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Machin - fully concur with your descriptions of the various elements there. NMBS has had the misfortune of having to change sides at half time so it's become a bit more complex for them. The effective 'loss' from the initial 0.83p is caught up in the ISA tax wrapper and therefore not immediately apparent how to utilise that against the 'gains' on the subsequent payments they are receiving outside the ISA, other than to argue the case with HMRC if need be.
Hi nmbs, re f machins post where he mentions the 5.19p as a dividend which is correct , the 5.19p in my case was all paid into my Isa so that part for me will all be tax free breakdown of the 5.19p is
the Transaction Dividend of 3.32 pence per share in cash (£66.1 million); and
· the Cash Consideration of 0.83 pence per share in cash (£16.5 million); (together, the "Firm Proceeds").
In addition, each Hurricane Shareholder will be entitled to receive:
· the Supplementary Dividend of up to 1.87 pence per share in cash (£37.2 million) (the "Supplementary Dividend Amount"); and
Much obliged for the information Corryvreckan1. Very useful. I will wait and see what happens next week for people here. My provider paid the last DCU payment into my trading account. After reading the points made by yourself and dave999, I’m coming round to the view that the DCU payments themselves should be paid into my ISA irrespective of where the DCUs themselves are held. I might take this up with my provider next week. Thanks again
Hello NMBS,
Here is my personal position and the way I will submit it to HMRC.
The initial purchase settlement from PRAX of 0.83p will be treated as Capital Tax Gain/Loss, most certainly a Loss in this instance, to be offset by the Capital Gain from the DCUs payments in the same year; 0.309p in October 3023 and the next one to come next week, yet to be declared and if settled before April 6th next. In respect of HUR/PRAX the end result will certainly be in the negative, to be used towards other gains from elsewhere and/or carried forward towards future tax period(s).
Bear in mind that the other payments were made under the guise of dividends of 5.19p in total, which are treated as income for tax purpose, albeit at different rates; therefore cannot be used against the above losses, alas! (All amounts are per share)
This applies solely to my ex share dealing account holding.
In respect of my ISA’s I shall do nothing.
Best, 🐸
NMBS
Try this one to start, my post about halfway down, 29 Sep 2023 20:53. There are other threads around that time if you switch to thread view. There is a very similar view on the ADV-FN forum on 5 Jan this year from dave999 after discussing it with HL (who maybe read my post first ;o).
https://www.lse.co.uk/ShareChat.html?ShareTicker=HUR&share=HUR.L&thread=FA0EB710-6294-41E0-8B86-141C8F367278
https://uk.advfn.com/stock-market/london/hurricane-energy-HUR/share-chat?page=3835
As a follow on from that, how you account for CGT is a private matter between you and HMRC, regardless of which account your broker pays the money into. So just because they don't pay it into an ISA, doesn't mean that you can't argue the case that it should have been if that is what you believe (and some of us here do believe that and some brokers still believe that as they did pay it into an ISA in Sept - we will know better next week if that continues and I suspect it will). Whether or not HMRC then accept that view is a separate matter to how you first choose to prepare your tax return.
That point aside and returning to your question, how to do the CGT calculation when the sell value is spread over a number of years rather than in one go is a matter for you to decide based on the HMRC rules, or get professional tax advice. I'm not, and I doubt anyone else posting on here is, qualified to give tax advice, therefore regret that I can't answer your specific question about how to do the calculation.
https://www.gov.uk/tax-sell-shares
Thanks for the info Corryvreckan1. I know this has been discussed before about the tax treatment of DCUs, but I can’t find the original thread on this platform. As I understand it, the DCUs payment made outside of an ISA (as mine now are grrrrr) are liable for capital gains tax, yes? So how do I work out the capital gain for this financial year? Is it the whole DCU payments or do I deduct something from that?
Inevitably I spot the typo after posting and not before :( The upside of my range should be 0.65 and 0.95 rather than 0.62 and 0.92. Must get that wobbly key on my keyboard sorted...
But it will be whatever Prax notify it will be and my musings won't matter when you try to work out how many extra chocolate eggs you can afford ;o)
0.7p for 2 offloads
1p for 3 offloads
Request - please keep this thread on topic and add useful info only, to avoid folk having to repeat the same questions asked before. Thank you :)
Timing
Payment is due on Thursday 28th, under the terms of the DCU Deed Poll. Some brokers were a bit tardy crediting accounts last time, and as it’s a long Easter holiday weekend you can be sure that some will wait until the following week and enjoy the interest for longer. Of course, it’s up to Prax and the Registrar (Computershare) to get the money out on time first…
Accounts
Many folk who previously held their Hurricane shares in an ISA will possibly still get the DCU payment into the ISA, despite the DCUs themselves being moved out to a regular non-ISA/Trading account. Consensus here was that from a tax perspective that was probably correct – there are previous threads from last Sept/Oct covering it that you can refer to rather than going over it again on this one.
The DCU payment is not a dividend. It's a capital payment (Deferred Consideration) relating to Prax buying your old Hurricane shares, regardless of what your nonsense broker decides to call it.
Offloads
Consensus here is that it will likely be for two offloads, July and October, and the offload at end Dec > early Jan would be too late for inclusion in this period, but you never know. I have crunched some numbers from the information/estimates we have available and from last September - it’s all a bit mixed due to Brent fluctuations and some headwinds.
If the terms of the BP contract still remain the same (we have no way of knowing) then $Brent to be applied last July is potentially lower than last April but October is certainly higher. laserdisc’s offload volume estimates for July and Oct average less than 1% lower than last April, so hopefully the reported volumes are comparable.
The fees and costs for each offload could be higher due to inflation and increased shipping costs later last year. The £/$ FX conversion could also be c.2 - 2.5% higher than last September, depending on when Prax draw down the funds to be in time for the payment, so that’s a likely negative hit.
Payment
Putting my head on the block here (be nice!). Overall, my estimate is that the payment could total in the range 0.57 - 0.62 pence per DCU, for two offloads (Sept was 0.309p for one offload). If the third offload is somehow included then I estimate within a range 0.85 - 0.92 pence. Lot’s of variables and unknowns though so may still surprise to the upside and prove me wrong [and all of this is just my own interpretation of key points for general info, so please DYOR as always].
-------
Everything else you need to know may already be answered in the Documents and the FAQs on Prax website - https://www.prax.com/information-for-holders-of-dcus/
The payment statement should also be published on there end of next week; the previous one is still there for comparison.
TIA and best wishes :o)
©
Laserdisc – thank you, “profit sharing” is the key term there that relates to what I was trying to recollect. It also helps explain the reconciliation between Hurricane’s Ops update for the offload last April and what Prax then reported in September.
All good, cheers.
Yes netback does " equate to a premium
Hi
The price which BP pays Hurricane for the oil it buys under the BP Contract is dependant upon the
price at which BP sells such oil to third parties including a profit sharing factor for Hurricane,
based on such sale price. As such, BP’s payment to Hurricane is calculated by taking (i) the average
of all the high and low quotations on Platts Crude Oil Marketwire for Dated Brent during the first
five days of the Bill of Lading month (subject to BP’s election to adopt such average from a period
at the end of a month); plus (ii) the differential to Dated Brent in BP’s on-sale price to third party
offtakers FOB at the delivery point (or, if delivery terms are not FOB at the delivery point, then the
differential is netted back to BP at a level that reasonably reflects a FOB delivery point differential
to Dated Brent using the actual figures); less (iii) a marketing fee.
The marketing fee consists of a fixed fee element (US$0.30 per barrel up to 15 million barrels
marketed and US$0.15 per barrel where over 15 million barrels are marketed) and the above
mentioned profit share element (calculated as 25 percent of the difference between the on-sale
differential and an agreed benchmark value based on the oil’s expected market value).
Question for any of the long termers here - I have a vague recollection that Hurricane may have received a premium to Brent on their offloads in the past? The closest comment I can find relating to this is from the annual reports which includes (for 2022):
"The average netback to the contractual Brent price was $2.7/bbl (2021: $2.7/bbl), representing the discount or premium offered by the refinery purchasing the crude, BP’s marketing fee, and the freight and port costs incurred by the buyer in transporting Lancaster crude to its ultimate destination."
The words "discount or premium" maybe don't help there - it should perhaps be clearer that it's one or the other? But in that context does "netback" equate to a premium, or have I misunderstood? This is a separate point to how the average Brent price is determined for each offload which I do know about, so I don't need the discussion to go into that.
Anyone knowledgeable have a quick and simple answer please? Thank you.
Nice post Sense!!!
I am afraid my expectations about future dividends is low. The lack of transparency and absence of trust is defining.
fand - good to hear from you. nice overview as usual. forum working well - a few posters give specifics - a few provide overview - we all end up wiser with a rounded understanding of where we stand re dcus - teamwork.
re brent price -today 82-83 after opec+ extended cuts (saudis need 90 to balance national spending budget & russia ain't that keen to see price drop). so currently we are looking secure at 80 with 3 month upside to 90.
below copy and paste from advfn re one of our posters masquerading over there as 'bionictroller' (already called out by advfn posters). just so no-one falls for his current 'faux helpful friendly-cuckoo' act on her. he bought at 6-7p and threw weight behind hur sale to prax for pure dcu profit motive. i won't name poster as he will baby-cry to moderator to remove post. his advfn post sentiment says it all:
"29 feb '24 - 20:39 - 37937 of 37939 - bionictroller
senseman
you have been so wrong on many aspects when it comes to hur
you are correct i don't care jack **** about other investors
i only care about my finances
i have many friends in the "shares field" and i am not despised by everyone
stop lying
move on from your bull**** about hur over the years old boy!
"As Dive says seems likely a shutdown or deliberate lower flow rate. Anyone any other suggestions?"
Could be doing a bit of reservoir engineering, might have let the 'other' well flow (can't remember what we use to call it), to see where it's at, giving the production well area a break to replenish etc.
A reduced production due to an unplanned maintenance issue.
Equipment condition monitoring threw up a spanner than needed a part.
The list is pretty endless with no info other than production was down for a reason. I would'nt be too twitchy until we see the next months figures, most installations have blips in production that nobody gets to hear about.
Next payment by end of March. either 0.7p or 1p depending on whether 2 or 3 offloads included
You can trade DCU's here:
https://jpjenkins.com/our-companies-1/
Hi, can someone tell me when the next payment date is?
Also how do I sell these dcu's I looked into it but now more confused.
Thank you
Thanks Corryvreckan1
The reduction equates to about 5 days production from the Nov/Dec average.
Could the major storms in January (Isha and Joceyln, 21st-24th) have had an impact, or is the AM sufficiently robust and secure enough to continue normal operations through them? Just wondering if they might have locked down or detached in advance as a precaution and then took a couple more days to get back up to speed after? Or maybe affected supply vessels attending?
Am Hargreaves. They opened a standard share account for all clients, in which the DCUS sit ( think they did whilst they were clarifying with HMRC how DCUS should be treated). But after this, 1st DCU payment was paid into all clients' ISA . So interesting to see if the next payment is paid into ISA.
Nov oil + water total 15.82 bpd . Dec total 15.73 total. Jan total 13.38. As Dive says seems likely a shutdown or deliberate lower flow rate. Anyone any other suggestions? Either way, puts us all on edge. Their projections indicated a sudden fairly dramatic oil production fall ( I couldn't figure out why). I thought that if oil fell dramatically, water would increase dramatically but Jan figures don't say that.
Thanks laser, that does now seem to be in line with most other providers, and it does look right from a tax perspective as trading the DCUs themselves doesn't qualify for ISA tax exemption as not done freely on an exchange.
We discussed the different treatments last time and several posters said they still received the payment into their ISA regardless, and consensus was that was correct as well as it relates to payment for shares that used to be held there. Wait and see where your provider pays it into at end of month...
They moved my whole holding to trading. they left the last cash payment in the isa
January’s production figure are just out and there is a noticeable reduction.
I have shown the last three months for comparison; figures are mb/d
November oil 6.87 water 8.95
December oil 6.72 water 9.01
January oil 5.69 water 7.69
The reduction is significantly more than you would expect from the historic decline rate and suggests either a temporary shut down or a deliberate reduction in flowrate. It will be interesting to see February’s figures next month and the timing of the next offloads but I am concerned that the September DCU payment will be less than expected.