Just thought I'd give my thought on what Range is worth, and what target prices should be set. This might look like 'ramping' now I'm back in- but my position changes when my view of the situation changes, not the other way round.
$290m for Trinidad P1 announced today. This is in addition to the $140m P1+P2 that we already knew about. It's also worth remembering the increase in reserves is for the Beach Marselle part of the licence only (Morne Diablo may potentially give greater reserves still, but that's speculation at this point). So we're on $440m P1+P2 (mostly P1) reserves for Trinidad.
Add in $106m for P1+P2 in Texas (this will almost certainly increase as the latest well has been a success, and so some P3 reserves should be moved to P1, but we don't know how many at this point, so let's just work with figures we know).
That's $546m in P1+P2 reserves across our licences (ignore Cotton Valley as I can't see it ever amounting to much). That's £345m.
£345m/2 billion shares= 17.25p.
I've valued cash at nothing, as it's going to be used for exploration- but obviously there's the potential exploratory upside in the Herrera's, future Georgia drills (if they sort their seismics out), and the future Texas stuff.
Based on the current situation, my price target is 17.25p. Not much response in the share price today but look at it longer term. There's no immediate drills coming up so people get impatient and sell- but now is the time to buy in and hold when P1 is clearly undervalued and there's all the exploratory upside to come as well. Just buying and holding until drilling starts on the next exploratory well should yield decent returns, IMO, if you're the risk averse type (as I am).
RRS Price at posting:
14.5¢ Sentiment: Buy Disclosure: Held
