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

Quite a lot of activity today, all of a sudden, most of it sales. SP off 0.1p. My broker quotes 1.38p to buy. End of financial year playing a role, or is there something blowing in the wind?

Fair comment soul. But the schedule has already slipped somewhat. Lets hope it happens before cash demands for the North Sea become apparent... which looks increasingly unlikely.
p.s. don't forget WHI are BLR's own broker! For another, more recent, perspective see http://www.proactiveinvestors.com/registered/articles/article.asp?BLR. You have to register but its free, easy and carries no baggage.

Very useful information, diydave - thanks very much! I hadn't used Proactive before so I'm doubly pleased you posted the info.

I realise that the schedule has slipped, but this is a fact of life with natural resources companies. Cash burn and stock dilution are more of an issue; these you have to factor in when projecting the co's profitability in a range of likely scenarios - I tend to reckon with at least 800 million shares ultimately being in issue (compared with 430 millon today), to give some kind of cushion.

I agree that the specific mention of the 30 wells in Proactive's article relates to the possibility of steam flooding not working at Arce. That said, if steam flooding is successful, the co will drill a number of other wells (which if 3000 bbl/day are produced at 150 bbl/well, will still add up to 20 wells). It is worth noting that the figure of 150 bbl/well/day is the more conservative of a bracketed set of estimates, so that there is possibly further upside to be gained if the steaming is successful, but which cannot be counted in when assessing the project's economic viability.

Will BLR hit its target of being in production in May? I'm hopeful that when you get down to a two-month time-frame, these things can be predicted with reasonable certainty (barring disasters!). Maybe that's just my youthful optimism!! As I've said before, I think that the announcement of oil finally coming out of the ground - at least, if steaming is successful - ought to provide the SP with the lift it has needed and make fundraising just that bit less painful in the future. I don't think they'll be able to avoid placing more stock altogether this year, unless they are able to do some kind of debt deal. The possibility of BLR offering a lender a cut of early Arce production or simply discounted oil in return for cash-up-front has crossed my mind and I wonder what the likelihood is of the company being able to raise funds in this fashion. I imagine a higher production rate as a result of the steaming might increase the likelihood of a loan on favourable terms.

Proactive's detailed discussion of some of the other plays impressed me, and reminded me that the reason I keep coming back to this stock is that it just has so much to offer provided that the company meets with a modicum of success. The next few weeks could be quite exciting!!

It's good to get some balanced and informed viewpoints on all of this; I hope you don't think I'm being too relentlessly bullish! Please keep them coming!

In again at 1.36p, increasing my holding by two-thirds. Roll on, May!!

Its your money, Soul. Be as bullish as you like!! At the moment, I'm balanced on a pole. More BLR, more SEY or a punt on SER which sounds so tempting but has done so for a long time. Can't afford to risk all three!

Glad you mentioned SER, Dave. I nearly posted something last night but withdrew it. The gist of what I wanted to say was that there seems to so much more substance and less speculation when you look at BLR. I haven't read the SER threads elsewhere, but on this BB the talk always seems to be about chart technicalities and whether the fact that the CEO is now taking his coffee black is a screaming buy signal. When I look at co's like BLR, NOP, VOG, I can't see what all the fuss is about with SER. I think there's as much upside and a lot less risk to be had elsewhere. Maybe I just have a blind spot here, but I feel I know what I'm getting myself into with BLR and the rest.

SEY is probably a good grower. I haven't looked into it all that deeply as I've been concentrated on other things, but the trendline seems encouraging. It's a bit of a biggie when mentioned in the same breath as BLR and SER, though!

There we go, rant over!! What I'm hoping for over the coming weeks is a big jump on VOG, after which I may channel some of my takings into another chunk of BLR. Perhaps I'll spend some time examining SER a little more closely, though, too. And I'd be interested to hear what you settle on in the end.

The main attraction with SER seems to be that they are already producing in a small way, profitably, no debt, not looking to raise funds yet looking for new pastures. My problem is whether they can do anything significantly big to be significant... and yet the sp has already been up over 70% this year... you just have to buy them in 100's of '000's to get a significant holding and there don't appear to be too many sellers available to the PI.
Again, some useful info on proactive site.
Sorry to bore true BLRers!

BLR skids slightly today - latest buys went through at 1.2p. Sales at 1.05p. At this price, I might have to raid Grandma's hip-op fund for some cash to buy some more shares.

Sorry Granny, you'll thank me for it one day . . .

Talk of a memorial service this w/e over on ADVFN. Bring your own sandwiches and a kettle 'cos BLR seems to have lost theirs!!!!!

Where there's tea, there's hope, eh??

Seriously, though, has anyone got any justification for writing this one off other than the soggy share price? I'd be interested to hear it. The fact of the matter is that nothing negative has come up in the fundamentals, the E&P news is getting better, and the only two potential risk areas are 1.) that Arce production turns out not to be particularly exciting (and even then there's still a big chance it will be cash-generative) and 2.) that BLR has to place loads of stock to raise funds. Even then, how many shares would they place or how much cash would they raise in one go? A million pounds' worth or so, initially, I should think. Then the SP will rise on good news and things should look a lot more rosy.

Meanwhile other areas including Baul and Monterey are being explored with a view to drilling, and never mind the rest of the North Sea plus the prospects in the USA, all of which look to me to be low-risk as they have already been shown to be hydrocarbon-bearing.

I know that any dilution will initially be hard on anyone who has bought in at a much higher price, but I think it's worth gritting one's teeth for a few more weeks as this is about to turn the corner.

It would not surprise me at all if investors like Bruce Rowan increased their stakes at the next placing, and I wouldn't want them to have all the fun and for me to miss out.

Ok, 'nuff said - I'm starting to sound like a ramper. Disagreements welcome, as ever.

It does occur to me, though, that any failure of the steaming at Arce is going to be hard on both the SP and the amount of stock needing to be issued to raise further funds.

Thats just what's worrying a lot of people... and the market seems to be anticipating the worst. Like you, however, I am conscious that there are some big players backing this one at least one of which, I believe, was party to the last large placement... and the big boys don't throw it away!

A quick glance at the trading of this share for the last few days reveals that it has been almost all purchases (assuming that the predictive software that monitors this stuff has guessed correctly). So far today there has not been one sale. No question about which way the smart money's going, IMO.

One of the 'big boys' has ventured to suggest the company has decided on a strategy for funding the medium term... not entirely to his preferred route but one with reasonable, even good, chances of success.
As and when this is made clear, we should see some sp recovery. Meanwhile, as you say, there seems to be some smart money picking up some bargains.

That would be a sensible move by BLR - at the moment they do seem to be careering from placing to placing, cap in hand. Do you happen to have anything you can post regarding this issue such as an RNS or a link?

I wonder, though, if Burgess is keeping his cards close to his chest until May and the hoped-for success with Arce, which would clearly make a big difference both to cashflow and to the share price IF steaming is successful. (You know me - ever optimistic!! :o))

The shares are currently Bid: 1.1p Offer: 1.25p, with the most recent purchase going through at 1.2p flat for 250,000 shs. That's the narrowest spread I've seen quoted (although I don't have L2).

Sorry, nothing official, soul. I'm reiterating a resume of a conversation a big(ish) player and long term trusted poster claimed to have had with the company. He wasn't ramping but was certainly out to reassure.
This funding issue has been extensively debated and analysed over on ADVFN.

Do my eyes deceive me, or has the spread tightened right down since Tuesday morning? Haven't been near a computer in the last three days, so haven't had a chance to confirm this during trading hours.

I would be delighted if this stock suddenly had a realistic spread instead of the 26% or so we're used to.

found the answer - these trades went through at the end of the day yesterday. For most of the time the spread has been narrower than we've been used to, but nowhere near as tight as this. As usual, the big boys get the bargains!


Trade time Price (p) Volume Assumed purchase/sale* (p) Bid (p) Ask (p)
16:36 (13/04) 1.2 3500000 purchase 1.14 1.15
16:35 (13/04) 1.15 4000000 purchase 1.14 1.15

Positive result following the placing. Will be good to get some confirmed news from Colombia on progress which will really ignite the share price.