Xcite Energy Ltd (XEL)

uptomyeyeballs

In the summer when this share was around 60p, the chance of success were put at 70%. This was still a risky share at that time. A small(ish) company who had no profit, just a plan for extracting oil which had been known about since the mid-70's. The project moved on, with positives along the way, and the share price rose with the fall in the risk. It is estimated that the chance of success now is about 90% (nothing is certain).

The shareprice is based on the value of the company at any point in time. As we stand, that value is based on the fact that they already have a known wet reservoir (they don't need to 'discover' oil here like Rockhopper did in the Falklands), with an increased volume since the early estimates, and all that stands between them and converting it to a company asset is a flow/pump test. If the test is unsuccessful, they'll try again, with different pump configurations to get the oil out. If they fail altogether (10% risk), then the shareprice will suffer.

YOUR STATEMENT THAT THE EXCITE SHAREPRICE COULD COLLAPSE 90% IS EXACTLY WHY INSTITUTIONS WON'T RISK INVESTING IN THIS SHARE UNTIL ALL UNCERTAINTY HAS BEEN REMOVED. IF THE FLOW TEST IS SUCCESSFUL, YOU'LL SEE THE BIG BOYS PILING IN.

Shatners_Bassoon

Indeed, we know the North Sea is a proven oil province so the oil is there, this is heavy oil and is much hard to extract but with modern techniques it is far easier and now that oil prices have risen it's economically viable to get this out of the ground. XER believe that this will not need any special treatment and it was decided that a horizontal well test would give the best flow test results, if this hits 2500+ bopd then it wiull fly!

blinko

anyway 1st week fo december results due

Darkpool, i would strongly suggest you short XEL if you believe results will be poor,

darkpool

If this is such a good field why did conoco sell it?

don't get me wrong if you lot are just normal private investors good luck to you. but you write like you work in a boiler room.

chris_m

Ooh look, he's found another "technical term" to drop in - amazing what you can "learn" on this interweb thingie, eh ;-)

darkpool

Another technical term is "RAMPING"

uptomyeyeballs

darkpool wrote: »

If this is such a good field why did conoco sell it?

don't get me wrong if you lot are just normal private investors good luck to you. but you write like you work in a boiler room.

Well, i'm just a normal private investor. I have also worked for the last 30 years for a large Norwegian oil company, who merged with Statoil a few years ago, and who own the adjoining field to the Bentley that Xcite are drilling, and extract similar heavy oil from it. What do you do?

chris_m

darkpool wrote: »

Another technical term is "RAMPING"

Bzzzt - can't use that one, you've already used it

sabretoothtigger

Sounds like slang.

The point made of why would conoco sell is not a final end to an oil field prospects. BP is selling all sorts right now for obvious reasons.

I imagine oil companies sell for a variety of reasons even in normal times, almost every deal I read of includes some line of splitting ownership of a field for some reason they just do this very often, I think its because it can cost so much.
You should look up the history of Cairn energy, shell discarded their oilfield to cairn for about 100m I think it was, that company is now worth billions. Apparently it was due to good management of technology to extract the oil and also it required arrangements for transport of oil I think


Just came across another share tip presented quite well, seems a decent case laid out and very cheap. Its not oil http://sharecrazy.com/beta/Tips/4531/skywest-airlines-buy-with-a-target-price-of-35p


Here is a really old thread on XEL back to 2007. They are really pleased it goes to 124p then thread goes quiet as price falls to 5p except one guy buys in...
Nice to see the cycle of these things
http://boards.thisismoney.co.uk/tim/threadnonInd.jsp?forum=85&thread=81874&message=274695

Shatners_Bassoon

darkpool you know nothing and as uptomyeyes has said I think he has a little more experience to talk about the chances of success when he's had 30 years in the industry! Their is a rumour that Statoil may be interested in XEL, make of that what you want.

But back to your point about Conoco, well look at Shell in 1998, they drilled a well very close to where Rockhopper hit with Sealion and found oil shows, what did they do? Nothing, the price of oil was so low back then compared to todays prices that it was not economically viable to get it out of the ground so they left it! I bet they wished they hadn't now as it appears that FI is the next oil province in British territorial waters. Make of that what you want but it shows that just because it doesnt work for one oil co. doesn't mean that it won't for another! DYOR and please please open your eyes to the truth.