Hey Jop,
I cannot disagree with you about how on average, the Chinese operate, at least with companies I have held. That being said, I feel ROC/Fosun as far I can tell, have not done anything untoward with any of the J/V partners who either operate or hold a share of their multiple oil production projects in South Asia.
ROC was swallowed up 3/4 years ago, yet, other than drilling more wells, they have simply been banking money (i.e US cash and bonds of $125m). Also, they have continually invested in the assets they have to keep production high and increase their 2P year on year.
I 100% understand where you are coming from regarding what you wanted to see BRU do in years to come, and, to be honest, if as you said, I had not held for 10 years and been through very, very frustrating events, I would have wanted the same, but.... as I have perhaps, harped on about, BRU was and still is Erics baby, and while hes one very youthful 70+ year old, he wants to crack the Canning sooner rather than later. Hence the deal. Now, if... if we had a different MD, I do think you would have got something closer to your vision.
You are also, 100% correct about how BRU has handled things over the past 5-6 months. Much of the 'exuberance' in the presentations has gone, plus of course some of the milestones have fallen by the wayside. (for those who prefer to think that everything is open and clear with BRU, please don't read on). Eric is a master of deals, and keeping his cards close to his chest and I think all of the newsflow in recent times has been massaged in a way to remove as much excitement as possible to help soften the 'blow' so to speak with the deal, why else have we still, not got even a resource estimate/update for Ungani 5 and Ungani 4, or even Ungani FW for that matter.
If I can try to remove myself from any bias, he has done 2 very good deals in just 12 months, even with, major, and I really do think Ungani 4 was a major FUBAR, plus, out of everyone's control 2 bloody cyclones, which, if they had not occurred, would, perhaps have even meant a very different transaction might have occurred.
Broome... Broome is hard, although again, we don't have all the info at our fingertips. I think it would stack up if U5 & U4 were perfect, but... just don't know? I am hopeful that if nothing else, ROC won't be wanting to hold back on accessing every barrel of oil in and around Ungani. Perhaps we will see some of that urgency in future company updates as to their actual plans for the year, now that they are not cash constrained? I guess the next update will occur when the next shipment sails (2 weeks or so). Or.. to go in tandem with the Eastern State visits.
Your last sentence hits the nail on the head mate. Hence, hopefully ROC will balance out what might be a issue within BRU.
Although ironically, the farmin was supposed to allow for the drilling.
I do hope you don't go and hide in your cave (unless its a seriously decked out one), as I for one, whilst not always agreeing with you, value your views.
@cujo - sorry, but... Jop obviously is assessing his position on BRU and fair enough. I disagree with you about the 5000bopd target. With proper drilling and pumps, Ungani will I believe, produce at 5000bopd within 18 months (I am quietly confident that will be one of ROCs goals. Their current production is 8900bopd net. To hit 10000, Ungani only needs to hit 4800bopd (another 1100bopd more). That does not even include if Ungani West proves commercial. But.... I do agree with CEO, BRU was cash constrained (I bet we are running on fumes right now), well, not after the $13m just added. To do all the drilling etc etc would have been another year. Its a very back and forth discussion, which I think I will stop there, as its probably been done to death for now.
As for the current share price. I think a slow steady accumulation is occurring. From those who are impatient or prefer even higher risk/reward propositions (even though I still think BRUs upside is huge for an oiler). Good luck to them.
@edshann - I am a little surprised that Peter Strachan views BRU as now only being worth only $129m. Considering it will have approx $67m in cash, plus the $20m free carry, plus the estimated $26-28m in cash flow for every 12 months, although I think if the POO stays around the same price, then with the operations upgrades etc done, we will be making even more than that in 2019 ignoring any potential discoveries.
CEO - btw - Not sure about where you got the $79m? The exploration carry is a full $20m, out of a total of $25m, so if $20m is spent, then $4m will be BRUs ($80m?), but... Eric pretty much says that the Rafael well is going to be expensive, unless perhaps the rig bigger rig can be used more than once. I do think BRU will get a decent sized tax refund for money spent last year, so could be another $2-5m (just guessing and going off past returns).
hmm... perhaps I should take your advice Jop and hide for a bit. I have work I should be doing.
One positive, my wife seems happy that BRU has a lot more cash, so.... happy wife happy life I suppose.
