More gas on the way. More cash on the way!
Sound Oil (LON: SOU) have been quietly going about doing the business in Italy. The share price hasn’t really done any thing other than mainly stay static. 10.5/11p. It’s actually maintained a stable holding pattern considering the oil price has plummeted, while news has been sparse. The strength of the Company fundamentally and asset wise is reflected by the stability in the share-price. Every thing is now lined up. Cornerstone investor, two producing assets, cash revenue coming in, Italians (ex-ENI) all in place on the Board, Italian bureaucracy, streamlined, High net worth’s involved, Nervesa about to be drilled, Cash in the bank, basically debt free. Lot of maneuvering has gone on to get Sound oil to this place in time. Lift off is here.
When I say ‘sparse’ I mean the Company are deliberately tight lipped. Always a sign that they’re sat on price sensitive news and don’t want a leak to ‘outside of the tenters’ such as yours truly. A communications lock down means they’re ‘nervous on Nervesa.’
About to go ballistic
There’s a lot of news about to come through as they gear up for what the Company describe as ‘an exciting period of back-to-back drilling’, which commences with site operations at Nervesa in a matter of a few weeks or two. News has reached the blog that all is on track for a major announcement over the coming week/s. Just what that is, isn’t known. But it’s almost certainly good news, bearing in mind that the flagship asset, Nervesa is about to go ‘operational’. Once this is announced then it’s game on for the sp. It will begin to climb. I expect the sp to double in value from where it currently stands. Then we have news on the exploration play that is Badile. A massive gas play that would catapult Sound oil into the arms of a major international oil company, never to be seen again. Gone, taken over for the good of Italy.
I’ve been trying to get an interview with the boy Parsons (CEO), the man’s a difficult fish to land. Particularly as he’s a frequent flyer, flying back and forth across Europe. Last spotted having a cappuccino with an Italian energy minister. We’re not supposed to know that! It’s no wonder that Continental Investment partners (Sounds’ ‘cornerstone Investor’) have agreed to throw more cash into the hat via one of their affiliated partners Greenberry S.A. It’s money for jam for them. They know (Unlike most) that they’re going to get a hefty return on the investment. Nervesa remains a Major project for Sound Oil with an estimated NPV10 of circa US$66,000,000 million (100%). Which will probably rise.
Tight lipped.
I’ve been keeping my eye on Italy news wise. The Italian oil and gas permitting process has now been cleaned up making life a lot easier re’ the permitting process. This was announced back in late August of this year by their Prime Minister.
Remember Nervesa is a huge gas discovery, once it comes on stream the sp should be transformed. It can only go one way. UP↑. Even as the oil price struggles Sound will reap huge benefits from Nervesa which is as those in the know know, gas, which is as those in the know know, highly sought after in Italy. Premium prices being paid.
Not so ‘tight lipped’
According to one recent article “Italy is the new Texas.” With over 40 small to middle oil companies on the verge of unlocking proven oil/gas resources. Sound Oil being one of them mentioned in the same article as? ENI!
Happy Days
Dan
