Post by
ShatnersRug on Mar 27, 2014 5:48am
Warp speed!
At the top of my agenda for today, I want to offer congratulations to those that have held this stock through the soap opera that has been the last 2 years. I'm only now realizing, through some missives sent to my inbox, how invested many have been in STP. I'm not talking solely shares here, but really INVESTED. Yesterday's news provided a bona fide reason to really feel good about STP moving forward. It looks as though I've become the de facto lightning rod for this message board. I'm ok with that. I know now how much of a lift my rants and raves gave to those that are long on this stock. I wasn't always this optimistic though. At December's end, I thought that this company was toast. I had even given it a "He's dead, Jim" on the board. I'm glad I saw the light. Really glad.
Dissecting the news
All of us were speculating which option management would select in order to address the money crunch due in May and June. The selling of assets(Senlac or Red Earth), selling a working interest at McKay, and capital raise(dilution) were discussed here. I do not think anyone could have guessed that the current deal could have been finagled. No loss of assets! No giving up any working interests! No dilution! What does Shatner think? Awesome. ---@Eye: Just the underwear is left!--- The ONE thing that has kept the share price down was the looming credit crunch. Now, this has been addressed, and with gusto! Best of all? We keep Senlac, my baby. We were speculating on getting between $100 and $150mil for Senlac. Well, we got $150m and KEPT Senlac. Score!
STP is going to start drawing some MAJOR interest starting today. Major. Unfortunately, this means that games will be played with the SP and we'll have to endure some ignorance and bashing. Comes with the territory I suppose.
Anyway, this deal would not have been possible if 2P1 and 1P5 were busts. In fact, the deal is so favourable, it's my feeling that 2P1 has stabilized closer to 900 bbl/d and 1P5 is conforming at rates much higher and faster than anticipated. Much. I cannot wait to hear how these two wells are performing. My feeling is that we will have to wait for the May operational and quarterly update for this information. It's not like it's going to be a painful wait as we'll see some upward strides in the SP.
Moving forward, it would serve message board participants best if we provided production projections based on the following scenarios:
A) Phase L spudded - when? ramp up time? production increase?
B) ICDs installed on Pad 102?
C) ICDs installed on Pad 101?
ICD installation will commence in mid-April. By end of May, STP-McKay will have 5 installed in total. Let the speculation begin as to which Pad these ICDs will be installed on and their effects on overall production. I feel that this should be the focus leading up to the May NR. It looks at though my prediction for breakeven by June will come to fruition. I welcome arguments for and against this outlook.
It's going to be refreshing to engage in production banter as opposed to company survival banter. STP will become the company that many of us had envisioned some years back. Took them a while to get over the McKay difficulties, but it looks as though the only long-term scar will be the loss of Leismer. The extended credit will be overcome in time. Things will start to get very interesting after breakeven is achieved. Can't wait.
Shat-