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According to Malky (oil analyst Malcom Graham-Wood) on today's RNS from Genel;
“Genel have issued their updated P2 reserves, which fell from 92.2m barrels at the end of 2022 to 88,9m barrels at the end of last year. This takes into account 4.5m b’s of production and the stripping out of the Sarta reserves, showing that there is still upside at the Tawke PSC, which is generating cash even in the current local sales environment.
Genel therefore remains in a very strong position, well funded and still looking for opportunities to diversify the portfolio.”
Today’s rising oil price should help!
Sorry the title of my last post should have read
"Tawke has largely recovered from the March 2023 pipeline shut down"
I am looking forward to Genel’s HY results as costs have been cut and local sales are good.
Any news on Somaliland and the Morocco Farm Out would be a bonus.
Today DNO reported on fields where we also have an interest;.
“At yearend, gross production from the DNO operated Tawke license (75% ) in Kurdistan had largely recovered from the March 2023 export pipeline shutdown and was averaging 80,000 boepd. Post pipeline shutdown, the Company’s net entitlement share has been sold at prices in the low-to-mid USD 30s per barrel on a cash and carry basis and transported by traders by road tanker or pipeline to local refineries. Concurrently, Tawke license operational spend was cut by some 65 percent from pre-pipeline shutdown levels as drilling activity was curtailed and staffing levels reduced.”
Investor Meet set for 26 March.
That will be full year results and hopefully an update on everything else.
I wonder what is happening with Somaliland. Initially, drilling was forecast for end of 2023. Then it was only preparation work which Haas been completed if I remember right. Normally drilling should be fairly straightforward and oil should be found pretty close to the surface ....
Any thoughts?
Back to triple digits? Where do we think is fair value now?
Erbil & Iraq agree to resume Kurdish pipeline exports
https://www.kurdistan24.net/en/story/34163-Erbil
Years ago the gas from BB fields was the reason for investing. The oil was merely a sideshow to fund gas field development.
Doubt Genel could afford to develop BB until pipeline is reopened and decent reliable sales payments are back and regular.
Im expecting this to rise to £1 over the next few weeks, should be a good return from these lows, imo
I was invested in CNE when they won their arbitration case against the Indian Government. Enforcement then would have been via the New York Convention, although the GoI eventually paid up without the need for it. It allows for confiscation of assets held in any country that is a signatory to the Convention, which is most of the Western world I think, so it certainly has teeth.
I'm still of the opinion that it will not come to that, though. I suspect that re-instatment of GENL's rights to develop the fields will effectively be any award, and not much in the way of hard cash. Where GENL goes from there is another matter. Just my opinion.
* I mean if they want western companies to invest in Kurditstan, KRG can't go about ignoring judgements issued against them. Adhering to an International Court of Arbitration is fundamental to FDI
I suppose if they want any western companies to invest in KRG, they can't go about knocking debtors...
I am no legal expert but I would have thought there must be legal rights to recovery or else why did the KRG eventually cough 2.4 billion if they could get away with not paying?!
Winning the case is one thing, getting paid another. Who enforces that the payment is made?
IMO there is a good chance of Genel being successful in its claim against the $1.4 billion they spent on the fields as the KRG lost its case in 2017 with UAE-based Dana Gas and its partners with a final settlement of $2.24 billion. At the time, folk said they wouldn’t pay up because they couldn’t afford to pay their teachers and army. but they coughed up rather than go back to court
Besides the Jefferies upgrade to buy (tp 100p) and them “seeing re-opening risk as over-sold, and a solid balance sheet with net cash to remain above $100m throughout 2024 supported by local sales, even if exports do not restart." Key Insights from Simply Wall St suggests Genel is potentially 32% undervalued;
“Using the 2 Stage Free Cash Flow to Equity, Genel Energy fair value estimate is UK£1.24 Current share price of UK£0.84 suggests Genel Energy is potentially 32% undervaluedOur fair value estimate is 28% higher than Genel Energy's analyst price target of US$0.97price”
It will be enforceable under English law, Kurdistan is recognized as a legal entity. within Iraq,
it will put further restraints on exports if they ever do come back on line, how many Assets do the Barzani family have tied up in Europe, a court order could grab those assets!!!!
Two questions spring to mind.
1) If there is no chance of KRG paying up, why proceed with the arbitration?
2) From KRG's perspective, if they can't / won't pay, why not just save legal costs and roll over now?
I suspect greater legal minds than ours have come to the conclusion that an award is enforceable, otherwise the whole process is a waste of time and money for both sides
Looks like it's heading back to 70's and staying within a rage until actual news...
Or Kurdistan
"Iraq has also deemed all oil companies active in Iraq to be operating illegally"
what a load of bowlocks....
Sorry - that should have read operating in KRG (not Iraq).
Mobiles and no glasses always a recipe for disaster 😲
The less aware amounts you may have missed the fact that KRG has spent years trying to be independent from Iraq (politically and financially).
Iraq has also deemed all oil companies active in Iraq to be operating illegally.
No way Iraq is going to pay KRG’s fines.
Go read any political news from the region over last decade.
Whats the point of wasting hundreds of thousands to win a case someone cant pay anyhow?
and why is genel up 20p almost in two days?!
One of my AFC Funds, the one in Iraq, has a peformance of 100% 2023 only. Yes, enough room for pay some arbitration money.
Guess when dana gas got paid for their arbitration they must have used monopoly money.
What a load off....
The gdp of Iraq gives it ample headroom to pay