These comments are obviously pre-yesterday's bad announcement (potentially very bad, not yet clear) re Italian drilling bad see http://www.stockopedia.co.uk/content/italy-restricts-offshore-drilling-44035/. In view of this, I won't go into loads of details but will cut to the chase...
AGM Presentation here: http://www.medoilgas.com/resources/MOG%20Investor%20Presentation%20June%202010%20%20FINAL.pdf
Slide 5 summarises their assets. Very nice too:
Guandalina will triple current production by end next year
Ombrina Mare planning well under way . Capex large, but they have 100%, so should be able to manage by farming out a large slug and debt financing for the rest - will have a bankable project by mid 2011. Curretly assesing whether to buy or lease a FPSO - big impact on upfront costs. I asked at what oil price the project was profitable - answer $35-40 is FPSO bought, clightly higher if leased
Monte Grosso is potentially huge, expected to spud mid 2011 but residual local permitting issues and query re rig availabilitybut the well is deep and will take 15 months to drill. est cost 55m euros plus for testing.
Tarxian will also need farm-outs.
Financing obviously extremely tight, but they had managed to extend the BoS facilty and were talking cheerfully about the options for OM and MG.
Special Offer: Invest like Buffett, Slater and Greenblatt. Click here for details »
At this point everyone else had stopped asking questions, so I decided to ask my remaining question after the meeting ended.
The BoS debt facility is for 18m euros. They had 5.9 in the bank at the start of the year. I asked if this was going to be enough to get them through the Guendalina development which needs 15m plus VAT. Answer NO. There is a restriction on the BoS facility that only 10m can be used for Guendalina.
eek. They only have 20%. And if they farm down any of it, the amount of the BoS facility they can use decreases. Basicall they need 5m NOW. Which means a placing is imminent.
Darron's comment last - why don't ENI put them out of their misery? - spring to mind. I sold my small position that afternoon.
With the new uncertainty about drilling, I can't see a placing being feasible at anything but a dreadful price.
db
PS sorry for later report - writing up Serica took priority
Disclaimer:
As per our Terms of Use, Stockopedia is a financial news & data site, discussion forum and content aggregator. Our site should be used for educational & informational purposes only. We do not provide investment advice, recommendations or views as to whether an investment or strategy is suited to the investment needs of a specific individual. You should make your own decisions and seek independent professional advice before doing so. The author may own shares in any companies discussed, all opinions are his/her own & are general/impersonal. Remember: Shares can go down as well as up. Past performance is not a guide to future performance & investors may not get back the amount invested.
Mediterranean Oil & Gas Plc (MOG) is engaged in oil and gas exploration, development and production. The Group has its head office in London and has oil and gas interests in Italy, Malta and France. The Company’s projects include Guendalina gas field and of the Ombrina Mare oil and gas field. The Guendalina gas field is located approximately 47 kilometers from the Italian coast. MOG has a 20% interest in the Guendalina gas field. The Guendalina gas field has 2P gas reserves. In the Southern Apennines, the Company operates the Monte Grosso project, holding a 22.89% interest. The Company’s subsidiaries include Malta Oil Pty Limited, Medoilgas Italia S.p.A, Medoilgas Civita Ltd and Phoenicia Energy Company Limited. In March 2013, it completed the sale of 75% interest in Phoenicia Energy Company Ltd to Genel Energy plc (Genel). more »
1 Post on this Thread show/hide all
Thanks for the comments db. The ENI question comes more to the fore now as, following the plunge last couple of days, its pennies for eni and yet there's very valuable assets to be stolen away. Agree that mog will need a funding issue now even fior guendalina. I've no position but it might be one for me to buy now, if I weren't committed to the m&a arb at dnx.