Web Site : http://www.petrolatinaenergy.com


SUMMARY of PELE as of 24th Jan 2008, please see post 190 on page 10


Link to Page 10 of posts

Up 4.5p in 8 minutes, not bad.

Excellent news...Strong Buy now.


Petrolatina Colombia well tests at higher end of forecast; sees early cash flow
AFX

LONDON (AFX) - Petrolatina Energy PLC said initial production testing results at its 50 pct-owned Serafin Well No 1 in Colombia are 'at the higher end of expectations', adding that it expects first commercial gas deliveries late in the second quarter of 2007.

It added that the project offers early cash flow and is expected to 'materially increase' the company's revenues from its Colombian operations.

The well flowed at at 14 mln cubic feet per day of gas, Petrolatina said. Completion of the final part of the project - building a pipeline - is expected early in the second quarter of 2007, and the estimated cost of development is 1.36 mln usd, about half of which will be borne by Petrolatina from available cash resources.

Chairman and chief executive Greg Smith said: 'The completion of this extremely positive test and the resultant early cash flows that it will generate, coupled with the initiation of the seismic shoot on the Midas and La Paloma exploration blocks, put our company in a strong position to continue our growth in Colombia.'

newsdesk@afxnews.com

jro/rar

Nice timing for the forthcoming Oilbarrel.com presentation on 22 Feb 07. :-)

By my calculations, please correct me if I have got it wrong, but think revenues to PELE of between $US 6 - 12 m over life of well, based upon $3 US per 1,000 cu ft,
and producing 14M Cu ft a day = $US 42,000 a day.

Sarafin will generate $42,000 per day, 50% of which goes to Petrolatina. This is around $7.5m per year to PELE, not over lifetime of the well.

I'm in.

Seems to be dropping back a bit. If this is worth $7.5m p.a. witch equals 3.825m approx. If you said 10years profit was the price to pay for the company then this find would add 38.25million to the market cap, raising it to approx 65.69million. This would be worth 59.85p per share I believe.

The objective capital report, linked to in the header, valued PELE at 34p. This included Serafin at just $3.6m. Now that high flow rates have been released, this value must be raised substantially.

On known info, the well is unlikely to last 10yrs, so perhaps a multiple of 3-4 would be more appropriate.

They snuck this bit of info into the resignation RNS from 1 Feb:

'Additionally and by way of an operational update, the initial phase of the
workover at the Serafin gas accumulation in Colombia has been completed as
expected. We now anticipate the accumulation to be somewhat larger than had
initially been expected. Production testing will now commence and we expect this
to be finalised during February 2007. This project offers immediate cash flow
and economic returns and we anticipate it to materially increase the Company's
annual cash flow from its Colombian operations. PetroLatina has a 50% interest
in the development'

The Guardian:

Latin America's oil and gas sector is within traders' sights on Aim. Shares in exploration and production group PetroLatina rose 4p, or 16.7%, yesterday to 28p after it reported gas flow from its Seraf well in Colombia at the higher end of expectations. Analysts think there is further to go.

House broker Seymour Pierce has a target price of 52p and rates the stock a "buy". It argues PetroLatina's shares are trading at a discount to the company's core net asset value. PetroLatina is starting work on surface facilities and a 3.5km trunk pipeline to tie in to the main Colombian gas infrastructure and expects the first commercial deliveries by the summer. The next news to watch for is due in two to three weeks, when PetroLatina provides more detailed test results from the well.

Ambitious 70p price target?

http://lemminginvestor.intellicontact.com/test

Ambitious 70p price target?
http://tinyurl.com/3yu6r5

The interesting thing now is the results from reservoir testing on the Serafin Gas Well. Previous estimates of between 4 to 8 Bcf were based on estimates from some time ago, when in fact they had little interest in doing it properly as it was un-economic at that time.

We might be in for our "somewhat larger" surprise in a couple of weeks, lets hope so, an upgrade of reservoir size to above 8 Bcf would go down nicely.

Seems to be some demand today.

L2 3 v 3 @27/30

On line limits :

Buy 3966 @ 30.85

Sell 100K @28.63



L2 now 4 v 2 @28/31 and all blue

I got in first thing, for the moment (at least) it looks like a good move...

Major Revenue Producing Assets :

a/Colombia Rio Zulia - Ayaccucho Pipeline - Tariff

At acquisiton this pipeline had throughput of 2,800bopd and was valued at 10m US$. The throughput will now in time increase to near 25,000 bopd, and therefore the value of this asset should soon be around 85m US$ sometime in H2 2008.

b/Colombia PDN Fields : 500 bopd per day.


Firm Plan of Expansion of Revenue Production :

a/H1 2007 Colombia Serafin Gas Well
b/2007 Colombia PDN field output increase upwards from present 500bopd


Potential upside

a/Guatemala Atzam well produces (2007)
b/Colombia La Paloma field find and production (07 and/or 08)
c/Colombia Midas field find and production (07 and/or 08)
d/Colombia additional gas wells at Serafin (07 and/or 08)
e/ Guatemala Tortugas workovers (07 and/or 08)
f/ Guatemala Las Casas farm out (08)
h/ Colombia PDN TEA upgrade to exploration status (07) and drilling (07 and/or 08)

Lots of buys today...PELE will climb tomorrow

On line limits fairly even, and the bid size is 26.75p for 37.5K, so they are still looking for stock.

I would take it the sharp rise yesterday and fall back today is a shake, to get some people into profit so they decide to sell. Might be more of this ahead of the further Serafin update. There is also Atzam simmering in the pot.

The 2m X trade confirms a buyer is about, therefore, its best imo just to sit tight and add on price weakness, and then wait for news.

You could also read the "tax selling" by Nick as an effort to restrain the price, if you so wish...........especially given what has been said, whats happening and a 2m X trade today (who was the buyer ? and are they friendly with NG ?) ;)

Looks like RAB have been buying.

The RAB SS Master Fund only had 3.7m shares in it from IPO, now its 14.8% or 16.3m, will explain the X trades earlier this year as well.

http://www.investegate.co.uk/Article.aspx?id=200702201341515564R

Petrolatina Energy PLC
20 February 2007
PetroLatina Energy Plc
('PetroLatina' or the 'Company')
Holding(s) in Company

In accordance with Rule 17 of the AIM Rules and section 198 of the Companies Act, the Company was informed that RAB Capital, acting as investment manager for RAB Special Situations (Masters) Fund Limited, currently holds 16,353,077 ordinary shares in the Company representing 14.8 per cent. of the issued ordinary share capital of the Company.

RAB Capital does not act as custodian for its clients and therefore the shares are held in a nominee account which is Credit Suisse Client Nominees (UK) limited.

PetroLatina Energy Ian Refault, Ianrefault@petrolatinaenergy.com +44(0)2072974360 www.petrolatinaenergy.com Chief Financial Officer

PapalPower - 21 Feb'07 - 00:08 - 1382 of 1383

There are still a number of warrants outstanding, and warrants are common enough on oil and gas stocks. The excercise of warrants entitles those who are holding the warrants to buy the amount of shares from the company for the price on the warrant they hold. Puts cash on the bottom line for a few more shares. Warrants are normally set up at the time of IPO, as incentives to the big initial holders who front the money for listing.

In this case its the last line (I think so) of the 10 cents shares (eg they pay the company 10 cents for each of the shares they buy with the warrants).

They next tranche of warrants due for expiry or conversion are end March 07, these are about 30m of them, and at around 50p conversion price, which could therefore put 15m sterling into the bank of PELE if they are converted.

Hopefully Serafin news (and Atzam too) might be enough to persuade the warrant holders to convert, cause if they do then the 15m into the bank of PELE would go down very nicely.

If Greg has converted and sold 900K to RAB to pay for it, good for him, as I would like it also to be Greg (under Taghmen ventures) who is going to convert those 50p warrants some time soon !!!



PapalPower - 21 Feb'07 - 01:14 - 1383 of 1383


For those not following the story, the original 35p warrants due for expiry in July 06 were extended to expire March 07 with a new price of around 50p, I do not have the figures on me, but as far as I can remember there are around 30 million of them (hence worth 15m sterling into PELE's bank if converted).

The 10 cents (just over 5p) warrants were always going to be converted, who is not going to convert them. With Greg Smith (the Chairman) under his Taghmen Ventures vehcile holding over 15% of PELE stock, he does have a vested interest in this all going well.

If anyone is in contact with Ian Refault, or going to the Oil Barrel conference, please ask Ian (or whoever is there from PELE) about the March 07 warrants, and if you can get the details of expiry/price and amount.