This looks a very good bet? Mentioned in the share magazine.

Should be going a lot higher.....this will be 100p by the years end or thereabouts; the production is going to be increased dramatically and the next update will inform the market about it !, plus there will be exploration wells and that is what gets a sp going.....

From tonights FT:


Petroneft, the exploration group focused on Western Siberia, added 3.6 per cent to 58p, after Canaccord Genuity reiterated its"buy" recommendation, citing among other factors a forthcoming report on reserves Traders reckon that update could be published very soon and will show at least a 30 per cent increase in proved plus probable reserves to about 100m barrels .

News out today, ongoing progress, and drilling program commencing in April

100p target for me at least....

Davy Research
Petroneft
(PTR LN)
Releases operational update
10 March 2011
Job Langbroek
Closing Price: $0.95 Rating: Outperform 09/08/10
FACTS: Petroneft has released (March 10th) an operational update. Reserves (2P) have been increased from just over 70m barrels per day to 97m barrels. Seven out of nine fracced wells are producing at 400 barrels each. Two more are still due to come back on-line. The first well in the second development pad has started and the first exploration well this year will commence in April. Macquarie has converted a standard debt facility to a reserve base facility of up to $75m of which $30m is approved. A further update is expected in early April.

ANALYSIS: The statement delivers on most parts of the business plan as guided by the group. Reserve growth to 97m 2P barrels is up 37% from just over 70m barrels with the increase coming roughly half through drilling and half through the addition of licence #67 to its portfolio. The first of this year's 17 development wells is due to complete very shortly and the first of this year's five exploration/appraisal wells will commence on the 12m barrel Kondrashevskoye prospect in April. Production output has suffered from a difficult February in the field. Consequently, only seven of the nine fracced wells are back on stabilised flow, running at 400 barrels per day on average. Petroneft now expects production to be in the 3,500-4,000 barrels per day range by early April. The conversion of the debt facility to reserve base lending is cheaper and points to the evolution of Petroneft as an oil and gas producer. The facility will obviously increase operational flexibility.

DAVY VIEW: The reserve upgrade and ongoing operational development of the Linenoye field is as expected. In all, this year's exploration targets and appraisal is targeting up to another 100m barrels of reserve growth. The production numbers will disappoint but should just be a function of timing. Guidance for exit production of 8,000 barrels per day by the end of 2011 is not challenging in the context of an additional 17 development wells on top of the nine drilled in recent months. Our valuation of 72p per share is built on a production profile which is very achievable and we see significant opportunity for reserve growth and value addition on top of the existing 2P reserve base. Our rating is 'outperform', a position made even more tenable by the recent share price pullback.

http://www.investegate.co.uk/Article.aspx?id=201103100701116879C/

http://www.investegate.co.uk/Article.aspx?id=201103210700092721D

All coming together,not long to wait?


At present, seven of the fractured wells have come back fully online and are averaging over 400 bopd after clean-up and normal initial decline. We currently anticipate that production will be in the 3,500 bopd to 4,000 bopd range by early April when all wells are back on production and we will provide a further update at that time.



Russia new oil tax regime to take effect by July
Fri Mar 25, 2011 2:24pm GMT
Print | Single Page[-] Text [+] MOSCOW, March 25 (Reuters) - Russia's new oil and oil products tax regime will take effect no later than July, deputy Finance Minister Sergei Shatalov told reporters on Friday.
"There are a few small problems with certain companies . . . We hope that a decision will be taken soon," he said, adding that the new tax regime -- that aims to lower duties on crude exports while increasing those on oil products -- will be enacted in July at the very latest.

Russia's Energy Ministry has submitted a new tax regime proposal to the Finance Ministry that would lower the crude oil export duty by around 7 percent.

Nobody seems interested in this one apart from niceonecyril and myself but this has all the hallmarks of a little gem.....

This is a good'un by the look of things...unfairly underpriced....just has to go higher...much higher...

Can't believe the drop here....with all the wells to be spudded soon and it drops like a stone ......the market has taken a very short term outlook with this one....

With current production of 2500 bopd and market cap of 120 million, looks fairly good value, and there are of course the other potential prospects comming on line. PE<10
Lets have some views.

Whens the next set of results due?

June 22, 2011

Operations Update
Production currently averaging about 2,500 bopd, primarily from 7 wells

Autumn production enhancement programme planned to re-frac, with larger frac sizes, existing wells on Pad 1 and new wells on Pad 2

Planned number of wells required from Pad 3 to be reduced recognising thinner oil pays

Extension of Lineynoye oil field north of Pad 2 with thicker pay zones expected in the longer term to compensate for reserve and production reductions from Pad 3

Q1 2012 production target has been revised to between 4,000 to 5,000 bopd and Q2 2013 to between 7,000 to 9,000 bopd

Update: PetroNeft tumbles amid lower production targets
Wed, 22/06/2011 - 10:12 | Fiona Bond

Russian-focused oil and gas explorer PetroNeft Resources (PTR) saw its shares plummet almost 20% on Wednesday morning after it lowered its production targets.

The company has revised its first-quarter 2012 production target to between 4,000 and 5,000 barrels of oil per day (bopd), down from its previous objective of 7,000 - 8,000 bopd.

Looking further ahead, it has set itself a range between 7,000 and 9,000 bopd in the first quarter of 2013.

Its current production is averaging around 2,500 bopd, primarily coming from seven of the nine wells drilled last year.

The company's more conservative approach to output stems from its decision to reduce the number of wells drilled from Pad 3 on the Lineynoye oil field as a result of thinner oil plays.

In turn, PetroNeft will increase the number of wells drilled from Pad 2, where results have so far proved pleasing to the company, revealing the northern part of the Lineynoye field to have thicker pay and extend further than originally anticipated.

However, this will mean fewer wells available for production in 2011, thereby reducing the company's near-term production rate, PetroNeft said.

Chief executive Dennis Francis commented: "While the results of Pad 2 drilling are encouraging, the Pad 3 drilling results will limit near-term production growth. We are currently producing from less than 10% of our current discovered reserves and this year's exploration programme has the potential to double these reserves and hence our long-term production capability."

PetroNeft's high impact 2011 exploration programme is targeting over 100 million barrels net to the company on five prospects spanning Licences 61 and 67.

The Kondrashevskoye No 2 sidetrack well on Licence 61 is progressing on schedule, with results expected in early July, the company said. A second exploration well will be at Sibkrayevskaya, a prospect of over 40 million barrels. The site for a third exploration well, North Varyakhskaya No. 1, has also been prepared and is set to spud in August/September time.

Meanwhile, two exploration wells, Cheremshanskaya No. 3 and Ledovoye No.2a on Licence 67 will be drilled in the second half of the year.

"We remain confident in the longer-term reserve and production potential of Licences 61 and 67," Francis added.

Oil and gas analysts at Ambrian published a note: "In reaction to this update, Petroneft has been significantly marked down, reflecting disappointment over current hydrocarbon flow rates.

"Despite the clear negative tone of the announcement, we highlight that although near-term production will be reduced, overall field reserves are likely to sustain a much smaller decrease in absolute percentage terms due to the discovery of thicker-than-expected net pay sections to the north of Pad 2. This serves to moderate the overall decrease in total asset value over the life of the field; however, the short-term impact in cashflow terms will clearly be more material to the company's development planning and will serve to push back the profit point.

"Whilst we reiterate our 'buy' recommendation, we move to reduce our target price from 108p to 83p."

Prelimernary results 11-5-11
Interim res 9 -9 - 10

Looks like interim results due sept 2011

Operations Update





PetroNeft Resources plc (AIM: PTR) owner and operator of Licences 61 and 67, Tomsk Oblast, Russian Federation, is pleased to provide an update on its operations.





Highlights:



Kondrashevskoye No. 2 sidetrack well confirms 2P reserves

Lineynoye 206 contains thickest oil pay encountered to date

Lineynoye/West Lineynoye has materially thicker pay and extends significantly further north than originally anticipated

Several new oil bearing structures are now likely to the north of Lineynoye/West Lineynoye



Licence 61 Exploration/Delineation programme



The Kondrashevskoye No. 2 sidetrack has been drilled down dip from the Kondrashevskoye No. 2 well and penetrated the oil water contact in the objective J1-1 sandstone interval at -2,465 m true vertical depth ("TVD"). The reservoir interval of 3 metres in the sidetrack section was slightly thicker than in the vertical well with the top metre of the reservoir oil bearing.



Based on the results, the well has most likely confirmed the existing independent Ryder Scott 2P reserves of 8.1 mmbo attributed to the field and we will now update the reserves with the Russian State Reserve committee in preparation for field development. The exact timing of development will depend upon how the economics of this field compares with other nearby fields, most notably Arbuzovskoye.



Production casing has been run and cemented in the well so it can be used when the field is developed. The drilling crew is in the process of moving to the potentially high impact Sibkrayevskaya exploration prospect which will commence drilling shortly.



Licence 61 Development programme



The Lineynoye 206 development well drilled from Pad 2 to the north contained 21.9 metres of gross sandstone with 18.5 metres of net pay which is the thickest net pay interval encountered to date in the drilling programme. The reservoir interval was completely saturated with oil and confirmed an oil-down-to of -2,437.5 m TVD, some 15 metres deeper than the previously mapped structural spill point of the field to the north.



The results of this and other recent Pad 2 wells have shown that the northern part of the Lineynoye field has materially thicker pay and extends significantly further north than originally anticipated. This has positive implications for reserves and productivity in this region of the field and for the likelihood of several new structures north of Lineynoye/West Lineynoye to be oil bearing.



Dennis Francis, Chief Executive Officer of PetroNeft Resources plc, commented:



"We are pleased to have proved reserves for economic development at Kondrashevskoye and will incorporate this discovery along with Arbuzovskoye in our 2012 development planning. Pad 2 drilling continues to be very encouraging with the thickest oil pay encountered yet indicating an increased probability that oil has migrated north from the Lineynoye/West Lineynoye field into the various structures contained in the undeveloped Emtorskaya High area."

Davys update looks good for the near term sp

Petroneft has issued an RNS confirming that 4 Directors (including the CEO and CFO) bought 440,000 shares at prices between 35.25p & 35.71p yesterday following their exploration and operational update.

We also understand that the draft law on MET decrease for small oil field was approved by the Russian Duma in the second reading late yesterday afternoon. If approved in the third reading (which is as a rule a technical reading only) we understand the legislation would be in force starting January 1, 2012. This would be a very positive development for Petroneft. Previously the company have indicated that half their current reserves would qualify for the reduced rates of Mineral Extraction Tax under the proposed legislation. Given that netbacks in Russia are broadly $10-$12 per bbl, an additional c.$5 per bbl would be very significant. Our NAV for Petroneft is 62p. The MET changes if introduced would increase it to 70p

http://www.deweyleboeuf.com/~/media/Files/clientalerts/KeyChangesinRussianTaxLegislation.ashx

A couple of posts regarding the effect it could have on PTR,suggesting a screaming buy?? imho

I done some calculations regarding the MET discount for small oil fields based on current reserves and using a sliding scale.
Kondrashevskoye 8.12 million barrels 49% discount = $ 79 million extra.
Arbuzovskaya 13.24 million barrels 40% discount = $ 106 million extra.
Tungolskoye 15.48 million barrels 36% discount = $ 113 million extra.
Ledovoye 15 million barrels 37% discount = $ 111 million extra.
Total for these 4 fields alone is $ 409 million extra.


Eventually the penny will drop regarding the upside on Lineynoye / West Lineynoye field and other structures to the north because of the oil down to 2437.5 mtrs in well 206 and a net pay thickness of 18.5 mtrs within 21.9 mtrs of sandstone.
This is 15 mtrs deeper than previously thought and will lead to significant reserve increase for the Lineynoye / Lineynoye fields alone.
The discount on Mineral extraction tax for small fields will also give a serious boost to the profit margin once it comes into effect.

http://www.reuters.com/article/2011/07/21/russia-energy-tax-idUSLDE76K14E20110721

and:

Petroneft (USc) (PTR LN)
Price: $0.51 Rating: Outperform Issued: 09/08/10
Russian president signs into law reduced tax bill for small oil fields
Caren Crowley

FACTS: On July 21st, a new bill to encourage the development of smaller oil fields in Russia by reducing the Mineral Extraction Tax (MET) payable was signed into law by the Russian president. The law comes into effect on January 1st 2012.

ANALYSIS: The law allows for a sliding scale reduction in the MET for fields below 5m tonnes, roughly 37m barrels. The maximum reduction will result in a halving of the MET rate. This will occur for fields up to 7.5m barrels, whereas fields containing 30m barrels will receive only a 12.5% discount. Fields containing 22.5m barrels will receive a 25% discount and so on. The MET rate relief will have a material impact on cash net back to producers of small fields, such Petroneft. Petroneft believes the tax relief can boost cash from operations by $8m in 2012 alone. The impact should be greater in future years. In other words, there is a potential additional profit margin of $7 per barrel (at $80 per barrel export price) versus a typical profit margin of $10-12 per barrel for Western Siberian oil fields.

DAVY VIEW: The new law is very good news for Petroneft. At present we see the tax change improving our NAV of 62p per share to 70p per share. However, we believe the additional value could be greater than our initial 8p per share estimate as our model is based on an older field development schedule. We believe management will optimise its development programme to maximise the benefit of the new tax relief.