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

This is the real reason for the drop off..........
FT.com

Equator Exploration rose 12.3 per cent to 114p amid talk that fellow oil and gas explorer Sterling Energy was considering a bid for the company, attracted by Equators Nigerian concessions and cash pile. Sterling shares eased 6.4 per cent to 22p.
http://news.ft.com/cms/s/543e05c4-f789-11da-9481-0000779e2340.html

Morning SWW

Good find & nice fit from what I have just read.

Regards

Could be a very good deal for HW. KBC Peel Hunt put a target of 500p on EEL as recently as March (ancient history in current market conditions). My understanding is that EEL's current market cap is almost entirley covered by their net cash, so the enterprise assets are in the price for free. Even allowing a bid premium on the current bombed out price, SEY could get ot below NAV at 171 p per share. Exciting times.
Having felt thoroughly dejected at close of play on Friday I am now feeling very chipper again. Roll on monday, bring it on....

Morning SWW,

Many thanks for that, still not sure why we would sell off so quickly though, I see that speculation as positive for SEY.

Harry did a great deal for SEY with the Fusion, and I'm sure he would achieve another one if this goes ahead.

Like pondy, that article has put a spring back in my step!

churchill2,

A repeat of your post on ADVFN, and as a Hardman shareholder you seem to have missed some of the differences between the two companies.

SEY stated before Chinguetti production that it would take some months to achieve maximum production of 75,000 BOPD, yet Hardman raised peole's expectations by declaring dull production had already been reached, only to dash them when the problems in the north field started.

SEY, correctly IMO, allowed for some teething troubles, unlike Hardman, who rushed out the "fulll production reached" statemement.

Sey have a seperate deal with the Mauritanian government to Hardman, and I have not seen anything official to question the validity of this agreement to date.

SEY have an increasing production in the GOM, much smaller than Ching, but a profit earner nevertheless.

The 12% royalty from even 41,000 BOPD will still increase SEY's 2006 earnings very substantially, and once the production level is back to normal after the technical problems are resolved, hopfully during Q3, 2007 should be a bumper year.

The delcaration of commerciality of Tiof is far more important IMO than the start of actual production, because if it happens, it will alow SEY to book more reserves, and hence increase asset value.

And now we have rumours of a deal for Equator!

Equator shareholders wish!

Andy

sorry to question you

But Tiof is outside the Ching field boundry so SEY would only benefit from the Premier deal. Am i wrong on that? If so I will be happy to be lambasted. Tevet /Lamb and possible Banda would boost SEY`s reserves.

Regards

Dr Square,

I think you are probably right, from their last staement below;
-------------


PSC A and B have delivered a high exploration drilling success ratio with four significant discoveries from 8 wells - Chinguetti (2001), Banda (2002), Tiof (2003) and Teve't (2004). First oil from the Chinguetti discovery is anticipated in March 2006.Evaluation of both the Tiof and Tevet oil discoveries is underway. The Teve't oil and gas discovery lies 10km east of the Chinguetti development, within tie-back distance. The Tiof oil and gas discovery lies 50km to the north of Chinguetti.

In addition to oil developments, gas discoveries (Banda) are being evaluated for potential European and North American markets.

Sterling's interests include a sliding scale royalty based on oil price coupled with specific cash bonuses for each commercial discovery in PSC A & B; and an economic interest derived from our financing of the governments 12% interest in the Chinguetti Field.

The Royalty and Discovery Bonuses
Royalty payment is linked to oil price, for every barrel produced net to a working interest of 3% in Area A, and 6% in Area B, subject to the Government's back-in rights. Also cash bonuses of $1mm for a greater than 50mmboe discovery in Area A and $2mm in Area B are payable to Sterling.

The Royalty payment per barrel escalates with oil price and inflation. For an average price of $50 in 2006, the royalty will be $5.87 per barrel.

If SEY made a bid for EEL there would be a counter bid by the likes of Chevron etc:

so are you going to buy EEL on Monday? ...... I shan't as got myself burnt last time I though they were cheap

cynic,

me neither, as the "news" (rumour) is already out, the price may gap up at open, and then you're playing into the MM's hands if you chase the price.

If the rumour is unfounded, it will be down again at double quick speed, and of course if it rises too much, any interest SEY may have could be extinguished as the deal becomes more expenive and loses it's premium to SEY.

News we may of missed.

Cameroon developments

Regards

Dr Square,

Are you a regular reader of the Tehran Times by any chance?

Interesting article though, and thanks for drawing our attention to it, it's high time this particular border dispute is resolved.

Andy

Not that often cancelled my subscription a few months ago. find it a dry read.

Just hope that the dispute is resolved and may put some momentum behind the Ntem dispute. As they seem all to be intermingled in some ways.

Regards

Dr Square,

I agree.

I see we have regained most of Friday's late fall, not sure we'll find out why it fell so dramatically at the close.

All that huff and puff over the weekend with lots of frantic posting from me and others mulling over the possibility of an SEY takeover of EEL - then quick as a flash on Monday morning, nothing happens. Oh well, it was fun while it lasted.

EEL is up nearly 10%, surely something's up for a possible SEY bid?

Yes - things have started to move with EEL.

so they have, but is that informed knowledge attracting interest or just the rumour ..... qui sait?

R88AVE,

well the MM's will have marked i up as they were ware of the rumour I guess.

That brings in the punters, and away you go.