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ROC - Roc Oil Company

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Does anybody knows something about the financial status of this company? Are they in big red depts, going bankrupt or is everything alright? :confused:
 
aussiger

I think ol blue's comments are close. I also see a substantial shareholder notice to ROC this morning whereby Nexus have off-loaded another 10mil shares. By comparison to an Nexus AGM presentation, Nexus have in fact offloaded nigh 20mil shares ... I suspect this reflects their (Nexus) predicament rather than ROC's.:banghead:

The BMG situation I think is worthy of a watch!

DYOR. I'm long ROC:D
 
ROC features often in my daily dog list and it has acheived the award again today. :banghead:

In view of the announcement I closed out my position today. It seems to me that a major shareholder is hell bent on closing out its position at 53 cents. So far NXS seems to have sold 20mil of its 54 mil portfolio...apparently on market.

If I were a ROC director I might call the NXS director and inquire (a) what the hell is he doing? :mad:(b) what drugs he is on? :mad:and (c) if NXS is hell bent on closing them out, can ROC help with a sensible placement?

If I were an NXS director, I think I'd ask ROC did they know of any interested party...surely a discrete sale of a significant parcel would yield a better outcome?:rolleyes: It might be possible to conclude that ROC couldn't identify a sesnible party


As I'm not a director and am not really close to NXS other than reading some of the commentary on this forum, I'd just as soon stand aside until it settles. Heaven forbid if NXS were required as part of a funding strategy / debt obligation to close out the entire 54 million parcel... quickly. Ouch.:eek:

DYOR... I really don't have a clue and so would prefer to sit on the fence and contemplate!
 
I think that if the oil price remains at a reasonable level once NXS finished selling out there should be a good bounce in ROC, as the majority of the selling pressure will be gone.

I closed my NXS position today (disappointed Libra not in communication with Crux) and think I'll put the funds into ROC in a week or so. I think there'll still be 2 weeks of NXS selling.
 
See that 30+mil get dumped at 52c just after 1pm and again another few million at 1.35pm that dragged the SP from 57 down to 52. Man, what a call, i sold at 57 and 2 minutes later rebought it at 52.

Do they have any more to get rid of? or is that it now?
 
record volume today... i think its safe to say that its bouncing off the floor @50c, its value is finally realised. averaging 10,000BOPD, definitely undervalued to others.
 
The main reason for the share decline (once the drop in crude oil is taken into account) is shareholder disapproval with the highly dilutive share issue to purchase all of Anzon. It has pretty much doubled the amount of shares the company has on issue, meaning any future exploration success will be much less in terms of value per share to original ROC shareholders. What makes matters worse is that this deal was made when oil was hitting its peak and no hedging was put in place at these prices. So really it was a double whammy for ROC shareholders. Then you throw into the mix the loss of a Dr John Doran a geological wiz and one fine CEO, an expensive drilling program in 08 which has yielded very little and now a possible lawsuit with contracting for a FPSO at BMG. 08 was really one bad year for the company, who knows 09 might just be as bad or worse but let’s hope not.

In terms of Beibu Gulf in China, I’m not really too fussed about the deferment because a development area has been granted by the Chinese authorities meaning the project has been given the green light. Things are being held up because of the conflicting ideas in terms of the development plan. CNOOC wants to lower the cost of the project by using a tie back system to their existing facilities a few km’s to the west instead of using the Australian JV team’s idea of a standalone system i.e. a well head platform and FPSO. The fall in the commodity prices in general is probably good news as it will lead to lower CAPEX costs for full development of this project. This is why a lot of company’s including ROC are urgently trying to exit existing contracts with oil servicing companies to take advantage of currently lower market prices for equipment and infrastructure than what has been seen over the past year/s.

Back onto BMG. If one was to try and see the positive out of its purchase which was bought to my attention by an analyst. Funding is very hard (and expensive) to come by in such an environment and is likely to be that way for a good period of time as banks ration credit to only those loans that meet a very strict criteria. Given ROC is in an industry that is heavily reliant on the price of oil a very volatile commodity of late, granting of loans for exploration programs, development or production drilling could be difficult to obtain. Given its purchase of BMG the company does not have to rely as much on its lenders but can use internal cash flow generated from the asset to continue the normal running of the company’s exploration, development and production programs. A luxury many other small oil companies are without.

In terms of NXS selling its stake in the company, this is probably just the result of a cash shortfall or debt commitments which means NXS has decided to offload one of its highly liquid assets, that being its shareholding in ROC. I’m sure ROC would also be doing the same if it was in need of some quick cash. I think the fact that ROC has yet to make a similar move indicates that it is not in desperate need of cash and is in a fairly healthy position. Agree. ROC held up extremely well today given NXS was continuing to dump its stock onto the open market.

At the end of the September quarter ROC had a cash balance of $US64.5m & gross debt of $US148.6m implying net debt of $US84.1m (excluding ROC’s >400,00bbl crude stock position and its ~10% shareholding in NXS).

Someone also asked about whether ROC was still generating positive cash flows from its operations. If you look at its half yearly results (30th June 2008) which is the most updated information I can find on this topic.

1H 07 – Production Costs = $US8.24/BBL (Cash cost/BBL)
Amortisation = $US22.45/BBL (Depreciation/BBL – non cash)
Total Cost = $US30.69/BBL

1H 08 – Production Costs = $US9.18/BBL (Cash Cost/BBL)
Amortisation = $US27.31/BBL (Depreciation/BBL – non cash)
Total Cost =$US36.49/BBL

These figures show ROC is still earning a very healthy cash margin on its operations at $40-50/bbl given cash production costs of around $10/BBL. However if ROC was looking to develop a new field it probably be looking for a sustainable future price of $45-60/BBL.
 
great review greens :iagree:! ROC is a few mid cap around thats generating a healthy income with low debt levels. even without further exploration, with the current projects in hand it should generate quite a healthy income over the next 2-3 yrs (not to mention that it should be debt free over the next 6 or so mths). Although in the past, ROC does not have an aggressive exploration program with high risk appetite, looks like its been paid off in the current economy environment.
 
GREENS said:
The main reason for the share decline (once the drop in crude oil is taken into account) is shareholder disapproval with the highly dilutive share issue to purchase all of Anzon. It has pretty much doubled the amount of shares the company has on issue, meaning any future exploration success will be much less in terms of value per share to original ROC shareholders. What makes matters worse is that this deal was made when oil was hitting its peak and no hedging was put in place at these prices. So really it was a double whammy for ROC shareholders. Then you throw into the mix the loss of a Dr John Doran a geological wiz and one fine CEO, an expensive drilling program in 08 which has yielded very little and now a possible lawsuit with contracting for a FPSO at BMG. 08 was really one bad year for the company, who knows 09 might just be as bad or worse but let’s hope not.

In terms of Beibu Gulf in China, I’m not really too fussed about the deferment because a development area has been granted by the Chinese authorities meaning the project has been given the green light. Things are being held up because of the conflicting ideas in terms of the development plan. CNOOC wants to lower the cost of the project by using a tie back system to their existing facilities a few km’s to the west instead of using the Australian JV team’s idea of a standalone system i.e. a well head platform and FPSO. The fall in the commodity prices in general is probably good news as it will lead to lower CAPEX costs for full development of this project. This is why a lot of company’s including ROC are urgently trying to exit existing contracts with oil servicing companies to take advantage of currently lower market prices for equipment and infrastructure than what has been seen over the past year/s.

Back onto BMG. If one was to try and see the positive out of its purchase which was bought to my attention by an analyst. Funding is very hard (and expensive) to come by in such an environment and is likely to be that way for a good period of time as banks ration credit to only those loans that meet a very strict criteria. Given ROC is in an industry that is heavily reliant on the price of oil a very volatile commodity of late, granting of loans for exploration programs, development or production drilling could be difficult to obtain. Given its purchase of BMG the company does not have to rely as much on its lenders but can use internal cash flow generated from the asset to continue the normal running of the company’s exploration, development and production programs. A luxury many other small oil companies are without.

In terms of NXS selling its stake in the company, this is probably just the result of a cash shortfall or debt commitments which means NXS has decided to offload one of its highly liquid assets, that being its shareholding in ROC. I’m sure ROC would also be doing the same if it was in need of some quick cash. I think the fact that ROC has yet to make a similar move indicates that it is not in desperate need of cash and is in a fairly healthy position. Agree. ROC held up extremely well today given NXS was continuing to dump its stock onto the open market.

At the end of the September quarter ROC had a cash balance of $US64.5m & gross debt of $US148.6m implying net debt of $US84.1m (excluding ROC’s >400,00bbl crude stock position and its ~10% shareholding in NXS).

Someone also asked about whether ROC was still generating positive cash flows from its operations. If you look at its half yearly results (30th June 2008) which is the most updated information I can find on this topic.

1H 07 – Production Costs = $US8.24/BBL (Cash cost/BBL)
Amortisation = $US22.45/BBL (Depreciation/BBL – non cash)
Total Cost = $US30.69/BBL

1H 08 – Production Costs = $US9.18/BBL (Cash Cost/BBL)
Amortisation = $US27.31/BBL (Depreciation/BBL – non cash)
Total Cost =$US36.49/BBL

These figures show ROC is still earning a very healthy cash margin on its operations at $40-50/bbl given cash production costs of around $10/BBL. However if ROC was looking to develop a new field it probably be looking for a sustainable future price of $45-60/BBL.
Click to expand...

Thanks for the info Greens. Another thing to note is that even IF there is a law suite it will only be over the FPSO contract and not over any of the other projects that ROC has. This also doesn't effect any of it's current production and revenues which is important for ROC as well.

All considering, the share price is still far too cheap and is way overdue for a bounce especially now that NXS is out of the picture.
 
UPKA While forecasted exploration drilling in 09/10 is much less than its hectic 08 schedule there is still some considerably high risk/high impact acreage in ROC’s exploration portfolio.

Yeh champ just had a quick glance at that recent market release on the termination of the Letter of Intent ("LOI") signed in July 2008 for the supply of a FPSO at BMG for phase 2 expansion. The company said if BW Offshore decides to take legal action costs are capped at $US78.5m which implies ROC would have to foot the bill in a worst case scenario of 40% of these costs or $US31.4m.
 
nice trend beggining to form upwards here for roc oil, backed with strong demand (close to twice as many as sellers) it looks as though it might be in search of its real value, in which i believe to be >$1 fingers crossed
 
I wouldnt read into the depth too much... orders can easily be pulled on both sides. I think ROC will continue on it's sideway movement until the crude price improves, i remembered reading ROC's report/presentation that only 10% of the output r hedged, so company's profit is very much closely related to the crude spot price.

Although OPEC made record cuts in production and still considering more, but the effect of the cut won't be felt until at a much later time. A lot of energy trading companies have stocked up crude oils in tankers, punting for the oil to jump back to the US$70-80 sometime this yr.
 
So, because of the low low oil price is this the reason why ROC has dropped 13c in the last 2 weeks or is there something else. Can't see anything in their presentation from 2 weeks ago that investors might not like......unless i'm missing something
 
When you are an explorer and you dont find anything, well u suffer, thats what happens.. some debt, lower oil prices, a poor acquisition....

alot of coys have some unstuck due to poor acquisitions lately, this wasnt a Suncorp or a Rio but, it really wasnt great... if they can go a few months without smoking themselves again they will most probably survive...
 
dmagnus said:
When you are an explorer and you dont find anything, well u suffer, thats what happens.. some debt, lower oil prices, a poor acquisition....

alot of coys have some unstuck due to poor acquisitions lately, this wasnt a Suncorp or a Rio but, it really wasnt great... if they can go a few months without smoking themselves again they will most probably survive...
Click to expand...

i think the term "survive" shouldnt be used with Roc. They have enough producing fields to keep them going for the next couple of years at least. They are confident enough to pay off its debts over the next 2-3yrs. Although its current producing fields r declining in production, any exploration success in Africa should see the SP head up north again.
 
Roc looking a lot better now, breaking through the recent highs of the last month.if the oil price can hold up roc could see a re-rating.i will hold until it falls below 40c, with an aim of 55c
 
I think the key resistance is at 50c, once that's through and NXS sold out their holdings, then we might see a significant re-rating.
 
It hits $0.455 today. Do not know if this stock going to the north.

Could anybody provide the plot with resistance and support line please?
 
ROC is largely affected by the movement of the oil price, and oil price has broke thru the key resistance for USD50/b couple of days ago, and being holding, which boosted investors confidence into oil stocks again. in my previous post, i've mentioned that the key resistance for ROC is at around 50c, sorry i dont have the graph handy, but it's not hard to see.. after breaking 40c, and have held well, you can safely say that would be the new floor.
 

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