Dragon Oil plcs principal production and exploration interests are located in the Cheleken Contract Area in the Caspian Sea, offshore Turkmenistan. The Cheleken Contract Area covers approximately 950 sq.kms and comprises two offshore oil and gas fields, Dzheitun (LAM) & Dzhygalybeg (Zhdanov), in water depths of 10 to 37 metres.

            Red = 25 day moving average.           Green = 200 day moving average.

Scot mate, this is a discussion board, not a place to air your prejudices. I am sure Cynic can defend himself, but you are becoming offensive. If you don't like the investment comments on these boards, go elsewhere.

don't worry Harry ..... the woaded-one is, i suspect, rather too fond of the bottle for he is at his most offensive in the evening ..... nevertheless, i dare say it shows his true colours.

anyway, back to DGO ..... i have just had a look at the chart, and am amazed that the bears have had such a ripping time here over the last few days ...... whether the minor recovery on the back of their 37% increase in production over the last year can be maintained is worth watching, but i suspect not, at least not immediately - the markets may have recovered somewhat, but a reversal or consolidation must be imminent

Excellent update though and the most important thing are the 2 lines that says : all production can be routed through Baku in Azerbaijan if necessary, well that does remove a big headache if there is trouble with Iran further down the line !, so why the ridiculous drop ?.

289p to buy but still dropping slightly. Buys outweigh sells by 2-1, so maybe a bounce imminent?

No bounce evident as graph still shows no support and Iran showing more problems.

Perhaps shareholders are wondering when they might see some dividends.

Sp sailed past the 200 DMA at just over 400p.
Next good support on the chart is anywhere between 150-170p. Below that then........

Can't rely on those Buys and Sells you know HC -):

Oh great! Now you tell me! :o)

No doubt DGO will drop drastically again today...260p target

what price end of 2009?

An old post i believe is worth reading, from the fools board

They operate in Turkmenistan and this IMHO is the biggest risk to the company. The bloke who runs Turkmenistan is quite a strange chap and makes our megalomaniac politicians seem tame. So the question has to be asked why am I stupid enough to put money into a company which operates in such an odd atmosphere. Well the answer is simple, its oil.
The company is expanding its oil production; by about 1 well per month and a couple of workovers on previously existing wells. However this is offset by big declines in drilled wells. This means that the company has to keep drilling in order to produce the same amount of oil it did the year before. Apparently the well production decline rates, that are characteristic of the Cheleken fields, range from 55% initially before stabilising to about 25% per annum. This has not stopped Dragon setting some high target rates, by the end of this year, they expect to produce 20k bopd and with their very lucrative production sharing agreement with the Turkmenistan government they will get the lions share of this. i.e. For the first 10k bopd they get 50% of production and there after 85%.
Looking at these figures and ignoring decline rates this would give Dragon an income of :-
5k bopd for the fist 10k produced and 8.5kbopd for the second 10k bopd giving a total of 13.5kbopd
Assuming this is over the whole year and allowing for 30 days down time a year this would mean a total production of 13500 * 330 = 4455000 barrels a year.
Assuming oil price of $35 a barrel (average achieved in 2003 was approx $27 a barrel), this would give a turnover of 4455000*35 = $155m

Unfortunately that is not the whole story they have to get the oil out of Turkmenistan to somewhere that will buy it, to do this they have two routes open to them and they tend to use both depending on the cheapest route. The first is through Iran and they use a production sharing agreement where they swap oil instead of pumping it to the other side of the country, however Iran takes a cut. Yes it's expensive to shift oil from Turkmenistan but may get cheaper as new routes compete for the production from the Caspian. The other was through Neka. In 2003 they shipped 1.6M barrels through each.
Well the results for last year are encouraging to say the least. However due to the decline in oil production for the first of this year with no real active drilling I would assume the first of the year will not be as good as the last of 2003. However they have started to drill again with some good results even though they did not complete the first well due to tech problems, but are now drilling new well every 35 days or so, but combined with this they have re worked some old wells and are now increasing production once again. Over the past month and a half they have increased production just due to reworked wells by 3600bopd, so assuming they are still producing over 10kpobd then about 3000 will be attributable to Dragon.


Year ended Year ended
31 December 2003 31 December 2002
US$'000 US$'000
Turnover 82,025 50,593
Thinking myself of reinvesting,having sold up sometime ago. just a matter of waiting for it to settle a little?
cyrill

If further takeover bids for some of the mid-cap oilies were coming like the possible IEC one, now would be a good time !.

so much for drasic fal u redicted today hyleo.....anther one u got wrong

not yet...we will see next week

i'm only interested end of next year at earliest

hmm

well almost a full month since hyleo stated this will be 200p..........i gave him a month rather than a week but still another prediction he got way wrong.......and he doesnt predict for end of 2009 as i asked. look out for your pants around your ankles hyleo

end 2009 is far too far away, but in the immediate, it willbe interesting to see if sp can break back up through 25 dma which it is now challenging ...... chances are, even in a steady market, that it will fail at least a couple of times

good increase today............lol, 2009 is too far away, its only a year away! thats problem with this society these days, everyone wants everything now......bring back the good ol days

dragon are well diversified and will increase production and revebue / profit for next year easily......do some research on dragon cynic and you will realise this is a buy even in current bear market