Hi All, The drop in SP is another case of impatients IMO. The...

Hi All,

The drop in SP is another case of impatients IMO. The swish area has massive potential the increased interest in a high yielding well!

"The target reservoirs in SWISH, include the 340’ to 500’ thick Woodford Shale (the organic rich, oil and gas prone source rock for entire Anadarko Basin) and the 320’ to > 380’ thick Sycamore Limestone that lies directly above the Woodford Shale. Both of these reservoirs are already being successfully exploited by tier-one operators that are actively developing adjacent acreage. These operators include NYSE listed large independments Newfield Exploration (NYSE: NFX) and Continental Resources (NYSE: CLR).
SWISH is a step change opportunity for Brookside, with the potential to generate substantial PUD value when leasing is completed and the acreage is held by production (i.e. an initial well is drilled and completed in each drilling unit)."

Couple this together with the report posted by pet0 earlier

"Royalties typically range from an eighth of the per-barrel price to as high as a quarter in premium areas like the Permian Shale Basin in Texas and New Mexico. Rights-holders are not on the hook for operating or financing costs to run the wells, although their income does depend on a driller’s willingness to keep pumping. In the Permian, drilling rights have reached $40,000 an acre and higher, although competition has been pushing the tab up."

The next announcement will be interesting to see how many acres they have secured with the money thats been raised. Even if we heavily discount the $40000 per acre in the new swish shale area the upside has to be massive given the old figures people have thrown around in the past and our interest % potential.
Also royalties between 12.5% & 25% interests are massive. Between $10&$20 (now) per barrel PROFIT without the risk of the cost associated.

I'm locked and loaded and feeling comfortable. There's plenty of support @1.4c so wouldnt expect the SP to drop further (should be trading around 5c anyway)

A few people have mentioned about the amount of options on the register now. I'm personally not worried about the amount of options on the register given the conversion will only go to the purchase of more land so even tho it will dilute the register we should in theory get an equal / greater apprication too the overall value of the company without the CR announcement comping in the future. Currently there are 263,774,924 options on the register which if all converted will raise another 5.3M.

Given we only have a 4M Loan facility and already have over 2000Acres under our belt, by right the injection of cash from oppies would have us theorietically acquire  double our current land holding without diluting the register in a proportional amount acting as a positive that everyone should want!

@$10000 per acre * 2000acres= values the company @ 20MC  AT LEAST on CURRENT land value.
Lets not mention the 3M raised recently & 1 Specific well (herring 1-33 1513MH old interest 13.6% , Now 18.2%) pumping out 1900/BOE per day and we have 18.2% interest in.

Just take a second to think what this is worth and even discount it!!

1500 barrels equivelent oil * $80 = $120,000 per day

our interest in this if im not mistaken (please correct me if i am) is 18.2% of $120,000 = over 20K per day or 8M per year???? IS THIS CORRECT ??? These calculations have to be incorrect can someone point out where im going wrong. Am i not taking the cost of production into account here??

we also have the below being produced but what catches my eye is the permit awaiting for swish #1 (30% interest) and Rangers (48% interest) which I would hazard a guess and say its in the swish region that the co want to acquire



In any case The company is undervalued by a current multiple of 4-5 as from the release of the half yearly report. Its anyones guess what it'll be worth once the Co secures the Woodford shale play and swish in general.

If anyone can pick out anything i've got wrong please would love to be corrected or at least someone help me understand why the SP is so low

Cheers

Anto xxx