So, after years of waiting it would appear that Puntland is...

So, after years of waiting it would appear that Puntland is finally happening. It has been a long hard road, but the real action for RRL is about to start now... )

ASX and AIM both building up beautifully towards the end of last week. AIM closed with a buy of 11p on friday, which equates to roughly 16.4c on the ASX, based on current exchange rates.

Below is an excellent post written by Kev on a UK board this morning. A must read I would suggest for all holders as we enter this incredibly exciting new chapter!! )

"The State of Play (WTYE 2012)

First up apologies for the inaccuracy in my WTYE prediction I was a couple of week out, but its a reminder with this don't expect content to be 100% its at best a estimate based on extensive research and a guide only. Secondly to the grammar police tough there will be inaccuracies and issues with punctuation etc, they are a legacy to past issues I‘ve had so like I said tough. Finally just so there is no illusion this is a blatant ramp based purely on my own thoughts, research and conjecture and view it as such. It is not investment advice in any way shape or form, any figures quoted are purely what I have personally used as a guide in my investment decisions.

The state of play at the moment is sentiment has changed the brakes removed and we are ready for lift off…………………….so what have we got? This is a rehash of my new year post but with elaboration and some figures if you don’t want to read the meat of it skip to the bottom.

Georgia
Contrary to earlier RNS’s I believe spud for the Kursebi site will be in Feb (we’re half way through Jan already) just convenient to align with a massive push in news and share price. First targets are gas at 700-800m so expect results soon after spud. The Gas target is of such a size that according to actual Geology it was masking deeper oil zones below on the Helium survey, but as the Vani drill there are stacked oil targets below.
The Vani drill the VSP has confirmed the lower targets so its sidetrack time at some point but I suspect not the next drill after Kursebi because further seismic are being done over further acreage of very prospective shale gas and a new JV partner seems likely to come in to exploit this. This would be big news for most companies but for Range negligible so I’m not going to attribute it value and consider it mere upside if it comes off, however importantly it is very handy for positive news flow!

East Cotton Valley
A few issues here as all know but the fact they are perforating and swabbing prior to frack operations I regard it like Georgia negligible not worth valuing but useful for positive news flow purposes.

North Chapman Ranch
Two wells producing Smith 2 a success note no detailed results yet so more news flow here! The Albrecht 1 drill approaching or at TD which will mean yet more news flow as will the prospects of four further drills this year!
IMHO this Albrecht drill will move as the board have said P3’s into P1’s and P2’s so I’m going to allocate $200mill to mcap.

Tangiers
5 mill shares for 40c a share which is now worth 50% more not bad in a time of doom and gloom but I as others feel there is more to this deal. Personal opinion the investment is a retainer for later entry into the Morocco play and a show of good faith. I’ll attribute no value to this other than the share price even though the W Africa play can be huge so currently adding A$3.15mill to mcap

Puntland
Starting to get interesting now Pres Farole has let the cat out of the bag in more ways than one imho saying we are targeting 2bill barrels tbh this is more inline with my own thoughts but I digress we’ll stick with official figures. There is a spudding Ceremony in the next few days where all the directors and dignitaries are getting together for some massive PR. This drill will well and truly be on lots of investors radar like the Falkland drills! Attention like this means only one thing for the share price which is further upside. One very important note this is a spudding ceremony not the actual spud and in all likelihood already drilling. They would want to ensure the drill was together and operational and not the embarrassment of all the media and dignitaries turning up to a rig with issues! There are three stacked targets on this drill the first of which is conceivably only a couple of weeks into the drill given the uncertainty of the current drill depth it’ll be a brave man jumping in and out trading during this drill.
The second site is only a few K away so the rig will be demobilized moved and spudded again within possibly 10 days of the first TD.
But Faroles second 'cat out of the bag' moment and biggest imho was his confirmation of the Nugal drill this year IMHO approx September they will not want the rig stood too long after the second Dharoor drill a quick service and give the guys some well earned R&R then back to work boys.

This Nugal block is where there seems to be some confusion but how I understand it the existing Nugal acreage is to be amalgamated subject to negotiation with the new Marauder and Range acreage. From correspondence with Marauder I understand that MES will be operator here which is very handy is it clearly delineates the two blocks making Dharoor much easier to sell upon proving up!
Why has K Hill given up Horns operatorship of Nugal imho for a entry into the two Offshore blocks that are also part of the Marauder Range deal. So I see this as a three way tie up with Marauder operator, AOI secondary partner and Range free carried upto drilling for 20% of the block (subject to formal PSA). The fact all the big players are together in Puntland this weekend I would expect this PSA to be signed this weekend more positive news flow into the mix.

Offshore warrants some serious research as it is imho the jewel in the crown of the Puntland acreage a couple of excerpts here from some of the old seismic reports I’ve managed to track down. There’s only three here from the Gulf area but it shows why Hill is so keen to get in and why it is so big for Range.

LAS DUREH SW PROSPECT
http://screencast.com/t/jKOCblizyn9
http://screencast.com/t/RzS3qM9mszey

LAS DUREH SE PROSPECT
http://screencast.com/t/bO97VQLdhw1h

EAST LAS DUREH LEAD
http://screencast.com/t/4Xv6wEpfzCm

So what’s it all worth, no idea is the honest answer though we are targeting multi billion barrel prospects in each of the Dharoor, Nugal, the Gulf area and the Eastern Seaboard area‘s!


TRINIDAD
We’ve already had a P1 upgrade on the Beach Marcelle block worth $300mill but with continual step out drilling a hitting pressurised reservoir multiple times and the drill to 6500ft which is likely to flow at 200-300bopd again a step out drill we are due yet another P1 upgrade here and I’d expect another $200mill added to mcap.

But the bigger stuff is just around the corner 100mill barrels recoverable from the Hererra imho at a current profit margin after all taxes, royalties and cost have been paid of $20 per barrel. Though PL is negotiating to further reduce these royalties but I’m just counting that as further topside. So 100mmbls recoverable at approx $20 profit is adding a mere $2bill to our coffers over the next few years so its going to make for some interesting mcap adjustments this year as Range are hoping to drill 3-4 Hererras this year. I’m very confident of these drills coming in as just a couple of kilometres away they are producing light sweet crude at 1200bopd in the adjacent block.

UC is going to be equally as large if not larger than Herrera’s but for now I’m leaving it out as further topside until I’m sure when the PSA will be approved though the fact PL referred to deeper targets not specifically Herrera’s in one of his later RNS’s and the fact the company are now in possession of another drilling rig……….anyone care to bet its not UC depth capable I don’t think it will be long before we have movement on this front.

COLOMBIA
Not exactly a great secret the blocks at the western edge of the country with adjacent blocks producing in the region of 50k bopd well worth the wait imho and as many area’s of Colombia have had exploration drilling done in the past decades it’ll be a fare bet it’ll be like Puntland and not a true wildcat drilling program with existing data on the block available.
BUT IT NEEDS PAYING FOR! This will not be a issue imho the interesting bit and reasons to follow.

Here’s a guesstimate of the next few months RNS’s and timelines as I see it. The left side I’ve added rough times to, the right side needs dropping in.

-Texas TD and results this week
-TT flow rates this week next
-Update on the 6500ft TT drill this week next
-Puntland Spud this week
-Hererra CPR this month
-Multiple TT spuds and results
-Georgia Spud
-Feb Announcement of new JV Georgia
-OTC announced
-Feb Hotstocks coverage
-MES PSA Feb (maybe earlier)
-East Nugal Autumn drill dates released
-Puntland shows
-Feb Dutchess fund raising
-Georgia Gas Feb
-Further details on Colombia
-Colombia farm in Feb/march
-Punty TD Early mid march (many updates prior to this though)
-TT flow rates hit target figures March
-Georgia TD March/April (many updates prior to this though)
-Punty Drill 2 Spud March/April.

Finally there, so what’s going to happen in the next few weeks and months imho and targets?

We are going to see a constant barrage of news from P Landau and the board he did say they had plans to stop the shorters if that little lot doesn’t do it then its time to give up and I’m certain I’ll of missed quite a bit as well.

What the board need is a high share price to fund the Colombian acquisition the news flow will go a long way towards that with value being added left right and centre but boy have they been clever. How this for a scenario initiate coverage with a major US tipsters who I believe has a database of in excess of 1/2mill subscribers and at the same time start offering Range shares over the counter in the US. Its all about supply demand and of the back of news flow like that boy is there going to be some demand from the Yanks who love there Oil stocks…………shares are going to be haemorrhaging from the Aim market to the US like they did in the early Aim days from the ASX all good for us guys as extra demand inflates prices.

But if my suspicions are right it gets even better as I expect the Dutchess placing shares to be placed straight to institutions in the US who will want a slice of the Range pie meaning we get our funding without diluting the Aim market with shares, in fact I’d expect many less shares on the Aim market in the coming months due to increased institutional holdings and US share holders.
Targets given all the above are a share price in the region of 40p going into March prior to Punty results which should be sustainable due to mcap revaluations on oil finds in Texas and Trinidad. This will be further inflated by results on two Dharoor drills and a Nugal drill this year plus further details on our expanding asset base. Hererra results should I also hope start coming in as well adding upto 15-20p value per share so my year end target is a nice round £1.

As for income I’d expect Trinidad to be producing 4000bopd by year end plus any flow rates from the Hererras or UC which could quite easily push this figure to approx 10k bopd or $200k per day profit, which leads us to the next stage regular dividends!

Kev"

Good luck all - the next few day, weeks and months have the 'potential' to be huge for Range...

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