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Correction - $250m.
On a deeper dive into Waldorf assets I see they have substantial holding in the NS including a 40% holding in Catcher, 25.7% in Alba and 50% holding in Enquest operated Scolty - Crathes, and 5 other fields.
A mixed bag and possibly a good deal to be made on a job-lot basis. But that's as far as I'm digging.
The cards are in the air, let's see where they fall.
Waldorf has concluded contingent payment terms with CNE on it's 2021 acquisition of interests in Kraken and Catcher, clearing the decks for onward sale.
To whom?
I don't think ENQ would be looking for 100% of Kraken.
HBR might be in the frame for an additional 20% of Catcher on top of their current 50%.
Many players out there but my interest is in Ithaca as a possible acquirer.
My rough numbers, c. 13K boepd in 2023, c. 11.5K boepd in 2024.
At $60 netback, CT on Catcher, EPL on both, I have c. $100m FCF for 2024. Worth $250?
Rough numbers but interesting.
North Sea firms hand back swathes of licences to NSTA regulator
Almost 57% of licence awards from the 32nd round three years ago have now been handed back.
https://www.energyvoice.com/oilandgas/north-sea/542986/north-sea-licences-relinquished/#:~:text=Almost%2057%25%20of%20licence%20awards
Https://www.malcysblog.com/2023/12/oil-price-san-leon-reabold-sound-ithaca-and-finally/
Good to read this final paragraph:
“All systems go for Ithaca at Cambo now and it makes it possible for the company to control its own destiny. Ithaca has the critical mass to remain one of the leading players in the industry going forward and with its commitment to paying out a huge amount to shareholders it comes with a 20+ % yield, what’s not to like?”
Be helpful if the markets took notice!
Hoping there is something within the update to shift the share price….. it seems to need a bit of a nudge…..
Https://www.investis-live.com/ithaca-energy/654a5da9464d140d008d31a0/mfdo
ITHACA ENERGY ANNOUNCES SUCCESSFUL COMPLETION OF ACQUISITION OF REMAINING STAKE IN THE FOTLA DISCOVERY AND THREE EXPLORATION LICENSES
Completion of acquisition of remaining stake in the Fotla Discovery
Ithaca Energy (LON: ITH) is pleased to announce the successful completion of its acquisition of the remaining 40% stake in the Fotla Discovery and three exploration licences (P.213 Area C, P.345 Area A and P.2536), previously announced on 12 July 2023, from Spirit Energy. The acquisition brings the Group's working interest in the Fotla Discovery to 100%.
The Fotla Discovery, operated by Ithaca Energy, is located in Block 22/1b of the UK North Sea in 431 ft of water, approximately 10 km southwest of the Ithaca Energy operated Alba field. The field was discovered in August 2021 by the Group's drilling of the 22/1b-12 well and subsequently appraised by two side-tracks. As previously stated, development plans are currently being evaluated, with first production from the Fotla Discovery targeted in 2026. The conceptual field development plan consists of a subsea tieback to existing infrastructure.
Alan Bruce, Chief Executive Officer, Ithaca Energy, commented: "We are delighted to announce the completion of this acquisition which provides Ithaca Energy with full control over the pre-final investment decision work programme and timing of project sanction. The deal strengthens our high-quality development portfolio and demonstrates further delivery of our clearly articulated strategy."
So now we know why the bounce yesterday
“ LONDON, Oct 30 (Reuters) - Britain's oil and gas regulator, the North Sea Transition Authority (NSTA), on Monday awarded 27 new hydrocarbon exploration licenses, even as climate activists criticise the government for allowing fresh drilling.
Among the successful bidders to drill for new oil and gas in the British North Sea are Shell (SHEL.L) - with the most licenses, Equinor (EQNR.OL), DNO (DNO.OL) , Aker BP (AKRBP.OL), Ithaca (ITH.L), TotalEnergies (TTEF.PA) and BP (BP.L).“
Things are looking up !
What did I miss…. anything incoming news wise?
As contrary as it sounds, it’s nice to be blue on a Monday morning !
Bloomberg
Cambo Oil Field Revival Hinges on UK Fiscal Review, Ithaca Says:
Company seeks more stability on North Sea investment
Rosebank oil and gas field just received government approval
Ithaca Energy Plc is awaiting the outcome of a fiscal review in the UK before committing to the development of the controversial Cambo oil field in the North Sea.
“We would like to move ahead if the environment is supportive,” Ithaca Chairman Gilad Myerson said in an interview. “More than anything we need stability and we need conviction that the fiscal environment will be a long-term one, and that it will last for at least the lifecycle of a project.”
https://www.bloomberg.com/news/articles/2023-09-29/cambo-oil-field-revival-hinges-on-uk-fiscal-review-ithaca-says?leadSource=uverify%20wall
Thats great news!
Hope to see some news regarding partial sale of Cambo as well, benefitting from Rosebanks green light. Quite sure 100% share is not ITHs target project allocation.
About time too !
Hoping the shares get re rated
"The controversial Rosebank offshore development off Shetland has been granted consent by regulators.
Located 80 miles of west of Shetland, Rosebank is the UK's largest untapped oil field and is estimated to contain 500 million barrels of oil.
Development and production consents have been given to owners Equinor and Ithaca Energy, following the acceptance of an environmental statement..."
https://www.bbc.co.uk/news/uk-scotland-scotland-business-66933346
Should be due as soon as the big wigs return from their holidays
“During July, the Group announced successful exploration drilling at the K2 prospect together with the decision to proceed with follow on appraisal drilling. Results from the appraisal side-track are expected during September and will provide further data to determine a recoverable resource estimate and future development activity. The K2 prospect is an excellent demonstration of the Group's BUILD strategy targeting opportunities close to existing infrastructure to maximise value.”
O&G Exploration, Development, and Production is a very very high risk/cost business, hence, why would anyone/company with half a brain invest here in the NS and take all relating risks/costs while this now nonsensical crazy tax regime and costs (not forgetting NS decommissioning, Environmental, HSE, Net Zero……..etc.) are in place so that then the UK government can take any potential profits for nothing/personal political agendas; “Energy Security” in the UK has become a meaningless political slogan at a time when it should have become a top priority, DYOR!
Source: https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/oil/090623-interview-equinors-uk-rosebank-oil-project-to-be-crown-jewel-of-decarbonization
Equinor speaks first, followed by ITH chair Myerson.
Keep my fingers crossed that both projects will be sanctioned this year. Market has priced in certain level of divi-cut for 2024 if you ask me. Any positive development around these projects should boost Ithaca.
With oil prices now at $90+ and expected to rise further and OPEC+ cuts until year end, the likes of ITH should be raking it in and thus plenty of cash flow to secure dividend in 2025
Thanks for your thoughts Tamovv.
On the divi, I’m going to pencil in $200m until we get better guidance on the production number for next year. I do think they’ll have to b conservative, and ensure they still pay off a good chunk of the debt, especially whilst the two main development projects remain on ice.
That would give us $133m at the year-end results and another $100m around this time next year.
What I do find odd is why the drilling at GSA has been postponed. The tax regime is horrendous BUT the investment allowance is small bright spot. Labour, only last week, were still talking about a proper windfall tax and removing the improved allowance, I would have thought next year would be a good opportunity to proceed with any short cycle activities.
As you say, the hedging has and continues to be excellent. Harbour could learn a lot, especially given their Gas hedging for next year is still awful.
I do remain optimistic that once the current government see the damage they’re doing to the industry they’ll tweak the tax regime, this could be done in the on-going fiscal review. Whatever folk think about Oil & Gas we still need to produce it whilst there’s demand for it.