Adam Davidson, CEO of Trident Royalties, discusses offtake milestones and catalysts to boost FY24. Watch the video here.
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Today they informed of a failed drill, with very little oil in place that could not even flow. They will wait some more time and try to get additional data before abandoning the drill. They also expect to get oil from other horizon in the same well, despite there a third horizon that is uneconomic. I'd expect another drop on this news, besides the drop after announcing the deal, will this affect the vote on the merger?
Hi Modestus,
If you have email I will write with some questions about the canadian oil&gas companies and oil service companies. Mine is l3traderuk at the gmail ...
just got dividends from CPG, and might add to my holding.
ATB
Hi Modestus,
Many thanks. I did sell VET at some point, but bought part back when they tanked a few weeks ago. My CPG puchases were a few months ago, at close to 7USD. but, I might add more even as they are now 30% higher.
I will look at the ones you mention, namely ESTE.
Suncor has done very well, as you will have noticed.
ATB,
L3
p.s.: North Sea focussed oil&gas companies will have a hard time regaining momentum, because of the new levy.
Another good buy lately were my ESTE-shares @ 13-14 USD : have rallied to 18-20 USD in no time : https://seekingalpha.com/article/4516003-earthstone-energy-este-investor-presentation-slideshow
Hi L3, i have added lots of CPG @ USD 6,50-7,50 and VET @ USD 17,50-20,25. Even when i have bought many many more at much much lower prices (cheapest CPG @ USD 1.50, VET @ USD 1.85) , so yes, i have conviction. I have more expensive CPG too by the way, i already bought CPG-shares 2016 and 2017. Very happy with the LPI-shares i bought very recently @ USD 60-65, have gone up over 50% in a matter of weeks. Much less happy with my big HBR-position for now, but i continue to see the value despite the British Government's vile move. Not sure what to think about the TLW-CNE-merger, if we can have a sustainably higher oil price for several more years, it could prove to be a very good deal.
Hi Modestus,
Thank you for the new names of Canadian companies. I was not looking at the SP of them for close to two weeks i should have increased my CPG holdings. I will look at Spartan Delta.
Unfortunately all of thse holding sit outsite tax wrappers so selling them will attract CGains tax. Then again I would rather pay this tax directly than pay indirectly via the companies them seles as with the new levy on UK production. I saw it coming but thought it would be a windfall tax, not a multy-year tax and such a high rate. It is absolutely farsical that the high prices of oil are already leading most companies to have huge tax bills this year at the old 40% rate. I fully agree with your comment on the ENQ bb. The new levy is so poorly thought out: "when oil price is back to normal, levy will end".. what the heck is normal $100/bbl? $65/bbl? As you wrote there confidence in the UK NS oi industry is gone. What investor seating overseas will want to invest or lend money to companies? To compute the levy financial expenses do not enter the profit calculation. So, a very indebted company could sill pay a huge amount of tax, even if it made a zero accounting profit because of its finance expenses. Think when ENQ was paying $200M in finance expenses. It would have to pay 25% of that as levy on top of those $200M.
I will keep posting here. The ENQ bb's environment realy does not suit my interaction style. So, I will post here more regularly.
ATB,
L3
Ps Another interesting Canadian natural gas stock i've started accumulating recently and that is making new highs very regularly is Spartan Delta (SDE), L3.
The future looks good here too : https://seekingalpha.com/article/4513099-transglobe-energy-cash-flow-guidance-under-the-new-contract
Hi L3,
CJ and CVE are running like a train indeed and are making constantly new year highs.
CPG and especially VET are having it more difficult to make a new year high, but i think there 's no specific reason for that. In the past days I have been adding a lot of CPG and VET as i believe there is much much upside left. Both have amongst the highest netbacks and highest free cash flow yields amongst companies in the Canadian oil patch. Both printing money. CPG has raised the dividend again, VET starts again with a paltry 0,06 CAD quarterly dividend, but both these companies have paid gigantic dividends before 2016. I suppose share price will rocket when we get back to much higher dividends which surely will be coming our way if oil and gas prices continue to cooperate. Both CPG and VET have been on the brink of collapse because of too high debt and not cutting dividends soon enough. It will take some more time to regain market's confidence, but i am confident both have a brilliant future.
Thank you for the detailed explanation about the contingency payments for CNE, L3. I own CNE-shares, even added yesterday. Again, i must add. It is the 3rd time i have built a position in CNE, have sold 2 times with a very nice profit. Intend to hold for a long time this time. Have built a considerable position in HBR too.
ATB,
Modestus
Hi Modestus,
Thank you.
CJ is one I had never looked at. Their performance is very impressive. So, you will net a 150% dividend yield on your purchase price. That is like winning the lottery.
I am actually surprised that CPG is not heading higher. I guess this will allow me to increase my position there.
Do you have any idea why?
Have you looked at CNE (Cairn/Capricorn)? I have holding there and only see positives. They are bound to make a lot of money from the contingency payments associated with their sale of Kraken and Catcher:
"Additional consideration payable based on a share of revenues generated by Brent prices in excess of US$52/bbl in the years 2021 to 2025"
"The amount of any Earn Out Consideration payable in respect of any year will be equal to the amount
by which Average Daily Brent Crude Price for that year exceeds US$52/bbl multiplied by the number
of barrels of production in that year in relation to the Sale Interests multiplied by a percentage rate set
for each year."
The percentage rates agreed for each year are:
• in respect of 2021, 60%;
• in respect of 2022, 50%;
• in respect of 2023, 40%;
• in respect of 2024, 30%; and
• in respect of 2025, 20%.
So, this year it is 50%. Assume Kraken produces 26Kbopd. CNE's WI was 29.5%. So, 2.8MMbbls. Assume it is sold at an average of $102/bbl as it is VLSFO. So, 50% x $50 x 2.8 MMbbls = $70M without doing anything for it. If you add Catcher We are talking about c. $100M this year.
Now, the interesting thing that most people following ENQ have not noticed is that their announcement had valuable infor about the Kraken field:
https://www.capricornenergy.com/media/2980/north-sea-circular.pdf
According to CNE, at the end of 2020, ENQ's 2P reserves in Kraken were 54MMbbls, but in 2021 they produced 8MMbbls. So 2P reserves left would be 46MMbbls at the start of this year.
ATB,
L3
Hi L3, VET, CPG, CVE and CJ are my biggest Canadian positions. Less than 2 years ago, those who still had money left could buy CJ-shares for 0,40 CAD. Today, the same CJ-share is worth 8,02 CAD. And starting in June, CJ will pay a monthly dividend of 0,05 CAD = 0,60 CAD/year. So those who had optimal timing 2 years ago paid less for the share than the dividend they will receive this next year. Incredible.
Hi Modestus,
Thank you for the links. That is very impressive and a huge return. Many congratulations.
By the way my Canadian holdings (VET, CPG) doing quite well. Thank you very much for brininging them to my attention. SUNCOR doing quite well (I wish I had added more...).
More on email at l3traderuk ....
Hi canetoad, thank you for the tip. I will look at it.
ATB
https://seekingalpha.com/article/4486683-transglobe-energy-stock-egypt-contract
https://seekingalpha.com/news/3814395-transglobe-energy-gaap-eps-of-009-revenue-of-9343m
https://seekingalpha.com/news/3814384-transglobe-energy-declares-010-dividend
https://seekingalpha.com/article/4496410-transglobe-energy-passing-cash
Hi L3, my cheapest Trans Globe i bought @ 0,55$ . So the 0,20$-dividend (0,10 = semi-annual) will give a nice yield.
@L3: I'm just starting to investigate TGL.
If you're interested in Canadian oilers, have a look at I3E. It used to be an explorer, but transformed itself over the past year into a stable producer (~20k boepd). It's worth investigating.
Hi Modestus,
Many thanks for this.
I will post on ths BB to ask your views on this and Canadian and other oil companies. I am not following ENQ's bb that closely any more. In fact, unless there is a RNS I won't post there until the results are announced on March 24. The TU allowed me to update my views on ENQ as an investment for now.
ATB
L3
Hi L3, sorry i did not see your message, i only visit this board when i get another article fro SA on TGL (TGA on US Stock Market). Hope the new article and comment section provide your answer : https://seekingalpha.com/article/4482642-transglobe-energy-results-come-in
Hi Modestus,
Hope you are well.
What is your view on this year's prospects given the most recent Operations update? (Canada production seems fine, but production declining in Egypt). The signing of the Egypt agreement is good in terms of visibility.
ATB,
L3
But hadding a closer loook: Worried about decline and ****ty field-performance in Egypt. Overall negative, IMO.
Initial Production Rates far above Expectations --> The Block is derisked and extremely Valuable!
https://finance.yahoo.com/news/transglobe-energy-corporation-announces-ratification-140500745.html
https://seekingalpha.com/article/4461620-transglobe-energy-results-begin-to-come-in
Update : https://seekingalpha.com/article/4457948-transglobe-energy-new-production-ahead-of-time