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

the width of the spread is arbitrary, especially where there is just a single MM ...... That does not of course preclude the ability to trade within that notional spread by leaving an order at a specific level.

Thx,
And another tick up just now,have held these for ages!!,looks like they may have been worth holding on to

had the capitilisation been larger (10m+), would have been moderately tempted myself

Cynic, there's a few of us think it soon will be larger and that's why we got in early. :o)

The share price seems to be picking up some momentum on what looks like a busy day today, with nearly 15 million traded so far (I realise that's not a huge amount of cash, but for this co it's high volume).

I put in a couple of dummy trades of 100K and got a spread of 1.45/1.57. Reasonable, I'd say.

Market cap 9 mil, Cynic. Twist or stick ??? :o))

At todays prices its got to be a stick for me!

I am one of the pariahs who trade via CFDs, hence the 10m minimum

top sliced as was running at a loss before today, but am keen to keep the remainder for a whole while longer to see where they go.
Alex

Found this in my mail box tonight

Buy Black Rock Oil & Gas at 1.475p

Says Stewart Dalby of Oilbarrel.com

Shares in Block Rock Oil and Gas, the London AIM listed junior have been in the doldrums for some time following some dry holes in Australia and disappointing drilling results on prospects on the Isle of Wight in southern England.

The company has a raft of interests in the UK North Sea and in southern England. In Ireland there are part blocks including 04/5 and 04/5 and 04/6 in the North Celtic Sea and 04/8 in the Irish Sea. There are prospects within these blocks within the Jurassic and Triassic zones.

This year Black Rock's prospects look brighter partly because of the development of a North Sea interest but mainly because of what looks like a successful foray into projects in Columbia in South America, at 1.475p the shares are definitely a buy.



Black Rock has 50 per cent of the Kappa Energy operated Arce oilfield which lies in the Las Quinchas Block in Columbia 's Middle Magdalena Basin. There have been a series of appraisal wells. Arce 3 came in pretty much in line with expectations, flowing between 25 and 36 barrels per day of sticky heavy API 13.5 degree while Arce 2 flowed at rates of 10 and 60 bpd. Arce 4 will be drilled in the coming weeks, following which the partners plan to steam flood the field, a process that should increase the flow rates. Steam flooding is a common technique on heavy oilfields in Colombia and has been proven to increase production rates by a factor of five or ten. The equipment has been ordered from California and the company is awaiting an exact delivery date. Should the technique work then further production wells will be drilled into the field to increase the daily production rate. From the first four wells production could emerge at around 600 barrels per day or 300 barrels per net to Black Rock.


Black Rock and Kappa also hold a 50/50 interest in the Baul oilfield also in the Middle Magdalena Basin. The partners have agreed to re-enter the once producing field. Discovered in 1960, 5 wells were drilled and there was 100 feet of net pay. Baul-3 produced 16,610 barrels of oil from a 14 foot sand l. The well was shut in during 1961 due to low oil prices. There will be re-testing late in 2006 or early 2007. Estimated recoverable reserves are put at 2-3 million barrels of oil of which 1 million is contained in the proven 14 feet sand.

Las Quinchas is also home to the Bukhara prospect. Discovered in 2000 one well was drilled and there was 175 feet of net pay. However, a 2005 test in 2005 proved inconclusive. There will be re-testing late in 2006 or early in 2007. The field could hold recoverable reserves of up to 75 million barrels of heavy waxy crude.

Leaving aside Baul and Bukhara as something for another day, Arce looks more positive and could be producing before the end of this year. Three hundred barrels a day might not sound like a company-making situation or be anything Shell or BP might be interested in. But as we always say at Oilbarrel.com, most things are relative. For Black Rock its means it has would the crucial jump from being a hopeful explorer to a producer. At a time when oil prices are sky high it will mean critical cash flow to promote other ventures. It is true that heavy oil is more expensive to draw than lighter crudes, but there are offsetting cost factors. In order to shore up production the Colombia government has announced their intention to reduce corporation tax from 38.5 per cent to 28.5 per cent. (This has helped make Colombia a favourite for small E&P companies). There is a pipeline running through the Arce acreage linking to a refinery capable of handling heavy crudes, so transport costs are low.

Black Rock Chief Executive, Ivan Burgess, told me that all in all with oil prices somewhere in the 60 dollar plus range, net cash flow to the company could work out at 25 dollars per barrel. Assuming the 300 barrels a day target a day is met then the company could earn net cash equivalent to a sum not unadjacent to 300,000 dollars a year. This is significant for a company which currently has no income. The company is hoping to book reserves of between 2.5 million to 10 million barrels of oil equivalent before the end of 2006 from Arce, Baul and Bukhara fields. Arce is thought to hold between 5 and 10 million boe. Assuming each barrel is worth 10 dollars in the ground this means a value of 25 million dollars taking the low figure. Compare this with the company's market capitalisation of 6.4 million pounds (11.9 million dollars) and it all looks good for Black Rock, providing of course it comes right.

Elsewhere Black Rock has a 15 per cent interest in Block 49/8c in the UK Southern North Sea. Wintershall operates the block and the plan is to drill into the Monterey zone to test the commerciality from a proven gas field in the third quarter of 2006. Arco made a significant discovery in the Monterey in 1989 when a well flowed at up to 5 million cubic feet a day. The operator estimates mean recoverable reserves of 165 bcf. If the test if successful the hope is development via a 2 well subsea tieback, probably to the Markham field and a development plan for production in 2007/2008.

be interesting to see what happens to BLR today as it looks like we're in for a battering in the markets today on the back of big falls in the DOW last night !

So far ,its up and maybee those large trades last night were buys!

Great volume. Still undervalued but expect a significant re-rating when the projects are realised.

Does anyone into blr think that the spread will narrow and stabilise should the sp increase?

It might if the MM's see sufficient retail/day-trade interest. I can't imagine the 27% spreads of old will persist for ever in any case, but around 12 - 15% might not be out of the question, which is still fairly chunky.

All this is pure conjecture, of course. Time will tell.

PS 14 mil traded already this morning??!! Amazing what a few dollops of press coverage can do . . .

Skyhigh, on a co as small as this (and particularly in view of the big spread) you could probably ignore the DOW effect, as the share is not a target for short-term trading and most of those who are in realise that there's a lot of value to be unlocked based on fundamental issues which are remote from main market forces. When the markets skidded in May, BLR was my best-performing stock (although you still couldn't have made much money short-term trading it). Nice to have one swim against the tide, though. And it's doing that again today :o)

Has anyone found anything more solid than end of 06 for first production of oil?

BB1, Arce production is reckoned to be fairly imminent (drilling to take place "in the coming weeks"); this will be initial production following which the resource will be steam-flood tested in the hopes of increasing output. All this is subject to the usual caveats and potential for delays, but all being well it looks like BLR should be producing at the steam-flood higher rate by the end of the year at the latest, assuming that steam-flooding is successful.

I think the co is being sensible in no longer telling us too precisely and/or optimistically when they think that production may occur, as any delay, no matter how justifiable, only has a detrimental effect on the SP.

All IMHO, PDYOR.

there was a good write up in the shares mag last week

Soul Traders, your right BLR need to keep investment and reduce there spread especially if further fund raising is needed. For this reason its not good to speculate as investors being investors always take speculation as gospal!!!! Shows good management, now it SEO had done the same with Greenseal, who knows where the sp would be now.

Taylor any chance of posting it please ?