Welcome to the new thread for Max Petroleum. Here's a link to the MXP web site and a presentation that everyone should read.

http://www.maxpetroleum.com/companypresentations.asp

with oil prices rising are potential gold mining shares undervalued.....

Max Petroleum (MXP.L/AIM/£144m)
todays Merchant Securities Lunchtime Wrap

The Max story was mixed during the course of 2011, ending on two sour notes. The Asanketken well (ASK-2) failed to encounter a viable Triassic reservoir (9 December 2011) and the second well drilled into the Sagiz West field was a dry hole (28 December 2011). These failures on important wells had significant and negative implications for our target price which was brought down to 25.2p (from 35.2p) the note is attached. Moreover, Max announced its Trial Production Project was extended another three months (16 December 2011), which may be indicative of political challenges. But, the stock really started to rally over the past few days (up 40% since end Jan) as traders speculate that it will be the next E&P (after the recent Bowleven M&A activity) that MXP will be next. A quick reminder of the story...

- 2 Strikes, but still not out: After the company had 2 high profile shallow well failures (Asanketken Triassic and SAGW-2), the company’s share price performance will be dependent on the deep well prospect.

- All eyes will be on the Emba-B: This is a huge deep prospect, one that is a potential game-changer for the company profile. The relative importance of pre-salt success has increased significantly, and the first deep exploration well (NUR-1) is expected to produce results around April 2012. A depth of 4,200m has been reached.

- What is in the target price valuation now?: For discovered assets – Zhana Makat 7.1p, Borkyldakty 0.6p, Sagiz West 3.3p, Uytas Cretaceous 1.2p, Uytas Jurrasic 1.7p, Asanketken Jurrasic 2.0p and East Kyzylzhar 2.3p. For Main undiscovered assets – Emba-B (dev2 only) 6.3p.

- Emba B has a 29% chance of success. Success would be worth circa 30.8p from a small fraction of the upside (does not include the de-risking of other prospects). 29% x 30.8p = 8.9p. The share price is circa 10.25p. For investors managing exploration risk via diversification, this is looking like good risk/return.

The high profile failures, plus political risk, will have deterred non-holders from revisiting the story. But, the potential upside from the pre-salt deep well results at the start of Q2 means Max is worth doing some work on. The numbers have been pulled back to conservative levels, and the target price of 25.2p is underpinned by the discovered assets (18.2p of target price). Forgetting bid spec, the story of Max Petroleum has yet to be fully written, we believe there could be a happy ending. BUY

StockMarketWire.com
Max Petroleum has announced an operational update on the results of the SAGW-3 appraisal well and progress with drilling operations at the NUR-1 well on the Emba B prospect.

Michael B. Young, President and CFO, commented:"Even during the worst Kazakh winter in over fifty years, we have been able to maintain our drilling and production operations with limited disruption thanks to the professionalism and hard work of our personnel on the ground.

"We are excited to see the successful result in the SAGW-3 appraisal well which has drilled as expected and now confirms the discovery made by the initial well in the field and we look forward to results of NUR-1 in the next few months."

Everbody (including myself) is watching the "Foilkies" shares but this little gem could hit the big time with this deep well that is nearing completion....wondering if they have hit something as this is almost the only blue apart from TRP in the oil sector......been in this for what seems years waiting for some action....

Successful appraisal well at Asanketken Field





14 May 2012



Max Petroleum Plc, an oil and gas exploration and production company focused on Kazakhstan, announces that the ASK-J1 appraisal well in the Asanketken Field has reached a total depth of 1,378 metres with electric logs indicating 36 metres of net oil pay. This includes 27 metres of high quality net oil pay in five zones at depths ranging from 1,240 to 1,321 metres in the same Middle Jurassic reservoirs that were proven productive in the first two wells drilled in the Field. Reservoir quality appears excellent with porosities ranging from 18% to 33%. In addition, there appears to be a shallower productive section in the Middle Jurassic which has not been encountered previously in the Field. These new reservoirs occur at depths from 1,069 to 1,090 metres, and include a total of nine metres of net oil pay in three zones with porosities ranging from 18% to 29%. The Company is running production casing in the well, which will be completed and placed on test production. The Zhanros ZJ-20 rig will now move to drill the ASK-J2 appraisal well in the Field.

Not many people watching this but this company is starting to pull in results !....

Max Petroleum Plc, an oil and gas exploration and production company focused on Kazakhstan, announces an operational and financial update.

The Company has experienced further delays drilling its NUR-1 well and as a result does not expect to reach total depth of 7,250 metres before August 2012. The delays largely result from the drill string becoming stuck in the top of salt in April 2012 at a depth of 5,718 metres. After side-tracking the well and setting casing at 5,681 metres, the Company drilled ahead. However, progress was slow as the Company drilled alongside the stuck drilling tools. After clearing the old wellbore, the well reached the Kungarian Salt on 19 June 2012. Due to encountering anomalously high pressures, the drill pipe has become stuck again at 5,722 metres, despite using the higher density mud specified for penetrating this section. Operations are now ongoing to increase the mud density further, free the stuck pipe by dissolving the salt with fresh water, and continue drilling through the salt to the next casing point at 5,900 metres.

Assuming near-term success in freeing the stuck pipe and normal operations going forward, the total costs for the NUR-1 well are now expected to be approximately US$43 million, with expected forward cost of approximately US$10 million. The Company will announce when it has resumed drilling ahead through the salt and, subsequently, after setting its next string of casing below the salt above the prospective pre-salt section.

In order to allow completion of its exploration drilling programme ahead of the expiry of the exploration phase of its Blocks A&E Licence in March 2013, the Company is working with its senior lender, Macquarie Bank Limited, and has initiated discussions with a number of providers of debt and equity financing, regarding the provision of additional capital. These discussions to date have been impacted by market conditions, as well as recent regulatory changes in Kazakhstan that currently prevent the Company from completing a conventional equity offering. The current outstanding balance on the Senior Credit Facility is US$54.2 million out of a total borrowing capacity of US$58 million through to 30 June 2012. The Company and Macquarie Bank Limited will review the borrowing threshold as part of their semi-annual budget review under the Credit Facility, as well as monthly amortization payments beginning in July 2012. In the absence of additional funding the Company may have to significantly curtail its intended exploration activities.

Moody’s cut Sydney-based Macquarie Group Ltd. (MQG) and Tokyo-based Nomura Holdings Inc. (8604) one level each. Nomura is the lowest rated of the 17 firms at Baa3, one grade above junk.

Huge crash at MXP now.

Overdone ......not good.....but I reckon it will refinance itself.....

How do one refinance itself if it is in debt with cap in hand?

2 caps

Picked up some at sub 4p.....

It's crazy but I've almost doubled my holding around an average 4p....I'm sure they will get some sort of funding because their production is increasing rapidly.....and there is a possibility of striking something big in this deep well......risky but with massive upside....

Crikey...I'd probably break even around 9p or so...unthinkable a few months ago...will not remain so low for long...

With Macquarie Bank being downgraded and in this economy, funding will be very difficult.

still a lot of buying going on so have dipped my toe in to see what happens.,.

I think it has further to fall,i agree with hlyeo on this one.

With so mant banks being downgraded and so many on negative watch risking further downgrade financing isn't going to be easy unless Max are taken over. At these prices Max has got to look attractive.

Max Petroleum plummets after further well delay.


Max Petroleum's (LON:MXP) shares plummeted after it revealed further delays to drilling its NUR-1 well.

And it warned that in the absence of additional funding it may have to curtail its intended exploration activities significantly.

Max says that does not expect its NUR-1 well to reach total depth of 7,250 metres before August.

The delays largely result from the drill string becoming stuck in the top of salt in April at a depth of 5,718 metres.

Assuming near-term success in freeing the stuck pipe and normal operations going forward, the total costs for the NUR-1 well are now expected to be approximately $43m, with expected forward cost of approximately $10m.

The company will announce when it has resumed drilling ahead through the salt and, subsequently, after setting its next string of casing below the salt above the prospective pre-salt section.

In order to allow completion of its exploration drilling programme ahead of the expiry of its A&E licence in March 2013, the company is working with its senior lender, Macquarie Bank, and has initiated discussions with a number of providers of debt and equity financing, regarding the provision of additional capital.

These discussions to date have been impacted by market conditions, as well as recent regulatory changes in Kazakhstan that currently prevent the company from completing a conventional equity offering.

The current outstanding balance on the senior credit facility is $54.2m out of a total borrowing capacity of $58m through to 30 June.

The company says that in the absence of additional funding it may have to significantly curtail its intended exploration activities.