epg on london oilbarrel, page-3

Hi P

I've no special knowledge. On the other hand, nor am I one of those PIs who demands hectic drilling all the time.

(One of my larger holdings is the UK company ATI Oil [ATIP], which has 50% of a huge set of oil and gas licences in Italy with scarcely a mention of anything so indecent as drillbits.)

My beef with EPG is that I can't think of a single instance on the ground where they've come anywhere near a target timescale. I don't mean a few weeks or a couple of months - that's standard in the industry. But pilot production at F and D was supposed to happen YEARS ago.

They came to this under-prepared and are taking ages to gear themselves up to do things. My working hypothesis is that they are opportunists like the Heritage guys they bought out, who thought they would get pretty quickly taken over themselves. So they didn't employ people who actually understood CBM/CMM but relied on consultants, keeping themselves as lean as possible because it never was in their personal plans to do anything much on the ground at all - just accumulate assets and get taken out for a profit.

Alan Flavelle's situation at that green gas company has been consistent with this reading. Not only is he not even full-time in EPG, he's obviously been having huge difficulty getting the issue away judging by the number of letters I've been receiving.

The EPG quarterly statement makes a few more promises. They are presenting at Oilbarrel on the 19th. Meanwhile the Oilbarrel piece is not without its hilarity, with statements like "It has taken time to mature this project but EGL’s persistence looks set to pay off" - that is, persistence in sitting on their hands.

So am I encouraged by the quarterly update? Not yet. EPG remains on my watchlist to buy back in - but only once they have started delivering on the ground to budget and reasonably to time. Until then, I don't see anything to invalidate my hypothesis. But if you do, please say!

Debate welcome, of course. :)