SGL - Sydney Gas
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Good luck Duchy...
IMO things can only get better for SGL in the coming months.
(a) New M.D. announcement pending anytime now after forced retirement of Mr Moore (health reasons).
(b) Ever increasing production from around 6 or more new wells being tied inb to the Camden network
(c) 50% Joint Venture partner AGL's recent announcement that CSM energy will be a major focus for them in the next 5-10 years (possibility of a future CSM based power station near the Camden fields perhaps?)
(d) Rocketing P/E ratios and prices of AOE, QGC etc start to make SGL's lowly current figures look better value over time.
Fingers x'ed...
AJ
[Note: I hold almost 600,000 SGL, so do your own research!!]
IMO things can only get better for SGL in the coming months.
(a) New M.D. announcement pending anytime now after forced retirement of Mr Moore (health reasons).
(b) Ever increasing production from around 6 or more new wells being tied inb to the Camden network
(c) 50% Joint Venture partner AGL's recent announcement that CSM energy will be a major focus for them in the next 5-10 years (possibility of a future CSM based power station near the Camden fields perhaps?)
(d) Rocketing P/E ratios and prices of AOE, QGC etc start to make SGL's lowly current figures look better value over time.
Fingers x'ed...
AJ
[Note: I hold almost 600,000 SGL, so do your own research!!]
SGL
Can someone please explain what happened here?
Buyers
1 4328 0.385 (ME)
Lots of others under
at .38etc
Last 10 Trades
Time Price Quantity
03:52:11 PM 0.385 288
03:52:11 PM 0.385 344
03:52:11 PM 0.385 183
03:52:11 PM 0.385 259
03:52:11 PM 0.385 556
03:52:11 PM 0.385 270 03:36:59 PM 0.390 1,734
03:23:08 PM 0.390 25,000
03:04:41 PM 0.390 1,266
02:26:20 PM 0.390 797
I had a buy order of 10000 @.385 which was sitting in the cue for a while
It was partially filled with about 3700 initially and then nothing for a while/
At 3:52:11 ........ 6 different orders went through for those small quantities.
Why were they sold at such prices
Rob
Can someone please explain what happened here?
Buyers
1 4328 0.385 (ME)
Lots of others under
at .38etc
Last 10 Trades
Time Price Quantity
03:52:11 PM 0.385 288
03:52:11 PM 0.385 344
03:52:11 PM 0.385 183
03:52:11 PM 0.385 259
03:52:11 PM 0.385 556
03:52:11 PM 0.385 270 03:36:59 PM 0.390 1,734
03:23:08 PM 0.390 25,000
03:04:41 PM 0.390 1,266
02:26:20 PM 0.390 797
I had a buy order of 10000 @.385 which was sitting in the cue for a while
It was partially filled with about 3700 initially and then nothing for a while/
At 3:52:11 ........ 6 different orders went through for those small quantities.
Why were they sold at such prices
Rob
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Something's up at Sydney Gas. I'm wondering whether the announcement that AGL has sold it's share in Alinta for $125 profit might have something to do with "various parties" being involved in the strategic review.
A couple of years ago, there was some small talk from the then SGL management and AGL about AGL's considering building a coal seam gas fired power station out near the Camden gas fields "in the near future". Nothing has been heard since, so I wonder whether this cash windfall for AGL has anything to do with those expansion plans.
(Disclaimer: I still hold SGL - this is in no way a recommendation - do your OWN research!).
AJ
A couple of years ago, there was some small talk from the then SGL management and AGL about AGL's considering building a coal seam gas fired power station out near the Camden gas fields "in the near future". Nothing has been heard since, so I wonder whether this cash windfall for AGL has anything to do with those expansion plans.
(Disclaimer: I still hold SGL - this is in no way a recommendation - do your OWN research!).
AJ
To match the price/reserve of its peers, it is supposed to go to 56.5c per share at least.
Let alone the speculating value on its gas power station. It has a chance the rumor may come true. It will add some specie on sgl's price.
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It's also worth noting that under the terms of the current joint venture, AGL will pay SGL "up to an additional $51 million by 31 December 2008, in consideration for proving up additional reserves at Camden" which is what they are currently undertaking to do. If my math is right, with 350 million shares held by shareholders, if SGL can achieve the maximum target, that could add up to approx. 14.5c per share over yesterday's closing price alone, before this morning's Strategic Review announcement.
Interesting...
AJ
Interesting...
AJ
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SGL closed Friday at 41.5c, up 2.5c (or 6.4%) on the previous days close.
After close of trading, SGL posted the following announcement:
STOCK EXCHANGE ANNOUNCEMENT - CORRECTION
FIRST QUARTER ACTIVITY REPORT - APPENDIX 5B – CONSOLIDATED STATEMENT OF CASH FLOW
We refer to our report released on 31 October 2007 and note a typographical error. The
first sentence under the heading Quarter Highlights should read, “Gas sales volume this
quarter was 20% higher than the comparable period in 2006/07” not “12%”.
Attached please find amended report for your information.
Pha Tran
Company Secretary
AJ
After close of trading, SGL posted the following announcement:
STOCK EXCHANGE ANNOUNCEMENT - CORRECTION
FIRST QUARTER ACTIVITY REPORT - APPENDIX 5B – CONSOLIDATED STATEMENT OF CASH FLOW
We refer to our report released on 31 October 2007 and note a typographical error. The
first sentence under the heading Quarter Highlights should read, “Gas sales volume this
quarter was 20% higher than the comparable period in 2006/07” not “12%”.
Attached please find amended report for your information.
Pha Tran
Company Secretary
AJ
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AJ Lucas (AJL) is proving up gas resources at its Gloucester Basin CSM project where in JV with MPO (30%). This encompasses a large area that includes both Stroud & Gloucester townships. Indications suggest it could be a highly significant project with potential to supply gas to the Newcastle/Sydney market.
AJL is investigating develpment options through dedicated business arm Lucas Energy.
AJL is a vertically integrated CSM operator with 48+ drilling rigs, pipeline building capability etc. Also has historic ties to AGL....has been preferred contractor on a range of AGL (& other projects); one of the directors,Garry O'Meally was formerly AGL Gen Manager.
AGL has been constrained by reliance on others to supply gas and to meet power demands. They have stated that it considers securing future generating capacity as a priority.
Gas-fired power stations are in vogue. Origin's Darling Downs 400MW gas-fired power-station is publicised as Co2 efficient....equiv to taking 200 000 cars off the road vs conventional coal.
To my speculative point....
Is AGL positioning itself to ann a gas-fired powerstation for Sydney/Hunter??....And towards this, is firming up long-term gas resources...& development capability, from SGL (both Camden, then Hunter projects) and also AJL??
Plenty of synergies exist for all parties if AGL was to coordinate such an arrangement .
AJL is investigating develpment options through dedicated business arm Lucas Energy.
AJL is a vertically integrated CSM operator with 48+ drilling rigs, pipeline building capability etc. Also has historic ties to AGL....has been preferred contractor on a range of AGL (& other projects); one of the directors,Garry O'Meally was formerly AGL Gen Manager.
AGL has been constrained by reliance on others to supply gas and to meet power demands. They have stated that it considers securing future generating capacity as a priority.
Gas-fired power stations are in vogue. Origin's Darling Downs 400MW gas-fired power-station is publicised as Co2 efficient....equiv to taking 200 000 cars off the road vs conventional coal.
To my speculative point....
Is AGL positioning itself to ann a gas-fired powerstation for Sydney/Hunter??....And towards this, is firming up long-term gas resources...& development capability, from SGL (both Camden, then Hunter projects) and also AJL??
Plenty of synergies exist for all parties if AGL was to coordinate such an arrangement .
I think that regardless of whether you are right Col, the MPO share price is the one that will benefit most from the Gloucester Basin project, at least in the short term. Although MPO has a lesser share in it, its lower share price (.195 - .22 av over last week or so) means a small success in the basin has potential for a substantial percentage increase; cf the large rise necessary for a similar percentage with SGL (SP .415) and AJL (SP 3.37).
I have put to one side the capitalisation, number of shares on issue and potential returns, because those factors tend to be more relevant to longer, not short, term share prices. I have also put to one side the other projects of MPO and AJL, because both have other substantial projects. I would accept that in the long term, if AJL has an infrstructure interest as well, then obviouly that will be an extra benefit to it.
It is probably fair to say that all three have significant potential, and I think that trading styles may determine the best investment for each shareholder.
I have put to one side the capitalisation, number of shares on issue and potential returns, because those factors tend to be more relevant to longer, not short, term share prices. I have also put to one side the other projects of MPO and AJL, because both have other substantial projects. I would accept that in the long term, if AJL has an infrstructure interest as well, then obviouly that will be an extra benefit to it.
It is probably fair to say that all three have significant potential, and I think that trading styles may determine the best investment for each shareholder.
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James...not sure you can assume other players/investors will disregard the factors you mentioned and focus only on the nominal sp numeral.
Consider this.....
MPO Mkt cap $178mill (@$0.20)
AJL mkt Cap $184mill (@$3.37)
MPO yet to make a profit. Forecast earnings...?
AJL (Comsec/Aspect figs)
eps07 11.8cents PE 22.5;
eps08 21.0c PE 16; Growth 78%;
eps 09 32.5c PE 10.4; 54%
eps 10 28.1....
Significantly, this income is generated independently of AJL's Gloucester (& QLD) potential gas production assets..!
We are comparing apples and abalone here; although I must admit to lacking a full knowledge of MPO's other projects.
However, it must be considered that all AJL non-gas-production sectors are growing - contributing to current earnings & growth projections ...eg pipelines, directional drilling, water projects etc.
These earnings at least underwrite the sp of AJL and justify the current $3.37sp & $184 mkt cap.
Difficult though to place a confident value on sp until the full extent of AJL/MPO Gloucester reserves are spelt out ( next couple of months).
The value of SGL may become apparent in this time-frame also, given evident positioning there, and may help decide AJl's ultimate value.
I'm tipping a further positive rerating.... but then, I do hold a few of these..
(Duplicate of AJL Thread reply...)
Consider this.....
MPO Mkt cap $178mill (@$0.20)
AJL mkt Cap $184mill (@$3.37)
MPO yet to make a profit. Forecast earnings...?
AJL (Comsec/Aspect figs)
eps07 11.8cents PE 22.5;
eps08 21.0c PE 16; Growth 78%;
eps 09 32.5c PE 10.4; 54%
eps 10 28.1....
Significantly, this income is generated independently of AJL's Gloucester (& QLD) potential gas production assets..!
We are comparing apples and abalone here; although I must admit to lacking a full knowledge of MPO's other projects.
However, it must be considered that all AJL non-gas-production sectors are growing - contributing to current earnings & growth projections ...eg pipelines, directional drilling, water projects etc.
These earnings at least underwrite the sp of AJL and justify the current $3.37sp & $184 mkt cap.
Difficult though to place a confident value on sp until the full extent of AJL/MPO Gloucester reserves are spelt out ( next couple of months).
The value of SGL may become apparent in this time-frame also, given evident positioning there, and may help decide AJl's ultimate value.
I'm tipping a further positive rerating.... but then, I do hold a few of these..
(Duplicate of AJL Thread reply...)
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Todays announcement.....
5 November 2007
MEDIA RELEASE
BLUE ENERGY RESPONDS TO MEDIA SPECULATION
In response to speculation about a possible transaction involving Blue Energy Limited (ASX: “BUL”) and Sydney Gas Limited (ASX: “SGL”), Blue Energy’s chairman, Mr Nick Stretch, confirms that the two companies have had informal discussions about a number of potential proposals any of which may or may not reach a stage where an announcement is appropriate.
The directors of Blue Energy will inform the ASX and shareholders immediately if and when a proposal is sufficiently developed to be appropriate for disclosure. Mr Stretch said that to disclose the nature of such preliminary discussions may have the effect of misleading the market. Until appropriate, no further comment or announcement will be made by Blue Energy.
Nick Stretch,
Chairman,
Blue Energy Limited
5 November 2007
MEDIA RELEASE
BLUE ENERGY RESPONDS TO MEDIA SPECULATION
In response to speculation about a possible transaction involving Blue Energy Limited (ASX: “BUL”) and Sydney Gas Limited (ASX: “SGL”), Blue Energy’s chairman, Mr Nick Stretch, confirms that the two companies have had informal discussions about a number of potential proposals any of which may or may not reach a stage where an announcement is appropriate.
The directors of Blue Energy will inform the ASX and shareholders immediately if and when a proposal is sufficiently developed to be appropriate for disclosure. Mr Stretch said that to disclose the nature of such preliminary discussions may have the effect of misleading the market. Until appropriate, no further comment or announcement will be made by Blue Energy.
Nick Stretch,
Chairman,
Blue Energy Limited
Col, all three companies, as I indicated, have potential. MPO has a variety of other and arguably more important projects than the basin.
I agree that not all investors will disregard fundamentals, but that will not necessary deter investment in either. They are at different stages of the cycle. Both have prospects and good management. My money is with one, and yours is (I infer) with the other.
You and are are in essence talking about different things. I am referring to short term market reaction and you are talking about longer term aspects. I think in the long term both are excellent. No doubt the market will determine the short term result. We could both be wrong or partially right ;-).
I agree that not all investors will disregard fundamentals, but that will not necessary deter investment in either. They are at different stages of the cycle. Both have prospects and good management. My money is with one, and yours is (I infer) with the other.
You and are are in essence talking about different things. I am referring to short term market reaction and you are talking about longer term aspects. I think in the long term both are excellent. No doubt the market will determine the short term result. We could both be wrong or partially right ;-).
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Hmmm. Bit of a move in SGL stocks this morning. Buyers jumping on board and sellers drying up, all with no further news regarding the strategic review and/or talks with BUL. There has been a fair bit of consolidation at the 40c mark over the last week or so, even with some days of thin volumes. Up 3.5 cents as I type....
AJ
AJ
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Significant news at last!
ASX AND MEDIA RELEASE
SIGNING HEADS OF AGREEMENT WITH THE A J LUCAS
GROUP AND APPOINTMENT OF CHIEF EXECUTIVE OFFICER
14 January 2008
Sydney Gas Ltd (“Sydney Gas”) has today signed heads of agreement with the A J Lucas Group Limited (“Heads of Agreement”) (“Lucas”) and intends to appoint Andy Lukas as the new Chief Executive Officer of Sydney Gas. The transaction has the following key benefits to Sydney Gas:
1. Access to leading management, personnel, and drilling resources in the coal seam methane gas industry with transparent alignment of interests through equity investment and performance based incentives.
2. Up to A$47.2 million of additional equity capital available for accelerated exploration and development.
3. A new Chief Executive Officer and a new non-executive director, with in-depth coal seam methane gas industry experience.
A meeting of Sydney Gas shareholders will be held in March 2008 to approve key elements of the arrangements.
Under the Heads of Agreement, Lucas will make available drilling and technical resources as required by Sydney Gas to accelerate the development of its gas assets and provide A$20.0 million upfront, and an additional A$27.2 million in total over 3 years, of exploration and development capital via taking a 15% shareholding in Sydney Gas, as well as options that could upon their exercise, subject to shareholder approval, over 3 years, increase its shareholding by 40.25 million shares. There are four key elements under the Heads of Agreement:
1. Upfront capital raising of A$20.0 million via a private placement to Lucas.
2. Provision of dedicated expert technical services by Lucas.
3. Incentive arrangements to create clear alignment of interests between Sydney Gas shareholder value and Lucas.
4. Raising an additional A$12.1 million and A$15.1 million of development capital via exercise of two tranches of performance-linked options which may be exercised:
(a) in approximately 2 years time and 3 years time, respectively; and
(b) upon Sydney G as achieving an increase of its 2P reserves by at least 75PJ and 150PJ, respectively, and an increase in its share price to at least 60 cents and at least 75 cents, respectively.
See the full details here:
http://imagesignal.comsec.com.au/asxdata/20080114/pdf/00802548.pdf
Cheers,
AJ
ASX AND MEDIA RELEASE
SIGNING HEADS OF AGREEMENT WITH THE A J LUCAS
GROUP AND APPOINTMENT OF CHIEF EXECUTIVE OFFICER
14 January 2008
Sydney Gas Ltd (“Sydney Gas”) has today signed heads of agreement with the A J Lucas Group Limited (“Heads of Agreement”) (“Lucas”) and intends to appoint Andy Lukas as the new Chief Executive Officer of Sydney Gas. The transaction has the following key benefits to Sydney Gas:
1. Access to leading management, personnel, and drilling resources in the coal seam methane gas industry with transparent alignment of interests through equity investment and performance based incentives.
2. Up to A$47.2 million of additional equity capital available for accelerated exploration and development.
3. A new Chief Executive Officer and a new non-executive director, with in-depth coal seam methane gas industry experience.
A meeting of Sydney Gas shareholders will be held in March 2008 to approve key elements of the arrangements.
Under the Heads of Agreement, Lucas will make available drilling and technical resources as required by Sydney Gas to accelerate the development of its gas assets and provide A$20.0 million upfront, and an additional A$27.2 million in total over 3 years, of exploration and development capital via taking a 15% shareholding in Sydney Gas, as well as options that could upon their exercise, subject to shareholder approval, over 3 years, increase its shareholding by 40.25 million shares. There are four key elements under the Heads of Agreement:
1. Upfront capital raising of A$20.0 million via a private placement to Lucas.
2. Provision of dedicated expert technical services by Lucas.
3. Incentive arrangements to create clear alignment of interests between Sydney Gas shareholder value and Lucas.
4. Raising an additional A$12.1 million and A$15.1 million of development capital via exercise of two tranches of performance-linked options which may be exercised:
(a) in approximately 2 years time and 3 years time, respectively; and
(b) upon Sydney G as achieving an increase of its 2P reserves by at least 75PJ and 150PJ, respectively, and an increase in its share price to at least 60 cents and at least 75 cents, respectively.
See the full details here:
http://imagesignal.comsec.com.au/asxdata/20080114/pdf/00802548.pdf
Cheers,
AJ
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AussieJeff....AJL's asx releases 21st & 22nd Feb are a must read for SGL followers IMO.
AJL arent known for hyperbole...and the releases should be read with this in mind. The Results Presentation (eg,Pg 16) stresses SGL's potential with AJL pulling the strings....
*well positioned in the market-place....
*has considerable reserves potential
*demand rapidly increasing in NSW gas-market
*considered very underpriced relative to peers
*Huge potential. Fits well with other CSM assets.
AJL arent known for hyperbole...and the releases should be read with this in mind. The Results Presentation (eg,Pg 16) stresses SGL's potential with AJL pulling the strings....
*well positioned in the market-place....
*has considerable reserves potential
*demand rapidly increasing in NSW gas-market
*considered very underpriced relative to peers
*Huge potential. Fits well with other CSM assets.
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The main problem I see is that investor sentiment has now been anti-SGL for a long time, thanks to the ridiculous instability of a series of mis-management teams. The comparison chart shows that from Jun '05 the SP's of QGC and AOE started to move ahead of SGL at an ever-increasing rate. If only SGL management had accepted QGC's takeover offer, eh? Imagine the SP growth rate combined....
However, I think you are right in that the outlook for SGL from about 6-12 months time (given AJL's expressed highly optimistic assessment for potentially large reserves and production increases) is probably better now than at any other time since the failed QGC bid. There does seem to be a faint glimmer of hope for long suffering share holders, given the pressure is now on to find more CSM gas and prices are ramping up. Now all that SGL needs to refloat their "Hindenburg" is STABLE management for at least the next 2 years, a BIG upgrade of their reserves and a LOT MORE production/drilling updates to keep investors interested than the paltry few that the current management team have offered over the last 12 months (honestly, they haven't a ruddy clue about selling their company via the wonders of modern day internet releases - unlike the flood of media releases that QGC and AOE have made in the past 12 months).
So, fingers crossed AJL know what they are getting themselves into!
AJ
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AussieJeff ...agree about punter scepticism towards SGL clouding short-term.....but then, isn't that what makes SGL the perfect contrarian energy/CSM play.....The vast tenement map page 11 of the presentation from Aug 2007 sealed it for me...even to the point of printing it out..! Moving to a decision to frame it may take a little longer....but I'm making space on the wall...
http://www.sydneygas.com/download.php?id=1935
This pres is a standout ...at least rel to the rest of poor online crap offered.
The scenario that this map suggests is pretty compelling ...as I see it anyway....pipeline through PEL4 (Merriwa + Denman+Mussellbrook prospects)>through PEL267(Hunter & Maitland); AND linking with Gloucester Project gas; before feeding into the heart of high-demand Newcastle-Sydney...
Advantages of infrastructure kept to relative minimum (eg rel to ESG pipeline), inhouse construction/operate and a running start with Gloucester close to commercial production. A myriad of market options..but likely to be directed with a AGK/BNB preference.
SGL mkt cap approx 120 mill; QGC ~ 2 bill;
How fast this gap is filled rests with AJL's ability to convert the many prospects to reserves..... i think they are confident of success....the recent releases reek of it...
http://www.sydneygas.com/download.php?id=1935
This pres is a standout ...at least rel to the rest of poor online crap offered.
The scenario that this map suggests is pretty compelling ...as I see it anyway....pipeline through PEL4 (Merriwa + Denman+Mussellbrook prospects)>through PEL267(Hunter & Maitland); AND linking with Gloucester Project gas; before feeding into the heart of high-demand Newcastle-Sydney...
Advantages of infrastructure kept to relative minimum (eg rel to ESG pipeline), inhouse construction/operate and a running start with Gloucester close to commercial production. A myriad of market options..but likely to be directed with a AGK/BNB preference.
SGL mkt cap approx 120 mill; QGC ~ 2 bill;
How fast this gap is filled rests with AJL's ability to convert the many prospects to reserves..... i think they are confident of success....the recent releases reek of it...
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Hey Col Lector...
Any ideas on why SGL has jumped +42% from an SP of 23.5c at close of business on Fri 18th April to currently 33.5c today (only 4 trading days) WITHOUT the announcement of any new or significant increases in production or reserves whatsoever? The last news-worthy item (not posted in Commsec News) was way back on 28th March in the local Singleton Argus: http://singleton.yourguide.com.au/news/local/general/sydney-gas-visit/1211824.html
The last official ASX announcement was back on 7th April, which only alluded to the appointment of new Operations Manager Alan Brew and in which new CEO Andy Lukas comments "As exploration manager for the co-venturers’ Hunter Project, Sydney Gas is ramping up the exploration programme. These are exciting times and Sydney Gas is building its team to deliver on the opportunities." However, the SP wasn't much excited by THAT news at all, until Mon 21st April after which the big swing around in the ratio of buyers to sellers began.
Guess I'll just have to undertake a course on how to read tea leaves...... LOL
AJ
Any ideas on why SGL has jumped +42% from an SP of 23.5c at close of business on Fri 18th April to currently 33.5c today (only 4 trading days) WITHOUT the announcement of any new or significant increases in production or reserves whatsoever? The last news-worthy item (not posted in Commsec News) was way back on 28th March in the local Singleton Argus: http://singleton.yourguide.com.au/news/local/general/sydney-gas-visit/1211824.html
The last official ASX announcement was back on 7th April, which only alluded to the appointment of new Operations Manager Alan Brew and in which new CEO Andy Lukas comments "As exploration manager for the co-venturers’ Hunter Project, Sydney Gas is ramping up the exploration programme. These are exciting times and Sydney Gas is building its team to deliver on the opportunities." However, the SP wasn't much excited by THAT news at all, until Mon 21st April after which the big swing around in the ratio of buyers to sellers began.
Guess I'll just have to undertake a course on how to read tea leaves...... LOL
AJ
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Aussiejeff....superb week!!! I posted under AJL re SGL's apparent rebound.
I put it all down to the "Chimaera Effect"...this has made me wary of buying more...got some at 25c but was thinking it could fall to 20c if Chimaera collapsed...clients have been key players in SGL previously.
The publicised "rescue" by ANZ has had a significant effect on SGL's market depth over the last few days. The dumping of shares appears to have ceased and confidence is returning to the buy-side, as evidenced by SGL's ~40% appreciation this week to return to around the discounted levels that AJL initially purchased...ie, 34c. IMO the roll is on...
I put it all down to the "Chimaera Effect"...this has made me wary of buying more...got some at 25c but was thinking it could fall to 20c if Chimaera collapsed...clients have been key players in SGL previously.
The publicised "rescue" by ANZ has had a significant effect on SGL's market depth over the last few days. The dumping of shares appears to have ceased and confidence is returning to the buy-side, as evidenced by SGL's ~40% appreciation this week to return to around the discounted levels that AJL initially purchased...ie, 34c. IMO the roll is on...
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