Just cannot understand recent SP volatility!

As a Dana shareholder I find it difficult to
find any reason to sell, even at current price. The Company has recently
entered a number of agreements which will have
considerable benefits:-

1. Reserves from 31st December 2003 of 123.7 mmboe
must now be in the region of 200.0 mmboe.( 100 million
North Sea 70 million Mauritana 30 million Russia ).

2. Production will rise to 25-27 thousand boepd in
2005 from 18 thousand in 2004.

3. At 30th June 2004 a Net cash position which will
have been enhanced significantly year to date.

4. Exciting exploration potential.

5. Management that seem to know what they are doing
with an excellent chief executive.

6. Recent deals by other oil companies have seen oil
assets bought at prices between 7-11 dollars a barrel
( see last weeks Investors Chronicle ) Dana must have
a value well in excess of the current 300 million.

I am holding firm and looking towards 800 pence.

Any other views out there?

Rigzone piece on yesterday's awards.

http://www.rigzone.com/news/article.asp?a_id=25036

Fund, gavdfc
The sp seems to be mirroring the oil price, whats the prospect of a dive if the barrel comes done significantly, or will the new licenses keep it up, (the sp that is)

Driver,

The sp does indeed seem to have mirrored the POO. Looking at the CLV5 chart, price fell from 60 to around $50 back in May before it started it's move back to where it is now.

CLV5

If you look at DNX's chart over a similar timescale, the recent move from around 5 started back in May also up to where it is now. It also shows the fall in DNX from around 6 in April to 5 in May before moving up as the POO started to move up. It does seem that DNX has moved in line with oil, as have the likes of VPC and BUR etc. I guess it would be fair to assume that volatility in oil prices would be matched by volatility in some sp's.

As to the new licence's keeping the sp up if oil pulls back, I wouldn't have thought so. Even if they do decide to drill any of the new prospects, I would imagine it would be quite a way off. From my reading of the RNS, there seems to be no actual commitment to drill, although at least they have the opportunity to decide whether to drill or not. Can't complain at that. Anway, just some thoughts of mine.

Personal opinion is that the SP like the pil price needed a breather. Oil reporting season starts next week with DNX nearer the end of the month. I think the results could well crystallise the impact the oil price is having on DNX being totally unhedged and also expecting some drilling news (Fiacre especially). Rerating by the end of the month based on results (profit and reserves upgrades)? 1100p-1200p???

all imho dyor etc etc

I wonder if a certain Mr Alves will change his mind when the results are out! ;-)

Reason for this mornings fall from the start perhaps?

Dana License Win Impact Seen Limited >DNX.LN

Wednesday, September 07, 2005 4:07:36 AM ET
Dow Jones Newswires



0758 GMT [Dow Jones] Dana Petroleum's (DNX.LN) successful application for 20 new licenses in the UK is unlikely to have a significant impact on the company in the short-term, says trader. Feels the company won't drill any wells under the licenses for at least a year and that prospect sizes, if any, are likely to be small. Trades -2.7% at 840p. (DWE)
http://www.newratings.com/analyst_news/article_1003865.html

Gav

re Alves - some people are not for changing lol.

Re the report - which trader? and on basis is "the company won't drill any wells under the licenses for at least a year and that prospect sizes, if any, are likely to be small" - has he spoken to Tom Cross, has he had surveys done on the blocks or is he just sticking his finger in the air for some comments - i wonder which lol

Fundy,

Yup, best he doesn't change his outlook here as things have gone quite well with his recommendation so far!

As to the report, which trader seems just about right! Perhaps an advfn trader! The only part of his statement I sort of agree with is timescale for drilling as getting ready to drill if they do will take time. The rest of it seems garbage and pretty badly written to me. Somehow I dont think he talked to Tom Cross. I wonder if he gets many phone calls from traders! The only reason I posted it as it may account for the immediate sell off from the open for those who blindly follow this sort of stuff. It did give a good top up point for those who wanted it, and it seemed some did from the bounce from the lows.

HOUSTON, September 13 /PRNewswire/ -- Endeavour International Corporation
(Amex: END) announced today an update
on its four-well drilling program in the United Kingdom sector of the North
Sea.


The company participated as non-operator in the Fiacre prospect on Block
23/11 (N), which was drilled to a total depth of 11,720 feet. The Upper
Jurassic target reservoir was encountered but economic hydrocarbons were not
present. Endeavour holds a 20 percent working interest in the well as part of
a farm-in agreement. The company's share of the cost of the well that has
been plugged and abandoned is approximately US$5 million.


The Global Santa Fe Arctic II semi-submersible rig is expected to move on
location and spud the first company-operated exploratory well this week. The
Turnberry prospect will be drilled on Block 31/26b in the Central Graben to
test the Jurassic Fulmar sandstone. The rig will then be moved on the same
block to the Turriff prospect targeted to test the same Jurassic objective
with a secondary prospect, the Tulliallan, aimed at a Cretaceous target.
Endeavour will hold a 40 percent interest in the Turnberry well and a 60
percent interest in the Turriff and Tulliallan prospects.


Currently moving to location is the Ensco #101 jack-up rig that will
drill the Prometheus prospect on Blocks 42/21 and 42/22 in the Southern Gas
Basin. The well is slated to spud within the next two weeks to test Permian
Rotliegend Leman sandstone. Endeavour will hold a 22.5 percent working
interest in the well.

Fund
Is it good or bad this oil stuff is a bit of a mystery to me.

Good find Fundy, cheers. Pity about the result though. No rns out from DNX yet.

Driver, bad news with regard to this well. The wells been plugged and abandoned, no oil there or what they've actually found is not worth pursuing, "economic hydrocarbons were not present". Shame really as they thought there was 105mbbl OIP.

Not been the greatest day for drilling updates for me! :-((

gavdfc
Thanks :-)

Driver

as gav says - bad news and hence the fall in share price - dare say it will get worse when DNX release an RNS - there again interims due in a fortnight

Gav - were you referring to Gabon being dry for SEY or another dry well?

Driver, you're welcome.

Fundy, yup, Iris Marin 1 in Gabon only found water, plugged and abandoned. Also yesterday, Espadon 1A through HNR in Mauritania, another plugged and abandoned.

Seems to me like DNX holding up well so far today, but stil no RNS yet. Would have thought we would have got one first thing this morning. Looking forward to the interims, Tullows results today were good. Alves even rated them a buy this morning!

PRESS RELEASE

DANA PETROLEUM PLC ('Dana' or 'the Company')

SUCCESSFUL APPRAISAL DELIVERS NEW GAS AT JOHNSTON FIELD

DRILLING UPDATE


Dana Petroleum is pleased to announce that the 43/27a-4 well, being drilled to
appraise the south-eastern area of the Johnston gas field in the UK Southern
North Sea, has been successful. The initial vertical pilot hole found gas
bearing sandstones in both the Rotliegend and Carboniferous horizons. The well
was then sidetracked to drill a 2,850 feet horizontal section through the most
productive Rotliegend reservoir section to provide an optimum offtake point for
additional gas production.

The horizontal well has now been completed and will henceforth be known as the
J4 producer. Well J4 has been production flow tested back to the Noble Julie
Robertson drilling rig at rates of approximately 55 million cubic feet of gas
per day (mmcfpd).

Following completion of the flow testing operations, the J4 well will be
connected via an 8 inch diameter pipeline, some 6.9 kilometres along the seabed
into the existing Johnston field infrastructure. The start-up of commercial gas
production from J4 is expected during October and should significantly boost
output from the Johnston field.

In the Central North Sea, drilling has also been completed on exploration well
23/11-4 having reached a total depth of 11,720 feet. The deeper Jurassic
sandstone target was found to be present as prognosed and of good reservoir
quality, but water bearing. However, the shallower Forties sandstones were
found to be hydrocarbon bearing and, whilst the recoverable volumes present at
this location are estimated to be small and non-commercial, these results
provide encouragement for the further appraisal of the 23/11 block, which also
contains an extension of the Barbara gas field.

Dana plans to drill two further important exploration wells before year-end.
The first is scheduled in October to test the Clachnaben oil prospect in the
Northern North Sea, where Dana holds a 79% stake. Clachnaben lies in Block 211/
22a, adjacent to the Cormorant/Brent export infrastructure through which Dana's
existing Hudson and Otter oil fields currently produce. This Brent sandstone
prospect has the potential to contain around 60 million barrels of oil in place
on a most likely basis. If drilling is successful, a fast-track subsea tie-back
development would be pursued jointly with the adjacent 211/22a-1 discovery,
drilled in 1977, which flowed 31 degree API oil.

Secondly, the Faucon well, in Block 1 offshore Mauritania, has been prepared for
drilling in November and is targeting a structure with the potential to contain
over one billion barrels of oil in place. Dana holds a 60% working interest in
the Block 1 Production Sharing Contract (PSC).

what does rns stand for

Up we go again.

Good news this morning on well J4 and start up in October. Also noticed they put the Fiacre news from earlier this week in with this RNS.

Busy end to the year with the Clachnaben drilling in October and Faucon in Mauritania in November. I wouldn't think we would get the results of Faucon until at least year end or early next year. Thoughts anyone? Lets hope they have more success in Mauritania than HNR have had of late. A big prospect indeed!

Gav

Faucon is potentially huge - net recoverable is f/c at 350m bbls of which i believe DNX have a 60% stake. That said it is high risk and personally would only put success chance at 25%. I would guess on that basis that 200mn net to DNX must be worth 3-4 on the share price witha potential downside of 80p - 1.

Need to to look into Clachnaben

For whoever asked:

RNS stands for Regulatory News Service which is where all formal news releases go through