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*Pistup
****up’s boasts of 450k here, representing only 5% of his net worth, seems unlikely for reasons already stated. His intransigence in the dividends v buybacks debate is unattractive to those of us invested here for long enough to remember the ineffectiveness of previous buybacks. But really it’s the gobbledygook he spouts with increasing regularity which is the greatest irritation.
Let’s keep things simple ****up. Production is heading for 55k boepd. POO is in a rising trend. Regular payments are our lifeblood.
Stop being such a pompous arrogant bully.
The only thing interesting about PUTUP’s posts is his endless posting and the change in strategy of those who keep knocking GKP. Real investors don’t post like this.
Well said Barrick. The motives of PUTUP are deeply suspicious. These are not the actions of a genuine investor.
‘’The interesting question is what's a company that produces $100m per annum (or whatever other number you propose) worth? How much should I pay for it today?’’
Erm… A much lower figure than most here have been waiting years to receive, is my guess!
Putup, Do you spend as much time, challenging and managing expectations of the other companies that you claim to be invested in?
I’m wondering why a so called multi millionaire, who claims that his share holding of GKP, is only 5-7% of his total portfolio, is able to devote so much time to it, even posting on a Saturday evening . Do you have the same dedication with your other investments?
You came on here as an instant expert, with a condescending manner, so it not surprising that still your posts are viewed with suspicious.
Good post demofarl. A few points to consider:
"the receipts for September/October do not track the increase in oil price, compared to say the receipt in April"
It's worth remembering that while Brent was up 15% in September versus April, production was down 4%. Revenues less CBC withheld (ie ignoring arrears) were up 17%. In October Brent was up 29% and production was up 4% versus April. Revenues less CBC withheld were up 55%. You're not going to see a directly linear correlation in large part because of the $21.1 discount. Compare the numbers again but this time looking at how much Brent - 21.1 changed. That discount is fixed and not proportional to Brent. As Brent rallies GKP does increasingly well (and vice versa when it falls).
As you can read in the 1H accounts, hedging only went out as far as September sales. Furthermore, the receipts for each month (before and after September) fit with unfettered Brent - 21.1 so you can see there's no upside being left on the table. The cost of the hedging is deducted in the accounts before getting to Revenues (see the 1H accounts).
Your $100m figure is about right for a GKP with a normalised CRP (so that's post 2022 as you note) producing 55k no longer investing for growth and, importantly, with Brent averaging $85. There's not many other assumptions you need to make to model that out. (Maintenance capex, contractor direct operating expense per barrel eg $2.40, an assumption re direct Shaikan G&A (say, 2x 1H 2020 figures), debt interest expense, say $10m or so, and other corporate G&A.) The tougher assumption is what R factor to assume. FWIW free cash flow generation of $100m equates broadly to an R factor such that the Working Interest in Profit Oil is 22.5% - midway between the current 30% and 15% as the R factor goes above 2.
The interesting question is what's a company that produces $100m per annum (or whatever other number you propose) worth? How much should I pay for it today?
been catching up on the posts here..
I don't see anyone (bar the baloney short stats poster) talking this down; all i see is differing views on how it will appreciate. I don't see egos, i see differing views trying to inform, broaden our understanding of what the success we all here believe in, might represent; disagreements on the level of GKP value appreciation, but no disagreement it will appreciate.. I personally feel that the suggesting of negativity/ego polishing here, is more from people seeking a 5 bagger on the 16th January 2022 and frustrated that some like me don't see it that way, or frankly want it that way, and that they have to wait, more than a day. Personally i'd rather see 10% divvis for 5 years, an appreciation of the share price that will come with a greater understanding of it's inherent cash generation, and then a 3 bagger of a doubled share price; good luck to anyone that gets a 5/10 bagger etc, but i don't take the baloney/targeting of those, like me that calculate conservatively but believe optimistically.
As has been said my maths is trite, and my reading of financial data dung, so who am ii with such a pedigree to question the suggestion that the recent receipts are tracking the increase in oil; but i do; yes they are rising but they are not in near direct correlation to such; the receipts for September/October do not track the increase in oil price, compared to say the receipt in April, when oil price and production was lower; oil price has increased 25% but despite a 4% production increase this produced only a 20% increase in payment - this suggests to me the Company's hedge hasn't just been downside, but the October figure comparatively higher (against Sep and before), is either out of the hedge, or reflecting a higher moving floor hedge.
I find laughable the suggestion that it would pretty poor just to get $100 million a year out of this; i think i may be guilty of putting this figure out there - i did it on a worst case basis, based on us receiving 15% on an ongoing basis post recovery of costs; NOT as has been highlighted, whilst we are still recovering costs at a considerably higher figure. Frankly, if, based on GKP's market cap, you are going to throw me out JUST $100 mill a year, i'd be fecking delighted, because at the current rate of production i'll be depleted before the field is.
Dismissing of the likelihood of buybacks, that ...'...and optimise the capital structure' doesn't mean buybacks is naïve; to my mind a capital restructure is for new shares (struggling for funds), to redomicile (tax avoidance/evasion) or buybacks; only the later makes sense - to state such implicitly would hold you hostage to fortune and impact your options/negotiating power. I believe there will be a mixture of dividend AND buyback ( i prefer just the former).
I don't agree that a$100 million dividends reduce your mkt cap by $100 mill - if you are a stagnant Co. yes, but not when throwing off more than that.