Invictus Energy (ASX:IVZ): Motherloade incoming?
Two very encouraging announcements from Invictus Energy in the past week but what does it all mean...
It’s been some time since I’ve made a post, I recently switched jobs and have been flat out with work so haven’t had the time to do any write ups, however I couldn’t not comment on the two huge announcements released by Invictus Energy over the last couple of days!
Invictus recap
Invictus Energy officially spudded on the 26th of September 2022 with a drilling timeline of 50-60 days to complete drilling and wire line logging (this is how they determine what is underground, see: Well Logging). Announcements have been few and far between which sent the market into a bit of a spiral. However after a very tumultuous month or so for Invictus Energy which saw the share price drop to the teens and even all the way down to 10c the company (finally) released an update on there Mukuyu-1 drilling campaign and boy was it a big one.
Elevated gas shows?!
On Thursday the 10th of November (the day before my birthday 🎉) Invictus released this announcement to the market which saw the share price jump 168% in a single day, not a bad early birthday present! let’s discuss.
Invictus Energy announced that they found the presence of elevated mud gas readings, fluorescence in the cuttings, elevated LWD resistivity and increasing background gas with depth is a positive sign as we progress through the Upper Angwa Alternations Member.
These are all tell tail signs of a working hydrocarbon system however first things first and this is quoted from the announcement:
Further exploration, appraisal and evaluation are required to determine the existence of a significant quantity of potentially movable hydrocarbons
These reading are very encouraging and in my eyes significantly de risk the upcoming wire line logging results to the point that IMO there is a 90% chance that Invictus Energy has discovered a working hydrocarbon deposit.
However there is still some way to go before declaring it an offical discovery and this is due to how the ASX defines a commercial oil/gas discovery see Reporting on oil and gas activities.
So after making that point even after this announcement obviously there is still some risk involved but then today on Monday 14th November Invictus released another statement.
Total depth reached and further encouraging signs
Today Invictus released another market update stating – Total Depth reached with additional zones of elevated gas and fluorescence. So like the announcement above they have stated further encouraging signs from the Mukuyu-1 well since drilling recommenced with multiple zones encountering elevated gas shows and fluorescence in our Upper Angwa primary target.
This is great news as the Upper Angwa was their primary target and had the largest estimated gas deposits.
The announcement also states they have reached there target depth and will now commence the wireline logging of all the well targets which should take between 3-6 days to complete. As of writing this announcement has sent the share price soaring another 50%! In my opinion this is just the beginning, lets get to some predictions.
Predictions
So I will embarrass my self and point out that my last prediction was the following:
Spud date: 26th August 2022
Share price: 36c 🤦
Looking back this didn’t really eventuate, the spud date was a month later and the share price nearly half of what I predicated (luckily we have hit that 36c mark as of today).
I’m going to make a few prediction one being where the share price will be once the wire logging is completed and then what I think the share price will be by Christmas
After wireline logging results are announced in roughly 3-6 days I’m predicting.
20th November @ 55c
Since posting this Invictus released an announcement stating that the tool used for collecting fluid samples and pressure testing was delayed in transit so the results essentially have been pushed back an extra 5-7 days. I still stand by that this will hit 55c day of or day after a discovery is declared (if there is in fact one).
and
Christmas @ $1.20
This is roughly a 300% increase from the share price today. This is of course assuming that the wireline results are positive. If they are negative I could see the share price drop back down to the 20c marks so there is still some risk involved.
Closing
This is such an exciting time for Invictus and have held the shares for nearly 12 months it great to see it finally paying off. The last month or so has been really tough for share holders especially those who have average above the 20c mark but kudos to all holder who have toughed it out. I haven’t sold a single share of Invictus and don’t plan to until either we get taken over by a big player like Mobil or the share price hit $5.. yes this is where I think this is heading.