Empyrean Energy

Web site : http://www.empyreanenergy.com

Another good post by Zengas !

ZENGAS - 21 Nov'05 - 14:02 - 454 of 454


RE-CAP from my earlier post.


Empyreans two projects.

Eagle Pool - Vicpet one of our partners who are 20% holders reckon it will increase their market cap 100% ie by 21m on just their 20% share based on appraisal well success. With Empyrean holding 38.5% that should give them 42m or circa 50m from their present 9.2m mkt cap. - A potential 5 fold increase. At that stage EME would need to raise at least a few million to take us to the next stage. Possibly 15% dilution to gain a further potential 70% upside again.

We are expecting 38.5% from a forecasted bopd output of 5500 barrels oil plus gas - ie 2100 bopd plus gas to Empyrean. The first (300m) horizontal well is expected to have flow rates of circa 1000 bopd plus gas. If successful subsequent (900m) horizontal wells are expected to have flow rates up to 2000 bopd plus gas.

As an example Global Energy Development operating in Colombia on 17 boe reserves and circa 1800 boepd has a market cap of 100m. The Eagle prospect could/should on success take us close to something similar to GED.

This project alone could see 5 - 9 fold upside to share-holders.
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Now Germany - the potentially huge gas project, but more riskier until the intactness of the seal is known (ie drilled).
Empyrean will have up to a maximum 52% share.

Pannonian are our partners on this and Galaxy their parent Co who are keen to get a foothold in Europe for specialist projects of this nature, bought out
Pannonian some time back. Galaxy are an American energy company specialising in these kind of projects operating similar successful ones in the USA.
One might well ask why would specialists like Galaxy be keen to get their hands on European potential like this by buying out Pannonian. They too will have well studied the potential before buying out Pannonian.

"The permit contains the Pfalzer Anticline which is a 515 square kilometre structure containing deep anthracitic coal beds overlaid by shale and sediment. The coal beds are too deep to mine economically but have been estimated by the independent expert to have generated many hundred trillion
cubic feet ("Tcf") of gas, with a recoverable gas potential of up to 6.2 Tcf in the first drilling prospect alone."

As an example VOG found 500bcf (half a trillion c/ft) gas. 74.8% is attibutable to VOG (350bcf).

With Russian gas prices somewhat different, VOG will have to sell most likely to Gazprom and a certain amount domestically which could be in
the order of $35 per 1000 cu metres. (ie 34,500 cu ft). With Gas prices in Gewrmany as in the prospectus given at around $4.60 per 1000 cu feet that
equates to $158 per 1000 cu mts or at the very, very least would be twice the price VOG would achieve. (Im still a long term holder going forward with 75% of my original VOG holding).

With up to 6.2 tcf potentially recoverable in the first prospect alone - it's huge.

If Empyrean only found 10 - 11% of that it would give them similarly a 350bcf share but worth twice the value based on German prices and only 5% royalty
(Max 10%)as what VOG would achieve.

VOGs market cap went from 34m to 105m based on their find. 70m straight away. (1.25p/share) The Broker estimates the company should be worth 3.06 per share minimum which is 250m and at least 180m of that is for the current find of 500 bcf (350bcf to VOG). Therefore what price would Empyrean be worth if the gas price is worth at least twice as much versus what VOG would achieve and in a much more readily available market to sell into, with no obstactles like Gazprom to have to deal/negotiate with.

A find for Empyrean of only 10% or so of the potential should see 100m minimum on their market cap or 11 times the current share price.
Both projects have the capacity to see a potential 20 fold upside - thats why i also referred to the company in a previous post having explosive short term upside especially with roughly only 7m shares on the open market.

It has a lowly market cap of only 9.2m/ 30p - share (floated at 35p) and compared to others that have no production and some bare licence areas, I feel this is undervalued by at least 100% when you see the likes of non producers Chaco 36.6m, Aminex 24.5m who are still early stage bare acerage - yet Empyreans Partners are drilling both projects anytime. The Eagle oil project has already had a producing standard vertical well with 233 bopd and 800tcf gas flow and now fully 3d seismiced to a much greater extent with a horizontal well to spud.

Imperail Energy was only floated 20 months ago at 10m mkt cap/35p share - Its now worth over 180m. Likewise VOG idling for weeks at 34m mkt cap - in a few days market cap is 105m which proves the point if Gems are spotted early the rewards can be enormous. EME does carry a degree of risk particularly on the German prospect but there is relavant reasons already well posted proving the coal seams already exist and by their nature should as the experts predict, have produced trillions of cubic feet of methane gas.
Nothing as we all know is ever guaranteed. Potential gems are difficult to spot early stage, but I feel Empyrean could well be one and as such that is why i have taken a holding.

As ever this is my own opinion based on risk/reward, DYOR etc.

Closed up 50% at 45p not bad fo one day, opinions on tommorow?

personaly i still believe this is cheap. i believe on the potential/risk ratio these are easily worth 80p. i am now 60% up on these and i am happy to leave them there as i think there is quite a way to go. if the drilling is successfull then the skys the limit.

Great call Papal,looked at it this morning and put it on my watch list.
Looks like my luck is out at the moment!
I have been keeping an eye on TAG since you posted it on the board and am tempted to release a few dogs and put whats left in EME or TAG.
DB66

DB66 it was a good one today on EME, and it will be the same as TAG and same as VOG, some people will get in before drilling results, and some people will be out and waiting. With EME and TAG I am holding through waiting results, but expect EME to be volatile in the run through drilling, with swings up and down.

TAG, news is due soon, and its as any hole driller, a risky venture until the drill results say its good. Again, if you are in now, you take the risk of losses, but also good gains, and if you wait, you have to pay much higher to get in if its good news.

Cannot advise on these as they are risk until drills are finished, and the drills can lead to nothing, but news is due on TAG soon, and EME in 4 to 6 weeks (EME you can see the regular drill updates on the earlier ASX link I put in)

Spread very tight 41.25p and 41.5p

Breakout due soon suppose, lets hope that its north

Well played by the MM's today and they free up loads of stock, but did not get mine.

Put some into EKA today, rumours in the Times of a positive drilling update, and they released a solid RNS today as well, but the Times rumoured drilling update is still to come ;)

What are your views on tommorrow, not a bad day considering up 50% the day before I thought

jimbobGR its had some good consolidation today, and it should bobble about at this price now pending the drilling news.

Some will want out before drills are finished, some will want in, so that is why its going to be up and down a bit I think.

Is this a temporary blip,or what,may be people taking profits before the next surge up i hope ,any views papalpower.

ateeq180 I would say profit taking as a number of people will not hold over drilling, just in case it goes wrong, this is where the risk players will hold, as they get the biggest gains if its good, or the biggest loss if its bad.

It has jumped up from the 20's to touching 50's, so a consolidation and slip back into the 30's should be expected with this type of company and situation, I would then expect another rise later as drilling nears completion as risk takers come in or top up, and then its either big up or big down when drill results are released.

this share is rubbish to trade or invest , virtually every trade of any size is reported late , making it impossible to see what is happening

To trade it makes it difficult yes, but to invest no, investors do not worry about daily volume of buys and sells, as they have long term targets. I purchased my first lot at 30p, and a second lot will be purchased before drill results when I think the price is bottomed out for a top up.

papalpower , i know what you are saying but i was looking for an entry today which has proved impossible. Some visibility is required here

for instance a 50k sell has just been reported immediately

Yes I have noticed, and this is at the MM's discretion, they can report any trade over 6 times the NMS size at any time, either instantly or delayed by 1 hour.

This is the trouble with price watching, as at any time any trade can be a buy or a sell regardless of where mid price is, I have purchased shares under mid price, and also sold share above mid price, which all adds to the confusion.

But this is what happens with smaller stocks, and until the market goes all SETS, its not going to change as the MM's make a market and make money too.

Just started looking at this one. I might have known i'd find Jimbo and Papal prevalent on the tread.

I'm jumping in on this one, good luck all!

A good price to get in at tallsiii, Eagle Pool is worth this price and more, Glantal is the blue sky potential.

We will know all by the end of January.

this one is moving this morning. Maybe off of the back of the gas price?

Nice move up. Now if EKA could just do the same tallsiii :)

This one clearly hasn't gained a following yet, given that it can go up by 23% before lunchtime and there are only two of us on here to talk about it.