Aurelian Oil & Gas. Stake-building?

Aureus of Aurelian minted in Mediolanum. Obv: ...

Emperor Daniel.

Keep your eyes on Aurelian Oil & Gas. Mentioned on the Blog as one to watch-list when the shares were trading at a lowly 17p! It’s looking like the company are finally on a charge. Confidence is at a premium in these dark days of world-wide financial uncertainty. The recent upping of Director stakes announced over the last week or so can only bode well for holders of Aurelian. We did tell you that there was rumoured to be buyers in the market. Looks like we shall have to chalk up another one for the Blog! Currently up over 40% since we began to highlight them! So now we have Directors ploughing money in to their company on top of the Tosca fund’s recent stake-building; certainly one to research and watchlist.

Viva!

Dan

Aurelian Oil & Gas. Toscafund questions remain unanswered..

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  1. marcus says:

    hi dan what about doing a tips page and when tipped and at what price it good to have a recoured

  2. Dan says:

    Rnsr80
    Roxi are incredible mate, 60% up just for spudding a well. Still got zero oil , I am in mxp round the corner in kazak , we have had more spuds than tesco this year yet we never move , we have ramped production , 1 flow rate increased production by nearly 50%
    Debt and funding sorted short term
    Spudded a deep drill last week going after 497m barrels – yet dropped 2% on the day
    Found oil 12 times in 2011 on the shallows, stitch together the revenue from these alone and max is worth 50p,deeps are almost free and not priced in.
    Yet des has nearly doubled from 11p in that time max has done nothing but find oil and drop from 20p to a low of 10p
    Yet the market doesn’t care, all these non producers who can fly on hype alone
    Max are doing the business , and yet I still want to jump off a building

  3. Wayne G says:

    BMD this one might well be somehow under your radar and I don’t think it should be. Please let me know what you think about SLME. Recent director buys at 30p and recent placing at a premium to current SP. Production by end of Year.

    Silvermere SLME (oil&gas) well worth a look. look way undervalued. interest picking up .

    Date: 21 Oct 11
    mkt cap……£03.85m (20p-22p)
    CPR Aug 11…£18.40m (100.2p/share)- proven and probable reserves
    CPR Aug 11…£59.00m (321.4p/share)- possible reserves
    Total……..£77.40m (421.6p/share)- proven/probable/possible

    see todays RNS – 21 Oct 2011:
    http://www.investegate.co.uk/Article.aspx?id=201110210700135726Q
    • “CPR in Aug 2011 valued our proven and probable reserves at £18.4m (100.2p/share based on the Company’s enlarged issued share capital) with a further £59.0 million (321.4p per share) of upside in our possible reserves.”

    • First production on target before end of 2011 (should generate $60-70k/month)
    • Upgrades of P2/P3 to P2/P1 expected before 2012 drilling campaign.
    • 3 more drills in 2012.
    • listed on 31 Aug 11 at 25p with a mkt cap of £4.5m so is now alot closer to imminent production and worth less!. (was an investment company prior to 31 Aug 11 called “Chalkwell Investments”)
    • GECR Buy Note 31 Aug 11 – target 61p
    http://oilbarrel.com/media/pub/var/release_downloadable_file/32848.pdf
    • Oilbarrel article on 26 Sep 11 (see below)
    • Oilbarrel presentation – 26 Sep 11:
    http://oilbarrel.com/media/pub/var/conference_presenter_presentation_file/9.pdf

    Date………………………21 Oct 2011
    Company……………………Silvermere Energy (SLME)
    Only Asset so far…………..20.83% NET of Mustang Island ,a shallow inshore oil and gas asset in Kleberg County, Texas waters in the Gulf of Mexico.

    Share Price………………..21.5p (20.0p-23.0p)
    Shares in Issue…………….18,354,191 (as of 21 Oct 2011)
    Mkt Cap……………………£3.95m or 021.5p/share
    Exchange market size (EMS)…..1,100

    proven reserves (1P)………..04.73 Bscf worth $4.49m/£2.84m or 15.5p/share.
    probable reserves (2P)………11.53 Bscf worth £24.87m/£15.73m or 85.7p/share.
    proven and probable (1P+2P)….16.26 Bscf worth $29.36m/£18.58m or 101.2p/share
    possible reserves (3P)………30.38 Bscf worth $94.36/£59.67m or 325p/share
    total potential…………….£78.25m or 426p/share

    NOTE 1: Although Silvermere have a 33.33% interest in the Mustang asset they get 20.83% NET after over-riding royalties to Texas State, Seadrift, Wellmaster and the Core Vendors. The above figs are the 20.83% NET values for Silvermeres stake taken from the 02 Aug 11 CPR.

    NOTE 2:The values are the NPV10 figs from the 02 Aug 11 CPR and are based on Exchange Rate of 1 GBP = 1.58007 USD

    RNS 21 Oct 2011:
    http://www.investegate.co.uk/Article.aspx?id=201110210700135726Q
    • “CPR in Aug 2011 valued our proven and probable reserves at £18.4m (100.2p/share based on the Company’s enlarged issued share capital) with a further £59.0 million (321.4p per share) of upside in our possible reserves.”
    —————————————————————————-

    OILBARREL – September 26, 2011

    Silvermere Energy Looks to Near Term Production In US To Fund Low Risk Acquisition Strategy

    Like an episode of BBC 1’s Who Do You Think You Are, Silvermere Energy has an interesting history, having been transformed from failed beauty products company The Core Business, to an oil and gas company on the brink of production in the Gulf of Mexico. Just like on the TV show, there are things in Silvermere’s past upon which it had no control, but the new board of directors, including Oilbarrel’s own Stewart Dalby, are all oil men brought in post The Core Business

    Silvermere began life on the July 14 2011 when Chalkwell Investments was renamed, and had its sights trained on the oil and gas sector after the acquisition of its current interest in the Mustang Island 818-L field in the Gulf of Mexico, Kleberg County, Texas. Silvermere has a 33.3 per cent WI and 20.83 per cent NRI in the Mustang assets, except for the I-1 well where it has a 33.3 per cent WI and 16.65 per cent NRI. The I-1 is a re-entry well that was completed and will be tied into production by the end of 2011. Testing of the well flowed at up to 2 mmscfpd, but Silvermere expects 3-4 mmscfpd and 84-160 bopd once the well is stabilised, cleaned up and has an initial 45-60 day production period under its belt. Should production fall short of expectations, additional zones can be perforated to increase output to more acceptable levels.

    An independent evaluation of 3D seismic and well bore data by RPS Energy estimated total net (to Silvermere) reserves of 4.73 Bcfe in the 1P category, 11.53 Bcfe in the 2P category and 30.38 Bcfe in the 3P category. The high amount of Possible (3P) Reserves is due to the fact that RPS were unable to attribute their production to individual sands, and thus Silvermere is confident that once production commences, these reserves will be capable of being upgraded into a higher category. Indeed, the intention is to get RPS back post production to re-analyse I-1, rather than waiting for the drilling of the 3 new wells to improve the reserve profile.

    The I-5 sands are the initial production horizon estimated at hosting 19.5 feet of net pay, while the G-3 sands are for the medium-term where there is also the potential to upgrade and enlarge current reserves. Three new wells (in addition to I-1) are expected to be drilled over the next 2 years, with the first pencilled in for the 2nd quarter of 2012. The 3 wells will test the structural highs of 3 fault blocks identified from historical 2D seismic run by Samedan Oil Corp in the 1980s. Silvermere’s share of these drilling and associated costs is US$8 million, the funds for which will need to be found, but given the company has US$5.8 million in existing warrants outstanding, as well as a range of other financing methods at its disposal (farm-in, debt, equity), CEO Andy Morrison does not foresee any issues.

    Confidence in such claims is no doubt founded on its recent fund raising history, where the company raised £1.52 million through the issue of equity at 25p in August and £750,000 in convertible loan notes issued in June. The former was used for tie-back costs (£600,000), working capital (£400,000) and RPS’s CPR, due diligence and Silvermere’s re-admission to AIM having been suspended since January (£500,000). Mustang Island was acquired from convertible loan note issue.

    Silvermere’s strategy is to acquire US onshore and shallow offshore oil and gas assets which are value for money, near production and capable of having their resources easily upgraded. To this end the company expects Mustang Island to develop into its cornerstone asset, throwing off sufficient cash flows to enable it to acquire and develop other assets without diluting shareholder capital unduly. Due to the ongoing financial crisis in the US, there is a significant shortage of capital for small development projects in that country, meaning there are tremendous opportunities to acquire quality assets at low prices. These circumstances have Silvermere rubbing its hands, and the company is already looking to acquire material, but minority interests in assets meeting its criteria, as it looks beyond Mustang Island. Working alongside the operator appeals to Silvermere at the moment, not only due to the fact that its skill set is financial, administrative and managerial, but it also allows the company to remain lean and flexible.

    Stewart Dalby, Editor and Managing Director of Oilbarrel, is a Non-Executive Director and a shareholder of Silvermere Energy.

    ——————————————————————-

    Proven reserves are those reserves claimed to have a reasonable certainty (normally at least 90% confidence) of being recoverable under existing economic and political conditions, with existing technology. Industry specialists refer to this as P90 (i.e., having a 90% certainty of being produced). Proven reserves are also known in the industry as 1P.

    Probable reserves are attributed to known accumulations and claim a 50% confidence level of recovery. Industry specialists refer to them as P50 (i.e., having a 50% certainty of being produced). These reserves are also referred to in the industry as 2P (proven plus probable).[7]

    Possible reserves are attributed to known accumulations that have a less likely chance of being recovered than probable reserves. This term is often used for reserves which are claimed to have at least a 10% certainty of being produced (P10). Reasons for classifying reserves as possible include varying interpretations of geology, reserves not producible at commercial rates, uncertainty due to reserve infill (seepage from adjacent areas) and projected reserves based on future recovery methods. They are referred to in the industry as 3P (proven plus probable plus possible

    ———————————————————–

    brief research:

    • 01 Mar 06 – AIM listing as “The Core Business plc” selling beauty products.
    • xx Jan 10 – creditors’ voluntary liquidation and was subsequently liquidated
    • 25 Jan 10 – Became an investing company.
    • 25 Mar 10 – Name change to Chalkwell Investments.
    • 15 Jul 10 – Name change to Silvermere Energy plc

    • 01 Nov 10 – £500k loan to Core Oil & Gas, Inc,a US-focused oil&gas company.
    – Core is a US-focused oil and gas company, which has acquired a 33.3% working interest and a 29.13% net revenue interest in respect of Mustang Island in Kleburg County, Texas
    – Mustang Island is a shallow inshore oil and gas asset, located in the Gulf of Mexico, with infrastructure in place and nearby oil and gas pipelines available.

    • 26 Jan 11 – Suspended (only allowed 12 months as an investment company)

    • 07 Feb 11 – Further £300k loan to Core Oil & Gas Inc.
    • 24 Feb 11 – Further £428k loan to Core Oil & Gas Inc.(total £1,228,000@ 10%, payable 1 October 2012 or earlier in certain circumstances.)
    • 26 May 11 – Further £260k loan to Core Oil & Gas Inc.
    • 04 Jul 11 – Further US$1,181,507 loan to Core Oil & Gas Inc.(total £2.75m)

    • 02 Aug 11 – Trading resumed at Placing price of 25p and mkt cap of £4.25m (16,980,750 shares x 25p).
    Admission Document: http://www.chalkwellinvestmentsplc.co.uk/docs/Silvermere%20Admission%20Document%20-%20Final%20-%20%20Press%20copy.pdf

    02 Aug 11 – Mustang Asset CPR by RPS Energy:
    – proven and probable reserves = NPV10 £18.4 million
    – possible reserves = further £59.0 million
    – total potential valuation for the Mustang Asset of over £75 million.
    CPR is in the Admission Document: http://www.chalkwellinvestmentsplc.co.uk/docs/Silvermere%20Admission%20Document%20-%20Final%20-%20%20Press%20copy.pdf

    • 31 Aug 11 – 1st acquisition completed. Mustang Asset located in Kleberg County, Texas waters in the Gulf of Mexico.Cost approximately £2.8m plus the future payment of certain royalties.
    – 3 new appointments to the board:
    — Andy Morrison (CEO) – He has spent his entire career in the oil and gas industry, including Shell, BG and BOC, and from 2007 until 2010 was CEO of Xtract Energy plc.
    — Frank Moxon (non-exec Chairman) – an experienced corporate financier specialising in natural resources and was previously head of corporate finance and head of natural resources at Williams de Broe
    — Stewart Dalby (non-exec director) – over 40 years’ experience of the oil and gas industry

    06 Sep 11 – Operations Update:
    – The Company’s Mustang Asset consists of a 16.66% working interest in the I-1 Well (with the Company bearing 33.33% of the costs up to completion of the well’s tie-in) and a 33.33% working interest in the remainder of the Mustang Licence Area.
    – operator, Dominion Production Company LLC: tripod platform fabrication, installation and tie-in contract with Laredo Construction Inc announced.
    – Work on the fabrication of the tripod platform has now commenced with installation and production expected before the end of 2011.

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