APY - Azonto Petroleum - Aussie Stock Forums

Page 1 of 2 12 LastLast
Results 1 to 20 of 35
  1. #1

    Post APY - Azonto Petroleum

    Been watching RIA for a while now, waiting to see if the SP would drop back from their run a few weeks ago into the mid-30c range. At recent low prices over the past few days, I'm happy with this as an entry.

    Firstly, I'm hoping that we might see a bit of a spike around new year if we get more confirmation of the drilling approvals for
    late Q1 2012.
    I am aware that RIA might 'go to the well' for extra funding but happy to invest some $$$ here and see if a spike hits first.
    If not, guess play it as a BESBS play. The target is big so should get interest nearer the spud.
    Time will tell but at these prices, given upcoming drilling in late Q1 2012 is a big target, the SP has been triple its current levels within the last year or so, and a historically low SP (within 10% of annual low) now presents itself, it ticks enough boxes for a punt.

    DYOR as I am no expert in this game.

    Holding RIA at 26.5c

  2. #2

    Default Re: RIA - Rialto Energy

    Right on schedule, announcement on 16/12 confirms that the Ivory Coast government have given the approval for RIA to start drilling and have access rights to CI-202.

    While this is all to be confirmed by the drill, plans are being made for delivery of up to 8000 bopd and 100 mmscfd. This highlights that this project is a big target (company maker) if oil and gas flow as expected.

    Announcement also confirmed:

    * Drill in Mid-February
    * Rig organised. GSF Monitor Jack-up rig to be used.

    Given some stability across the wider market, this should be a good BESBS play.

    Holding at 26.5c

  3. #3

    Default Re: RIA - Rialto Energy

    Quote Originally Posted by BESBS Player View Post

    Given some stability across the wider market, this should be a good BESBS play.

    Volume and SP starting to build. Lovely to see 36c as drilling is still a couple of months out.

    Given the potential size of the target - RIA management are claiming up to 8000 bopd and 100 mmscfd - and the fact that these are more-so development wells, this has the potential to run much further yet as a BESBS play.

    Holding RIA at 26.5c

  4. #4

    Default Re: RIA - Rialto Energy

    Currently in trading halt while they finalise a cap raising.

  5. #5

    Default Re: RIA - Rialto Energy

    33.5c .... where to now , waiting

    Anyone have info on what ?

  6. #6

    Default Re: RIA - Rialto Energy

    Thought that some might like to read some extracts from a broker report. I have allowed time for it to be acted upon by followers before posting. I found this on another site. It really just summarises some of what I have been saying for a while:

    Rialto Energy Ltd
    (RIA $0.34) Buy

    Analyst: Jon Bishop
    Date: 27 January 2012

    Capital Raising

    Price Target: $0.86/sh
    Investment Case
    We remain highly enamoured by the potential of RIA’s Cote d'Ivoire asset. The recent conditional investment of US$20m by the World Bank (IFC) reinforces our positive view. Furthermore, alignment in the interests of the IFC and the Cote d'Ivoire Government provides further surety for development once FID is met later this year. As well as converting 59mmbboe into reserves, significant value can be added with the forthcoming drill campaign which is also targeting material exploration upside. We value RIA at $620m or $0.86/sh on the assumed dilution.
    Key Points
    RIA intends to raise up to $68m by way of a two tranche placement ($60m) and SPP (up to $8m). Post completion of the raising, RIA will have up to $119m in cash (inclusive of the IFC $20m placement). Anticipated allocation of the cash reserves will be:
    - Forthcoming CI-202 Block drilling campaign comprising 2x appraisal/exploration wells and 1x exploration well ($73m)
    - Allocation for the Accra Block, offshore Ghana ($15m)
    - 3D seismic acquisition costs over the CI-202 Block ($11m)
    - Long-lead items towards FEED for CI-202 Block ($4m)
    - General working capital
    Forthcoming Drilling Campaign
    The upcoming drilling campaign is expected to commence mid-February. The programme will comprise:
    - the Gazelle P-3 and P-4 appraisal wells targeting 59mmboe 2C Resources
    - Success in the appraisal campaign will ensure momentum towards FID; slated for mid-2012 on this basis.
    - We value the proposed Gazelle Hub Phase I development comprising 8kbopd (with capacity of 15kbopd) and 100mmscf/d at $412m (or $0.57/sh post issue).
    - Deepening the P-3 well to test the 15mmbbls + 750Bcf Condor prospect
    - At $5/bbl and $0.10/mcf in-ground, a discovery would be worth $128m (~$0.18/sh fully diluted) net to RIA (at 85% interest).
    - The Chouette exploration well targeting 84mmbbls and 42Bcf of recoverable resource
    - A success case would warrant a valuation of around $361m at $5/bbl in-ground or $0.50/sh) net to RIA.
    Our valuation for RIA stands at $0.86/sh (vs $0.96/sh as a function of the dilution).
    Valuation breakdown: $0.57/sh for the proposed Gazelle Hub development; $0.14/sh cash (net of IFC); $0.03/sh unpaid capital (to reflect IFC placement) and $0.14/sh for exploration.
    Our total $620m valuation compares favourably with an EV of $99m post issue (assuming a cash and unpaid capital position of $119m inclusive of IFC placement) at $0.30/sh.
    The raising ensures that RIA has sufficient capital to fund its upcoming 3 well drilling campaign as well as the recently acquired 3D seismic over the CI-202 Block.
    We remain attracted to the potential of the CI-202 Block to yield a number of meaningful oil and gas discoveries and new developments in time.
    Govt ratification of the FDP and attaching Gas Sales Agreement MOU provides development momentum for RIA’s asset. The recent conditional placement to the IFC (World Bank) further endorses the CI-202 Block potential.
    IFC – Cornestone Placement
    IFC, the private sector lending arm of the World Bank Group, is looking to invest US$20m via a private placement, subject to IFC Board approval post a 60 days public disclosure period and RIA shareholder approval. An IFC investment is of great significance as it:
    - confirms the attractive technical and commercial attributes of RIA's asset following comprehensive technical due diligence
    - introduces a high quality cornerstone investor that is aligned with the interests of both the Cote d'Ivoire Government and RIA, thus ensuring smooth future development of RIA’s gas-oil dev. hub
    - flags the IFC's involvement in key strategic energy projects in the region - specifically in Cote d'Ivoire
    - allows the IFC to underpin its own ambitions pertaining to energy supply within country and the region
    - potentially provides substantial funding in the short term towards the imminent appraisal/exploration campaign
    - potentially provides an obvious and reliable source for future development debt capital
    As part of the investment, the IFC is to receive 16.7m warrants at $0.50 exercisable within 4yrs.
    Forthcoming Drilling Campaign
    The 3-well drilling campaign, due to commence in Feb, comprises appraisal of two completed and suspended oil development wells at the Gazelle Hub by the P-3 and P-4 wells.
    The Gazelle P-3 and P-4 appraisal wells seek to covert 59mmboe (circa 14mmbbls oil, 266Bcf gas) 2C Resources into reserves.
    The main focus of the appraisal drilling is to better delineate the Gazelle Field.
    The wells have been designed to intercept key contacts (ie oil:water, gasil/gas water contacts) to define field volumes.
    Drill Stem Tests (DSTs) will be undertaken to recover hydrocarbon samples. The constrained flow tests will assist in substantiating whether commercial flow rates (as seen in the discovery wells) can be replicated. However, the pressure data that will be gathered from the DSTs is of greater importance.
    The DST information is critical in terms of finalizing production designs for the development.
    A likely extension leg to the P-3 well will test the deeper Condor exploration gas-condensate target (P50 – 15mmbbls and 758Bcf potential).
    Identification of commercial quantities of moveable hydrocarbons at the Condor exploration leg of the P-3 well. A success case will have a very positive bearing upon the overall development economics.
    A third well will target the high impact, oil prone, Chouette (84mmbbls P50 potential) exploration prospect at the Hippo Cluster.
    Chouette lies between the Bubale (Gas-oil), Hippo (gas) and Impala (oil) accumulations discovered by the Hippo, IVCO-22 and IVCO-18 wells.
    Phase II - Drilling Campaign
    Conceptually, a second drilling phase (from the Dec H’12) would likely involve tying-in the Gazelle wells and appraising/developing the Hippo hub (>4 wells) which comprises a series of feeder canyons analogous to the 1Bnbbl Jubilee field.
    Acquisition of 3D seismic in CI-202 is complete and should provide more detail on the Gazelle hub as well as exploration features outboard.
    Exploration drilling would likely focus on the Faucon (154mmbbls and 77Bcf – P50 potential) outboard area.
    Broader Potential of the CI-202 Block
    The key attraction of RIA’s Cote d’Ivoire remains its prospectivity. The CI-202 Block lies within a proven petroleum system with a number of play types.
    RIA has five undeveloped oil & gas fields on its CI-202 block providing portfolio depth and development flexibility.
    Of the wells drilled, 11 produced commercial flow rates as high as 3.7kbopd and 40mmscf/d.
    The mean gross contingent oil & gas volumes for CI-202 are currently 50mmbbls and 396Bcf respectively based on the 13 wells drilled on the block so far.
    Comprehensive seismic over the block has identified a high impact inventory of large, game changing, oil and gas prospects that can easily be development via tie-back or on a standalone basis where size permits.
    Current exploration portfolio of 14 identified prospects with total mean Prospective Resources of 511 mmbbls & ~1.8 Tcf.
    Interpretation of new 3D over the entire block will define drill ready candidates for the Phase II campaign and test the outboard exploration potential.
    Gazelle Hub - Phase I Development
    The Government of Cote d’Ivoire has recently approved the Field Development Plan (“FDP”) for the Gazelle Field located in CI-202.
    Consequent to the approval of the FDP, RIA will be formally granted a 25yr Exclusive Exploitation Area (58.5 km2) over the Gazelle Field.
    An attaching Memorandum of Understanding (“MOU”) provides the framework for a binding take or pay Gas Sales Agreement (“GSA”) to be executed prior to Final Investment Decision (“FID”) expected mid-2012.
    Targetted commencement of production at the Gazelle Hub is mid-FY’14 @ initial oil rates of 8000bopd and gas rates up to 100mmscfd for at least 7yrs.
    Our forecasts assume one fixed platform (with compression and gas and liquids handling facilities) with oil & gas being piped onshore. Spare Oil production capacity of at least 15kbopd and gas of 100 mmcf/day is assumed.
    We assume 20 mmbbl of oil and 300Bcf gas to be produced in the initial 7yr development phase.
    We will revise our valuation and forecasts to include gas once more details on the potential gas development emerge with finalization of FID.
    We assume US$400m of capex for the initial development phase would be likely funded largely via debt. The potential incorporation of IFC into the development provides an obvious and reliable source for project finance.
    Geological Risks:
    As the two appraisal wells are designed to test existing discoveries, barring mechanical failure, we are confident that these wells will intersect hydrocarbon bearing reservoir.
    The risks therefore relate to whether the reservoir thicknesses are supportive for development and consistent with existing volumetric analysis.
    Additionally whether the reservoir quality is of sufficient quality (in terms of porosity and permeability) and of a relatively uniform nature.
    And finally, whether the pressure regime is consistent across the net to gross or whether the field is compartmentalized (thus requiring a potentially more complicated development design).
    Exploration drilling is subject to the normal geological risks.

  7. #7

    Default Re: RIA - Rialto Energy

    It looks like the BESBS (Buy Early Sell Before Spud) players and those who want a longer term perspective (ie. results of drill) are now flocking in as we have ended the week at 39.5c

    Apart from the obvious attractions of the project, this was always on the cards. Funding is secured, World Bank funding adds credibility, rig is on schedule, CR is offering a bargain and recent volumes suggest that paying a premium is now the only sure way of late entry.

    Enjoying the ride (and yes, I'll take up my allocations). Until then, I won't adjust my entry price as we are yet to see if we get full allocations.

    To the best of my knowledge, the drill schedule is still okay (as much as these things keep to stated times!)

    Holding RIA at 26.5c

  8. #8

    Default Re: RIA - Rialto Energy

    Quote Originally Posted by BESBS Player View Post
    Enjoying the ride (and yes, I'll take up my allocations). Until then, I won't adjust my entry price as we are yet to see if we get full allocations.
    It seems rather likely that we won't. If the SP stays around 40c, most holders would seem likely to jump at the chance to buy at 30c. (Myself included.)

  9. #9

    Default Re: RIA - Rialto Energy

    Nice to see stock coming into the account at 30c and already up 35%+!!! Interesting the way they protected the '50,000 shares +' holders to get a full allocation but scaled back the smaller holders. I had one account that got scaled...

    Next step is the announcement that the rig is close to readiness. Should be an announcement any day on the European market. When that hits the news, the SP should start the next leg up (assuming that the global situation holds).

    Happily holding RIA at 27.5c

  10. #10

    Default Re: RIA - Rialto Energy

    share price is at 43c, would you advise against a late buy in? - considering it ... cheers (at my own risk ofcourse)

  11. #11

    Default Re: RIA - Rialto Energy

    Hi Smashie,

    As always, it is ultimately up to you.
    For what it is worth, here are my thoughts.

    According to the ASX, the rig is now on the way to site and we should see the drill start by early-mid March. Assuming that the wider market holds, I see the following pattern:

    * SP drifts between 40-45c until confirmation of rig arriving.
    * SP should rise a little once drill starts (45c maybe up to 50c)
    * Given the first drill will take several weeks, I think you'll see $$$ pour in closer to target. This occurred in a similar length drill with MMR some time ago. By this stage, I'd expect the SP to be between 55c (at worst) and 80c (at best) before results in the first well. After this, you punt on results...

    Remember, these are just my thoughts and only time will reveal the truth.

    All the best with your investments

  12. #12

    Default Re: RIA - Rialto Energy

    Thanks alot, yeah holding at 42 cents - i've got faith!

  13. #13

    Default Re: RIA - Rialto Energy

    This has uncertain SP .... 36.5c one moment then back to 38c . Why would one sell today and not yesterday ....why bother be in stocks. This has traded down in past week 43c to 36.5c ....38c to where tomorrow ! Just plain crazy...

  14. #14

    Default Re: RIA - Rialto Energy

    Quote Originally Posted by Bonk View Post
    This has traded down in past week 43c to 36.5c ....38c to where tomorrow ! Just plain crazy...
    It's understandable. There was a recent large cap raising at 30c, so there's a whole pile of stock recently acquired that can be dumped at a large profit. At the same time, there are many holders in for the long run and various broker reports suggesting they are worth much more. Once the short-term profits have been taken, we should see more stability.

  15. #15

    Default Re: RIA - Rialto Energy

    Well explained, Kremmen!

    Nice to see drilling underway.

    Now the wait. I can't see a huge surge in the SP at present as the target depth is still a while off and there is always a risk of mechanical/technical/'I lost my beer down the hole issues. I'm also suspecting that we might see some of the instutional placement slowly drip-fed through the early part of the drill. Lets face it, a sale at 42c on a 30c purchase is a 40% profit in a month!
    That said, once closer to target, I can see a movement north in the SP. I'll be holding for quite a while as the drill bit turns. Rather than a BESBS, I'll play this as a BESBTD (Buy Early Sell Before Total Depth).

    The carrot here is big. The media coverage of big numbers and an oil/gas discovery such as this, if it eventuates, should get many punters emotionally hooked. That is the time to make a killing if you are a holder at that time.

    Good luck to all holders however you play this one.

    Holding at 28c ave since the SPP

  16. #16

    Default Re: RIA - Rialto Energy

    I totally agree with you Kremmen, I have been watching SP closely since I bought in late at 42c, and just as the sp breaks away north the SPP sellers give resistance... I am going to play it like you BESBS player, aiming for TD. From your experiance with spec companies, when a company meets oil and gas targets for an exploration well does the SP drop or tend to stabalise due to the new proven assets? I guess more specifically if the signs are good leading to TD would you consider holding after TD because of the next two exploration wells?

  17. #17

    Default Re: RIA - Rialto Energy

    Hi RIAers!

    Nice to see the SP heading northward today after the RIA update.

    While it might be roughly 45 days to ETD, I am hoping that we will find the next influx of funds comes just prior to hitting the oil the first potential oil area (which could be as early as 10 days). With this in mind, provided the drill bit continues to work without any mechanical or technical issues, I could see a sudden SP rise toward the middle of next week.
    Hoping that it won't be too long and we will see 50c.

    Once we get close to the first oil zone, then I'll have to think carefully about unloading much of these. After all, I limit the risk, hence BESBS (or in this case, BESBTD).


    Holding RIA at 28c ave

  18. #18

    Default Re: RIA - Rialto Energy

    Quote Originally Posted by Smashie View Post
    I totally agree with you Kremmen, I have been watching SP closely since I bought in late at 42c, and just as the sp breaks away north the SPP sellers give resistance... I am going to play it like you BESBS player, aiming for TD. From your experiance with spec companies, when a company meets oil and gas targets for an exploration well does the SP drop or tend to stabalise due to the new proven assets? I guess more specifically if the signs are good leading to TD would you consider holding after TD because of the next two exploration wells?
    Hi Smashie,

    Please note that I won't be holding until TD unless amazing announcements start filtering through very early on. For instance, we should be around the first zone of interest within 10 days, so a hydrocarbon show would be positive.

    Reading some broker reports on RIA's website, one notes vague references to the possible complexity of the target reservoir at Gazelle. Put simply, this suggests to me that the pathway between the lower target zone and a successful development might be more difficult than we assume. I hate to say but it is not often that a drill goes according to pre-drill reserve estimates.

    For me, I'd rather take my profit (I'm hoping that this will be around 100%) and then stand aside unless these cracker early announcements keep coming. While I could always re-enter later, I find the best and most reliable profits are in the BESBS stage of a company's development. Nonetheless, they are just my thoughts...

    I just wanted to be clear as I am not part of an RIA cheersquad but trying to watch this objectively with a great desire to protect and advance my capital. I learned long ago - emotion and share companies do not mix well very often!

    All the best with RIA.

  19. #19

    Default Re: RIA - Rialto Energy

    Thanks for your input BESBS_player, I too think that the sell before spud tactic removes alot of the risk and entry into a stock early enough locks in a nice profit.

    In regards to the IFU $20mil investment finalisation and 2nd drilling update report:

    - Investment by big body (IFU) tells me that they rate this drilling program
    - Drilling seems to be continuing without problems

    - No early hydrocarbon shows (was this even realistic though?)
    - IFU $20mil placement was at 30c and they got 1 option for every 4 shares purchased
    - Shares diluted even further...

    will be interesting to see how traders respond today

  20. #20

    Default Re: RIA - Rialto Energy

    Hi Smashie,

    I agree the chances of hydrocarbons at this depth is very unlikely. I suspect we will see the SP hover until closer to next announcement. Interesting times ahead...

    Holding RIA at 28c ave

Similar Threads

  1. BPT - Beach Petroleum
    By Bonk in forum Stocks 0-H
    Replies: 684
    Last Post: 2nd-March-2016, 08:47 PM
  2. TXN - Texon Petroleum
    By surfingman in forum Stocks Q-Z
    Replies: 627
    Last Post: 1st-March-2013, 05:13 PM
  3. OIP - Orion Petroleum
    By sfx in forum Stocks I-P
    Replies: 97
    Last Post: 7th-April-2010, 12:44 PM
  4. LMP - L & M Petroleum
    By yogi-in-oz in forum Stocks I-P
    Replies: 9
    Last Post: 25th-July-2008, 11:40 AM
  5. BHP Petroleum anyone?
    By vishalt in forum ASX Stock Chat
    Replies: 8
    Last Post: 8th-December-2007, 11:12 AM

Tags for this Thread


Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
Aussie Stock Forums