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I am with Therapist. 49228 boepd 2021 including GE in Q4. Moody's will be wrong. We will get OGA data for May tomorrow AM or Monday.
Tigar, I like your numbers. But, there are several interpretations on how they did their calculations, e.g., did they take the realized price of hedged production rather than $55/bbl for the hedged barrels? i assume the answer is yes . Let us wait for H1 figures to get an idea of where ENQ is.
Pelle, thank you. my Swedish is getting better every month...
BTW, Petronordic carrying load #98 left AK in the early hours of the morning...
ATB
Hi L3,
I don’t have much knowledge of hedging and the company must have treasury team to advise
on hedging. Also, hedging cost is there which may have impact on decision relating to production hedging.
However, management need to realize that this is best oil price range ($70-$80) to hedge the production, they should hedge at least 30%-50% production for 2022 and 20%-30% production for 2023 in this price range subject to hedging cost involved.
In the past, company suffered badly due to their fantasy that oil would reach around $90 or $100/bbl as it was in 2012 and before. Even in Sep 2018 when oil price was around $87 for short time, and they did hedge small amount and repeated the same mistakes in later years and didn’t try to learn from past mistakes.
Only in April 2015, they made right decision at right time when they hedged 80% production for 2016 as heavy capex was involved in 2016 after that hedging strategy was not up to mark.
thx
KO - no I am happy to have taken some profit, and if this takes the SP to 30p Monday then I might take some more profit!! Leaving some in to pay for my attendance at the 60p party of course!
My circumstances have changed since I first bought in, and the risk of being all in on one company is no longer tolerable!
ENQ still my largest holding, and happy to keep it for the dividends when they come.
L3
I agree we will know much more on H1 figures, but doubt Enquest gave Moody's the realised prices of our oil sale's for their update, or our cash position at 30th June. They run a tight ship. Bond payment should be confirmed Monday and Moody's update may give them a boost.
Good morning,
What other elements do the include on top of the debt?
730m x 3 = 2,2b
I have net debt end this year around 1b
So roughly 1,2b more they include as leverage
Moody's Adjusted EBITDA of $730 million and a Free Cash Flow of around $400 million in 2021
The cash flow generated will be primarily used to repay drawings under the RBL and to fund the Golden Eagle acquisition, leading to an estimated Moody's-adjusted gross leverage of around 3.0x at year-end 2021.
Hi acchi,
Thank you for the historical perspective on hedging.
I am fully in agreement with you. When they announce their results in September they will report their hedging , I would hope. We will see then what volume they have hedged in light of the RBL conditions.
Hi Pelle, What matters for the SP is that Moody's upped its rating. SP targets by others might be upped as well. The good news is that the POO is c. $75/bbl and that as you write ENQ can stop assuming and just guarantee a floor price for its oil at a small cost in order to keep the upside of what acchi wrote, " their fantasy that oil would reach around $90 or $100/bbl". So, they can keep their fantasy alive for a small cost... I leave it to you to cross check Moody's calculations.
Hi Tigar, Enq has to give a lot more info to Moody's than to us to have its rating re-assessed. But, collectively (i.e., pooling together the knowledge shared in this BB we understand ENQ's moving parts calculations from than Moody's. I can guarantee you that. We even have someone watching the EP... ) I have also learned a lot by going through ENQ's annual report. THere are bits and bobs there, helpful to understand the different moving parts of ENQ.
Enjoy your weekend all. I look forward to the OGA data. Anyway, enough of ENQ for me. I am now going to read up on E121's and Modestus's kind suggestions, which i think can be very useful to diversify risk.
ATB
"future FCF too accurately when it's going to be damn nigh impossible unless you know how much they hedge, at what price, when for and what type of hedge it is? If people want to"
I think what we know now about hedging gives you much better range of FCF.
Not sure what more than average min/max price of hedge you need to know.
ENQ based on fundametals is very cheap so I am not reallly sure at this point you gain much by doing more than an basic estimate. What we in Sweden call servettkalkyl.
@BJ....whilst us unhealthy Brits use the back of fag ( cigarette) packets !
I would use Moody’s upgrade figures as the bottom line, Enquest are always very conservative with figures as not to underdeliver.
Let’s see how the market reacts tomorrow
"I thought my original question was clear - the type of hedge and when it's for."
I do not see how that that information matters. We know it is costless collars know the amount and average min/max price.
Yes, now around 50% hedge with max 72 oil if I remember correctly. So realised price today around 73,5.
Regarding these production figures.
Think our consensus H1 is 46k excluding GE.
What’s GE H1?
We been told GE 10k
I think we will see H2 improvements Magnus, Malaysia and GE to reach 59k including GE.
Therapist can probably break it down better with the fresh OGA numbers
Would be very nice have 60k+ H2 and start 2022
Moody's expects the acquisition of Golden Eagle to close by the end of the third quarter of this year leading to a full year pro-forma production of 59kboepd.
Morning Pelle,
OGA MAy now out.
GEAD for first five months at 9467boepd to Enquest but includes very low April which may have been maintenance or plumbing in new well. 9171boepd to Enquest May.
Kraken well up. No time now so more later.
GLAXXX