www.blackrockoilandgasplc.co.uk
www.vsaresources.com
www.oilbarrel.com
Presentation from Thursday 6th July 06 can be seen on oilbarrel !


Monterey appraisal well suspended pending Wintershall evaluation. 1/12/06
BLR and Kappa in dispute.
BLR to meet with Kappa within next two weeks 1/12/06

Although this is a relatively quiet board, I know there are a few who are bewildered by the sp since the results were announced, and so I post a few thoughts from the advfn board, if it is of any help.

I agree that we didn't get all the news, but if we ask ourselves the reasons, we may well understand why. There has been a lot of hype in the past, especially oil explorers, with some companies guilty of deliberately misleading the markets and investors (I won't name them, but I think we all remember them), and the outcome was that new rules were introduced to try and prevent this happening again. Ok, I agree, the Stock Exchange and all the regulatory bodies don't have much in the way of teeth, but the NOMADS make damn sure that they don't get into trouble or penalised for allowing wayward companies to be overly enthusiastic, to the point of misleading the markets. This has resulted in "not enough information", instead of the previously "too much information", and "bending the truth". Most companies can now only say what they can prove 100%, whereas before, we would hear of estimates, anticipated things, hopes, and beliefs. Now somebody actually has to put their name to the statements, and not many are willing to risk their reputation by putting out info which turns out to be incorrect. (Neither NOMADS or Competent Persons within the company).

So what exactly did we get, and what didn't we get, that we think we should have?

The RNS was great, in that it confirms we have oil, although classed as heavy, it is light enough to flow without steam, and in good enough quantities to be worthwhile bringing up. We can also see that in comparison with Arce, we have many advantages at Acacia. Whereas Arce2 produced up to 60bopd at 13 degree, Arce3 produced 30bopd at 13.5 degree, and Arce4 produced 30.5bopd at 16-17 degree, Acacia actually produced much more at 101bopd. The Arce wells were also into the Mugrosa formation, and all fields are on the same trend ... Chicala, Arce, Acacia, and Bukhara too, so we would expect similar oil. But we appear to have a better viscosity and flowrate. Maybe Acacia could be under higher pressure, which may help? We also appear to have much less water than at Arce too. We also know that quantity of oil was pumped at a much slower pump speed than we would have normally operated at, so giving much more room for improvement.

So what didn't we get? and why? Well, ok, this is all in hindsight, and is merely an opinion, as interpreted from events, but I believe that when we first started testing, we did it our way and tested as we normally would, hence the anticipated 15-20 days before results could be expected. In view of the air of confidence which seemed to be around, I believe this may have given the first indications of a good flow, but we weren't allowed to base official info on those test proceedures, and Ecopetrol insisted we do it their way, by the book, both to avoid the danger of sand ingress, but also to be totally transparent, for Ecopetrol will at some later date, base their decision whether to back-in, upon the information which they would obtain from the well results. So the results had to be accurate, and done to their liking.

As we hear, the pump speed started off at a lowly 1 stroke per minute, and was run for a while, increasing gradually, but we have still only got up to 3 or 4 spm, which is only maybe a third of what speed we could eventually expect. Although sand ingress has been low so far, I believe that before we can start to really motor, we have to ensure the well is gravel-packed and maybe a liner installed, to avoid any risk from the sand, etc. Sensible, for why go to the expense of gravel-packing and a inserting a liner, until we are sure it will be money well spent (flowing oil, not water). Ok, so what we know so far is all good, and the chances of getting better are extremely high. But they can't/won't put out guesses on what we could/may/may not achieve. And after our long history through previous regimes, I wouldn't want anything other than reliable info, which we can trust. I also don't think we would be allowed by the NOMAD to put out anything other than facts either.

So what else? The main factor I believe that could affect the sp, is probably the size of the field, for the amount of oil we have in the bank is undoubtedly the most influential factor. In plain terms, we simply don't know yet. We can guess, for sure, but as we have said, guesses simply won't do. I think the company know the possibilities, but it now demands that an independent "competent person" must audit the findings, and draw his own conclusions to be acceptable. For someone to put his name/reputation to a report, he has to be damn sure of his facts. I think this may be why we are now going to fast-track appraisal wells, probably 1 or 2, before we could be sure of exactly what we have under the ground. But the good news is, that when a "competent person" does put his name to it, then it will be as good as cash. It will be "bankable", and we can officially regard it as an asset. At the moment, all we can do is ponder the possibilities. I believe the company does have a figure in their minds, and that figure will be big enough to proceed with appraisal. Would they really bother if the signs were those of a small field? No way. So how big? Well, the estimate from the outset was a possible 50-100 million barrel field. They know how much pay they recorded. They know the approx linear area of the field from previous seismics. They know the pressure and flow rates, they know enough to have a stab, but of course, a stab is no longer aceptable. So we will have to wait for the appraisal wells. But they are "delighted" the results are "excellent", and "Acacia Este is now considered to be a highly significant discovery for Black Rock".

Interpret the tone of the RNS. Think big, think top end of the estimates. Who knows? They could even be higher. They do "moderate" and "cautious", so its possible.

When we have the full testing results, maybe in a couple of weeks or more, and have done an appraisal well or two ... it won't take long ... then we can look for the increase in the sp that we didn't get today. All my own personal opinion, of course, as always.

Tick tock tick tock, one for the patient this is..... As the last broker report described this share as an "Undervalued Asset Play", firm up time looms closer....
Who's still in? Anyone.

Yup, still here explosive. But still far from excited.

I am still here and will be for a few years more as I think a good long term play.
We should have results of steam testing from Arce in the next week or two.
Not for the feint hearted right enough but plenty of potential so patience needed.

nor arguably for those with more than 2 brain cells ..... BLR falls in the same league as the likes of ULT, GOO (which i hold!), AMER and almost, though quite as pathetic, SEO

Well I must in the 2 brain cells club then because I've held most of those shares over the years....

http://www.proactiveinvestors.co.uk/articles/art.php?BLR2

Managed to pick some up this morning at 21.75 but not showing yet,if it appears later on as a sell it aint!

Should I be looking to bottom fish soon has this share got any potential.

you'ld better off going to fishmonger!

Cod and Chips then.

cod is a mid-level swimmer, but there are some particularly fine plaice around at the moment .... for a piece of trivial but useful info .... the fresher the plaice, the more orange the spots on the dark skin ..... ultimately they will fade to grey, but stll be sold as fresh!

Plaice and Chips then.

dont think we will make a profit from these but it is worth the challenge they seem to keep all information from there shareholders if i sell now will make a very big loss would sooner lose all.

in that case, you are almost certainly backing a winner!

take a look at NPE.. I bought in a couple of weeks ago..could do well! (imho, dyor etc.)

teddybear5
Ive sold many a share at a loss some times the money is better somewhere else making more, never say never.

Staying in on this one, call it whatever you will but I think the share is still value for money! Cynic please do your worst as I do value your thoughts and when done if you'd be so kind as to pop over to the SER thread and repeat the exercise i'd be very grateful.... exy..

hi exy .... too damn tired tonight but think i may have already cast pearls before swine on SER at an earlier date! .... will look again on the morrow

I am tempted to have a flutter on these @ this price,any thoughts ?,

Could have reached the bottom @16p and noticed it only took a couple of small buys to see a small increase even though the spread is quite wide.