Any views on Gulf Keystone Petroleum

ejlmcdonald

Snap! That's timing for you

sabretoothtigger

GKP has about doubled in a month now. With this much risk I dont think they can be derisked or they'd double again surely


Tony speaks http://www.youtube.com/watch?v=ysZPi4Gs5-c&feature=player_embedded

BLB53

Robbie Burns is keen on this one - have a read of his thoughts on the nakedtrader website

ejlmcdonald

Sabretooth, not sure what you mean.

The anomaly is not that they've doubled in price in the last month but that they had halved in price in the preceding 8 months. That in a period when reserves have approx. doubled, political risk has reduced, oil and gas law has moved closer, Kurdistan is exporting again and companies have begun to be paid by central govt. They're sitting on 20 Billion barrels of oil, and Tony Haywood and his city chums think the risk worth taking. If Tony is talking down the value, it may be because he has hopes of taking over GKP as well.

blinko

ejlmcdonald wrote: »

Sabretooth, not sure what you mean.

The anomaly is not that they've doubled in price in the last month but that they had halved in price in the preceding 8 months. That in a period when reserves have approx. doubled, political risk has reduced, oil and gas law has moved closer, Kurdistan is exporting again and companies have begun to be paid by central govt. They're sitting on 20 Billion barrels of oil, and Tony Haywood and his city chums think the risk worth taking. If Tony is talking down the value, it may be because he has hopes of taking over GKP as well.

welcome to the stockmarket

amictus

I'm really regretting not buying in before all the hype. I'm just not sure if it's worth the risk at current prices. Any thoughts?

sabretoothtigger

If Tony is talking down the value, it may be because he has hopes of taking over GKP as well.

He should be so lucky, cant believe he bounced back so quick and publicly even. Not that Im sure he was the man at fault exactly. But GKP is too big for his venture, if not in price then potential often a proper takeover requires a way higher bid then market, who are the biggest owners?

I think world wide revolutions explains the price drop just fine, GKP overall has boomed and even at 80 it was still positive over the years

Best comparisons are in contrast to alternative ventures. Listed in order of todays negative gains: (only GKP has a clear record over time)




I took some profits but wondering where I might rebuy if it did fall much

amictus

sabretoothtigger wrote: »

I took some profits but wondering where I might rebuy if it did fall much

Might this coming week be a good time?

The share price seems to be hovering stuck at the 170 seen as price for the $200m new shares issue rumoured to take place this week...

http://ftalphaville.ft.com/blog/2011/09/16/679171/gulf-keystone-plots-200m-fund-raising/

Any thoughts on what will happen to the price following this placing (assuming it happens)? Will the rise continue?!

ejlmcdonald

Surely it takes more than looking at a comparison of past performance to assess future potential?

Each of the shares you mention has it's own story; Cadogan had a corrupt management and law suits all over the place. It's now sorted out, has a new management team and a farm in contract with the Italian giant ENI, positioning them for a possible takeover. It had fallen from about £1.75 5 years ago too. Very good potential.

Xcite has found oil in the North Sea and has 100% of the licence but will need funding to get it into production, costly offshore production. Again there has been a massive fall in the last 6 months from £3.50 in April to £1.44 yesterday, on nothing more than a badly worded statement and worries over funding. Again good potential.

GKP, however, started as a tiny company, one of the minnows prepared to take the risk of going into Kurdistan under uncertain terms (still uncertain) have found BILLIONS of barrels of oil, and so the value is going up accordingly.

This explains the positive growth and says nothing about future potential, in my mind.

The GKP placing is needed to continue that growth and I think the price will continue to rise. Like Tullow, this is a share to research and invest in, if you want to get the best out of it, rather than to trade.

But the rollercoaster comment still stands, this share is played with by traders and hedge funds and the volatility is high. If you buy in, I would put it in a bottom drawer for a while or be prepared to enjoy the ride.

All my own opinion, DYOR, of course.

ses6jwg

I have owned GKP since they were 34p in June 2009 and it has been interesting watching "the ducks line up" so to speak, and see every criticism that has been fire at them eventually proven wrong. I tried to trade them and got caught out so rebought at £1.01 in December 09 and have held the same shares ever since.

People said that the political situation in Iraq was too high risk. That is slowing being resolved and I have all confidence that it will be resolved within the next 18 months or sooner.

People said that the company was not transparent enough about its ETAMIC partners. ETAMIC went bust so this question was resolved.

People said the company did not have enough funds for their drilling campaign. They raised money via a placing and the share price was not damaged.

People said the oil was "heavy" and of a poor quality, and that the company was overstating their reserves. They got an indepedent report which showed these rumours to be de-ramping nonsense.

People criticised the company for choosing to list on AIM. Now they openly say they want to move to the main market.

People said the area they were drilling in lacked infrastructure. So GKP tenured for storage and transport, and now has plans in place to hook up to the pipeline.

The only real issues outstanding now, in my view, are:

1) The political situation is still not quite resolved, but will be.
2) They pay their executives far too much whilst still making a loss
3) They need to give themselves some credibility and move from the joke-market that is AIM to the main market.


Once all the ducks have lined up, a big boy like SINOPEC or the like WILL come in and swallow them whole. At many multiples of the current share price. Whether that takes 6 months or 6 years is anybodys guess. But my shares will not be sold until that day comes.

They have BILLIONS of oil in the ground. Nothing can change that.