UK 06:53 Saturday, 7 November 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
I note the comments made today by my colleague Tom Winnifrith on Greka Drilling (GDL). They certainly give one pause for thought but I am still a bull.
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Comments
scrutable
The company puts out factual information without arranging it in the easiest form for PI’s to get to a proper understanding.
Having split off its drilling limb, and listed it as a separate company, the parent GDG decided a year ago to win the confidence and additional drilling business for coal bed methane gas currently in the gift of four Chinese Oil & Gas supermajors. After a year of exhaustive tests to demonstrate a step jump in drilling in all its variants the strategy is succeeding in marketing terms. Yet it shows on the bottom line as a set back, but next year the build up will easily surpass the business level enjoyed till now as a 1:1 sole subsidiary of Green Dragon Gas.
The company RNS has failed to spell out that although the probable 52 wells already completed and still to drill this year for GDG fall well below the 90 completed in 2012, this is more than made up for by the 14 varied test wells for the new Chinese supermajor clients plus 65 on firm order still to spud and a further 150 on conditional order subject to conclusion of the still satisfactory test program
Pis have been allowed to think that production capability and orders were falling when exactly the opposite pertains. The misunderstanding stems from the very necessary and unavoidable short term gap and change in gear from dependency on the parent to global exploitation for its proven,
and leading technology
Tom Winnifrith
But Q3 metres drilled was down – how is that “more than made up?”
Tom
scrutable
True that the number of wells and length drilled is down but you are concentrating on the rear mirror and measuring ‘speed’ ie rate of change of distance traveled. What you are missing is a measure of the ‘ acceleration’. An engineer or mathematician would see that quickly.
The number of wells under contract – and therefore the length of drilling under contract is very much higher than six months ago when the whole vehicle slowed down to change gear.
The next two reports on progress will make that clearer.
The underlying figures actually reveal a company in rapid development