When it comes to ‘investing’, I was taught to focus on the fundamentals. Once the analysis is done, and the investment decisions are made, monitoring these fundamentals gives one the opportunity and insight to recognize if the game has changed, and when it is time to change directions, or at least, change tactics.
At some point the fundamentals can change for any of us. Our tolerance and patience can collapse from any number of reasons. Such as frustration, new opportunities, market conditions, or just lack of interest. But I recognize and respect the limits we all face as investors/traders. This is part of it and can happen to any of us at any time.
So put me in the category of those that found the posts from MktMvn to be both interesting and informative. I too will miss his contributions and technical insights. I wish him only the best. Perhaps he will return once the conditions for drilling improve. I choose to believe he will.
Over the last ten years global O&G E&P has declined, but Delek has been aggressively moving into the E&P energy sector.
So going back to 2018, and reading from the Delek Group website, gives us insight as to the state of mind and management vision for the company at that time.
Quoting:
“FOCUS on E&P & DIVESTMENT of NON-CORE ASSETS
With a focus on transitioning from a diversified conglomerate to become an E&P pure play, since 2014 we have been divesting the company’s non-core assets. To date, we have redeployed the USD 1.3 billion generated from these sales to reduce our leverage and increase our capital reserves, and now we are focused on divesting our last non-energy assets: Phoenix Holdings Ltd., an insurance company, and IDE Technologies, a water desalination company.”
And they did follow through with that vision. So today Delek is a prospering oil and gas energy company seeking global E&P opportunities.
In the most current Delek financials, there are no references that make drilling in the GOM an imminent priority, but the ability to drill at some future point is maintained.
Quoting from Delek Group’s annual financials released in March 2022:
“In the US Gulf of Mexico region, where the Tau oil asset is located, there has been extensive experience in exploration, development and production of oil and gas assets, and as a result, oil treatment and pipeline infrastructures are highly prevalent…. extensive use of existing infrastructures…. result in shorter development time of oil assets and less capital expenditure needed than in many other places worldwide.”
Evidently Delek management does still recognize the potential for the Tau drill well and has determined to keep the partnership with Gulfslope Energy alive.
To me it appears that the situation has evolved to the point where it has forced the stock’s trading appeal to ‘cool off’ somewhat, and the shareholders being put in the position of being investors awaiting the awakening of Delek management’s desire to develop the Tau.
Checking the crystal ball reveals images that the global sentiment in support of the New Liberal World Order’s desire to end fossil fuels is beginning to crumble. The focus moving forward is a return to the pursuit of oil and gas exploration. As spec pointed out in an earlier post, as these conditions continue to develop, the timeline will accelerate and the outlook will become sooner rather than later.
It is still early in the ‘new O&G energy renaissance’ but the trend seems to be that the world is waking up to the fact that renewables are not yet ready for prime time, and there must be determined drilling campaigns to provide billions of people the energy and ability to not only prosper but to survive. That is the most unwavering fundamental.
Part of that strategy will involve Gulfslope Energy and Delek drilling the Tau. For this reason I will continue to support GSPE stock…. At least until Delek throws in the towel and pulls the plug.
Mrs. Smith
