Valuation, sentiment, and SP direction

In reply to loglorry, post #397

What price would you sell your non-core position Isaac and why if you don't mind me asking?

I don't have a price in mind to offload my trading position. I think around 300p is too cheap to offload it though,. I want a bigger win & that requires patience. My preference is to offload after a decent move up, 10% in two days is not bad...

But one has to bear in mind why it went to 266p in the first place and I believe it was because someone decided to hit stop losses causing a spike down in the price, one that lasted less then two hours which makes me think especially with management willing buyers of the stock up to 290p that to get the price below this level will probably be difficult and there will be few opportunities to pick up stock in the 260-290p range IMO.

With the stock only about 9p or so above what management are prepared to buy and provide good support I see low risk opportunity to make more money and as such it does'nt make sense to flip so quickly only to hope you will get your next decision right in your next stock.....

I say this despite having a very overweight position, but over the next 6+ months I see the fundamentals further improving with ramp up of  Phase 1+2 TGT which again makes the risk relatively low.....

And I suspect management are'nt buying shares at £2.90 so they can offload for a 10% gain, I think their end price is much higher, perhaps 100% so what may appear clever now by selling may look silly in 6 months.

In reply to emptyend, post #400

Not so much a trading position as a day-trading position.....

Surely there's no minimum time to hold a trading position?

In reply to redhill, post #403

Maybe not - but the shorter one comes, the closer to it being a blind gamble rather than a "trade".

I'm a great deal more impressed with Isaac's rationale for his trade than loglorry's.

yes maybe traded too soon, but with the markets as they are, I don't blame you for taking a profit. Who knows what the future will bring ? I'm not talking about SOCO specifically but the market. There are risks, the EZ issues are still there, who knows if they'll be an opportunity to buy back in at that price again ?

I have on several occasions bought and thought, I won't get a chance to buy at these levels again, most recently before the last results, then after the last results I thought the share price would gradually progress over the summer leading up to tgt phase 2, so there you go, don't take trading advice from me !. So in my view there's no harm trading a bit in and out, (do as I say, not as I do, I can assure you it's more profitable !)

K

I don't see any problem with trading out the next day for a 10% profit knowing you'd be happy to hold the shares for much longer if you needed. It's only gambling if one day is the maximum you would be willing to hold them IMO.

I'm keeping the ones I bought at 271p though.

I'm a great deal more impressed with Isaac's rationale for his trade than loglorry's.

A great investor once said "Play the ball not the man".

LOL!

In reply to loglorry, post #407

I'm a great deal more impressed with Isaac's rationale for his trade than loglorry's.

A great investor once said "Play the ball not the man".

I was commenting on the rationale. You should both be grateful that was all I was commenting on.....

have a rec as a sign of gratitude.

FWIW:
http://af.reuters.com/article/energyOilNews/idAFL3E8FN7UW20120423

* TENDERS
- Vietnam's PV Oil sold TGT crude for June loading at steady to higher premiums on robust demand for the distillate-rich, low sulphur grade, traders said. A recovery in gasoil margins could have lifted the value of the crude while buyers also preferred Vietnamese crude priced on dated Brent instead of the Minas formula, which has surged recently, one source said.
Three, 300,000-barrel cargoes were sold to SK Energy and Shell at premiums between $6.50 and $8.00 a barrel to dated Brent, the sources said.

Shame there isn't more being sold.

In reply to Spurticus, post #410

Three, 300,000-barrel cargoes were sold to SK Energy and Shell

Interesting. Buried in the Annual Report (p83) is a summary of sources of revenue.....based on the final destination of oil and gas sold.

South Korea (SK) in fact bought less crude in 2011 than in 2010 (so presumably are also a buyer of CNV crude). Vietnam continued to be the largest customer (as in 2010)....but with a smaller share of production (26% in 2011). The three largest non-Vietnam customers were all new in 2011 (and therefore one can infer they are buying TGT crude):

China - 23%

Malaysia - 19%

Japan -11%

S. Korea - 7%

Good premia continuing too.....$6.50-$8.00

I think I am reasonable person, it is difficult for me not to credit the management on their buy back programme. The level of patience they have in waiting for the price to dip below £2.90 and then buying back shares is pure genius IMO.

More shares bought back today, it is very pleasing how well IMO the buy back is executed. I'd rather they kept buying back shares and ramping up TGT then do anymore wild cat drilling tbh. It is probably the best way to increase NAV with hardly any risk.....

http://uk.advfn.com/news/UKREG/2012/article/52112568

 

Transaction in own shares

SOCO announces that on 23 April 2012 it purchased 80,926 of its ordinary shares at an average price of 289.1502 pence per ordinary share. The highest price and the lowest price paid for these shares were 290 pence and 288.3 pence respectively. All the purchased shares will be held as Treasury shares.

Following the above purchase, SOCO holds 2,999,013 ordinary shares as Treasury shares. The total number of ordinary shares in issue is 337,831,439 (excluding ordinary shares held as treasury shares).

What it does go to show though is that there MUST be a clear strategy for undertaking a programme of buybacks - and IMO this is the case regarding SOCO's plans. The fact that many of us (myself included) may wish the company to be more aggressive suggests that the company's approach is not merely opportunistic but is part of a careful plan. I'd be expecting to see the shape of that plan start to emerge in the coming weeks (starting with the TGD decision - which should be clear within the week).

ee from ADVFN

Interesting comments from ee, I don't disagree with this view that there is a plan behind the buy backs. It is part of the reason why I am reluctant offload shares for a quick profit and have been a keen buyer in the last month of Soco stock.

If one reads the takeover RNS published by VOD which is looking to buyout CWW it states :

Under the terms of the Offer, CWW Shareholders will be entitled to receive 38 pence in cash for each CWW Share held, representing a premium of approximately:

-         92 per cent. to the Closing Price of 19.8 pence per CWW Share on 10 February 2012 (being the last Business Day prior to the commencement of the Offer Period); and

-         107 per cent. to the average Closing Price of 18.4 pence per CWW Share for the three months ended 10 February 2012.

http://www.investegate.co.uk/Article.aspx?id=201204230700188298B

Which is why I think Soco will be reluctant to see the shares significantly below £2.90 & will buy back shares to support the price, a takeout price of £6/ share represents a 107% premium to what the company is currently trading at.

I don't think that would be difficult for an acquiror to convince their own stakeholders to back a takeout at such a premium IMO.

In reply to Isaac, post #413

Yes, once again I find myself in agreement with Isaac - though we don't need to look outside the sector for large premia, given that premiums of up to 140% have been paid in recent memory. Indeed there is another example this morning from Shell's bid for Cove:

The Offer values the entire issued and to be issued share capital of Cove at approximately £1,120 million and represents a premium of: * 134 per cent. to the Closing Price of 94 pence per Cove Share as of 12 December 2011, the last Business Day prior to the date of the announcement by Cove of its proposed sale of the Rovuma Area 1 Interest; * 95.6 per cent. to the Closing Price of 112.5 pence per Cove Share as of 4 January 2012, the last Business Day prior to start of the Offer Period

There is quite a good piece from Edmond Jackson here, which reaches a sensible conclusion despite wooly/misleading comments about Director buying and only an oblique reference to the underlying endgame.

It is merely a matter of twiddling one's thumbs for long enough and refusing to get bored.....even if that doesn't naturally suit the mentality of those who prefer to trade actively.

ee

I've been twiddling my thumbs so long now that I've got arthritis...

Will Ed and Roger pay me industrial compensation?

:-)

In reply to djpreston, post #415

:-)

Patience, LukeSkywalker - or you won't become Jedi.......

Interesting move just announced re TGT crude sales. Not sure what the implications are, other than confidence over maintaining production:

Vietnam's PV Oil has offered Te Giac Trang crude for loading from July to December in the first term tender for the grade, a trade source said.
Buyers will be required to place bids for a minimum 6,700 barrels per day of TGT in the tender that will close on May 10, the source said. Bids will remain valid until a day later.
The producer is offering the grade on a term basis as the production volume is high and has stabilised, the source said.

In reply to emptyend, post #417

"as the production volume is high and has stabilised"

Good news.

But I wonder if that's stable at PV's version of 'high', or mine.

In reply to Spurticus, post #418

But I wonder if that's stable at PV's version of 'high', or mine.

Well I suspect it may be both - in that phase 2 is/was scheduled to come onstream in August....but we know from jimbly on ADVFN today that:

H4 progresses:
http://www.baobariavungtau.com.vn/en/oilgas/97076/index.brvt

"On April 20, EPC contractor - Petroleum Equipment Assembly & Metal Structure Co.,Ltd (PVC-MS) - and Hoang Long Joint Operating Company (Hoang Long JOC) jointly celebrated one million man hours without LTI (lost time incidents) for the H4 topside project, the component of WHP - H4 - Te Giac Trang field.

The WHP- H4 topside consists of 4 main decks, weighing 2,100 tons. After nearly 10 months of fabrication, the Te Giac Trang – WHP - H4 has achieved the milestone of 1 million man-hours without LTI. Regarding workload, PVC-MS reached 99.77% of onshore fabrication, exceeding 1% of the schedule set out. As planned, at the end of May 2012, WHP-H4 topside will complete the onshore fabrication, loadout and continue to sail out for offshore installation. However, to meet the requirements of schedule for WHP-H4 production, PVC-MS has launched an emulation to shorten construction time for loadout WHP-H4 topside on 09-05-2012."

...FWIW

....which might imply that the capability for 55,000 bopd is being brought forward into July (whether or not they perf the Miocene in the phase 1 wells).

And in turn that might imply that the reservoir management discussions have been progressing in the right direction (and just possibly there may be some news in the offing on that front?)

Whatever the case, it seems to be that positive moves are in process.

Well it was a disappointment to hear that TGD had been dropped. I do wonder how much of it was down to what might be perceived as a worsened working relationship with PV, regarding production on TGT. And why would we punt 10's M of dollars for the 3rd (4th if you count the very first abandoned drill), on a new licence no longer recoverable against TGT production, when the upside might be reduced by what soco clearly think is over caution by PV.
Anyway, thats all in the past, but what it did make me think is that perhaps, part of the decision was to do with other options that they might have elsewhere. Perhaps, better terms or chances of success can be had elsewhere with the same amount of money (we have to accept TGD was hard and expensive to drill ).

So maybe there is other potential upside opportunities elsewhere that we are not aware of yet ?
or of course the other option that they think they are closer to a deal for SOCO vietnam than think.
It has been suggested that they cannot be in discussion with anyone for the sale of the company as they are buying back shares. BUT, if they are considering discussing the sale of Soco Vietnam, the sale of a non wholely owned subsidiary would that still apply ? I don't know.

I would have thought later in the year or 6 months after start up of tgt p2 would be the most likely timescale for sale, which I guess puts us at the start of 2013, but it's all a guess, and I won't pretend I have any particular insight.

My point in this post was really , lets not be downhearted about TGD, (better to have loved and lost ??!!??), there may be a lot of other fish in the sea !!

have a good week end every body,

K

Well I just bought a few Soco at 286p same reason as last time to add to my core holding. I'll probably get slated for making another quick 10% in a matter of days but again I think it is a decent short term strategy with the buy back in place and the very solid asset backing. We'll see how it works out but I expect them to be back around 305p quite shortly where i'll take a quick profit. I'll keep my core holding intact though and wait for a bid around the 400-450p mark.

Log