NZ Oil & Gas (NZO)

[Lion]

Why on earth would anybody want a dividend right now?

- Ummm . . . me?! I've recently joined the super-annuitants and a little bit of extra regular income is welcome.

Any money returned to shareholders at the moment would effectively just be a capital return.

- Why? The company is still earning income, isn't it?

I would prefer that the company uses the $98M to acquire excellent assets that will then allow dividends in the future.

- Sorry to argue every point, but my view is that Barque will be the making of this company (and maybe also Ironbark owned by CUE in WA) Any capital the company has (and I can't see how it's in the pockets of the directors) would be best used to retain as big an interest in that (those) as we can, rather than sell out to some big multinational.

I've seen quite a bit of informed comment that LNG could be a very important bridge from coal and oil to renewables, therefore an important fuel in the next decade or two.

Incidentally, I see OGOG's Alastair McGregor is chairman of the board at CUE, and NZOG's Andrew Jefferies is also on their very strong board. I'd say NZOG and OGOG see quite some potential for CUE.

(Sorry about font change, I copied and pasted and can't change it back)

Cheers, Lion

[Joshuatree]

thanks for sharing your view and info Lion. Sitting on my small holding for now.

[Marilyn Munroe]

I am less enthusiastic about Barque than you Lion.

It is generally agreed that if it is a strike it is more likely to be gas rather than oil. If it is gas it will have to be a large field to justify the development costs

Pipping it ashore for Otagoites to cook their morning porridge is not sufficient to make it economic.

A development of the necessary scale to make it economic would involve a export floating LNG facility.

Product from this field on the far side of the world would have to compete with product from closer to the centre of demand in the Northern Hemisphere.

The cost of development is too high for NOG to handle. Shell spent $A12 billion on a floating production and storage platform alone in their recent Western Australian offshore development.

If a discovery is made the best thing for NOG to do would be an outright sale or a mining tenement to an oil major.

And all this is before worrying about the Coalition Governments lollipops and unicorns offshore exploration policy.

Boop boop de do
Marilyn

[mistaTea]

If a discovery is made the best thing for NOG to do would be an outright sale or a mining tenement to an oil major.

I would have thought that it was hardly in OGOG’s long term interests to go through all of the hassle of acquiring NZOG and Cue just to make a ‘few mil’ with a quick sale of a potentially huge asset (assuming a discovery is made).

OGOG is a huge company, and piss-willy transactions like that wouldn’t even move the needle for them.

Of course, OGOG could have made a mistake in their analysis. Until we find out for sure, I sure do enjoy being their junior partner.

[tim23]

Good point mistatea - I'm thinking of adding to my holding 98c cash for 58c seems like a deal to me!

[mistaTea]

Good point mistatea - I'm thinking of adding to my holding 98c cash for 58c seems like a deal to me!

Not sure where you get 98c cash per share?

I never ever give buy/hold/sell advice for any stock - but you may want to check your numbers again before making your next investment decision.

[Vaygor1]

I am less enthusiastic about Barque than you Lion.

It is generally agreed that if it is a strike it is more likely to be gas rather than oil. If it is gas it will have to be a large field to justify the development costs

Pipping it ashore for Otagoites to cook their morning porridge is not sufficient to make it economic.

A development of the necessary scale to make it economic would involve a export floating LNG facility.

Product from this field on the far side of the world would have to compete with product from closer to the centre of demand in the Northern Hemisphere.

The cost of development is too high for NOG to handle. Shell spent $A12 billion on a floating production and storage platform alone in their recent Western Australian offshore development.

If a discovery is made the best thing for NOG to do would be an outright sale or a mining tenement to an oil major.

And all this is before worrying about the Coalition Governments lollipops and unicorns offshore exploration policy.

Boop boop de do
Marilyn

I am an NZO holder and I agree with what you are saying Marilyn.

Why would any company risk injecting a large amount of capital into a potential development while a completely deluded government are making purely political Oil & Gas decisions without Cabinet's input or sanction?

Offshore LNG would be the only way to go (labour and the greens would LOVE that.. yeah right) unless a huge taker of gas (like Methanex) is established in the South Island near Oamaru... something the Labour/Green coalition would also be all in favour of... not.

I will be hanging onto my NZO shares and will patiently wait for the current coalition to either self-destruct or get ousted before getting them out of the bottom drawer.

[tim23]

Not sure where you get 98c cash per share?

I never ever give buy/hold/sell advice for any stock - but you may want to check your numbers again before making your next investment decision.

Got the $98 million from recently quarterly unless I read incorrectly?

[blackcap]

Got the $98 million from recently quarterly unless I read incorrectly?

$98m cash on hand, 164m shares on issue, 98/164 is about 60 cents per share in cash.

Effectively buying NZO now gives you Kupe, the prospects and Cue for free.

[tim23]

Not sure where you get 98c cash per share?

I never ever give buy/hold/sell advice for any stock - but you may want to check your numbers again before making your next investment decision.

My quote 31.7.18 was "Had quick look at quarterly - if market cap is about 94 million and company has 98 million in cash what am I missing?" So effectively you get all the other bits for free Cue, exploration permits etc