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NGMS. I too was buying at 35p, 40p and 45p. So was the chairman. As Stu said, this isn't about has old hur disappointed, it clearly has massively and my Sipp also decimated. LTHs can either sell out or average down and hope for Stu's vision, getting back to say a 300m to 500m cap. Given COVID and poo crash, that would be an achievement. Newbies would make 300 to 500 % , LTHs would only break even if they average down.
O and G investment is Brutal
Stu,
If, if and a bigger if
There's more chance of total wipeout than £200m of value here. The EPS is in such a perilous state that production could cease pending expensive intervention or abandonment at any time. Quite simply over time the water has continued to get worse.
I'm not paid, just a PI whose been in this sector a long long time.
The only ones I currently trust in this sector are TXP and JSE.
Slift, and interesting question.
This materially depends on where the OWC is.
If it's structural closure 1,380m TVDSS then this https://sp.lyellcollection.org/content/397/1/81 suggests P50 < 60m barrels recoverable.
But that doesn't mean the existing wells can recover the oil, far from it. They may need more $75m a pop wells.
We know 7z had material stability issues that affected 6. The ESP has constrained this for now. Will it continue? Will water cut continue to increase?
Remember increasing water cut == less oil production == less revenue.
Where's the cut off point for abandonment? i.e. at what point does the FPSO become uneconomic? The CPR assumes rates not going below 11k bopd.
The CPR actually states this:
Due to the limitations of the Material Balance modelling method, the models are not dual porosity/dual permeability models and therefore do not capture the impact on field behaviour of the fracture network.In the event of water breakthrough for example, water cut is anticipated to increase quickly after breakthrough due to the high permeability of the fractures and may result in production rates being curtailed or potentially a well watering out completely.
So the risk here is large and very real. None of us know how this will ultimately play out but in my opinion the odds aren't good for equity.
You are appraising the company as if the market cap was £1bn.
Trice needed to deliver + £2-3bn of value or he would have a lot of egg on his face. He realised he couldn’t do that and so he left.
90% of that equity DID get wiped out.
Today the market cap is <£100m. If Beverly Smith can deliver £200m of value that’s a home run.
This is easily achievable by merely seeing out the EPS.
Your post belongs in January. Today it’s just not relevant.
lol - classic paid deramp before deal, if i ever heard one.
Gleeful?
I bought from 35p all the way upto 55p.
I've lost more on HUR than any other share I've ever owned.
I also had some experience with Fractured Basement reservoirs so really believed the story and honestly thought this was the best share on the market as others didn't understand it but would do once the cash started flowing.
Unfortunately the EPS which is designed to gather real world reservoir performance has shown that all the models previously put forward and the CPR are plain and simply wrong.
We were told that the fracture connectively was excellent, which means water being perched is far less likely and if it is won't flow very easily due to the poor connectivity.
Just look what happened, 7z had increasing water cut, Dr T told us he was confident it was perched but didn't provide the public domain with all the data to prove it. That's why some of us including DSPP began asking questions. No answers were forthcoming. In the meantime the water cut was getting worse and worse.
Stobie went in February, did he foresee the Convertibles he issued being unable to be repaid in 2022. You know the ones that materially suppressed the share price during the good times?
Dr T resigned in June, note the mutual consent bit. Did it become apparent to all on the BOD that the baby had died in infancy? Why else would Dr T leave his baby? He worked his balls off for HUR.
My personal conclusion bluntly is that its rats leaving a sinking ship. They know the games over.
I'm posting here not to be gleeful as it's put my retirement back by 5 years at least but to offer a reasoned argument to those that portray alls rosy in the garden. I'll be delighted if this blooms but personally put that option as less than 5%
I really do think equities dead.
ngms27,
As a shareholder, I agree with your views.
I think it's important to know how much of it is priced into the current share price.
I'm holding thinking that BOTH perched water AND increasing OWC (and hence aquifer) is at play.
I'm also holding thinking that there is enough oil recoverable at 75% of initial estimates. Or in otherwords, a 25% downgrade in reserves and resources maximum.
And at the above and at the current share price, this stock is hugely undervalued. Especially now that the uncertainties have been rectified with the higher OWC (Markets are expecting the watercut to increase, and the lower rate of recovery of oil is priced in).
What makes you think that the next RNS will make me concede? In your own opinion, do you think that the downgrade will be more than 25%?
Green. Thank you for those sentiments. It says a lot about you.
Pitiful glee in the tone suggests some kind of psychological misalignment at the purported misfortune of others. It says more about him than anyone else. I for one hope you all make a shedload here....
What evidence do you have? SUggesting the equity is worthless every few days on ADVFN is simply NASTY...and disrespectful to existing holders UNLESS you have solid evidence. Provide it!
Sure I got the bonds date in my head wrong on occasion but so what. Nothing fundamentally changes.
The next Rns should make you all concede good old Jonny got it right again.
Where do you all think the OWC Is?
What evidence do you have?
Why do you think the waters perched given Dr T got run out of Dodge City?
What evidence do you have that the waters Perched?
SG2
ngms27 has no evidence of his own. He is an acolyte of dspp.
NGMS - when are the bonds due? 2018, 2020, 2021, 2022 or 2030 again? I note you thought they were due 2021. Also mix between creditors and debtors. What clangers. Let's see what HUR has to say rather than sbdy agenda-driven.
Ngms, like me you are an ex-hur shareholder. Why you feel you need to post here with your thoughts is beyond me. I also note your apparent lack of the IMO nomenclature telling.
Robert Trice got it wrong. That’s why he’s no longer with the company he founded.
He was confident the water was perched but didn’t publicly provide categorical information required to prove this.
Given the last RNS stating ‘Hurricanes Technical Committee has concluded that there is reasonable probability that the Oil Water Contact in the Lancaster field is shallower than the range of Oil Water Contacts envisaged in the 2017 Competent Persons Report by RPS Energy’
That infers two things:
1) OWC is above structural closure given that was the shallowest point in the CPR
2) Given 1) the water is coming from the Aquifer
...and your EVIDENCE for those statements, ngms, is - ?
I'd like to see it posted here, please. Evidence, not assumption, rumour, your opinion: EVIDENCE.
gla
Robert trice - the industry expert gave a very good explanation as to why he thought it was perched.
So your calling Robert Trice wrong or a liar ?
You really think a well producing 53% water cut isn’t going to increase water cut over time? It would have to change the laws of fluid dynamics to do so unless perched.
This water given the recent RNS isn’t perched, it’s coming from a higher than modelled OWC. In layman’s terms it’s coning from the aquifer.
Increased water cut - stabilised on 7z and 12% on 6 well
OWC not confirmed
Possible downgrading but not know how much
Perched water not aquifer according to a leading expert who just happens to have been ousted by big business
Last statement I think we will let you think about if pumping 17k a day
Current fundamentals are:
Increasing water cut on both wells
OWC higher than modelled
Contingent Resources and Reserves to be downgraded from the CPR
Prior to commissioning the ESP on 7z swabbing was occurring affecting ALL production
Water likely coming from the aquifer
Both existing wells likely to water out within months
For 2020 could be not far off our entire mc - lunacy