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Kistos Energy Norway AS (KENAS) update for the second quarter of 2023
OPERATIONAL
Since the end of June 2023, production from the Balder Area has averaged approximately 2 500 b/d net to KENAS. However, partly due to a planned maintenance period, which was completed on schedule in June, the average rate net to KENAS in the second quarter of 2023 was 1 684 b/d. Output was positively impacted by the restart of the riser at Ringhorne in May. This was temporarily shut-in during the first quarter and will be permanently replaced in the third quarter during the planned Balder FPU turnaround. A new well at Ringhorne was brought on stream during the quarter and production efficiency for Balder/Ringhorne improved to 83% from 80% in the previous three months.
The upgrade of the Jotun FPSO for the Balder X development project is ongoing and the re-float of the vessel out of dry-dock occurred in late in June. This enabled the safe completion of the heavy-lift installation of the turret, turntable, and gantry in July. The operator (Vår Energi ASA) has reported that the upgrade of the FPSO remains on critical path and that it is focussed on securing sail-away in the second quarter of 2024 and production start-up in the third quarter of 2024.
Balder X drilling activities are progressing well with seven out of 15 wells completed. The last well was the first multilateral and represents the longest reservoir section ever drilled in the Balder area, with a total length of 1,153 metres in the reservoir. The project’s subsea equipment has been delivered and the majority is already installed. Two of the six offshore installation campaigns planned this year have been completed according to plan.
The operator did not provide any update to its 2P reserves or the Balder Area during the period. As of December 31, 2022, KENAS estimated its 2P reserves were 24 MMboe.
FINANCIAL
During the second quarter, 3 cargoes of crude oil were loaded from the Balder FPU. Net to KENAS, these totalled 185 kbbl, which realised an average price of USD 72.74 per bbl. At the end of the period, KENAS had cash at bank of 8.0 MUSD, of which 1.1 MUSD was restricted and had drawn 14.4 MUSD under the terms of the revolving credit facility from its parent company, Kistos plc.
A near tripling of production in Norway and the UK and steady production in the Netherlands make our monthly production figures look far more healthy at just over 9000 barrels per day.
Norway (Oil)
Total production of 0.095092 millSm3 or 598,129 barrels of oil up from 0.037063 millSm3 in April. That's 19,294 barrels per day. Our net 10% interest = 1924 barrels per day of oil.
UK GLA (Gas)
Total production of 112.4 mmscf/d or 19922 boepd up from 43 mmscf/d in April. Our net 20% interest = 3984 boepd of gas and 180 barrels/day of oil
Netherlands (Gas)
Total production of 25.338.692 Nm3 or 153,208 boe up from 24.857.296 in April. That's 4942 boepd. Our net 60% interest = 2965 boepd
aimo dyor.
It's an interesting consideration, I think he may have but following the WFT, UK OnG direction (despite Sunaks recent about turn, Labour will be in and they will turn their full support to windfarm development ONshore) and AA expecting "Mime’s capital expenditures to reach up to $130m for 2023" it's a bridge too far, IOG currently loosing £28.45m per annum ( as I read it) what would turn that around. More drilling/ exploration risks?
I am not saying your wrong as if he stepped in with a sound plan and support from more lenders it's not impossible but his comments in April " “Kistos has evaluated several transactions in the UK and Dutch sectors, but the imposition of punitive windfall taxes and a lack of fiscal certainty have meant that both countries remain difficult places to commit capital and ensure continuity of shareholder returns.”
And commitment to Mime plus more costs in NL AND consistant / recent drilling fails would have bruised even him.
Again I think the UK instability of Tory and Labour policy is the final straw for him.
Would be nice though, but another item that has changed is even the carbon neutral gas (that AA was promoting and selling at a premium) is irrelevant to the Co2 / green / narrative now.
IMHO of course.
I sold half my holdings in Kistos, not at the peak only to much after. Would like to have come back in at the 230p level again but and too committed to older speculations at moment. Hopefully, one being GKP, is resolved before Kistos moves up too much again.
Rgds Sft
I believe Andrew Austin tried to buy IOG in the RRE days, i wonder if he will try again, looks like they are in deep trouble with default on their bonds looking like a possibility
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The Government has signalled that it will rethink its windfall taxes on oil and gas profits after the Prime Minister announced hundreds of North Sea oil contracts.
The Treasury has already committed to keeping the so-called Energy Profits Levy in place until March 2028 as companies saw their earnings surge after Putin’s invasion of Ukraine.
However, today ministers launched a call for evidence seeking views on the “evolving context for taxes” on the sector over the long term.
Rishi Sunak said the projects were vital for Britain’s energy security amid the war in Ukraine and pointed to new analysis showing domestic gas production has around one-quarter the carbon footprint of imported liquified natural gas.
Rishi Sunak will travel to Aberdeenshire to reveal that North East Scotland and the Humber have been chosen as the locations for two new carbon capture usage and storage clusters, which could support up to 50,000 jobs.
The Prime Minister said a quarter of Britain’s energy needs will be met by oil and gas even if Britain meets its net zero targets by 2050.
Mr Sunak said: “We have all witnessed how Putin has manipulated and weaponised energy – disrupting supply and stalling growth in countries around the world.
“Now more than ever, it’s vital that we bolster our energy security and capitalise on that independence to deliver more affordable, clean energy to British homes and businesses.
“Even when we’ve reached net zero in 2050, a quarter of our energy needs will come from oil and gas. But there are those who would rather that it come from hostile states than from the supplies we have here at home.
“We’re choosing to power up Britain from Britain and invest in crucial industries such as carbon capture and storage, rather than depend on more carbon intensive gas imports from overseas – which will support thousands of skilled jobs, unlock further opportunities for green technologies and grow the economy.”
NoQuestionMarks, howdo those projections compare to the Kistos projections given at the time of Mime acquisition?
Excellent progress being made at Balder and Ringhorne, the Mime acquisition is going to be another superb piece of business the team.
Jotun FPSO re-float and installation of the turret safely completed. On track for >50% production growth by end-2025. Production efficiency of 83% with planned maintenance in the quarter. Restart of the riser at Ringhorne in May with permanent replacement scheduled in Q3. Planned turnaround in Q3 and high-activity period at Balder FPU ongoing. Improved drilling performance with increased drill speed and reduced costs.
https://s29.q4cdn.com/674042470/files/doc_news/att-1-Vr-Energi-reports-second-quarter-2023-results-2023.pdf
Berenberg and Panmure Gordon are our in house brokers so their advice is not seen by many as strictly impartial.
However, I agree with their sentiment.
£196m for all that we have going on is bonkers.
Kistos tipped for more growth, analyst targets 100% upside
https://www.proactiveinvestors.co.uk/companies/news/1021483/kistos-tipped-for-more-growth-analyst-targets-100-upside-1021483.html
Ura only 4 mill msg cap with the mine open before year end
3 bag at least imho
I think he will be investing more into that company they need a bit more to open the mine
But the value is over 250 mill recent jorc mine is pretty much operational in a few months
In follow AA IN TOMORROW
A little bit of speculation and diversification by AA?
" £50,000 participation in the CLN by Austin Acquisitions 1 Limited, a personal investment company of Mr Andrew Austin, which we BELIEVE speaks highly of confidence in our strategy and plans"
https://www.londonstockexchange.com/news-article/URAH/placing-subscription-and-cln-to-raise-ps330-000/15967460
Rgds Sft
Could be multibagger mine reopening this year Jorc
Over 250 mill
Berenberg upgrading Kistos to £4.8 - does anyone have access to their full update on Kistos?
Why Kistos Holdings Plc (LON:KIST) Looks Like A Quality Company
- Simply Wall St / Yahoo Finance
https://finance.yahoo.com/news/why-kistos-holdings-plc-lon-092322294.html
Very good news, I must admit I wasn't too hopeful that we would succeed.
Over 100MMboe of 2P and 2C now puts us back on the radar of buyers.
"As a result of this positive news, Kistos estimates Group 2P reserves of 36.2MMboe and 2C resources of 72.2MMboe, making the overall Group 2P reserves plus 2C resources, 108.4MMboe."
Kistos advances as appeal win sees Dutch project retained ...
https://www.proactiveinvestors.co.uk/companies/news/1021342/kistos-holdings-advances-as-appeal-win-sees-dutch-project-retained-1021342.html
New - Agreed.
Personally, id like like another 2 deals in at least similar in size to GLA & Tulip with existing production already in place in order to build up the cash hoard. Maybe even something outside Europe.
My target since IPO has always been between £8-£10 for a takeover price. Hopefully the 'deal maker' will get us over the line over the next 2-3 years.
OM1984,
AA could well have his eye on other 'bargain' assets, for which he may want to do one more deal, then package and sell off KISTOS, done it before has he not.
atb
Taqa assets in the Dutch sector and still for sale since the Waldorf deal fell through. Wouldn't rule out AA looking at these assets if the price is right! Taqa clearly want rid, since the deal fell through they haven't even added the assets back onto their website.
IMO - A bargain to be had!
TMC1 is a self-proclaimed shorter and its posts always reflect that position, just don't engage or reply on its subject thread.
As for today's news, really great adds value via reserves once again and can set AA up to sell off KISTOS. After watching his recent interview I got the impression his excitement of O&G industry has be drained out of him with these punitive taxes. He will be looking to sell off KIST asap imo for more than today's market price for sure.
aimo & dyor
The UK is an outlier here. AA will expand in Norway and somewhere else........and 'may' do something in Netherlands if gas stays at this price. The UK is a gas wasteland with their energy profits levy with gas prices where they are. It could actually reduce tax income overall where prices are at.
I am not wrong. There are no extra taxes at the current tff gas price.
No windfall tax at these prices on ANY dutch gas
Your post didn't age well mate, less than 12 hours in fact.