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Er, no.... neat question BD!
Erdogan maybe? I kinda hope not.
Boyo,
In GKP’s office in London, you have a pic of Massoud Barzani.
In Genel’s office, do you know who is on the picture?
Thanks
Bravedog
Bravedog: Agreed, Tony was not the right guy for the job! I'm not sure the majors will bother with KRI but who knows
Best of luck whatever path you take - currently in GKP? Hope that's a winner for you. ATB
Tartine: Given the payment issue in KRI I can't disagree with you. I'm just sensing the possible direction (based on the Chevron deals). I'm not sure what my immediate reaction would be if it actually happened - it would depend on the terms, of course, but, as you rightly imply, it certainly wouldn't change G's risk profile!
Boyo,
Yes, I am the one from iii, everything fine, but a little bit older as everyone here...
I believe all those Kurdish E&P will be taken out by majors because they aren’t unable to invest billions. Hayward paid 2 bil $ for Taq2, lost another bil or more in stupid diversification. Without money, they are only a small player.
Well, if they splash the cash on further acquisitions in KRI, that might be a signal for me to sell out. The cash we have at present, is a safety cushion to develop current assets (mainly KRI, Somaliland and Morrocco until proven otherwise are just distractions) and weather the intermittent payment disruptions.
I would not like to see 200 or 300 millions disappear on further acquisitions. If it happens, then we will have to judge it, then, on its merits but I am not keen. We will see!
Rational comments Tartine but, in reality, G's resources and infrastructure are KRI focussed, with the main offices in neighbouring Turkey. Incremental expansion of operations within the area seems to be the strategy so far.
Just an aside: Ankara Offices are nice, btw: https://officesnapshots.com/2016/01/22/genel-energy-head-offices-ankara/
Buying in KRI would be crazy. We are lucky to be in a fairly good situation given the significant hurdles present in the region. We have recently acquired more blocks in Kurdistan that are still to produce oil. Using the cash pile should be kept for either developing our existing assets or diversify away from Kurdistan.
The current global turmoil is not going away tomorrow. Refinancing was the right thing to do as it gives us peace of mind. So far, we can not fault the management. OK no fireworks but steady probably shrewd decisions ... just what we need I think.
Just to add this, in answer to Bravedog's query, from the Bond announcement RNS:
Genel has the option to call the outstanding bond amount in December 2020 at a price equal to 105% of the nominal amount.
This is apparently the $77m remaining after repurchasing $223m of the existing senior unsecured bond issue .
Bravedog? Well I never - you used to post on ii, of course. Hope all's well with you.
I assumed the Bonds thing was just about timely renewal. I can't see G doing much other than surviving until OP reaches $50, unless it can acquire something that is distressed but cash generating....
Regarding ShaMaran it looks a bit shaky: https://simplywall.st/news/is-shamaran-petroleum-cvesnm-weighed-on-by-its-debt-load/
Rangor,
Not back in this one.
What brought me back was the fact that 2 cies will raise money thru bonds: Genel and GKP.
What can they do with the money? Nothing interesting a part from buying shares of a Kurdish oil cy or buyback their own shares...
Do you know if the Genel bonds sold this year will have a call option from the cy? Does the December 2020 buyback option at 105% applies to the 2025 bond issue or only to the previous one?
Christ, not seen bravedog on here for years.
are you back in genel then, if so why suddenly now?
Hello everyone
Hello Boyo as you are still here
The cy can either invest to increase production or buy cheap oil assets on the market. They can buy more Genel stocks, but they can also build a stake in GKP which is cheaper than Shamaran.
If Lucas Lundin wants to take part in the consolidation of the Kurdish oil industry, he can also use Shamaran accumulate a stake in GKP.
This will guarantee the KRG that all the small players in Kurdistan disappear at the same time when the TO of GKP happens. Why do you think that GKP has no CEO and that they fired most of the foreigners ? A new team is coming in and will be lead by a consortium.
Of course, I may be totally wrong, but lot of insiders bought this stock below 1£.
GLA
BD
A few quick questions:
- Are the $233M being repurchased at par? The RNS does not say anything about it.
- The bonds were going to mature in 2022. Why the hurry? Once the poo goes up, GENL will receive money owed by KRG. So, on a more solid footing, could lower the interest rate from 10% to something substantially lower than what it got 9.25%. My view has not changed. This is not about GENL being risky. It is all about deals being made that destroy shareholder value, for those of us who do not own the bonds.
- The justification on having to pay 9.25% because GENL is a risky company, only reinforces my view that GENL should acquire a portfolio in a neighborhood that is not so rough (...), as DNO did when it took over FPM.
After all Genel had cash in excess of $350 million at 30 August 2020, and net cash of $55 million. W/ lots of small E&P in financial distress now should be the time to diversify to lower risk. If GENL only has producing assets in Iraqi Kurdstan, KRG will keep on playing hard ball.
Finally a question: are the monthly payments currently being received from KRG the full amount that corresponds to the corresponding monthly production, or are KRG withholding some?
GLA
Whitehat, I am actually based in London but come from a long line of Geordies. Up the toon!
Hi Whitehat, not going to lie... i have no idea what a Novocastrian perchance is.
Is this just a coincidence?
and with Pareto (Lundin’s home bank - jaority shareholder of Shamaran) acting as bookrunner. It may all be coincidence but smoke has definitely not been taken out by Dr Adel (CEO of Shamaran) yesterday when he was directly asked about the potential takeover.
This share is a miracle. It outperforms against all odds and fundamentals. Fantastic stuff
Not seen this posted here yet, but with a deal between the KRG and Iraq looking relatively positive (yep i know... ive thought the same many times before in the last ten years)... maybe its M and A time for the region:
'#Shamaran petroleum could be a target for a possible buy out. There isserious interests in Shamarans share at #Atrush field by a known IOC. Question is if the Lundin family is willing to sell right now considering current oil prices and fields overall exceptional performance.'
In a updated version: “a second person familiar with the matter clarified that there were a number of potential M&A suitors who may earlier have been considering ShaMaran a target, including TAQA and fellow KRG-based oil company Genel”
Genel also successfully completed issuance of $300 million in new bonds with $77M extra than to cover the old bonds. Genel also already got $350M cash in excess according to there own statement.... hmmm interesting
Totally agree, this money could have been distributed to shareholders via div instead of to the chosen few, unless they are intending to use the bond money for acquisitions or asset development.
The interest is high because it is a very risky company. I think it is still a good move as it reduces (ok only a little) the interest we pay every year and importantly it gives the company financial security for another 5 years.
The people who buy those bonds are the same that bought previously. They help the company when it was not so easy to get finance given the business backdrop we operated in.
So it is a very positive move and done with the right timing ... I.e we dont get to the stage where we only have a year left and nobody knows whether we will be able to get finance, disrupt investment plans, etc ....
The coupon is 9.25% for a company that is in a positive cash net balance. This is a terrible deal. I wonder who got such a nice steady stream of income.
Previous coupon was 10% when interest rates were higher and the cash balance was not positive.
Management doing deals we do not know?
There should have been an explanation why the interest rate is so high.
This is becoming an uninspiring company.