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I'm satisfied that during testing, plus the costs of running UKOG and doing stuff in the other subsidiaries (planning applications etc) there is an underlying cost of about £1mm a month. The 3 months following the end March 2019 appeared (with SS stating they has 'less than £8mm left at end June, though no details) to have gross outgoings of about £1.1mm per month - these one off costs do seem to keep on cropping up. (The gross outgoings per month in the 6 month accounts up to end March were about £1.285mm.)
There was also the £2mm raised in early December which looked like a cheeky top up to keep a cash cushion until HH-2z started producing in late December.
But comparing this:-
'Once the fix is complete (from existing funds) expenses will be minimal and I would anticipate that 3 tankers a day would produce cash flow for the company assuming we come out of the fix with cash in the bank.'
with this (from GM RNS):
'Therefore, the Board seeks approval to increase its authority to allot and issue shares so that it can act swiftly to establish Production via an ability to fund the Company's Horse Hill FDP and to ensure that the Second Deferred Payment can be satisfied.'
Doesn't really sound like they are hopeful that 'existing funds', and by inference cashflow, will be sufficient to satisfy the immediately upcoming work of course if they could get a named ii for a placing rather than a CLN this would not be such an issue
We shall see, as production is now planned to commence by bringing HH-1 into Production during Spring 2020 and this revised authority expires at the next AGM I assume this is the 'swift' bit.
Or we may just be bought out within the next 2 to 5 years.
Penguins, that figure includes amounts attributable to the group decreasing its trade payable, an increase in abandonment expense (Mark Woods) and the increase in administrative expenses (increased employee costs).
Once the fix is complete (from existing funds) expenses will be minimal and I would anticipate that 3 tankers a day would produce cash flow for the company assuming we come out of the fix with cash in the bank.
I'm sure it'll take longer than anyone thinks but good sustained flows from the horizontal will increase the share price significantly and reduce the amount of dilution going forward with each conversion which in itself would be nice. Also there would a 'floor' under which investors would support the share price recognising the strength of the investment case based more of fundamentals than hope?
At the moment there's no real floor or stimulus to attract new investors in. At the moment though, that might change soon?
I agree but the CPR will not be a surprise on HH-1 since we already know it's coming and will be in place this spring before production officially begins.
As we all know once we have the CPR declared we have a very valuable asset the company can go to the bank with for proper long term loans and then the flood gates will be open for quicker expansion.
As each asset is declared more and more money will be available..... this will expand and grow exponentially.
Which is why UKOG are working on planning for all their other assets right now. They want to be in a position to moneties them as soon as possible once big money starts flowing..... no frustrations waiting for admin and bureaucracy.
The planning application may have put the myth to bed that any time soon UKOG will firstly pay off this CLN with cash, or stop having to use sharecoin.
Restricting export to 3 tankers a day until the full site is up and running suggests that at best test production might cover ongoing costs, but how long before even 3 tankers a day are seen? Fix confirmed as having worked, rather than attempted, by Monday seems highly unlikely. Maybe they will have decided what fix to attempt, and start deploying the necessary equipment down hole, as long as it is on site. Assuming it is simple (eg a cement job) as well as routine a short wait then they will need to test the well before demobilising all the kit, just in case the fix fails. Maybe a few days of test production, and then, assuming all is OK dismantling and trucking away the CT unit and all the other kit.
3 tankers a day 6 days a week, we shall see, that.s about £750,000 a month. UKOG consolidated cash accounts suggested gross cash outflow during the tests in the 6 months up to March 2019, plus all the other costs of running UKOG and it's subsidiaries, of at least £1mm a month. While Horndean helps with the petty cash there could be the need for a little 'top up' before the full site refurb and extra well/s paid for (hopefully) by a RBL.
Last plan was that HH-1 will be put into long term production 'soon'. HH-2z would be ewt 'd until Q3 when HH-2z would be put on long term production and perhaps another well would be drilled. That would seem to be the time that they might embark on the site reorganisation. By then they should have a CPR for the Portland so maybe at last they could start financing operations using RBL - of course depending what exactly,the CPR says, the complications of compartmentalisation and water conduits will add to the complexity, and perhaps uncertainty in any model used to create a CPR.
Shorts are All part of the process.
They have had there day. This is turning.
As already been said. Once the oil is gushing YA can be paid cash. No interest. 10% settlement fee if I remember right.
We are due a cpr when all this is sorted. Then the doors will be blown off this price.
FOMO is a terrible thing.
"what we need is a surprise CPR "
Any new CPR will have to wait until they get some results post fixing the water - and I don't mean a couple of days of results - the reservoir engineers will want a couple of weeks minimum (otherwise it will be on the one hand and the other hand - more hands than a Hindu God). It'll then take 2-4 weeks to re-run all the reservoir models and maybe 2 weeks wrangling over the exact wording......................
If the horizontal flows like the Nile I'd be all if favour of a period of consolidation.
Flow oil, build the bank balance and then pay YA off.
From there the share price would stabilise and rise with time and only be enhanced by CPRs - provided they were good obviously, as well as the next Horse Hill wells. Another Portland horizontal and then a Kimmeridge well? But will the Kimmeridge be vertical or horizontal?
By the end of the year UKOG might be back to where it was several years ago.
Producing at Horse Hill and all the hope of the Kimmeridge back with a flowing horizontal well at Horse Hill? Angus may help us out there as well of course.
2020 has the potential to be quite special.
The other way to counter YA is to pay it in cash and not shares
CaptainStanley-look back at the September RNS and the provisions within---
what we need is a surprise CPR & get those trolling shorts & YA out.
No problem with borrowing money, it's the taking it back. The ink was hardly dry on the contract and they had their hand out. Over a 2 year period I read. it's on 1/4 way through and they have already taken 1/2 of it back. if they had, had some restraint I'd imagine this would be at 0.85 Nor 0.06.
BTW it is 100% certain their is dry oil in HH2 proof of that lies with HH1 Giving that HH1 has been flowing dry for over 6 months I'd say we can go at least 1,000 feet with HH2/
He's right thoughlongtermholder14.
The only way to counter YA is for more shares to be bought than they're selling, which in reality means news driven enthusiasm for the stock and an improved investment outlook.
It's all about the upcoming RNSs for better or worse?
Recently there have been fairly big spikes on little or no news.
I think the appetite is there and if the news if real and significant I'd expect a big spike settling to a re-rated share price into the AGM and new of forward looking ops etc.
Hope so anyway.
Scallywag3-YA have facilitated this.... where else do you think the money is coming from....
GLA ignore the trolls
Rns Monday would more likely be YA Scumbags dipping their bread in the gravy train.
We might even start paying it down with cash instead of shares
I would expect YA to be clear well before September.
Once this fix is sorted and the bpd numbers are in the volume will lift and they can offload quicker.
Looks like we have bottomed now and consolidating around the top trend line.
Could breakout at anytime with news. News could drop at anytime.
Very busy onsite.
Patience is Free!
Hold tight, when it’s let go it will fly.
Whatever your strategy.
The remorseless decline since end September 2019 seems to be flattening out at around 0.6 - 0.625
PCS calculated the current overhang would be gone by September 2020 (no-one argued with him IIRC)
No chance of a significant rise until they tell us what the rates are once all the work is finished
4.5 million in large trades at 0.61 this morning
Whoever it is seems to be happy to shovel shares out as long as the price is over 0.60 - that suggests they already know how much they're going to make as long as it stays over 0.6 - Riverfort or YA I suppose............
" Almost guaranteed a Monday RNS. I expect it will be to report that the fix has been completed."
Doubt it - I reckon 12-14 days after rig or CT arrival so end of next week I suspect - assuming all goes well..................
I get ya, thanks. Must be for well water storage?
Surprised this didn’t open up after the large sell on the close where there is usually a large buy. With Halliburton working over night I’m sure they will work the weekend if needed. Almost guaranteed a Monday RNS. I expect it will be to report that the fix has been completed.
Do you mean the original planning for the existing site or the planning for the extension to the existing site.
From the top of my head I thought that the planning for extra oil storage in the new extended site was for an extra 9000 barrel oil.