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FDM - Freedom Oil and Gas

Discussion in 'Stocks 0-H' started by Chief Wigam, Jul 17, 2010.

  1. Sdajii

    Sdajii Sdaji

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    Re: MAD - Maverick Drilling & Exploration

    At least in MAD's case it was coincidence (a nice one). This announcement was scheduled, they'd have released it at that time either way, unless they decided to go for a trading halt instead if it was a really nasty day.

    As for the announcement, I'm thrilled! I was expecting 1P to go to about 75-80k, and to see it top 100k was awesome! MAD's 1P reserves are just incredible! How many other ASX companies have that much? Additionally, the cost of production is very low. After originally buying in at an average of 21.5c, on yesterday's announcement I topped up with another 40k shares. Over the next year or two production will steadily increase and the share price should get dragged up with it. If they wanted to they could sit there producing a heap of oil for a hundred years or so, but more likely they'll further prove up acreage (still plenty to go, we'll probably end up with over 200k in 1P reserves within a year or two! And all of it oil, not BOE, and all of it oil which carries a $17 premium to WTI oil! Even now we're selling our oil for around $100 per barrel, and it's low cost production). Most likely once they've sufficiently proved up some of the acres they'll start selling it which will put us in a nice cash position and allow us to really ramp up our own production, and probably start paying some decent dividends.

    I think MAD is definitely one to have a good, close look at, and should be exciting to watch and be part of over the next few years.

    DYOR etc. etc. and all that.
     
  2. Chief Wigam

    Chief Wigam

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    Re: MAD - Maverick Drilling & Exploration

    Good article from EnergyNewsPremium.net:



    Who is the tall dark stranger there?

    The comparisons between Maverick Drilling &
    Exploration and Aurora Oil & Gas have ratcheted up as
    fast as Maverick was able to provide the market with
    reserves estimates for its holdings in Texas.
    Its latest update had its proven reserves doubled to
    102 million barrels of oil based on an initial reserves
    study at its Boling Dome Holdings. The news sent
    Maverick shares north, just over 20% to $1.34.
    While the rise has been somewhat pegged back, it is
    part of a broader trend for Maverick as investors on
    the ASX start sitting up and taking notice of the
    junior.
    Its shares have gone up nearly 418% since the start
    of the year, sparking lamentations among the lateadopters
    and cork-popping from those who held
    shares in 2011.
    To be fair, there was little indication in 2011 that
    Maverick’s share price would undergo such an
    explosion. For most of 2011, it was content to snap up
    more acreage around its projects while poking around
    for some early cash flow.
    However, in 2012 it has started getting the numbers
    from independent assessors, and since then the
    market has been forced to sit up and take notice.
    Investors have long sat up and taken notice of Aurora
    Oil and Gas too, and with good reason. Its position in
    the Eagle Ford shale is the envy of many an operator
    in the region. Its faith in its Sugarloaf acreage has
    been confirmed by two separate transactions.
    The first being a 6% interest grab from a nonoperator
    for $US95m, and it is in the middle of
    acquiring a 6.25% stake from Eureka Energy via a
    $A107m takeover bid.
    Its acreage coupled with a no-fuss approach to getting
    assets into production, along with the interest of
    Marathon Oil in developing Aurora’s acreage has
    helped grow its share price nearly 300% over the past
    two years, with the growth even more astronomical
    when taking in a longer time frame.
    Again, those who got on early would be buying
    Faberge eggs for breakfast.
    Here is the scary thing though. A quick look at both
    Aurora’s reserves position and Maverick’s reserves
    position suggests there is a lot of upside in the market
    to come from Maverick.
    Aurora’s proven reserves sit at 80 million barrels of oil
    equivalent pre-royalty and its proven and probable
    reserves are 92MMboe.
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    EnergyNewsPremium.net - Who is the tall dark stranger there?

    By all accounts, that is a pretty decent haul.
    After the latest reserves upgrade, Maverick is sitting at
    102 million barrels of oil on 1P and 192MMbbls on 2P.
    Aside from the cursory “one number is bigger than the
    other” analysis, the astute will notice that Aurora’s
    reserves are in Boe while Mavericks reserves are in
    Bbl. With gas prices feeling the pinch in North
    America, crude is very much king.
    Aside from being focused on crude, Maverick has
    managed to finagle a price for its crude of $18 above
    West Texas Intermediate pricing.
    While Maverick management do not invite the
    comparison with Aurora, labelling Aurora a totally
    different play to Maverick, the market cannot help
    make matching the two based on the numbers.
    While management could not comment specifically on
    the validity of its market valuation, the company told
    EnergyNewsPremium from Houston that it feels it is on
    the beginning of a long path to its true valuation.
    It added that it was sure analysts were crunching the
    numbers to issue re-ratings in the near future.
    Maverick also played a straight bat to suggestions the
    recent reserves upgrades could have other players in
    the area interested.
    “Yes – we have had inquiries and tyre kicking from
    several parts of the world but nothing material at this
    point,” Maverick executive director Brad Simmons
    said.
    “We have a long way to go to really be thinking about
    being a takeover candidate – and we don’t need any
    partners to develop our fields.”
    If the tyre kicking is not frenzied now, forthcoming
    reserves evaluations for 3500 acres at Boling Dome,
    1930 acres at Blue Ridge and a potential 4685 acres
    at Nash Dome may just pique more curiosity.
    As Simmons says though, Maverick does not need
    anybody along for the ride to develop its fields.
    It has a 100% stake in three producing fields. It has
    spent time proving them up to provide data for
    reserves estimates. It has 14 rigs it is preparing for
    further drilling, four of which will be out and drilling in
    the fields in short order.
    This in turn will drive production upward of its
    757bopd and provide cash flow.
    The real question for Maverick is how much time it will
    take to fully exploit its plentiful resource.
    While it is not a bad dilemma to have, it is one that
    could detract from the love Maverick has been feeling
    lately.
    Detractors have pointed out that Maverick’s producers
    so far have been on the “piddly” end of the scale. In
    fact, a number of its wells have stabilised in the 10 to
    20bopd range.
    Those sorts of production numbers don’t exactly excite
    shareholders or the broader market, but Maverick
    insists that it has higher producing zones to tap if
    needed.
    But surely if it could produce from the higher zones
    then it would, or so the logic goes.
    The company has told investors that it is able to
    break even at 10bopd, but those who have jumped on
    board the MAD bandwagon would like to see the
    company do better than just break even.
    Past comments from directors in Simmons and Don
    Henrich point to why the company has limited
    production, and as far as excuses go for limiting
    production thus far go, it is a pretty good one.
    In an April Interview with Motley Fool Share Advisor
    the pair elaborated on why they may just want to
    keep a lid on things.
    “As some MAD followers have now realised, premature
    release of positive information creates the prospect of
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    EnergyNewsPremium.net - Who is the tall dark stranger there?
    http://www.energynewspremium.net/StoryView.asp?StoryID=8685601[6/20/2012 11:15:01 PM]
    ‘shooting yourself in the foot’ in terms of acquiring the
    offset acreage in the vicinity,” they said.
    “We are pleased with the results of those wells, and
    for now we leave it at that.”
    So while Aurora Oil & Gas will be taking part in the
    frenzied drilling campaign of Marathon Oil, and more
    than likely growing its production figures at a rate of
    knots Maverick will be more of a slow-burner.
    With acreage all around Texas hotter than Texas in
    July, Maverick’s game is to not add to the inflationary
    pressure of the market by producing a bucket-load of
    oil, and hopefully building a massive acreage position
    for the best possible price.
    “We hear facetious comments about Maverick’s ‘200
    years of drilling’ ahead at the pace we are drilling
    now,” Simmons and Henrich said.
    “We don’t think Exxon or BHP loses any sleep about
    having decades or more of drilling ahead. The ones
    who should be losing sleep are those who do not have
    decades or moe of drilling ahead.”
    It figures that by going slow and steady, it may win
    the race.
    Source: ENP
     
  3. Fantasy09

    Fantasy09

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    Re: MAD - Maverick Drilling & Exploration

    So AUT and MAD both have similar in oil reserves. However, AUT SP is at $3.00 and 1.3 billions market cap, and MAD SP is at $1.00 and 300 millions market cap...something didn't add up:confused::confused::confused:
     
  4. Sdajii

    Sdajii Sdaji

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    Re: MAD - Maverick Drilling & Exploration

    That's too simplistic a way to look at things, but you don't need to add too much more to start looking at it and draw some conclusions. Basically, it's not just about how much oil is in the ground, it's about how much it costs to get it out and how quickly it can be obtained. If one company had a cost of $50 per barrel and the other a cost of $20 per barrel, one would be getting about a 60% return on their expenses and the other about a 400% return.

    If it was going to take one month to get that return it would be a lot better than if it was going to take a year or several years. Shorter recovery times also mean they can ramp production up faster if they don't already have the capital to develop their resources aggressively.

    And the total reserves in the ground says how long they can do it for.

    They have similar reserves, AUT gets big gushy wells and MAD gets trickly wells, but MAD's are much cheaper. MAD also gets an $18 bonus per barrel of oil, which is utterly brilliant and of more value than it gets credit for in my opinion.

    Of course, there are also the technicals. AUT is the big powerhouse everyone loves and trusts, and MAD is the Johnny-come-lately people aren't so sure about. Of course, fundamentals win out in the long run, and in my opinion MAD is the better long term investment. People love to buy the sure thing and hate the new, uncertain thing (even if it's certain, they don't consider it certain until the rest of the market does :p: ). I'll leave the short term technicals to the experts, but the long term technicals, to me, scream "MAD is a better bet than AUT!"

    I bought into AUT at about 50-60c, sold at $3.40ish, bought MAD at 21.5c average, still happily holding! Good times :)
     
  5. mrlister

    mrlister

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    I reckon based on the massive jump in oil prices, the Europe signals, and the reserves increase announced last week,.....we are gonna see MAD push it's resistance levels to the max this week. May ever reach that 1.5 mark. But I'd prob sell there. Cos I'm sure Europe has something new waiting for us!
     
  6. mrlister

    mrlister

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    MAD trading halt. capital raising 50 mill at a 13% discount 1.02.

    This stinks!!
     
  7. Chasero

    Chasero

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    Re: MAD - Maverick Drilling & Exploration

    Lots of companies trying to raise cash atm. Honestly surprised MAD did another one so soon. (BCC just did one today as well...)
     
  8. mrlister

    mrlister

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    I can only assume MAD is doing this now due to the additional resources discovered and the additional requirements for extraction.

    But agree. They only raised in march.
     
  9. rcm617

    rcm617

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    Re: MAD - Maverick Drilling & Exploration

    I'm a bit surprised too they have raised so soon, would have thought they would have waited till they had a few of the big impact targets under their belt.
    According to the presentation they still had $20m in cash so that would have funded them for the next quarter.
    I think they are impatient to get going on the results of the seismic.
     
  10. mrlister

    mrlister

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    CR in march had a positive impact on price, along with a few other announcements. Let's hope they have a few tricks up their sleeve here too.
     
  11. basilio

    basilio

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    Re: MAD - Maverick Drilling & Exploration

    In an awful market MAD is still powering along. That $50m capital raising looks excellent when you look at the drilling opportunities it has. There is so much upsiide with this company.

    A simple, economical, transparent and profitable business model. :)

    (Just wish some other dogs could follow suit...)
     
  12. buick23

    buick23

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    Maverick Drilling -MAD - Don't get it?

    Hi Guys

    Is anyone familiar with Maverick drilling and Exploration limited? code MAD?

    I have been watching this stock for a few months - I saw it rise to 1.44 and now
    seen it go down to 1.07? looks like it could continue to drop.

    I thought it would take a little hit but nothing like this
    Can anyone explain to me why it has taken such a downward spiral?

    I didn't buy into it, as I'm still learning so would really like to know the reasons for it?
     
  13. Des P

    Des P

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    Re: Maverick Drilling -MAD - Don't get it?

    Go back at least 6 months and you will see this was one of the the hot tips by one of the pay for Forums
    They haven't stopped harping on about it since
    You are new and so am i after twelve months
    Do a lot of research and learn about fundamentals and Technical annalist
    This should help you
    there is plenty on this web to teach you
    Hope somebody can give you a more direct answer to your question
    Cheers
    Des P
     
  14. oldblue

    oldblue

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    Re: MAD - Maverick Drilling & Exploration

    Important to remember that MAD was trading around 20c as recently as February! Meteoric rise on the back of a recommendation by Motley Fool who pointed out that this was a very "cheap" price if one valued the company on a 2P reserve basis. Some would argue that not overpriced at current levels on that basis but as with all stocks that soar there is potential to fluctuate wildly as profits get taken. Add in the nervous state of today's market and you still have a highly speculative stock, but then, that's the nature of most o and g stocks!

    ;)
     
  15. jancha

    jancha

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    Re: MAD - Maverick Drilling & Exploration

    Why does it stink? You'll get it at a cheaper price on the market.
     
  16. rcm617

    rcm617

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    Re: MAD - Maverick Drilling & Exploration

    12% of shares in the company are coming out of escrow on monday, shareholders might be worried that a percentage of these will be dumped on the market next week.
    Still cheap on a 1P and 2P reserve basis, but with the drop back in production while they filled their contract drilling orders whilst interpreting their recent seismics, they will have to lift production substantially to justify their market cap.
    With four drilling rigs now operating shouldnt be long to see the results, including some of their high impact targets.
     
  17. oldblue

    oldblue

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    Re: MAD - Maverick Drilling & Exploration

    Ah, hindsight is a wonderful investment tool!

    :rolleyes:

    But at the time of the placement, $1.02 was a nice discount to market price and a lot of shareholders would have liked the opportunity to participate. Or so I'm told!
     
  18. jancha

    jancha

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    Re: MAD - Maverick Drilling & Exploration

    Hmmm Yes Oldblue but how often is that the case when you can pick it up at a lower cost after?
     
  19. rcm617

    rcm617

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    Re: MAD - Maverick Drilling & Exploration

    Gulf South Holdings signed an MOU with MAD to buy into their shallow salt dome drilling. Effectively they are paying 5 times the value for 1P reserves that MAD is valued at.
    This should allow MAD to rapidly expand production without monetary constraints as GSH are paying the full cost of the wells for a 25% interest.
     
  20. jancha

    jancha

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    Re: MAD - Maverick Drilling & Exploration

    Rather large volume trading (17mil) Closed basically where it opened suggesting a few stops have been triggered? Or could be the current well being drilled.
    Whatever the reason those that didn't get on board with the last placement at $1.02 should rubbing their hands together or just thankful they didn't have that opportunity to buy in then.


     
    
    
    
     
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