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AbrahamS

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May 2, 2019
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Managed to be on board for yesterday's 24% surge on the positive announcement. Had previously got in and out for a small win. If it sounds like bragging, I apologise as I've held others that smashed me hard (SDL & RES to name a couple).

With wire log results due next week and two more wells to drill straight after Dorado2 how far do people think this will go? I realise I'm assuming positive results.
 
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Been in and out a couple of times. Thoughts this time (I beat the recent spike to get in, yay!) is to ride them through the drilling program this year and look at offloading Q4 '19 - Q1 '20.
 

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I haven't been watching many at all. Even this one I'm not in for much (<$10k). Really just hoping to pick up enough to cover a large portion of spending money for a holiday at the end of this year.
 
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Super announcement today. Surprised it didn't hold above 60c TBH. Oh well, waiting until Oct!
 
US shale oil on the TMS. Explorers with a small amount of production now iirc. Bought assets on the down part of the cycle and a management team that have prior experience and success in building a company called Aurora oil and gas up from ground up to a takeover. They did have a few problems with the drill head assembly getting stuck a few months back in one of their wells.

I think that's right have to re-read it all haven't looked at them for ages, someone on the weekend just reminded me they had drifted back in SP.
 
Part of a recent RBC report.
July 24, 2019
Carnarvon Petroleum Limited

Share placement ahead of Dorado FEED

Our view: Carnarvon is seeking to raise up to A$84m primarily to
fund remaining Dorado appraisal, FEED costs and pre-development
expenditure. While we are not surprised at the placement we had
anticipated Carnarvon would wait for the completion of Dorado appraisal
drilling with its share price weakened following the recent Roc South-1
exploration well. We are retaining our Outperform recommendation.
Key points:

Share placement to help fund Dorado project development. Carnarvon
is seeking to raise A$84m (pre costs) of new equity via an underwritten
$79m placement to institutions at A$0.39/shr (9% discount to 5-day
VWAP) and a $5m non-underwritten share purchase plan for eligible
investors on equal pricing terms. We are a bit surprised by the timing of
the raise with CVN shares trading weaker post the Roc South-1 exploration
well and still A$74m cash at hand. We had anticipated timing for the
next raise would be after the forthcoming Dorado-3 appraisal well. Having
said this with an uncertain and volatile oil outlook the adage of raise
when you can, not when you have to comes to mind. Specifically, this
placement seeks to lock in funds ahead of a Dorado development, while
also contributing towards ongoing appraisal and FEED costs. We estimate
the company needs a further A$150m of equity (prior to this raise) to
fund a Dorado phase 1 oil development, premised on a net post-FID capex
burden of ~A$250m. We think some debt funding is likely for Dorado with
the balance of post-FID capex and appraisal/FEED to be met by equity
hence our ~A$150m potential equity requirement estimate. Carnarvon is
also seeking to drill an appraisal well at its Buffalo oil redevelopment field
in mid CY20 which is not factored into our funding estimates as we assume
a degree of carry upon sell down from current 100% equity level.

Dorado-3 drilling underway this week. Carnarvon recently had Dorado
resource volumes assessed by independent ERC Equipose (CVN/STO:
Updated Dorado resource estimate from Carnarvon; oil down a bit and
gas up larger as anticipated). This saw gross 2C liquids volumes reduced
from prior estimates of 186mmboe to 162mmboe (-12% revision) and a
material gas uplift from 552bcf to 748bcf (+35% revision). We anticipate
further refinement of the oil and gas volumes range after the Dorado-3
appraisal well.

Estimates changes. We have updated our estimates to account for the
dilution associated with the capital raise relative to our prior NAV and
have factored in a slightly lower oil resource base consistent with the
recent resource update. Our NAV/shr decreases to A$0.70/shr and our
price target likewise decreases to A$0.70/shr.

Investment summary
Carnarvon represents a rare investment opportunity in an
ASX context, being a pure-play conventional oil explorer
with two high-quality development opportunities and a
strong inventory of exploration prospects. With its significant
resources across both Buffalo and the Phoenix project
areas, Carnarvon presents a unique opportunity to invest in
development assets at a discount while considering a strong
exploration outlook as a free option.

Potential catalysts
• Dorado appraisal drilling and well testing. Further insights
from appraisal drilling and well testing over CY19 will
provide a greater level of certainty over the value of the
promising Dorado asset.
• Buffalo farm-down deal. We expect Carnarvon to farm
down 30–40% of its current 100% equity interest in Buffalo
over the next six months to provide carry for a 2HCY19
appraisal/development well.
Risks
• Commodity and currency price risk. Carnarvon is looking
to explore for and develop oil in Western Australia and is
therefore exposed to fluctuations in international oil prices.
• Exploration and appraisal risk. Carnarvon Petroleum is
looking to explore for oil assets. There is a risk that in some
areas oil will not flow at sufficient rates or that the company
will not be able to book sufficient reserves to underpin
a development. The cost of development could also turn
out to be higher than expected, which would reduce the
expected return to the company.
• Funding risk. Carnarvon does not currently have sufficient
resources or cash flow from which to fund a full
development program for the various exploration assets in
which it holds interests, and it will need to farm down and
raise debt and/or equity to fund its share of future appraisal/
development capex.
Click to expand...
 
Kram said:
Part of a recent RBC report.
Click to expand...
Just letting you know this one seems to be going again now. Worth having a read of what is going on, potentially a lot of short covering approaching. For disclosure I just bought this stock.
 

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