OEL - (Otto) Multi based, Gambling Stock.

[ELYOB]

More research needed here . You will find OEL are changing right now in the run-up to April'12 drilling with BHPP. The FPSO has now been disconnected , and holidaying in Singapore ....why = reliability, future Galoc performance. 2P reserves remaining on current 2 wells now 15mmbbloe ; and the Phase 2 is expected to increase this by 4-6??? so wait ? OEL expect the current 6800 gross mmbblopd to increase >12,000 with Phase 2????? If Phase 2 is good , OEL will have longlife at Galoc even with decline issues . The GALOC field is first class , it was the FPSO that has been the big problem all along with poor performance . NOW , this is being FIXED in Singapore .....tick tick.

In time OEL could be a target of BHPP ....

[shasta]

I just sat down for abit to go over OEL for the first time in a few years...

I still cant see it in OEL...
it could do ok, but it doesnt have the wow factor...
OEL does have a shot, but Vitol does not pull out on a sound project...

so long as Galoc can maintain a stable profile on oel until they launch their next lead... So that, BHP and other exploration targets provide other upsides...

phase 2 Galoc with the operational downtime impacts the commercial viability of the whole project...

Galoc 2 well lined up, and needed to add to decline...

galoc north inherit with risks but could work...

To sum up Galoc,
It is a grinding project...
OEL will have to increase its reserves to support its current sp in the future...
not ideal...
an oiler like this needs to have protected downside, which OEL does not have...
gL

.^sc

Certainly not the most exciting or leveraged oil producer around thats for sure, but no debt, & getting a small discount to the Brent price is keeping things ticking over.

Galoc & Galoc phase two are the main drivers, & the BHP deal is the potential company maker

Theres always the possibility of a left field ann with them buying into an established field in the Phillipines, especially with NDO & KIK in the region.

[jdg]

Certainly not the most exciting or leveraged oil producer around thats for sure, but no debt, & getting a small discount to the Brent price is keeping things ticking over.

sure, but with cinco worth 50c if it comes in, that's a pretty big addition to the current sp of below 9c. furthermore, if cinco did come in it would presumable derisk other parts of sc55 and give greater value to the acerage. given the downside appears very well protected by galoc, it's as good a punt as you will find anywhere, in my view.

-j

ps i've only just clicked that the drill names in sc55 (barring hawkeye) are spanish numerics...

[Rabbi]

sure, but with cinco worth 50c if it comes in, that's a pretty big addition to the current sp of below 9c. furthermore, if cinco did come in it would presumable derisk other parts of sc55 and give greater value to the acerage. given the downside appears very well protected by galoc, it's as good a punt as you will find anywhere, in my view.

-j

ps i've only just clicked that the drill names in sc55 (barring hawkeye) are spanish numerics...

Looks like the smart money is starting to buy into the cinco drill already. Any retrace and I'll top up as this is as good an exploration play as you are going to get. Whether you hold through the drill is up to your tolerance for risk. Anything can go wrong and usually does but this huge gas prospect is a real company maker if it comes in.
Thrill and drill at it's best.

[shasta]

OEL - OTTO ENERGY EXECUTES FINAL FARM‐IN AGREEMENTS FOR SC55

Otto Energy Ltd (ASX:OEL) is pleased to announce that it has executed the final farm‐in agreements supporting BHP Billiton's earlier decision to enter into Service Contract 55, Offshore Palawan, Philippines.

The execution of the final documents follows the previously announced decision by BHP Billiton to exercise their farm‐in option in May 2011. With the execution of these final farm‐in agreements, Otto will receive a final payment relating to back costs associated with SC55 of US$7.3m, of which $5.0m has already been received.

Full announcement:
http://stocknessmonster.com/news-ite...E=ASX&N=572900

[Crypto Crude]

very valid points everyone...

How to approach OEL with coin is up to the investor////a lot depends on which investment route one takes...
The investment vehicle is either to trade Cinco, or invest through it...
upside would probably trade it away, I would probably invest through...
and who profits more from this... The upside type of investor...

the predicted share price will run higher leading into Cinco...

with the hit and miss nature of this well (15% chance of success) ...I need not say more...
there are no 18 cent valuations on this... its either <8c or >50c...
how do you get a Hartleys valuation of 18c when its 1 or the other...?


in that report posted by JDG, it said OEL have 28million in cash.. that of which is being pumped back into phase 2... so basically everything OEL have worked towards so far with galoc has, or is going to be spent up...

Hope the well hits... and its up to the holder... I personally like the idea of running profits by being in early, and risking lead up (un-booked profits) for something much bigger

There is no doubt that OEL will need to add reserves and projects somewhere...

oel is far from a dumb investment...
Im not even saying that, just that it needs to get discovery lucky for growth, or PPP it up...
called that too...


early days and a 50cent targets.. why not...
Just have to be bearish on this sort of well, but excited on the inside...

if I were the diversified type of guy I might look alittle closer...
lastly,
have a good new years...

.^sc

[shasta]

Shrewdie

OEL is really a medium sized oil producer (around 2000bopd net) thats gets the Brent price less a small discount (around 5% i believe) with a concentrated focus in the Phillipines, the weather has affected Galoc many times, & there were been plenty of problems with the initial commissioning etc, no different to many other 1st time producers, but that was with other operators, now Galoc is under OEL control.

You may be interested in a BESBS style trade with OEL on the BHP drill, thats the only "excitement" within OEL at present.

I want to see OEL proceed with the Galoc phase 2 project, thats where i see some value in OEL.

Have been looking into another O&G producer, given OEL is purely oil at this point, with no unconventional gas exposure.

Thinking either STO or maybe ROC, but would love to hear others thoughts, producers only however.

[Corporate]

Shasta, for producers you could try looking at Mad or Bru

[Rabbi]

Shasta, for producers you could try looking at Mad or Bru

Those two are interesting picks with potentially huge upside but they both haven't been derisked as yet. MAD (maverick) has what looks like large reserves but has been having problems increasing production as wells have very small output. So the risk is whether they can increase production.
BRU (Buru )on the other hand look like they have a large Oil find at Ungani but the size of the field could be anything between .5m barrels or in the upper case 20m barrels. They have a partner in Mitsubishi and probably have the largest shale gas acreage in the Canning Basin. NSE (New Standard Energy) is not far behind in Shale gas acreage but is not a producer. The risk with BRU is that the Ungani field is not as large as they think it is.

For unconventional and shale gas exposure my pick would be BPT (Beach) with great underlying cash flow from their Cooper Basin Oil and significant shale and unconventional acreage in the Cooper Basin. SXY (Senex) is another Cooper Basin shale play I favour along with DLS (Drillsearch) who already have a farmin partner.

AWE (Australian Worldwide) has large unconventional holdings in the Perth Basin and look cheap on any metrics. They just paid out a special dividend, so are cashed up and are ready to move forward after a disastrous drilling campaign in the Taranaki Basin in 2010.
Sorry about rambling on the OEL thread. OEL thread title sums it up. Elephant hunting in the Phillipines with BHP Billiton makes it a gambling stock if you want to invest for the upcoming drill this year..

Disc: Hold BRU BPT SXY

[hal]

Rabbi
I think that OEL is not so much a gambling stock because it has the back up of Galoc production. It could have big upside if the sc55 block finds oil/gas. They have a very experienced new manager and they have a lot of other areas of interest in their Philipines blocks.

They are also looking to expand into East Africa and with the management they have it won't be do on a whim.

By the way Buru's Ungani 2 found oil as well and it looks like it is a deeper pool than Ungani1. The ceo has indicated they have at least the top end of your range.

It could be a very exciting year for the oilers but we will have to wait and see(with the markets the way they are).