anyone got any ideas about the block trades that went through today?

website: http://www.sterlingenergyplc.com/



weather: www.nhc.noaa.gov/refresh/graphics_at4+shtml/084938.shtml?50wind120

and so the thread moves onto a soft commodity discussion. the subjects are seemingly endless.

I've already put my mother in law in the shed with loads of hay.

MS

hibernating?

Hope so. Will bring her out when the weather gets warmer.

MS

LOL

LOL

LOL

MS dunno how you do it!

and if the weather stays bleak?

With any luck it will and she stays in.

MS

From a poster on ADVFN who avidly dislikes bovines and likes to make their lives unpleasant.

insectivore - 10 Dec'04 - 13:05 - 3110 of 3110


Not been here for a while, but reading through the last week's posts there has been some unpleasant rubbishing of SEY. Some of the negative commentary relates to the market cap and the justification for such a high value when last year's profits and revenues were rather thin.

So it is probably worth reminding folks that SEY is a completely different company from the one that reported those results. Since the last year end, the company has paid 40M for an African exploration portfolio that will only start delivering revenues in 2006 (from Chinguetti) but which includes major long term growth potential through exploration success; it has acquired $40M of gas production and development potential in the Gulf of Mexico, some of which one might expect to be reflected in this year's results, but my guess is not all of it; and it is now sitting on 100M or so of cash, some of which is earmarked for Chinguetti, but not all.

On a rough valuation based on the interims and various bits of analysts research I have seen, it would seem that a value of 250M is easily justified as follows:

Cash 100M
GOM 80M - based on 2P reserves of 60 bcfe @ $2.35 /mcfe
Fusion 50M - based on it having appreciated by, say, 25% since acquisition, given the success of Tiof and Tevet and the upswing in oil prices.
GPC deal 15M - arbitrary estimate based on 20% ROR on $130M

From this one would have to deduct US debt which is around 15M according to the interims. But one could also add the value of the Madagascar deal, the Philippine acreage and the value of the strategic partnership with the government of Mauritania, all of which are difficult to put a number on.

SEY seems to have a rather unusual profile for a company its size. It is not an out and out exploration play (thank goodness) but neither is it any longer a production company that can be valued on an earnings basis. And it has grown remarkably quickly which makes it even more difficult to assess. I have been in for a while, and have been pleasantly surprised by what it has achieved. I am probably in the Andy Reilly camp - expecting continued growth to be provided by re-continued success in Mauritania, drilling in Gabon next year, and other exploration actrivity, plus incremental increases in the US reserves. I also expect the management to continue to deliver creative value additions as they seem pretty good at this. But I do not expect the shares to double overnight.

From all of the above, you will gather that I am as confused as everyone else as to why the shares have been so weak in recent days. Seems an over-reaction to a couple of dry exploration wells in Mauritania.

DYOR!

cheers for the post SWW.

PT

You didn't fancy the booze up then. I think that's where they all are. Too far for me to travel. I get a nose bleed if I go more that 20 mile from home.

MS

Is it all uphill from where you are then MS?

far too busy bantering to go for xmas drinks...where are u based MS?

Nr Tenterden Kent. Your right namreh3 bit of an old fart these days. Too much of everything in my younger days and loved every minute of it.

MS

Kentish or Man of..?

I don't know how that works. I've heard the expression several times. I think it's something to do with which side of the river Medway you're born. But any way no. Ex service brat so I'm from every where.

MS

everywhere uk or abroad as well?

Lived in the Far East for a while plus a couple of stays in Germany. Lots of places in the UK.

MS

so staying within a 20 mile radius seems a lovely idea!

Just great. Done all the travelling I want to. Besides 20 miles from me takes me to the coast Rye in particular and Camber Sands. My favourite place of all Leeds Castle. If ever you're in Kent it's a must see place.

MS

yup, one day i will get down there with the kids. does your moth-in-law do a bit of babysitting?