Red Emperor Resources (RMP) is an ASX and AIM listed natural resources exploration company
with interests in the frontier state of Puntland, Somalia and the Republic of
Georgia.

* In Puntland, Red Emperor holds a 20% working interest in two licences
encompassing the highly prospective Dharoor and Nugaal valleys. These two
exploration areas cover over 36,000km2. The first well in a two well
programme spudded with drilling also commenced on the second well in
January 2012 targeting 300mmbls and 375mmbbls of best estimate Prospective
Resources (100% basis). Site construction has commenced on the second well
with the setting of the 30 inch surface casing and the drilling of a 50
meter pilot hole in readiness for spudding following the completion of the
first well.

* In the Republic of Georgia, Red Emperor has a 20% working interest in
onshore blocks VIa and VIb, covering approx. 6,500km2. Joint Venture
partner Range Resources Limited (ASX: RRS | AIM: RRL) previously funded a
410km 2D seismic program with independent consultants RPS Energy
identifying 68 potential structures containing an estimated 2.045 billion
barrels of oilinplace (on a mean 100% basis) with the first (Mukhiani-1)
of two exploration wells having spudded in July in 2011. Re-interpreted
seismic supported by the Mukhiani-1 vertical seismic profiling has
identified new fault and stratigraphic trapping potential with the
possibility of a side track well to be drilled post additional seismic in
2H 2012.



As at 8th March 2012, the Company has 206,681,755 ordinary
shares in issue. The Company holds no shares in treasury and each share carries
one vote. This figure may be used by shareholders in the Company as the
denominator for calculations by which they will determine if they are required
to notify their interest in, or a change to their interest, under the
Disclosure and Transparency Rules.

http://www.iii.co.uk/tv/episode/red-emperor-resources-rmp

-5.6% on the ASX

Red Hot Penny Shares
Shares recommended may be small company shares. These can be relatively illiquid and hard to trade making them riskier than other investments. Please seek independent personal advice if necessary.
Where to find the big profits in the UKs most exciting share market
Issue 153 August 2011
Tom Bulford, Editor
Inside
Next Issue
Friday
2 September 2011 ...continued over...
This crisis will breed
a new enthusiasm
for stocks........Page 4
This West End
secret could make
you 183% in the
Olympic rush...Page 5
The huge prize
at the end of the
great Bahamas
oil hunt..........Page 8
Toms Masterclass:
The radical
potential of biotech
heralds a new age
of progress....Page 11
If you are not prepared for the biggest gamble of the year, then skip this
article and move on.
I have found a new way of playing two of the hottest oil exploration
prospects in the world. Thanks to one deal, this company has a 20% interest in
two highly promising oil and gas plays in the former Soviet state of Georgia.
And thanks to a second it has a 20% interest in two onshore basins in Puntland,
the autonomous region of Somalia.
If you were following Range Resources you will remember that it is also
participating in these same projects. And you will remember that Range has
chosen not to stake its entire future on these two projects alone.
But the company I am describing today is prepared to stake everything on
Georgia and Puntland. If it doesnt hit oil its shares will have negligible value.
But if the gamble comes off we could make a 365% return on our investment.
And because they are eligible for your ISA, that nice capital gain could come
entirely tax-free!
In fact this is a company that could have been created just for Red Hot Penny
Shares even down to its name Red Emperor.
Lets start by reminding ourselves why Georgia and Puntland are two of the
most important new oil and gas plays in the world right now.
A colossal basin that stretches from
Georgia to the Black Sea
Since escaping from its Soviet past in the Rose Revolution of 2003, Georgia
has been given the accolade of top reformer by the World Bank. Its
done everything possible to attract foreign investment. And its position at
the crossroads of Europe and Central Asia has made it a natural hub for
infrastructure which includes a network of oil and gas pipelines. So if oil and
gas can be found it should be quite easy to get it to market at a profit.
And oil has been found lots of it. The Supsa Field near the Black Sea has
been producing oil since 1889. To date there have been 22 other discoveries,
confirming the presence of a working hydrocarbon system that extends all the
way from Georgia into the Black Sea.
In January last year Red Emperor acquired a 20% interest in two blocks that
cover 10% of the entire land area of Georgia. The operator of the licences is the
private company Strait Oil & Gas. It has a 40% stake, while Range Resources
has the other 40%. Exploration got under way last year and an independent
report by consultants at RPS Energy included a best estimate across 68 different
drillable prospects of 2.05bn barrels of oil.
Now drilling targets have been identified and on 14 July drilling commenced
This massive oil gamble
could make you 365%
2 ...continued on next page...
32
26
30
24
28
34
Jun 24 Jul 1 Jul 8 Jul 15 Jul 22 Jul 29
Yearly performance since listed (Jun) 2011 -28.93%
RED EMPEROR: SHARE PRICE
Year to end Revenue Pre-tax profit Earnings P/e Yield
June A$m A$m A$ (%)
2009A 0.09 -1.9 0.05 0.0 0.0%
2010A 0.02 -1.2 -2.8 0.0 0.0%
2011E N/A N/A N/A N/A N/A
2012E N/A N/A N/A N/A N/A
Latest Bid/Mid/Offer: 20.5, 21.5, 22.5 Limit Buy Price: 25
Bid Break Even: 9% 12-month Price Target: 100
Shares in Issue (m): 152.5 Market Cap (m): 32.8
NAV(p): N/A Price/NAV: N/A
Epic code: RMP Market: AIM
Website: www.redemperorresources.com Risk Rating: High
Normal Market Size: 10,000 52 week High/Low: 34.13p-14p
RED EMPEROR: THE FACTS
on the first of these, Mukhiani 1. This well is targeting the Vani 3 prospect which has a mean estimate
of 115m barrels in place, of which Red Emperors 20% share would be 23m bbls. The well is expected to
take up to 55 days to drill which means that we should get the results in early September. The rig will
then move to a second exploration well.
How much could Red Emperors interests in Georgia be worth? Old Park Lane Capital provides the
following analysis:
Variable Blocks VIA & VIB
Undiscovered oil in place 2,045mbls
Red Emperor interest 20%
Net to Red Emperor 409mbls
Recovery factor 30%
Unrisked recoverable resource 123mbls
Chance of success 8.33% (1 in 12)
Risked resource 10mbls
Implied value per bl of discovered oil $6.60/bl
Risked value $67m
Market/political risk discount 50%
Less share of costs $2.8m
Expected monetary value (EMV) $31m
Source: RPS and OPLC estimates
The table starts with the 2,045mbls estimate of RPS Energy and, if this is discovered its value in the
ground is judged to be $6.6/bl. Working through the table though, you can see that Old Park Lane has
assumed a recovery factor of 30% (that is the percentage of the 2,045mbls than can actually be extracted);
it has given the project a 1 in 12 chance of success; and then it has further discounted the calculated by
value 50% to allow for market and political risk. The 30% recovery factor and 50% risk discounts are
conservative. But what really limits the bottom line value of $31m is the 1 in 12 chance of success.
That is fair enough, but of course, any individual well will not be one-twelfth successful. Either the
well will have oil that can be extracted or it wont. So if oil is found across this block in the magnitude
that RPS has estimated, the value of Red Emperors multiplies twelve-fold from $31m to $372m.
Why oil majors have been crawling over Puntland
Now let us turn to Puntland, which is the autonomous region of Somalia on the very north-east tip of
the Horn of Africa. This has long excited oil geologists for one very good reason: eighteen million years
Source: RHPS
3 ...continued on next page...
ago the Horn of Africa was attached to what is now Yemen, before the continents parted and the Gulf of
Aden intervened. Yemen is known to have oil, with an estimated 5-10bn barrels.
Given that the geology of Yemen is a match to that of Puntland, it is a fair assumption that Puntland
has oil also. This inspired exploration in the 1980s by various oil majors including Conoco, Shell, AGIP,
Phillips and Amoco. 2D seismic surveys identified some likely geological structures, oil seeped to the
surface, and some exploratory drilling found shows of oil. But then the political climate became too
hostile, especially towards US interests, and the oil majors withdrew.
Within the next few months though, the first well for 20 years sh ould be drilled in Puntland.
Leading the endeavour is Canadas Africa Oil, which has spent $30m on a 2D seismic survey and
is set to drill a first exploratory well by the end of the year . Africa Oil currently holds a 60% interest
in the Puntland licenses, Range has 20% and Red Emperor has 20%. Drilling locations have been
selected, and a contract should be signed with a drilling contractor this month.
There are two basins of interest, the Dharoor Valley and the Nugaal Valley, together covering an
enormous area of 40,000 sq kms. How much could this be worth to Red Emperor?
This penny stock could hit 8.96 per share
Again the starting point is an independent report compiled earlier this year by Gaffney, Cline &
Associates. It estimated that Nugaal holds 12,405mmbbls of oil, while Dharoor holds 5,804mmbbls.
Variable Nugaal Dharoor
Undiscovered oil in place 12,405mbls 5,804mbls
Red Emperor interest 20% 20%
Net to Red Emperor 2,481mbls 1,161mbls
Recovery Factor 25% 25%
Unrisked recoverable resource 620mbls 290mbls
Chance of Success 11.3% 7.4%
Risked Resource 70mbls 22mbls
Implied Value per bl of discovered oil $7.21/bl $7.21/bl
Risked value $504m $156m
Market/political risk discount 75% 75%
Expected monetary value (EMV) $126m $39m
Source: RPS and OPLC estimates
The methodology here is the same, starting with an estimate of the amount of oil that could be
present, and then discounting it for the various risks involved. Notably the political risk here is
judged (correctly I am sure) to be much higher than that of Georgia, but the biggest discount is the
Chance of Success. But if we assume success, and thus eliminate this particular discount, the value
of Red Emperors interest in Nugaal goes from $126m to $1,115m; while for Dharoor it goes from
$39m to $727m.
And that is the simple story! At present, according to Old Park Lane Capital (and similar estimates
by other brokers) Red Emperors interests in Georgia are worth $31m, and in Puntland $165m. That is a
total of $196m, or 120m, a figure already well in excess of Red Emperors current stock market value of
48m. But success in Georgia could add $341m (210m) to this value; while success in Puntland could add
$1,577m (1,035m). That makes a total potential value of 1,365m, or 8.96 per share.
Red Hot Verdict: There is no doubting the political risk, especially in Puntland. As you can see from the
chart on page two, this is a very volatile stock. However, if oil is found Red Emperors value is certain to
increase, and issues of exploitation can be left for another day. This is an outright gamble but as we have
seen in the past, with Gulf Keystone in Kurdistan (see page 8), these risky oil exploration plays can yield a
spectacular pay-off. With an initial target of 1, BUY UP TO 25p.

Thanks to scarey pete on LSE




Completed oil wells (or gas) are like inverted telescopes into the ground. Bynari is spot on regarding risk of blowout and volumes to control. Much easier and quicker to drill an 8&1/2 " pilot hole and then, when it is known to be safe, open it out to 17&1/2". Rather like drilling a 1" Hole through a piece of steel plate. Drill through with a 1/4" drill and then open it out in stages. Offshore we used to start with ( and they will still do it thye same way) 36" drill to about 150 /200 ft, line it with 30" casing, then drill to about 1500ft with 24" drill. Line that hole with 20" caseing. Drill to 4,000/5,000 ft with 17&1/2" and line with 13&3/8" caseing, then drill with 12" until close to target zone. Line that with 9&5/8" caseing. each time you run and set caseing it has cement pumped down to the bottom of the casing and out through the bottom so that it then flows up the outside of the caseing and secures the caseing to the formation surrounding the hole. That was the bit BP got wrong in Gulf of Mex last year. amongst other things, they did a poor cement job and the well found the week spot and blew out. Hope this helps you to understand a bit of what is going on.

GL

Scarey Pete

http://www.stockopedia.co.uk/content/red-emperor-flotation-offers-strong-leverage-into-range-resources-exploration-portfolio-57639/

released after hours today by Africa oil

Africa Oil Puntland Drilling Update

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 17, 2011) - Africa Oil Corp. (TSX VENTURE:AOI)(OMX:AOI) ("Africa Oil" or the "Company") is pleased to provide an update on drilling operations related to the two-well exploration program in the Dharoor Valley Block, located in Puntland (Somalia).

Drilling locations have been selected over two robust prospects targeting gross best estimated prospective resources of over 300 million barrels each, based on internal estimates. A contract has been awarded to Sakson Drilling and Oil Services who will provide a 1,500 horse-power, top drive equipped rig. The majority of the drilling-related third party service contracts have been entered into and all outstanding service contracts are expected to be completed before the end of August.

The Company is actively engaged in sourcing drilling related materials and early stage logistics including drill site and ingress route construction. A contract has been signed with a water well drilling company and water well drilling will commence in early September. Mobilization of required personnel and equipment is planned to allow for spud of the Shabeel-1 well during the fourth quarter of this year.

The Puntland Government and Dharoor Valley communities are fully supportive of the drilling project and have ensured they will do all that they can to allow the project to move forward safely and expeditiously.

Please refer to the Company's press release dated August 11, 2011, detailing a proposed transaction whereby the Company will transfer its interests in the Puntland production sharing contracts to Denovo Capital Corp. ("Denovo"). Assuming completion of the transaction and related financing, it is anticipated the Company will own approximately 50% of Denovo. A private placement of CAD$40.9 million has been closed by Denovo subject to final TSX Venture Exchange approval of the transaction which will allow the new combined company to fully fund the upcoming two well program.

Keith Hill, Africa Oil's President and Chief Executive Officer, commented, "We are very pleased to have signed a drilling rig contract and to have procured the required services to allow us to commence drilling operations in Puntland. With support from the local communities and Puntland Government, we are eager to drill the first exploration wells in Puntland in over 20 years, aimed at unlocking the resource potential of the area."

Africa Oil Corp. is a Canadian oil and gas company with assets in Kenya, Ethiopia and Puntland (Somalia). Africa Oil's East African holdings are in within a world-class exploration play fairway with a total gross land package in this prolific region in excess of 300,000 square kilometers. The East African Rift Basin system is one of the last of the great rift basins to be explored. New discoveries have been announced on all sides of Africa Oil's virtually unexplored land position including the major Albert Graben oil discovery in neighbouring Uganda. Similar to the Albert Graben play model, Africa Oil's concessions have older wells, a legacy database, and host numerous oil seeps indicating a proven petroleum system. Good quality existing seismic show robust leads and prospects throughout Africa Oil's project areas. The Company is listed on the TSX Venture Exchange and on First North at NASDAQ OMX-Stockholm under the symbol "AOI".

Should be a rns Thursday

18 August 2011
BOARD & MANAGEMENT
Mr Greg Bandy
EXECUTIVE DIRECTOR
Mr Jason Bontempo
NON‐EXECUTIVE DIRECTOR
Mr Stephen Brockhurst
NON‐EXECUTIVE DIRECTOR
Ms Shannon Robinson
COMPANY SECRETARY
REGISTERED OFFICE
945 Wellington Street
West Perth WA 6005
POSTAL ADDRESS
PO Box 1263
West Perth WA 6872
CONTACT DETAILS
Tel: +61 8 9322 7600
Fax: +61 8 9322 7602
WEBSITE
www.redemperorresources.com
SHARE REGISTRY
Computershare
Level 2
45 St Georges Terrace
Perth WA 6000
Tel: 1300 555 159
NOMINATED ADVISER
Cairn Financial Advisers LLP
61 Cheapside
London EC2V 6AX
Tel: +44 (0) 207 148 7900
Fax: +44 (0) 207 148 7909
ASX CODE
RMP
AIM CODE
RMP
Manager of Company Announcements
ASX Limited
Level 8 Exchange Plaza
2 The Esplanade
PERTH WA 6000
By E‐Lodgement
Puntland Drilling Contract Signed Drilling Set for Q4, 2011
Highlights:
Africa Oil signs landmark contracts for a drilling rig and third party
services to drill 1st well in Puntland in over 20 years
Mobilization of required personnel and equipment to begin
First drill target, Shabeel‐1, to spud in Q4, 2011
Red Emperor Resources NL (ASX/AIM: RMP) is pleased to announce that its joint venture
partner and Puntland PSA operator, Africa Oil Corp (TSXV: AOI) has signed a landmark
contract with Sakson Drilling and Oil Services who will provide a 1,500 horse‐power, top
drive drilling rig to drill two highly anticipated exploration wells in the frontier state of
Puntland, Somalia.
The majority of the drilling‐related third party service contracts have been entered into
with the mobilization of required personnel and equipment to commence which will
allow for the spudding of the first well during the fourth quarter of this year.
Drilling locations have been selected over two robust prospects each targeting gross
best estimate oil in place of circa 900 million barrels. The first prospect, Shabeel‐1, is
targeting in excess of 300 million recoverable barrels of oil. Red Emperor has an option
to participate in the second well.
The Puntland Government and Dharoor Valley communities have assured they will assist
and support the joint venture to allow the project to move forward safely and
expeditiously.
Africa Oil will hold its interest in the Puntland Projects through its shareholding in Horn
Petroleum, who recently completed a $41m capital raising.
Red Emperors Executive Director Greg Bandy commented, We are delighted that our
JV partner has signed a drilling rig contract and associated contracts and we look
forward to drilling the first exploration wells in Puntland in over 20 years.
For and on behalf of the Board
Greg Bandy
Executive Director

Held well today

http://www.iii.co.uk/tv/episode/aim-oil-and-gas-firms-set-strong-end-2011

Sudden turn around. great . Keep going

Buying at 24p

dc easy money here just need a bit of time
nav v share allocation many would envy
also iis coming in secretly
perfect for me

Going to be a very good share if we hit. Nice rise 1.25p - 5.65%

Today is day 38 of the Georgia drill since spud.
At the Maukhiani 1 well we are targeting 115 million barrels,
at a drill depth of 3500mtrs.
Red Emperors interest being being 23 million barrels - 20% interest.
We have just gone by the 10 day update, so there should be
news early next week.

dc yes good day at the office
according to chatter not if we hit but WHEN, certain parties very interested so i am told and building stakes on the quiet

gibby, All sounds very good to me.

DC, how do you think the SP has been held back?

I've seen this or similar comments posted on a number of occasions on a number of different stocks over the years and am curious as to SPs are held back.

ptholden, again my only personal view as post 53 explains. You have your views i have mine.

DC, you've stated that you think (rightly or wrongly) that you believe the SP is being held back, I'm simply asking you how you think that is achieved? I'm not picking you up or expressing a view either way. Simple queston.