Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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"c. $47m worth of commitments of CAPEX/Decom etc."
*$86m including bond interest and wind down costs
"they are saying that they expect to produce nothing in the next 12 months which can only mean they are taking the extremely pessimistic view that production will drop of rapidly."
No, they just have commitments.
c. $47m worth of commitments of CAPEX/Decom etc.
RNS translator
“The cost per bbl is dependent on the production rate because the majority of costs are fixed.”
Fundamentally this is correct although I recollect that Bluewater’s renumeration is subject to variations in oil price and or production rates. There is obviously a poo dependant minimum production level at which the Company can continue to generate profit.
Based on recent production figures, poo and the cash accrual during the last quarter I reckon they need to produce at least 5.6k bopd with poo at 68$ to break even.
When you read the Companies cash generation predictions, they are saying that they expect to produce nothing in the next 12 months which can only mean they are taking the extremely pessimistic view that production will drop of rapidly. Also they are using a much more pessimistic figure for poo, for example at 50$ they would only need production to drop to7.75k bopd to reach the break even point.
If production could be maintained for the rest of the year at 10k bopd then with the current oil price they would have 205m free cash by the year end.
When you consider that the bondholders have been collecting interest at 7.5% over the last 3 years they will suffer no net loss on the $50m relinquished in exchange for 95% of the Company. The shareholders have been screwed and the BoD are responsible. AK suspects a motive. Either that or they are totally lacking in entrepreneurial management skills.
RNStranslator,
"The cost per bbl is dependent on the production rate because the majority of costs are fixed. So you can’t go back to when it did 20,000 per day and say it was $25 per bbl then because it doesnt work that way."
Utter stuff and nonsense, Nigel, and I suggest you change your hardhat colour back to green as it once was on a certain website before photoshopping it yellow. I have a long memory...
'Uplift cost' is utterly irrespective of production quantity. OK, it might be slightly affected by the amount of fuel-oil used by the FPSO, but hopefully the FPSO is now running on produced gas via the turbines, per plan, but the BoD haven't even had the politeness to inform us about that.
And don't get me started on the 'other valuable resources' which will miraculously reappear etc et etc
Slitty
The problem is that the production guidance figures are rogue BoD produced and cannot be relied upon. Production will exceed those figures
A further problem is that you, MeBladder & Transmitter are rampers paid to agree and reinforce whatever drivel each other posts
RNSTranslator,
I have similar figures for cost.
Upwards of $45/barrel at production guidance.
The company needs an average of $90+/barrel between now and May 2021 to be able to have enough free cash to pay bondholders.
Try persuading a Judge of High Court that the oil price will be over $90/barrel for another 12 months lol.
adoubleuk
you are correct, it was $28 all in, not £28
$45 a barrel is fiction
slackymebladder - is that the best you can do? - what daily rate does a ramper get paid nowadays? kisses x
Aduk
The cost per bbl is dependent on the production rate because the majority of costs are fixed. So you can’t go back to when it did 20,000 per day and say it was $25 per bbl then because it doesnt work that way.
By extreme example, if it was producing 1000 bbls per day would the opex Capex and G&A only be $25, 000 per day -clearly not... if you want to discuss cost per bbl, you could at least try to understand how it’s calculated and Huw it changes ...
RNSTranslator,
"So what is the cost per bbl mr Sense?"
Interestingly (and to my mind rather tellingly), the latest CPR from ERCE does not give a figure for 'uplift cost per barrel'. So one has to go back to old documentation for that, but of course if the current BoD is to be believed, nothing in years of previous work actually can be believed !
But previous estimates gave an uplift cost (all included) at around $28 / bbl. (Though might be 28 pounds sterling, in which case apologies, but can't be bothered to check.)
Of course, maybe the new BoD might issue a new estimate, saying it's $70 / bbl, that all previous estimates were wrong, and that they're working at a loss, to bolster their attempts to trash the company which is paying their own wages. Nothing would surprise me.
senseman
Posts: 97
Price: 0.78
RE: Revenues and profitsToday 18:42
"Tranny & SlackyBladder
The PInky & Perky virgin act doesn't suit you
The village idiot know one can feed highly paid professionals whatever cherry picked date & financials you want and they write report on what is placed before them
Costing Hurr $45 to produce a barrel of oil - what a crock of cr*p....!!))"
With another of your many examples of childish immature language like the one above you wrote tonight it doesn't take a genius to figure out who the village idiot is.....
Tranny - if Satan told you it was not hot in hell, you would ramp in agreement
Here’s a clue if you’re struggling.
Take the daily costs and divide by the number of bbls produced...
Cost $440000 per day, average bbls produced over the next 15m 9600 bbls /day... happy hear your analysis....but presume you’re still not answering questions?
So what is the cost per bbl mr Sense?
Tranny & SlackyBladder
The PInky & Perky virgin act doesn't suit you
The village idiot know one can feed highly paid professionals whatever cherry picked date & financials you want and they write report on what is placed before them
Costing Hurr $45 to produce a barrel of oil - what a crock of cr*p....!!))
Senseman clearly is totally lacking in sense just like several others who just can't accept what's in black and white and the reason for that is they hold onto this illusion the whole thing from start to finish is a scam.
It's turned out to be one big failure as a business because they simply took on too much debt and the man in charge at the time made catastrophic errors in interpretation of the data which led many to believe in the sheer amount of oil down there. The bubble on that interpretation was finally burst further down the line but by then it was too late.
Sense man
You clearly don’t want to believe these figures signed off by the NOMAD, pwc, ERCE and all their lawyers...are they all colluding with the BoD?
Tranny
I bet my last farthing that the financials produced by the BoD in their presentation would not pass scrutiny via an independent account requesting they be proved
Capex $22mm Opex $153mm G&A $19mm Interest $20mm over 15 months
Add all that up and its $431,000 per day to run the system, at 9600 bbls/day average each barrel costs $44.90 to produce.
Its just maths...
Tranny
How will it cost $45 to produce a barrel between now & doomsday (and for the past few months) when much of the CAPEX already paid for? News to me. Creative BoD presentation accounting?
Agreed
You only have to look at the indepth circular to the bondholders evidencing how much focus and due diligence put into the behind the scenes plan.
Here are the figures from the presentation put in a form everybody should understand:
Total Capex/Opex and G&A from Q2 21 to end Q2 22. $194,000,000 plus $20,000,000 interest payments
Average production rate for the WHOLE period 9600 bbls/day.
Net Revenue i.e Gross revenue minus the above at $60 is $45mm, $65 is $66mm, $70 is $88mm, $75 is $110mm
Even $75/bbl doesn't get you there.
The cost to produce a barrel is $45.
This is before you deal with abandonment provision and early termination fees etc...
This isn't rocket science... not auditors would sign off on this...
hasiba, no, to all your points.
macadder....
Didn’t you read the restructuring plans details mentioned in H1 of 2020 at low oil price of tge average around $34pb ..HUR was breaking even.
Now oil price $68+pb and in fact my estimate of pure profits after costs was a-bit conservative ..
More oil at higher price = better margins of profits in any oil company including HUR....these facts are basic knowledge...
Hasiba As much as you want to consider what if the oil price is higher, thats not the way business decisions are made.
Telling shareholders we're not a going concern but as long as the ESP's stay working and the oil price goes up we'll be fine...