20 July 2011admin correction● Neutral
Corrects typos in the entitlement offer document: issue price is $0.15, not $0.12 in one section, and options on issue are 13,435,000, not 14,835,000. A corrected document is attached.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
13 July 2011capital raising announcement● NeutralMajor
Strike is raising $16.8m: a $7.39m placement (about half taken by M H Carnegie) plus a fully underwritten entitlement offer, for US Eagle Ford and Wilcox Slope work and working capital. MD Simon Ashton intends to step down; director David Wrench is in talks to become CEO.
11 July 2011admin correction● Neutral
Clarifying statement on the Kingston lignite resource in the 4 July presentation: 578.3 Mt under JORC 2004 (523.5 Mt measured, 54.8 Mt indicated), reported as of June 2007. No change to the estimate; open-cut potential is undetermined.
4 July 2011asset acquisition disposition▲ GoodMajor
Strike paid US$2.3m for 10% of the 37,000-acre St Landry Canyon project in Louisiana. First well, targeting 360-680 Bcfe (dry hole cost about US$14m gross), spuds in August. Eagle Ford leasing expanded to 18,000 acres; Sadie 1 pipeline now delayed to late July/August.
4 July 2011investor presentation● Neutral
Company presentation promoting new US initiatives in the Eagle Ford and Louisiana Wilcox Slope, alongside Louise, Sadie 1, Cooper and Kingston. It mostly repeats the 4 July announcement, adding a claim of potential 're-rating'. No new results.
16 June 2011farm in farm out agreement▲ GoodMajor
Strike signed the Eagle Landing JV agreement, confirming its 27.5% Eagle Ford interest. JV leases total 12,400 acres (3,410 net), mostly in Fayette County. Net target potential is 10-21 million barrels of oil equivalent; leasing continues. Finalises the position announced 28 April.
15 June 2011director officer appointment● Neutral
Company Secretary Tony Brazier resigned effective 15 June 2011, and Andrew Dimsey has been appointed in his place. Administrative change.
31 May 2011regulatory community update● Neutral
Strike says its Southern Cooper permits PEL 94 (35%), 95 (50%) and 96 (66.67%), covering 8,400 sq km, have unconventional gas and liquids potential. Drilling is planned later in 2011 or early 2012, after Senex spudded a nearby well. No new results.
24 May 2011joint venture update● Neutral
Eagle Ford acreage has grown to 10,000 gross (2,750 net). Sadie 1 pipeline tie-in needs 6-8 more weeks before testing, and Louise output rose 15% to 5.2 MMcfe/day. The 2011 drilling program is being restructured to 3-5 wells, with Wilcox drilling slipping to Q4.
28 Apr 2011farm in farm out agreement▲ GoodMajor
Strike is taking a 27.5% interest in an Eagle Ford shale joint venture in Texas, with about 8,500 gross acres (2,300 net) in the oil window. Target potential is 7-14 million barrels net. New oil-focused strategy; documentation still being finalised and no price stated.
31 Mar 2011drilling progress report● Neutral
Production casing is set at Sadie 1, with plan to test direct to sales via a nearby pipeline. Pipeline and fraccing scheduling mean testing is expected in two to three months, later than earlier drilling timing implied. No flow results yet.
24 Mar 2011drilling result▲ GoodMajor
Sadie 1 reached total depth of 12,400 feet. Gas shows and logs indicate potential gas pay in the main Wilcox target; the well is being prepared for completion and testing. Prospective resource 15-20 Bcf (40% Strike). Commerciality is not yet shown.
23 Mar 2011director officer appointment● NeutralMajor
Executive Director and COO Derrick O'Keeffe resigned from the board, effective immediately, after an internal reorganisation to cut operating management and focus on high-impact exploration. This follows the January sale of two producing fields.
18 Mar 2011asset acquisition disposition▲ GoodMajor
Strike bought a further 10% of the Louise gas-condensate field and Eaglewood JV for US$3.75m, lifting its stake from 30% to 40%. Louise has produced a steady 5 MMcfe/day since May 2010 with no decline; Strike's share rises to about 2 MMcfe/day.
17 Mar 2011drilling progress report● Neutral
Sadie 1 has set a 7 5/8-inch liner at 10,992 feet and is being prepared to drill ahead. The 12,500-foot target is expected within 1-2 weeks. Strike holds 40%. No new result.
14 Mar 2011half year report▲ Good
Half year to 31 Dec 2010: net profit A$2.64m on revenue A$6m, EBITDAX A$2.78m, cash A$5m. January's US$21.7m Rayburn/Mesquite sale left A$20.4m cash and no debt. Steindorf 1 flows remain below commercial, with plug-and-abandon decision still pending.
10 Mar 2011drilling progress report● Neutral
Sadie 1 is drilling ahead at 10,341 feet, with the 12,500-foot target expected in 2-3 weeks. On schedule. No new result.
3 Mar 2011drilling progress report● Neutral
Sadie 1 is setting a 9 5/8-inch liner at 7,690 feet, with the 12,500-foot target expected in 3-4 weeks. No new result.
2 Mar 2011investor presentation● Neutral
Conference presentation repeating known facts: 2011 exploration push, US$21.7m sale, Louise, Cooper CSG and Kingston. Shows 328.6m shares at 20.5c, market cap A$67.4m, nil debt as of 23 February. No new results.
1 Mar 2011investor presentation● Neutral
Conference presentation on Kingston lignite (578 Mt resource): University of Adelaide tests confirmed it can be combusted and gasified into syngas. Strike is now seeking a partner to advance the project. No new resource figure or funding.
24 Feb 2011well test result▼ BadMajor
Steindorf 1 flowed gas from four zones, but on current indications below commercial rates, which the company calls disappointing. One horizon is still being evaluated before a decision to extend testing or abandon. Sadie 1 is drilling ahead at 2,370 feet.
21 Feb 2011drilling spud● Neutral
Sadie 1 spudded over the weekend at Homeplace, Texas, and is at 2,285 feet. Target is 15-20 Bcf at 12,000 feet, about 40 days to drill. Strike holds 40% and will give weekly updates. Opens the six-well 2011 program.
15 Feb 2011drilling scheduled▲ Good
Strike expects to spud Sadie 1 within a fortnight, the first of six 2011 US wells, targeting 15-20 Bcf at Homeplace to 12,000 feet. Strike's interest rose from 30% to 40%.
10 Feb 2011flow test result● Neutral
Four zones of Steindorf 1 were fracced and the well is cleaning up, flaring gas as planned. No flow rates are given yet; measurements will follow once the well stabilises. Commerciality remains unproven.
28 Jan 2011drilling progress report● Neutral
Steindorf 1 was perforated and fraccing could start as soon as 1 February, with production testing to follow over several weeks across multiple zones. This put testing slightly behind the late January start earlier flagged, and commerciality remained to be shown.
17 Jan 2011asset acquisition disposition▲ GoodMajor
Strike sold its Rayburn and Mesquite US gas fields for US$21.7m net cash (US$2.63/Mcfe of 1P reserves). Debt of US$5.8m is repaid and hedges closed, leaving A$20.4m cash. Louise (30%) and Eaglewood remain, with a six-well US program proposed.
22 Dec 2010other● Neutral
Administrative notice: Strike lodged its updated Share Trading Policy, approved 20 December 2010 and effective 1 January 2011. No operational or financial substance.
7 Dec 2010drilling scheduled● Neutral
Steindorf 1 has production casing set. Testing is planned for late January, when fraccing equipment becomes available. The Deerslayer prospect is 200 Bcf prospective, Strike 30%. Follows November's encouraging logs; commerciality still unproven.
3 Dec 2010investor presentation● Neutral
Conference presentation on Strike's Southern Cooper Basin coal seam gas position (over 17,000 km2). Repeats known facts: Forge 1 suspended at 1,351m, new program planned first half 2011, potential for 5 deep wells and 20 shallow holes. No new result.
22 Nov 2010well test result▲ GoodMajor
Steindorf 1 logs and samples suggest commercial gas intervals may exist in the Wilcox target. The joint venture approved casing so the zones can be tested. Management says commercial viability is unproven. Testing timing awaits equipment.