Pretty obvious EOFY selling pushing the SP down, while the 'talk' last week followed up by zero announcements doesn't help..
I noticed a few new slides in that presentation I haven't seen before, and I'm thinking they are prepared for the next announcement, when 'whatever' is finalised.
Thinking outside the square, with a nearly worst case scenario, imagine we have a dilution of another 600M shares at 5c or thereabouts, giving us another $30M to prove up one of the many leads, then another 600M shares (I mentioned near worst case!!) for again only 5c, giving another $30M. Total of 3B shares issued in total (including options).... plus we get actual flowing hydrocarbons for all this and a resource estimate...
Even a Mcap of $1b would be over 30c/sh. given the size of the basin and our holdings in it, with all the 'leads' generated, with possibly many trillions of cuft gas, and oil from the margin plays (a few hundred million barrels at least)... The $1B mcap would be incredibly cheap...
Assuming we farm out 50% of our holding, taking 'net' remaining to IVZ down to 40%, then govt taking another 50% in 'profit share', leaving us with 20% of profits..
Making some longer term assumptions of just 2Tcf of gas for entire basin, a cost to use this gas of $2.4B being discovery, extra wells, processing plant/s, pipelines etc of $2.4B.
A return only a $6/Gj gas price (really low), then the 2Tcf = around 2B Gj = $1.6B in profit to Invictus, over time or over 50c/sh before taxes etc...
It's getting very hard to justify such a low SP, especially after EOFY selling has finished. It also probably means that when Scotty does have some great news for us PPSA, partner or whatever, the SP will spike very quickly as we get rerated, no matter what the dilution..
My own opinion is, our ground in the basin probably holds 10-20 or more Tcf of gas, given it's size, with liquids eventually adding a lot more value, plus we wont be getting to 3B shares any time soon, with farmout for less than 50% of our holding in one of the permit areas (not the lot) covering the 18-24 months expenditure as stated by Scott... In other words nowhere near worst case scenario applies.
I just hope of don't die of old age before anything happens....
IVZ Price at posting:
6.1¢ Sentiment: None Disclosure: Held
