< "> edit this post http://www.investegate.co.uk/afren-plc-%28afr%29/rns/trading-statement-and-operations-update/201301210700069619
http://www.investegate.co.uk/afren-plc--afr-/rns/2012-full-year-results/201303250700107200A/

In an attempt to cut down the header page,i've transferred some of the older news to Page1 post No.3.

http://www.oil-price.net/index.php?lang=en
http://www.ft.com/home/uk

http://www.investegate.co.uk/Article.aspx?id=201111020700081674R
http://www.investegate.co.uk/Article.aspx?id=201111150700250723S
http://www.investegate.co.uk/Article.aspx?id=201112010705051251T
http://www.investegate.co.uk/Article.aspx?id=201201170700146472V
http://www.investegate.co.uk/Article.aspx?id=201201230701479690V
http://www.moneyam.com/action/news/showArticle?id=4323758
http://www.investegate.co.uk/Article.aspx?id=201204170700164488B
http://www.investegate.co.uk/Article.aspx?id=201205140700212304D
http://www.investegate.co.uk/Article.aspx?id=201205210700407032D
http://www.moneyam.com/action/news/showArticle?id=4430164
http://www.investegate.co.uk/afren-plc-%28afr%29/rns/significant-new-seychelles-3d-seismic-programme/201212120700052973T/
http://www.investegate.co.uk/afren-plc--afr-/rns/2013-half-yearly-results/201308230700063334M/
http://www.investegate.co.uk/afren-plc--afr-/rns/ogo-drilling-and-resources-update/201311190700083404T/
http://www.investegate.co.uk/afren-plc--afr-/rns/trading-statement-and-operations-update/201401280700096280Y/
http://www.investegate.co.uk/afren-plc--afr-/rns/interim-management-statement/201405200700135209H/
http://www.investegate.co.uk/afren-plc--afr-/rns/interim-management-statement/201410300700116483V/
http://www.moneyam.com/action/news/showArticle?id=4942625
http://www.moneyam.com/action/news/showArticle?id=4943375

Oriel price target 40p.

HTTP://oilpro.com/post/9485/first-us-oil-company-files-bankruptcy-amid-oil-price-crash

http://wolfstreet.com/2015/01/05/the-real-question-about-fracking-after-oil-price-crash-when-will-people-stop-giving-these-companies-money/


Last sentence sums it up.

http://www.investmentu.com/article/detail/42568/invest-oil-2015-forecast#.VLGm83uONZh
To see chart go to website above.
Goldman Sachs predicting $85 for 2015.
Bloomberg survey $82.
Fuures$59


Chart of the Week: The Future of Oil

by Rachel Gearhart, Managing Editor Saturday, January 10, 2015 Natural Riches Natural Riches
Share on facebook Share on twitter Share on google_plusone_share Share on print Share on email
future-of-oil

This week’s chart looks at oil prices from December 2012 through the end of 2014. It also does something quite interesting. It shows predictions out to June 2016. To create the chart, we looked at forecasts from Goldman Sachs, analysts surveyed by Bloomberg and the futures market.

As you can see in the chart, analysts and Goldman Sachs forecast a strong rebound in oil prices.

Though no one predicts that oil will rebound to anywhere near its circa $110 a barrel price from pre-June 2014 drop, plenty of folks on Wall Street expect to see prices similar to those from September 2014. That’s good news for the sector.

The futures curve, though, is not as positive.

Remember, a futures contract is an agreement that allows a party to purchase oil at a predetermined price on a predetermined date in the future. The relatively slow price growth predicted by the futures market tells us that the folks actually buying crude oil or hedging its movements don’t see a significant move higher anytime soon.

Of course, after the week we just saw on the crude market, analysts may be anxious to revise their forecasts lower as the year progresses. In fact, earlier this week, Citigroup cut its average Brent forecast for 2015 from $80 a barrel to $63 a barrel. For 2016, it cut its forecast from $85 a barrel to $70 a barrel.

With so much movement in oil prices, it can be hard to make smart investment decisions. In a recent article, Dave Fessler said that the best way to hedge the volatility in oil prices is with a pipeline master limited partnership.

As the “tollbooth operators of the oil and natural gas transportation highways,” pipeline MLPs provide stability and had a strong showing at the end of 2014. Individual MLPs and funds that hold pipeline MLPs beat the S&P 500 every month in 2014. And with oil prices certain to stay volatile, they’ll likely do the same in 2015. This makes for an excellent investing opportunity as oil forecasts change.

If I'm not mistaken Afren has some of its production hedged at $95 us a barrel....that should help a lot...

2 POSTS TO CONSIDER?

rather a scary note from Oriel Securities
Afren lost 5.7 per cent to 39.4p after Oriel Securities downgraded to “sell”. The stock had been supported over the past month after Nigerian peer Seplat said it had proposed a merger, as well as by regular reheats of speculation that key shareholder SAPetro might make a counterbid.

But Oriel reckoned that, with Afren’s Nigerian tax break expiring in 2016, cash flow from current assets would not be enough to pay down debt.

“We are not convinced there is much equity value in Afren at $60 oil and still see it as limited at $80,” the broker said.
Afren could sell fields such its Ogo discovery in Nigeria and its Kurdistan acreage to prop up its balance sheet, Oriel said.

But if oil remains at about $60 a barrel, Ogo becomes uneconomical and Kurdistan would have a value of no more than $700m, equivalent to just 40 per cent of Afren’s debt by 2020, the broker forecast.

“From that perspective, the company has one of the worst defensive positions among its peers and we could see a scenario where the shares could lose the majority of their value (that is, no equity value) in a prolonged period of $60 Brent,” Oriel said.

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I will never understand how anyone listens to the charlatan analysts all over the city. It's a buy when oil is mid 80's in October and a hold all they way through to late December with oil at 60.

Now she's a busted flush. Might as well pack up here guys, its all over.

23-Dec-14 AFR Oriel Securities Hold 1.25 1.25 Reiteration
30-Oct-14 AFR Oriel Securities Hold 1.25 1.25 Reiteration
20-Oct-14 AFR Oriel Securities Hold 1.25 1.25 Reiteration
15-Oct-14 AFR Oriel Securities Hold 0.00 1.25 DownGrade
13-Oct-14 AFR Oriel Securities Buy 1.25 1.25 Reiteration
01-Oct-14 AFR Oriel Securities Buy 1.25 1.25 Reiteration
22-Sep-14 AFR Oriel Securities Buy 1.25 1.25 Reiteration
27-Aug-14 AFR Oriel Securities Buy 1.25 1.25 Reiteration
18-Aug-14 AFR Oriel Securities Buy 1.25 1.25 Reiteration
08-Aug-14 AFR Oriel Securities Buy 1.25 1.25 Reiteration
07-Aug-14 AFR Oriel Securities Buy 1.45 1.25 Upgrade

one wonders if they or their clients have large short positions

Going from bad to worse.......when I think everybody thought this was heading for 200p including myself at one-time...

This didn't help and is going to knock confidence again:
"An updated Competent Person's Report (CPR) of Barda Rash, carried out as part of the Company's annual reserves review, is expected to show a material reduction to previously published estimates of reserves and resources, essentially eliminating gross 2P reserves of 190 mmbbls and revising gross 2C resources from 1,243 mmbbls to around 250 mmbbls.
The movement in 2P and 2C reserves and resources has been due to the 2014 reprocessing of 3D seismic shot in 2012 and processed in 2013, alongside results from the Company's drilling campaign. Overall, the reservoirs have not performed according to previous expectations and the approved Field Development Plan (FDP). The wells have produced higher water cuts than expected and the Company has encountered operational challenges associated with the drilling of difficult complex fractured reservoirs. Production from these reservoirs could potentially be achieved with the implementation of recovery schemes requiring significant capital expenditure, which may well be appropriate for a company with a different strategic focus. Furthermore, while recent results at the field have indicated the presence of light oil accumulations from the deeper Triassic Kurra Chine reservoirs, these have a high level of associated Hydrogen Sulfide (H2S), which would require significant capital expenditure to develop. In light of the above, the Company is now considering its strategic options for the Barda Rash field."

What a shocker.

and 50p t/o looks pretty remote too
the previous reserve figures have a strong smell of rotten fish

Well worth a punt at these levels imo,typical overreaction.

error

12 Jan Canaccord... 27.00 Hold
12 Jan VSA Capital N/A Under Review
12 Jan Westhouse... 90.00 Neutral
12 Jan Deutsche Bank 60.00 Hold

Take your pick ,, you have to love canaccord ,the price is in the low 30's and their rec is 27p and hold . I can't think of anything they have got anywhere near right that i looked at last year , who pays these analysts and would they give me a job all that's needed is a dartboard .

Details of the Canaccord note:
"This is very disappointing and a significant negative for our view on Afren. Barda Rash accounted for 37p/sh (or 56%) of our 66p/sh risked Central NAV at our base case US $88/bbl LT Brent crude price and a 15% discount rate.
We have chosen to eliminate all value for Kurdistan, mainly Barda Rash and a modest contribution from the Ain Sifni block, from our NAV.
Our Central NAV at a 15% discount rate and using our US$88/bbl base case falls from 66p/sh to 27p/sh as a consequence of these changes.
We reduce our target price from 65p/sh to 27p/sh and our rating from Speculative Buy to HOLD on the assumption that the stock will fall heavily today. Our risked Central NAV at a 10% discount rate, assuming debt can be refinanced in 2015, stands at 57p/sh providing some headroom for a takeover offer from a well funded acquirer.
Although we believe the business model of oil and gas develompent in Nigeria remains robust at low oil prices, Afren needs to refinance some debt in 2015 and progress on this front is of the utmost importance to the company’s future as a standalone entity. Seplat has made a highly preliminary approach to Afren and has until 19th January to make a firm offer under Takeover Panel rules. We also await updates on operational progress at the Ebok and Okwok projects where installation of platforms should be underway."

Be careful here.

totally disillusioned so out with a nasty loss
i really do not see this 50p bid materialising and that "reassessment" of resources just stank of fraud - or least the initial one did

It's so low now that I would have expected any holders to sit it out, unless you need the loss for CGT purposes. Many oilers are bombed out, but when crude starts to rise all of these should recover to some degree, imo.

the quality oilies will, but it seems to me that the value of the whole of AFR's reserves and everything else are seriously under question

Yes, you might be right. I was actually starting to think this might be worth buying, but will mull things over for a while.