NDO - Nido Petroleum

[jonojpsg]

Jumped today Nice move up 14% to break out of trading range from last two months and sitting at 16c. With jackup rig arriving sometime in the next week or two and well testing (production!) to be shortly after, this should have upwards pressure towards my target of 20-25c.

If well flows at 10000bpd we should see the top end of that estimate IMO

 

[moses]

Nice looking pennant forming here. With drilling under way presumably we can expect some news soon...

 

[moses]

Interesting. Nice jump in volume today with 21.6m shares exchanged.

From the website...

"As we turn into the year's second quarter, there is palpable excitement in Nido particularly with the ongoing development work at Tindalo and the exploration activities in the outboard acreage. We just released an announcement that the Aquamarine Driller has come on hire and is sailing towards Palawan to commence operations. The seabed coring program is fully underway in Service Contract 58 and interpretation of the 3D seismic data over the southern portion of Service Contract 63 is moving at heightened pace. Markets, be they the capital markets or the oil markets, seem to have settled down to an even tempo. For the Tindalo development, we bid Joanne Williams good luck as she headed to Manila to oversee operations on the ground there. Jon Pattillo, on the other hand, continued to meet with companies interested in to partner with us in the outboard blocks. Everyone in Nido is intensely focused on the work at hand and in delivering the desired results. We are looking forward to a rewarding next few months."

Jocot de Dios

23 April 2010

 

[jonojpsg]

With jack-up rig in place and well to be reentered shortly, this has to be the best opportunity to make a quick dollar doesn't it??

Seriously though, the announcement of oil flowing at upwards of 7000 bpd with 43% of that to Nido has got to get the SP moving given that it's been rated at this level based on Galoc flow of 2000bpd for the last year.

While it may not double the SP, if they get the minimum 7000 bpd from the range stated in the reports, with 2900bpd of that to Nido, it has to give it at least 5-10c boost IMO.

Anyone interested? Care to shoot me down?

 

[moses]

Well I hope you prove right but meanwhile my very nice looking pennant theory appears to have failed.

 

[jonojpsg]

OK, know I know why Mr Market hasn't ramped the SP up in anticipation

Just have all my fingers crossed that all that work and money Nido (and I!!) have put into this don't come to naught with an "Oh woops, the well didn't flow as we'd expected" announcement.

Nido has anticipated initial oil production from the Tindalo well at 7,000 to 15,000 barrels of oil per day, based upon independent party assessment. The production estimate is based upon subsurface geological modelling and reservoir simulation consistent with production history matching of two nearby oil fields (Nido A&B fields located nine miles to the south) that have produced 19 million barrels to date from the same age reservoir. Recoverable oil over an approximate 18 month life may range between 5-6 million barrels for Tindalo. There is no assurance that this well can produce as estimated and there is no certainty that it will be commercially viable to produce any portion of the resources mentioned in this release as there is no flow test data

Waiting extremely impatiently now

 

[pillman]

Well, it's TANKING today . . . cant be certain if this is the effect of the bloodbath on the markets or the flow rates have come in and blown a duster. Either way, the volume is high

Kinda reassuring that a director jumped in and bought a 350000 parcel in the middle of all this mess

 

[jonojpsg]

Well, it's TANKING today . . . cant be certain if this is the effect of the bloodbath on the markets or the flow rates have come in and blown a duster. Either way, the volume is high

Kinda reassuring that a director jumped in and bought a 350000 parcel in the middle of all this mess

I would think that this is the reason - most stocks down on a -2% day. Definitely pushed back this arvo - I was watching closely - and settled at 13.5 which is steady from yesterday. There MUST be news close at hand though, it's been a week since jack-up rig was in place and I wouldn't think it would take longer than that to complete and test the well?

Here's hoping anyway - definitely think that good flow rates will give a massive boost to SP with the uncertainty that surrounds the market atm, any good news will be jumped on IMO

 

[pillman]

I was fortunate / stupid enough to grab a whole bag full at 13c when the world caved in on Friday. Monday will hopefully tell me whether or not that was a bad thing.

Logic would suggest that buying in a crashed market with an imminent announcement that has a high likelyhood of success would be a wise move . . . however logical is not exactly how I would describe the markets these days.

You would think after the weekend (they do work weekends right?) that we would have some results . . they wont save it all up for the AGM on the 19th.

PS, for the useless stat crazy, in 94% of all cases where a company announces an agm and a director has purchased stocks, the stock rises, with an average of 16% rise between the agm ann to the agm day. I spend way too much time with excel.

 

[pillman]

Well, I can only guess it's not bad or good news, just no news. If it was either it would be leaking from either side. At the moment the SP is flatlining with no real indication.

the volume suggests a flush of the speculators for more speculators?

 

[pillman]

NDO gets Insider Trader pick of the week

Here's a stock where Directors have been buying and one broker has a strong buy recommendation on it. Nido Petroleum is an oil and gas exploration company. This company has large acreage reserves, mainly in the Phillipines, and is currently installing a rig right now in the Palawan basin. If all goes well the company should see some shareprice increase due to increased revenues. Of course, sometimes things don't go according to plan so treat this as a speculative stock.

The share price has hit 50c before and Directors buying around 15c gives us some confidence.

 

[jonojpsg]

Hey pillman,
You may be pleased to know I got an email from the AssMD (am I allowed to use that term) that said they are working hard on installing all production equipment and testing the FPSO vessel and connection prior to well completion which she said would definitely still be in May, all things going as planned.

IMO I think this is a no brainer given the amount of money and effort Nido have gone to to get this far - seriously though, if the well doesn't flow as planned they will have egg on their face that will definitely not come off and would they risk that if they weren't 99.99% sure it was going to happen the way they said it would??

Still waiting with a tad of nervous anticipation though IF it comes off with the planned 7-15000bopd I will have a BIG grin Definitely one to watch for the announcement

 

[jonojpsg]

Nice close higher today, up 1.5c to 15.5c, with update on operations as per my last post. Buyers now lining up to get a part of the action, with maybe a week to ten days before the BIG announcement re flow rates. Given the ease with which it moved today, IMO we will see 2-3c creep over the next week then at least 5c more IFF the flow rate fits the stated range.

Worth getting on, which I am obviously

 

[pillman]

Well predicted, and a nice close after a very conservative announcement. I would say they wouldnt go to all that effort of setting up all this hose and equipment . . for a dry well.

The valuation will be the next challenge, how would a decent flow rate impact the SP? There has been a lot of conversations on other sites around it being no big deal in comparison to the neighboring blocks they cant drill yet and dont have the money for?

 

[jonojpsg]

Well predicted, and a nice close after a very conservative announcement. I would say they wouldnt go to all that effort of setting up all this hose and equipment . . for a dry well.

The valuation will be the next challenge, how would a decent flow rate impact the SP? There has been a lot of conversations on other sites around it being no big deal in comparison to the neighboring blocks they cant drill yet and dont have the money for?

Yeah you'd be happy about picking up a bunch at 13 To my mind, the flow rate is not particularly important as long as it is in the range 7-15k bopd that they predicted. The big thing, and this answers your second point, is that it will give Nido cashflow of around $100+ million over the next 12-18 months that they can then apply to the work on their BIG prospects.

Exxon have drilled two holes in a neighbouring deep water permit for around $100m each so assuming Nido could find partners to offset at least 50% of the cost that would give them enough to drill at least two - and there must be something worth finding there as Exxon are coughing up for a third well to be drilled late MAY.

So as far as impact on SP goes, well it certainly adds significant value to the company IMO - the MC increases by about $10m per cent of SP so a reasonable value with success on this well should take them to around $300m MC, or around 30c.

 

[pillman]

Nido announce 5 well program

5 well program over 2 years funded from profits @ SC54 etc.

Shares wont be going backwards again for a while unless there is a storm

 

[jonojpsg]

Re: Nido announce 5 well program

5 well program over 2 years funded from profits @ SC54 etc.

Shares wont be going backwards again for a while unless there is a storm

Mmmm, just reading the AGM presentation!! Looks like some veeerrry tasty prospects there, with the next two years holding some exciting times!! Just can't wait for Tindalo to actually start up and I can sit back and relax and enjoy the ride

 

[pilots]

Re: Nido announce 5 well program

Mmmm, just reading the AGM presentation!! Looks like some veeerrry tasty prospects there, with the next two years holding some exciting times!! Just can't wait for Tindalo to actually start up and I can sit back and relax and enjoy the ride

What will be good this time is that they have done 3D seismic, this makes finding Oil/Gas a lot easer.

 

[pillman]

Im looking at this comparitively to other stocks that a few years ago where in the same boat, such as Molopo and OSH. (Both at opposite ends of the spectrum given Molopo were a penny stock and OSH a semi blue chip . . note I did say "semi" for the purists)

NDO have put forward a fairly robust plan that stands up to scrutiny, as did both OSH and MPO. They have a product that people are going to need to buy . . it's not a bio tech that has some potential regulatory issues etc along the way . . and an organisational structure that allows them to sell it (they arent held back by internal challenges)

The issue will be "do they find oil that is commercially sustainable" . . . and if so can they then use that profit to continue to find out that is commercially sustainable.

At one stage in 2004, OSH was trading at 67c and MPO at about 7 cents . . . now they are $7 and $1.40 respectively. And looking back you can see why, basically a continued growth thru aquiring JV's or new discoveries in commercially viable areas.

But at the same time I remember the chat rooms all were alive with discusion about the companies not making it much further and having all sorts of issues. (MPO even had numerous listings to further dilute the SP)

So . . I think this might be a matter of locking them away in the draw and coming back in a year, see what's happened, dont imagine it would be bad as if it was bad, it would be zero. They cant stand still at this rate, they can only go up or out.

My 2 cents

 

[Buckfont]

Pillman, you`ve got me a little confused saying OSH and MPO are $7.00 and $1.40 respectfully today. My last look had OSH $5.36 and MPO $1.06, and that was a cuppla mins ago. I`m looking at NDO too but will hold off for the moment.