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Post from elsewhere :


Clive205 - 2 Dec'09 - 20:25 - 10331 of 10332

In the FD note from Nov, 6th it published a table of licences showing AST holding 45% of Dolina and 15% of Globoki.

It also published the estimated pps value to AST as follows:

Field Risked PPS Unrisked PPS
Dolina 3.7 14.7
Globoki 3.5 7

These figures represent AST's respective percentage holding.

However it also says that AST's wholly owned subsidiary NSC currently owns 75% because joint venture partners have declined to participate in the work, but that FD has chosen to ignore this for now and assumed an interest of only 15%.

So if this situation remains the same and AST actually retain 75% I make the figures as follows;


Field Risked PPS Unrisked PPS
Dolina 5.8 24.5
Globoki 17.5 35

I've not taken into account dilution as a result of the recent fundraising, but do these figures look right?

If so then we could be in for an exciting ride H1 of 2010.



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Pro_S2009 - 3 Dec'09 - 00:22 - 10332 of 10332

A good post Clive.

It would appear that the 6M raised will complete the PEN wells planned and complete the Panhandle wells planned and that is the end of the Hungary work once at least 5 are on line by mid 2010 (PEN-104AA, PEN-105, GH-1, GH-2, PEN-101, PEN-106 or another).

The main use of the money is to drill Slovenia and prove that up and get it into production. It is well known that production facilities and infrastructure is in place (which means less Capex and less delays in brining discoveries to production). Production licenses are already in place, again no delay, and it appears the Slovenia government want to get income and so are fully supportive.

Its going to be very interesting what comes out of Slovenia in the first 6 months of the year, if they start to prove up that oil is commerical and start producing it things change dramatically (especially with talked about figures of 50MM to 80MM barrels) and thats ignoring the gas in the deeps.

From Clive's post above it can be seen that the risked figures have significant potential impact on the SP of AST, the unrisked figures of course are far higher, however that risked basis was done without the latest 3D sesimic results and so could be very much different now.

I think FD will keep a 20p target price, but lift up all the Slovenian figures based on the new seismic in their new note.

An exciting period ahead, buy your tickets and off we go on another 7 month AST journey to mid 2010 and see what brings.

*** and yes, I totally ignore Fontana-1 as IMO its best to regard this as nothing, only upside if anything good happens.

Nice post from elsewhere. There is "rumour" that the 3D seismic has shown up 50m to 70m barrels of potential, however, for now with that no in the open, working with the 24m figure does give some food for thought.



"bobobob5 - 3 Dec'09 - 00:58 - 1063 of 1069

The Dolina is very interesting. There isn't much historic public domain stuff about it which is easy to find (or which even exists!) but what there is sounds good. It produced for the Germans from 1942, but most of the original oil-in-place is still there. This is very easy to establish by studying the produced oil, the residual Proved and Probable volume (not currently booked to reserves because the field isn't on proper production), and the recovery level.

There are various ways to get at the OIIP figure, prior to the revised 3D assessment which is unpublished; e.g. (a) by working backwards from the above data, (b) by comparison with the over-the-border volumes for the other 2/3 of the structure (AST have given those numbers), and (c) by asking the company (which I did at Proactive Investors in 2007, and I got a figure for it).

As Smarty emphasises, we now know that the 3D derived volumetric estimate (albeit unpublished) is ABOVE COMPANY EXPECTATIONS. What that means is anyone's guess...but based on the work i did 2 yrears ago after Proactive, I would plump for 100 million barrels original oil in place. And whyever not? This whole industry is based on a broad church of science, guesswork and speculation, whatever anyone might like to claim to the contrary.

If that figure were correct, and we were to assume that with modern methods 30% of it could be recovered over time, the original recoverable volume would be 30 million barrels. Deduct the 5.6 million barrels prodiuced since 1942, and we get a remaining 24.4 million barrels. This is about double the 10.7 million barrels 2P stated by Ascent in 2007, but Ascent now say that their new figure is ABOVE EXPECTATIONS. So I will assume 24.4 million barrels, and why not.

I am disinclined, without any evidence, to assume more than the current 45% AST stake; the deeper gas percentage may well rise above the 15.75% however.

So on my basis: 24.4m x 0.45 = 10.98m so call it 11 million barrels.

Now if we monetise that using Ascent's own 2007 Reserve Value Approximations table, on Full cycle development 10% NPV, interpreting their 15-20 euros per onshore barrel fiogure as currently being about 15, the value (using Ascent's own methodology) is:

11m barrels x 15 a barrel = 165m

Now as oil in ground, the sp would not reflect that much; possibly, I would guesstimate 40% of it, which would be 66m (this being 6 a barrel, which doesn't seem at all daft to me)

On this line of valuation, depending on how one views the # of shares vis a vis the Placing, and one uses for sake of argument 440m shares as being a relevant number, this (hypothetical) Dolina oil might represent something like 15p per share. though of course AS PRODUCTION it would be worth a lot more, because there isn't then the time-related reduction of the NPV methodology, and the 60% reduction is gone.

If we consider that the current market capitalisation is, broadly, underpinned by the PEN wells, then the above (speculative) 15p represents an upside. And a not inconsiderable one, though not exactly in the multibagger class (imo one needs to look at the Globoki gas for that, etc)

It's very clear from the Placing RNS that the 6m is intended to help make the Slovenian shallow oil potential *real*. Jeremy Eng said so, it's clear and it's unequivocal.

In terms of bopd in 2010, well how on earth can one possibly guess as to what that might be? Well it's se;lf evident that one well is the minimum # of weels to achieve production! So the only issue then becomes: what would a reasonable expectation be for a modern production well, targeted into NEW PROSPECTS (see RNS) in an area that the Nazis produced using crude, by modern-day standards, technology? I don't know...500 bopd maybe?

If that were so, it would be (say) 160,000 barrels per annum allowing for maintenance down-time etc. So take the 45% and it's 72,000 barrels to AST. At say 20 a barrel initially (otherwise Ascent's NPV multiplier doesn't work) we would have 1.44m per annum from the first well. Add another...and it's close to 3m per annum. Which is not a fortune, but it would form a third income stream, to supplement the anticipated PEN and GH gas from Hungary.

btw I bought a piece of art from the delightful Gaye Advert this evening. And Ascent Resources are not One Chord Wonders!

but imho DYOR etc as always"

pp keep pumping!

I am well in profit from 3.5p levels recently purchased......and next year more bagging to come :)

Making money is what its about, buy low, sell high.

pp fill your boots, but hopefully not with water!

OJ thinks next week for PEN-104AA and PEN-105.



http://www1.investorvillage.com/smbd.asp?mb=12050&mn=5895&pt=msg&mid=8243992


104AA and 105 flow rates to be released next week according to a "continental" friend.

If he is right 104AA is testing now and it will be great to finally see the flow rates on the two wells.

Use of flush as you may.

OJ

Worth a read for views :

http://boards.fool.co.uk/Message.asp?mid=11767739&sort=whole


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Interesting that the lastest Otto presentation just out on page 5 has 4 prospects/leads in the Po Valley license area they share 50/50 with Ascent.

One might be Rubiera, it may not. However even if it is there remains 3 others. The Po Valley is very prospective and those who have written off the AST held area simply after 1 P&A are misplaced and misguided. It certainly will not be part of the 2010 work plan, but Otto and AST may well revisit there in 2011.


http://www.ottoenergy.com/irm/Company/ShowPage.aspx?CPID=1417&EID=74632515



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RNS AST parts company with San Severina, what a waste of time.

Its been a dead deal for months now, ever since the JR deal fell through. AST must be getting rid of all their skeletons out of the cupboard and start the new year with a clean sheet.

Fontana-1 if bad should be out between 22nd Dec and 31st Dec.......any later than that and it might be good news and not bad.

20p target price from Hoodless.

http://www.hoodlessbrennan.com/EasysiteWeb/getresource.axd?AssetID=21276&type=Full&servicetype=Attachment


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What a target currently around 5p!

It should make sense that if G-1 (Gavignano well) found reservoir formation but deep, and A-1 (Anagni) found that reservoir formation but higher up and with traces of live oil, then F-1 (Fontana) being the highest point of the formation should be where the oil is now located.

That would not only prove F-1 but also the potential for a "string of pearls" theory across this area.

Which is of course following G-1 and A-1, why F-1 is now being drilled to test the area for the presence of the reservoir formation and also whether it has oil in it.


Still, one should discount this to nothing and expect F-1 to fail, however, one also must take into account that should oil be found it will likely be commercial in terms of recovery potential and also will have a profound impact on the potential of the Frosinone area.

The SP presently allows nothing for F-1 or Frosinone (and so it should be discounting down to nothing on expected failure), and therefore there is considerable upside to get priced in should there be an oil find.

I certainly wouldn't count ny chickens as far as F-1 is concerned,could go below 4p if unsuccessful?
cyril

Couple of things, firstly from a post elsewhere we have more details of what the work plan is for PEN-104AA in January.


""""""Handykart - 18 Dec'09 - 00:08 - 10934 of 10934

All,thought this might be of interest, as you were talking about remedial work on Pen-104AA.I sent an e.mail to the company last week.Last part of the reply was

" In short, we now need to clear out the well and to do this we are sourcing a small bore velocity string that we can install in the well and blow it down with nitrogen. There are some restrictions with equipment, particularly one of the two coiled tubing units in HU is u/s and so it will be January before we can proceed.""""""

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Secondly a bit of of background info on "Tight Gas" and how many in the industry believe "non conventional" tight gas will become the new "conventional".

http://www.arabianoilandgas.com/article-6646-tight-times/1/

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Relative as Slovenia has "tight" deep gas.

And do not forget everyone, get your 2010 stock picking entries in. Click the link and then click on "Entry Form".

http://www.stockchallenge.co.uk/index.htm


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Ascent to become the "tight gas" exploration company ? Does seem that AST will now embark on tight gas plays as exploration with the back up of production from conventional gas plays.

PEN and PAN are the conventional gas production.

Slovenia and and Hungary (Lovaszi and Ujfalyu) are the "tight gas" exploration.


Upside is certainly there, as Jeremy says "300Bcf "recoverable" potential" in the area thats just been 3D'd. On going 3D in the other area in Slovenia and also 3D to be done on the Lovaszi and Ujfalyu field in Hungary across the border. Lovaszi and Ujfalyu are very prospective in terms of tight gas potential, and so AST could be looking at 500Bcf recoverable when all the 3D is done and all the data analyzed.

You can see why the temptation is there to go for it, as the potential recoverable figure is so large, and on top of that the Slovenian government is very supportive of getting gas flowing there.

MOL has experience in many area's with tight gas, and they have had some success (Dereckse basin) and some failures/inconclusive, but obviously their experience level is increasing all the time. Slovenia of course MOL is not part of the team, however at Lovaszi and Ujfalyu they are.

For those who try to smear tight gas as "all the same", MOL openly say they have 5 tight gas potential area's in Hungary, and each one is entirely different in terms of not only prospectivity, but how to work on each one as well. Therefore whilst some people point to say the Mako Trough and quote trouble, that is just one area and totally different to the others in many ways.

Anyway, "tight gas" and other presently "non-conventional" plays will become the new "conventional" in the coming years, and AST is going to be one of those companies next year that attempts to move this forward.

Upside of 500Bcf recoverable on the licenses they own ???? Certainly worth trying especially as for 2 years at least Hungary conventional gas at PEN and PAN will be flowing and keeping the tills turning over.

Interesting RNS, its interesting because, now we have it confirmed the highly permeable formation is present up dip (some 300 metres higher than at Aggers 1.7km away) at Fontana-1.

As Jeremy says ".......the potential upside from Fontana-1 still remains."

Given the seismic is proved by work so far and the formation is there, its only now a question of does it contain oil or not.

Simple as that, and most interesting and the redrill results in January will now come down to simply oil or not.

I had discounted F-1 as nothing, and there is nothing in the price for it, but I might have to add some value to it now, for the potential is very much there for a surprise.

On line :

Max Buy is 25K at full 5p

Max Sell is 1 million at 4.77p



There is strong demand for the shares.