Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
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I just wish all north sea players would stick together. Inmv they should mothball everything until these idiots realise that they will have no tax revenue until they see sense. As for milliband and it's cronies. Well look what happened when he became labour leader in the past.Maybe he is hoping to run again in the future .
Milliband has confirmed that a Labour Govt will remove all investment allowances for N Sea companies. No wonder SQZ is at a one year low.
Mitch Flegg, Chief Executive of Serica, commented:
"We are pleased to have completed this transaction which creates the possibility of adding a third production hub to Serica's North Sea portfolio. As a potential domestic source of oil and gas with a low level of production emissions, a provider of quality jobs for UK workers and a generator of much needed future tax revenues, Buchan is the sort of project the UK needs as part of the energy transition."
Article cont'd............... ''its short- and medium-term prospects are good, and at this yield and valuation we would buy''
Peel Hunt says'' it is important to state that we believe the business remains in a very strong financial position and is funded for all planned work programmes and shareholder distributions."
https://twitter.com/surprised_trade/status/1760730520952967248
For anyone who missed the article Friday, IC and brokers have a positive outlook despite public sentiment being low currently for North Sea operators as the actual metrics look attractive.
Of the UK-listed mid-cap energy companies, Serica Energy (SQZ) is an inexpensive option. The North Sea-focused group sits on a forward enterprise value/Ebitda ratio of less than one times, with a dividend yield of around 12 per cent.
Serica's metrics look so attractive because its share price has fallen by 60 per cent from an August 2022 high of 450p. Even a cash-and-shares deal that doubled production has not been enough to bring shareholders back. The group could be due a rebound, however.
Serica’s low enterprise value (EV)/Ebitda ratio is driven by its high cash profits and small pile of debt. Ebitdax (‘x’ being exploration costs) for 2023 is forecast at £401mn. This is a drop from 2022 due to lower oil and gas prices, but still represents a cash profit margin of 63 per cent. Broker Stifel thinks this margin will climb to 70 per cent in the current year, implying Ebitdax of £612mn.
Peel Hunt analysts Werner Riding and Matthew Cooper remain bullish, however. “Despite lowering our numbers, it is important to state that we believe the business remains in a very strong financial position and is funded for all planned work programmes and shareholder distributions."
The Tailwind deal increased Serica's production from an average of 26,000 boepd to a forecast 40,000-45,000 for 2023. The thinking behind the deal was the same as that behind the BKR acquisition: add mature production.
The broad idea is that mature fields that aren’t large-scale enough for the majors to take an interest in or to hold onto for the long term will still have reserves large enough to provide positive cash flow for at least a few years.
Much of the appeal of Serica lies in its low operating costs, although these have climbed a third from $16 (£12.70) per boe in 2022 to around $20 per boe now, according to Peel Hunt forecasts. They are expected to stay around that level in the medium term, however, and margins are already ahead of peers'. Gross profit per barrel (or netback) is around $40/boe for 2023, which Stifel forecasts will rise to $49/boe this year.
Chris Wheaton, an analyst at Stifel, sees net cash rising from £81.4mn at the end of 2023 to £449mn two years later. This is more of a rebound than a turnaround, given the use of £58.7mn in the Tailwind buyout and a cash outflow in the second half of last year (as per Wheaton’s forecast). But it does leave management with some firepower, even alongside its work to get more barrels out of existing wells.
Serica’s portfolio offers balance between energy scenarios with 55 per cent gas and 45 per cent oil production. The reserves life is slightly less than a decade, so further deals will be needed to keep the company going. But its short- and medium-term prospects are good, and at this yiel
Alas we will soon be importing even more from overseas thanks to the idiot politicians .While in the process not selling much of our own home grown .inmho dyor
Maybe UK hmg are all secret c...my agents. The new hmg could even add I...Lynn agents. Minute Britain were getting. Who knows we may even produce a new car on the back of all this and export it somewhere. Not sure where,but you just don't know.
Better still let's start a new strain of c......v.d
Is it possible that when prices normalise for oil and gas that a legal challenge could made against the wft, if not then this does not bode well for any investment in the UK if the government decides upon a political stance against any industry it chooses to demonise then who or what will be next.
I see Norway have subsidised EVs to the of £4B with discounts to buy free parking and tax concessions etc yet ice vehicles have still increased in number in Norway this tells a story when Norway is held up as the poster boy for EV adoption.
Oil and gas even though out of fashion is still seeing increased demand which shows no sign of decreasing.
Five AIM income stocks for your ISA in 2024
https://www.ii.co.uk/analysis-commentary/five-aim-income-stocks-your-isa-2024-ii530851?utm_source=newsletter&utm_medium=email&utm_campaign=Weekend%20Newsletter%2020240224&utm_content=newsletter&utm_source=sfmc&utm_medium=email&utm_campaign=Weekend+Newsletter+AMP&utm_term=%25%25%3dRedirectTo(%40article2URL)%3d%25%25%3f%25%25%3dv(%40UTM)%3d%25%25&utm_id=151180&sfmc_id=5902060
Labours manifesto states they will increase EPL in line with Norway. They will also remove investment allowance. So unless we can complete workovers by the summer then it will be pointless inmv. The industry estimates forty six thousand job losses together with twenty six billion lost during the next few years.
The only glimmer of hope is conservatives are elected and remove EPL inmo
The fact that three directors have recently bought shares suggests that a transformational change isn't imminent otherwise they would be guilty of insider trading. I assume they're investing based on long term prospects. I don't see this personally but hopefully all will become clear when they release their next update.
Usually a buy recommendation in IC causes a short lived bounce, but its had no impact to the SQZ share price, just continues its decline
It’s the EPL and Labour that are killing this Company and others
With gas prices there lowest since 2021 before the Ukraine debacle and prices set to fall, the winter has been mild and gas stocks throughout Europe are at there highest for this time of year, oil prices are hardly breaking all time highs so is the wft due for renewal or challenged as it only supposed to be for gains which are deemed extraordinary to normal market conditions.
IC also has a page write up on Sqz and has it as a buy, which is better than hold or sell, perhaps the worm is turning.
Seems were in the same boat chinch,but I'm still holding a few awaiting some kind of bounce. Having said that it could once again be a interesting buy ,but alas not at this level inmv, dyor
Well that’s it - sold my last tranche this morning having bought in at 14p. This is going nowhere as epl and the acquisition of Mercuria have had a devastating impact on the Company. MF has feathered his nest and really should have taken this company forward but decided not to do so. The div might also be under threat,
It’s been a blast over the years with lots of informative posts from various people for which I’m grateful.
I wish everyone all the best for the future.
Skerryvore: The UK North Sea ‘well to watch’ this year
https://www.energyvoice.com/oilandgas/north-sea/exploration-production/548401/skerryvore-the-uk-north-sea-well-to-watch-this-year/?utm_content=176885462&utm_medium=social&utm_source=twitter&hss_channel=tw-1379070162
Preferably from Hull uni and not the rest.
Come Serica you can rise today can't ya. After all it's poets day
What industry does hmg and the new hmg actually support. If so how long will they actually show kind of support to anything that they are pontificating at pressent.
I Personally i am not from a oil and oil gas backround and not that well eduquated , but can clearly see that we should be supporting such industries as this during the transpition stage, So what the \h..l is going on here... Maybe some eduv=cated person can answer this one, ???
Surprised
I hope it is due for a rebound. For me then that will allow me to offload further. Fwiw i am not blaming the bod in so much as hmg . As i believe events have over taken their most recent decisions. As we all know any planing a business objective needs to plan ahead, but alas we we are now dealing with matters beyond anyones control. So maybe Serica should just try to preserve as much cash/oil field reserves as possible and not develop anything and possibly start to unofficlly mothball production. Easily done by saying things such as health and safety and some bit falling off a rig . inmv onmho
The problem now is not so much to do with not diversifying overseas , but with HMG and all the other political parties. Oil and gas in this country now has no political allie. So where do we go from here.
Some of you may have recalled that i have mentioned on numerous occasions that they should have all stuck together and not bid for any licenses let alone develop excisting ones. As i have posted before they are speading up their own demise by not being united.
As the saying goes United we stand divided we fall.
Last one leaving turn of the lights. Just hope that Serica is not that one that does that.
Https://twitter.com/surprised_trade/status/1760730520952967248
Idea of the week from Investors Chronicle - Serica could be due a rebound, metrics look so attractive-Peel Hunt says'' it is important to state that we believe the business remains in a very strong financial position and is funded for all planned work programmes and shareholder distributions."
https://www.investorschronicle.co.uk/ideas/2024/02/22/this-north-sea-energy-company-is-making-waves/
Part of today's feature ..
This North Sea energy company is making waves
Investors should take note of this mid-cap's profitable growth strategy
.....Serica’s relatively low enterprise value (EV)/Ebitda ratio is driven by its high cash profits and small pile of debt. Ebitdax (‘x’ being exploration costs) for 2023 is forecast at £401mn. This is a sizeable drop from 2022 due to lower oil and gas prices, but still represents a cash profit margin of 63 per cent. Broker Stifel thinks this margin will climb to 70 per cent in the current year, implying Ebitdax of £612mn. .........
Peel Hunt analysts Werner Riding and Matthew Cooper remain bullish, however. “Despite lowering our numbers, it is important to state that we believe the business remains in a very strong financial position and is funded for all planned work programmes and shareholder distributions."
...........
The Tailwind deal was covered with shares – 100mn new shares, to be precise, taking the count to around 380mn – and £58.7mn of cash, drawn from a sizeable cash pile. The deal increased Serica's production from an average of 26,000 boepd to a forecast 40,000-45,000 for 2023. The thinking behind the deal was the same as that behind the BKR acquisition: add mature production.
The broad idea is that mature fields that aren’t large-scale enough for the majors to take an interest in or to hold onto for the long term will still have reserves large enough to provide positive cash flow for at least a few years. ......
.....Much of the appeal of Serica lies in its low operating costs, although these have climbed a third from $16 (£12.70) per boe in 2022 to around $20 per boe now, according to Peel Hunt forecasts. They are expected to stay around that level in the medium term, however, and margins are already ahead of peers'. Gross profit per barrel (or netback) is around $40/boe for 2023, which Stifel forecasts will rise to $49/boe this year.
.......Chris Wheaton, an analyst at Stifel, sees net cash rising from £81.4mn at the end of 2023 to £449mn two years later. This is more of a rebound than a turnaround, given the use of £58.7mn in the Tailwind buyout and a cash outflow in the second half of last year (as per Wheaton’s forecast). But it does leave management with some firepower, even alongside its work to get more barrels out of existing wells. ..........The oil and gas industry has enjoyed a resurgence in government support in recent years, after a long period of investors pulling away. Clearly North Sea players have not had all their wishes granted – the windfall tax still being in place is the key example of this – but forecasts around oil and gas use have been revised as global trade flows have changed. ...........Serica's short- and medium-term prospects are good, and at this yield and valuation we would buy.
Such punitive taxation only applies to companies responsible for providing 75% of the UK's energy. They're not as important as banks who are still allowed to make a profit.
Are they also promoting that banks be subject to WFT too ? Have you seen some banks profits the last few days ?