Orcadian CEO, Steve Brown put a few ‘myths to bed’ in my first Twitter Spaces call where we discussed Orcadian’s flag-ship Pilot Project, recent deals and Oracdian’s participation in the 33rd licensing round
What is Investor Meets Director ?
It’s basically what it says, Me as an investor chatting to Directors of companies I am invested in. The aim is to get ‘airtime’ with the people who run the company and probe them on the investment case with a balanced view, i.e. not just all the glossy bits but also getting a view on funding and risks, and lets face it most companies listed on AIM present both as real consideration for investors.
That said, I like to think that companies I have researched and have selected for investment are going to give me higher returns than say other lower risk investments. That’s why we all dabble in the junior markets, for those blue-sky returns!
I’m also planning on hosting ‘Investor meets Director’ with a number of companies I am not invested in with two aims, one, for my own benefit and to help with my own research and two, for the benefit of others who can then make up their own minds.
If you have contact with a company and would like me to run a Twitter Spaces session with them then let me know.
As previously mentioned, my first session was with Steve Brown, Orcadian Energy (I am invested) and it was great to hear more detail from the ‘horses mouth’ given I’d fielded some negative comments when blogging on the company from other fellow investors. Steve put those to bed on the call!
The link to the call is below (click on the graphic)
Some brief highlights are as follows, but it is well worth listening to the full interview if a) you are into Oil & Gas, b) are looking for an interesting investment that does offer blue-sky potential if the cogs fall into place, especially when you compare Orcadian to market peers trading 5-10x their valuation!
- Steve gave a good account of how he considers the Pilot project one of the best projects currently in the N Sea with its 79MMbbl 2P reserves and explained that Ithaca are already producing from the Captain field using Polymer flooding, an approach Orcadian would use.
- Steve mentioned that the primary focus for the company is on developing Pilot and that the data room is ‘open’ and ‘active’ and that he is working towards closing a deal whether that be a farm-in partner or some other structure. He said at some point, larger companies paying EPL and Corporation tax will realise that investment in projects like Pilot will be beneficial.
- Steve addressed funding concerns (having just raised) and said that any form of deal could likely come with an up-front form of payment or that in any case a deal would re-rate the share and of course it would. Alongside, cash could come near-term from the Crinan and Dandy disposal agreement with follow on royalties.
- Steve also mentioned three interesting project applied for in the 33rd licensing round, two of a gas nature one being a a particularly interesting gas to wire project, and would be a scoop.
- Steve also mentioned some seismic acquisition that sounded like it could have some material value but could not elaborate and are hoping to announce something on this soon.
- Finally Steve presented the investment case.
It’s well worth a listen, I certainly learnt a lot more about the company and came away scratching my head at a sub £10M cap valuation when this company has fully appraised 2P reserves that are commercial and comparable in scale to market peers trading many multiples of Orcadian.
You can read more in my research note here
As always, I welcome feedback and you can follow me and message on twitter. https://twitter.com/TheMoneySponge
Research materials prepared based upon my own analysis and research. Accuracy cannot be guaranteed and research notes should not be taken as investment advice. Please always do your own research.