VOG 2005 New Thread

Brm03,

Here's a ost I did a little while ago showing what the assets are and having a stab at whatthose assets might be worth in the future assuming the resources prove up into reserves. Tamdykol might be a bit overplyed in there given its prior history and the latest well being a duster. The condensate thought, if it proves up is very underplayed.

Make you own mind up and DYOR.

P.S. I was in around August and September in the mid-40's, so despite the movements right now, I'm actaully quite pleased with what I am sitting on. If I can free up cash from some of my other more shorter-term plays (e.g. EME, TMC), I would be looking to top up at these levels.

P.P.S. Beware the shorters trying to play mind games with you, they tend to be obvious when they appear, and are probably paid for their posts. Listen especially to Zengas, who is more experienced and probably better researched than I.

P.P.P.S. Don't believe everything you read in the Daily Mail


West Med Gas: 0.5-2.3 tcf roughly equals to 14-64bn cubic metres. If they get the same net back as Novatek at RUR660 per 1,000 cubic meters, that's about $22.9 per 1,000 cubic metres. Take off say $3 for production costs, and factor down to a 75% holding gives: $210-$960m of market cap. Equivalent to 147-672p per share (Assuming $1.7:£ and RUR28.8:$1 and 84m shares in issue). This valuation may increase if the Russian gas market liberalises.

West Med Condensate. From the RNS of 18th March, potential condensate is say 100-200m barrels. If we value that at a conservative $1 in the ground, gives say 53-105p per share. As these are proven up, and start producing the value per barrel is likely to increase.

Kemerkol. 60m boe potential recoverable. Again be conservative and value this at say $1.50 in the ground to $5 per bbl in production as it hasn't flowed for VOG yet. This gives say 63p-210p per share.

Tamdykol. Potential 34m barrels. 90% owned. Again say $1.50 in the ground to $5 in production gives 32-105p per share. Probably mark this down a bit now after the first well being a duster. But NEK asking to expand the programme to 10 wells (especially if that is at their cost like the previous 4-well contract) is a positive angle.

Note also that the original estimate for recoverable reserves in West Med was 4.8tcf. The deeper levels of the field have yet to be drilled so there is potentially another 2.5 tcf of gas at these deeper levels not included yet in the valuation.

I guess this gives low-high valuation estimates at: 295-1092p per share.



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