Thank you for your post and apologies for the delay in replying.
You raise some points that are at the forefront of many holders minds.
There certainly have been many capital raisings , especially in the early life of BRK, and they have been a huge hand break on the share price. The discussion as to the reasons for the raises has been done, but I do want to point out the quantum of raises was ~$5 million ( 2015-2020.....prospecting, leasing and proof of concept phase ), and ~$39 million ( 2021-2022... HBP drilling funding).
The $39 million funded the drilling of the 4 wells as you say, ( ~A$ 46 million net to BRK) plus pooling of the 3 HBP DSU's, leasing the 4th DSU, drilling Juanita, spending $3 million , funding all annual corporate running costs of Perth and Tulsa and still having ~$30 million in the bank, ready to fund the ~A$40 million net cost to BRK of the FMDP.
If BRK did nothing but sat on the cash they raised earning interest, then I would agree with you that most of the market cap is due to the cap raises... but that cash has been recycled twice over already, so I do not agree.
DP other jobs do not limit his time with BRK. His job at BRK limits the time he has as NE Chairman elsewhere. In 2023 he spent more ~5 months in the USA working on BRK, and is again in Tulsa right now, having left at the end of June for another multi month stay ( already spent a month there in Jan-Feb 2024)
As far as shareholder returns are concerned, there have not been any sustainable, long term returns for shareholders, there is no arguing that. RFE failed due to excessive debt and a collapse in the oil price so there were no returns for shareholders at the end. But from 2005 to 2012, as the company grew production , revenue and profits, shareholders did see short term returns .
For BRK, the lessons learned from RFE have laid the foundation of avoiding debt where possible, holding only tier 1 assets that can make money through the cycle low, and build profitable and sustainable, long term business.
As far as the plan changing , a couple of points.
The business plan of prospecting, proving and monetising has been constant. But in terms of monetisation, 100% agree, the pathway of going down the production and cashflow harvesting, verses the original selling the revalued PUD reserves has seen a big change. But , DP always said, whilst selling may have been the preferred option, the monetisation pathway chosen was always going to be the one which gave shareholders the best return at the time.
When it comes to the 2028 " date" , that is only the end date of the SWISH FFD... that is not the date the company will pull up stumps and go home. The plan is to build a sustainable business and the SWISH FFD is just the monetisation of that particular asset. What the SP will do up to that date and beyond is anyone's guess. But what is not a guess is at that date, BRK net production will peak ( on the current asset base) at over 6000 BOEPD, which will place it towards the top of the small/ mid cap producers on the ASX. Current peers at that level or above are COE and STX.
DP has only been CEO of RFE ( no long term shareholder return), and BRK ( story in progress but in monetisation phase)... As a NED and NEC of a couple of others , along with any Non Exec , I'm not sure he much say, other than oversight powers in a company.... so possibly, to " blame" him as non exec director for another company's lack of shareholder return is possibly a going a bit far. Having said that, I agree , DP is ultimately responsible for ensuring BRK has the best chance to achieve returns for shareholders.
When is time to change the management? .. Don't have an answer for that, just a whole lot of questions.
Is that just the CEO or the executive team/ board in general.? Are you changing management to change the operations ? Changing the CEO usually leads to a change in direction so what direction do we want BRK to go down... spend less on building a business which will throw of significant excess cash in favour of a smaller business but with some cash returns, buy backs now? Or is it just stay on the same path, change the figure head, then the sun will shine, all will be well in the land and the Sp will rocket?
Thanks for the discussion
Cheers
Dan
BRK Price at posting:
1.2¢ Sentiment: Buy Disclosure: Held
(20min delay)