Tony Hayward, the chief executive of Genel Energy (LON:GENL), insists Kurdistan, where Genel operates, is a ‘secure and stable’ place to do business despite the threat of terrorism in the region. Ex-BP CEO Hayward explains how he ‘wouldn’t for a moment change 29 years’ at the oil giant, hints at possible acquisitions for Genel, and also talks about the differences of working for a smaller oil group.
I calculate the Miran gas field will pay them around $10 billion over its lifetime (fixed price of 78 c per thousand cf). 100% of oil from the field is used to pay Genel's development costs, thereafter 50%. Oil production from Tawke and Tak Tak up 50% over last year and projected to be up 50% next year. Extraction costs among the lowest anywhere. Pipeline capacity well in excess of production potential (no $25 per barrel trucking costs). The share price went down initially - of course. Stands to reason, doesn't it?
Although the KRG have said they will start to pay I don't think this will be realised until mid/late next year.
I hope the increased production will directly increase cash flow generation which will obviously negate the need for fund raising. Realising the invoices submitted to KRG in a timely manor is still a cause for concern IMO.
Nonetheless, I am invested and hope my reservations are proven incorrect!!
Morocco is not particularly good news, but outweighed to the commercialisation of its 11 TCF of gas contained within KRI. Genel confident enough to acquire OMV's 34% interest in Bina Bawi for $150mm and combining that with Miran, they'll have 100% interest and operation. Released guidance for next year (90-100k boepd) and Capex ($300mm-$350mm).
Can't see any need for a fund raising; oil exports, payment mechanism and this gas agreement nullify need IMHO.
Lots to take in from the numerous updates seen this morning.
Nothing really earth shattering key points I have taken out: - Production ramp up progessing well - Sidi Moussa obviously bad news. - Increased spending for 2015, fund raising a possibility depending on off-take agreements.
Overall nothing really to cause a sharp increase or decrease... but for me the trend is now up for the next 6 months...
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