch Looks very interesting

 

[wipz]

You could be on the money there. What's been happening with this one? When are they drilling? I haven't been following for a few months.....

q1 09?
i don't know! i don't follow it, but given woodside is going to develop browse kar seems to be a no brainer.
either:
a) get taken out
b) pipe their gas through woodside facilities

i think im going to get in when this market settles down!

cheers

 

[wipz]

I'm in this as of today.

Targeting a monster reserve of gas in the Browse Basin.
Just spudded 1st well (Poseidon-1) of a 200 day drilling program.
Poseidon-1 is targeting 7 TCF and is in the same formation as Woodsides 21 TCF Torosa, Calliance and Brecknock gas fields.

Any gas find (highly likely) will send this small cap north.

With AU$140m cash and no debt I just couldn't resist, the up side is huge.

GL Holders, very exciting times.

 

[wipz]

Just a recap of the estimated p50 reserves the ConocoPhilips and Karoon JV are targeting in this 200 day drilling program (as per the AGM presentation on 27-11-2008):

Poseidon -> 7 TCF
Kon-tiki -> 7 TCF
Grace -> 5.7 TCF
Dyfken -> 4 TCF

Over 20+ TCF!

DeGolyer & MacNaughton have conducted an assessment and concluded 6.77 TCF for the Browse basin targets:

1.23 Billions of BOE ( based on DeGolyer & MacNaughton Assessment)
= 1,230,000,000.00 BOE
= 6,765,000,000,000.00 Cubic feet of gas (based on 1boe = ~5,500 std cubic feet of gas)
= 6.77 TCF

Karoon has AU$140 mil cash , zero debt and market cap of ~$420 mil, if 6.77 TCF is found this small cap will go through the roof.

I personally believe gas will be found, as i mentioned before, the fields are in the same formation as woodsides 21+ TCF Torosa, Calliance and Brecknock gas fields.

Well worth an educated punt.

 

[grace]

Grace -> 5.7 TCF


Well worth an educated punt.

Did some research on this about 18 months ago. In the right position to find something good. Nice name too! I have been investing a lot in the onshore variety - csg.

Too tired to get my brain around the numbers at the moment.

Offshore gas costs 4 x to get to LNG compared with csg (I recall reading that and posting in the csg thread). Also taxed at 4 x compared to csg. That comes from memory too (and the govt is bound to increase on the csg variety though). I'll post up some facts and figures on comparisons when I get time.

I recall Southern Cross Equities had a $20 price target for 3.5 yrs time (as they gave it about 18 months ago). Haven't read their recent targets though.

Will discuss some more with you when I get some time.

 

[wipz]

Hmmmmmmm, no interest here in Karoon? Having a great run, up 50% in a couple of weeks.
Drilling Poseidon-1 7tcf target.

Grace, I'd like to hear why you prefer CSG over LNG.

Anyone else holding Karoon?

Cheers.

 

[sinner]

Yep, in at 2.94, +17.7% as of right now.

Not sure how this stock will hold up if the market tumbles again, but happy to hold over the longer term.

 

[grace]

Hmmmmmmm, no interest here in Karoon? Having a great run, up 50% in a couple of weeks.
Drilling Poseidon-1 7tcf target.

Grace, I'd like to hear why you prefer CSG over LNG.

Anyone else holding Karoon?

Cheers.

Pull up a chart for PES over the last 2 years, and you'll see why I like csg! and read the news today.

I am watching Karoon though. It has some enormous potential.

Some of the figures say 1/4 of the cost to get csg to LNG as opposed to convential gas to LNG. Don't believe my memory though, I'll post up the link for this when I have time.

I do like Karoon though.

 

[Dangerous]

Offshore gas costs 4 x to get to LNG compared with csg (I recall reading that and posting in the csg thread). Also taxed at 4 x compared to csg. That comes from memory too (and the govt is bound to increase on the csg variety though). I'll post up some facts and figures on comparisons when I get time.


Grace, I don't know that this can be said given that LNG plants for CSG have not even been built. If you were to look at CSG stocks to conventional stocks over the last few years you would argue that CSG is the way forward. However, there are massive challenges for CSG to LNG as oppposed to the proven conventional to LNG - a few hundred CSG wells equal one conventional well! Further to this the CSG producers don't know what to do with all the water and are not yet 100% sure that they can even shut in their wells. This makes the process of turning on a LNG plant a logistical nightmare. Add to this the enormous CSG footprint (2,000 wells for each big producer) and all the associated landholder issues and costs. I understand that if the multinationals have the will, there is a way, but remember that one WPL well can produce more than all of what QGC and AOE can produce in one day... The WPL's and Exxons of the world realize this and perhaps that is why Shell has not yet acted - Voelte has made his thoughts on CSG well known. I trade CSG stocks purely (no pun intended) for the sentiment behind them, not the fundamentals, although i believe it to be a great domestic gas source.

 

[grace]

Offshore gas costs 4 x to get to LNG compared with csg (I recall reading that and posting in the csg thread). Also taxed at 4 x compared to csg. That comes from memory too (and the govt is bound to increase on the csg variety though). I'll post up some facts and figures on comparisons when I get time.


Grace, I don't know that this can be said given that LNG plants for CSG have not even been built. If you were to look at CSG stocks to conventional stocks over the last few years you would argue that CSG is the way forward. However, there are massive challenges for CSG to LNG as oppposed to the proven conventional to LNG - a few hundred CSG wells equal one conventional well! Further to this the CSG producers don't know what to do with all the water and are not yet 100% sure that they can even shut in their wells. This makes the process of turning on a LNG plant a logistical nightmare. Add to this the enormous CSG footprint (2,000 wells for each big producer) and all the associated landholder issues and costs. I understand that if the multinationals have the will, there is a way, but remember that one WPL well can produce more than all of what QGC and AOE can produce in one day... The WPL's and Exxons of the world realize this and perhaps that is why Shell has not yet acted - Voelte has made his thoughts on CSG well known. I trade CSG stocks purely (no pun intended) for the sentiment behind them, not the fundamentals, although i believe it to be a great domestic gas source.

Here is the story and link - what do you think?

A recent comparison of conventional LNG projects with coal seam gas projects by Deutsche Bank analysts illustrated the differences neatly. They compared Woodside’s Pluto project with Santos’ Gladstone LNG (GLNG) project, which will source gas from its Fairview resource.

Pluto will drill five wells to support its initial LNG production. GLNG will drill 540. Pluto will increase its number of wells to 8, while GLNG will be adding about 60 wells a year.

The ramp up period to first production is about five days for Pluto, but two years for GLNG, while production per well is about 120 million cubic feet of gas a day for Pluto and only about one million cubic feet per well for Fairview. Total production for Pluto would be around 614 million cubic feet where Fairview is expected to produce 526 million cubic feet.

So, at face value, coal seam gas involves far more drilling for significantly less production and, because coal seam gas contains no liquids, significantly less valuable production.

The capital expenditure on the upstream phase of the development to bring Pluto into production, however, is about $5 billion, whereas Fairview will cost only about $1.2 billion – that’s the difference between an offshore development and an onshore project.

Moreover, where Pluto faces a petroleum resource rent tax rate of 40 per cent, as an onshore project Fairview will only pay royalties of 10 per cent – the upstream tax take, the analysts say, will be $6.7 billion for Pluto but only $2.3 billion for Fairview.

As Santos says, the growth in Australian coal seam gas production is following a similar path to coal seam gas in the US, although average production from the Queensland fields is substantially greater than from the average well in the US – Santos says the Australian resources are of better quality than those in the US.

The reason there is excitement about the prospects for the sector is the ability to tap into the global gas market and gain exposure to LNG prices. If the coal seam resources were devoted purely to the domestic market they might benefit from the impact of carbon pricing but, in the near term at least, would over-supply the domestic market and dampen price growth.

With four export LNG plants planned in Queensland, the market for the gas would suddenly become a global one. Exports of the gas as LNG will generate greater value and inevitably pull domestic prices up to narrow the arbitrage opportunity, putting a rising floor under the economics of the coal seam gas sector and bringing other unconventional sources of gas into play.

http://www.businessspectator.com.au/bs.nsf/Article/Gas-rises-on-demand-F953F?OpenDocument