Member Info for affc21

Very happy with the appointment of Fox Davies, speaking from experience with another of my investments where they are also joint broker. We should be getting more frequent updates, as and when any relevant news is released.

That's a very informative couple of posts GRH, which has helped me to understand the merits of sand jet perforating when compared to explosive perforating.

Intrigued by the potential Net Pay increase in MOU-1...

Thanks for sharing your insights

My condolences Fred, wishing you all the best

The Sunday Times

Green ideology is turn off for future of gas

https://twitter.com/OffshoreIreland/status/1655542216255733762?t=Sh2PwOPfHApCktm34Zdu3A&s=09

Apologies if already posted

Pt2
Rosenberg has analyzed PE ratios by energy stocks by looking at historical data since 1990 and found that, on average, the sector ranks in just its 27th percentile historically. In contrast, the S&P 500 sits in its 71st percentile despite last year’s deep selloff.

Even better, the outlook for the energy sector remains bright. According to a Moody's research report, industry earnings will stabilize overall in 2023, though they will come in slightly below levels reached in 2022.

The analysts note that commodity prices have declined from very high levels earlier in 2022, but have predicted that prices are likely to remain cyclically strong through 2023. This, combined with modest growth in volumes, will support strong cash flow generation for oil and gas producers. Moody’s estimates that the U.S. energy sector’s EBITDA for 2022 will clock in at $$623B but fall to $585B in 2023.

The analysts say that low capex, rising uncertainty about the expansion of future supplies and high geopolitical risk premium will, however, continue to support cyclically high oil prices.

In other words, there simply aren’t better places for people investing in the U.S. stock market to park their money if they are looking for serious earnings growth.

Market Deficit

But the biggest reason to be bullish about the sector is that the current oil surplus is likely to morph into a deficit as the quarters roll on.

Oil prices have only been treading water since the big initial gains from the shock announcement, with concerns regarding global demand and recession risks continuing to weigh down the oil markets. Indeed, oil prices have barely budged even after EIA data has shown that U.S. crude stockpiles have been falling while Saudi Arabia will hike its official selling prices for all oil sales to Asian customers starting May.

But StanChart has predicted that the OPEC+ cuts will eventually eliminate the surplus that had built up in the global oil markets. According to the analysts, a large oil surplus started building in late 2022 and spilled over into the first quarter of the current year. The analysts estimate that current oil inventories are 200 million barrels higher than at the start of 2022 and a good 268 million barrels higher than the June 2022 minimum.

However, they are now optimistic that the build over the past two quarters will be gone by November if cuts are maintained all year. In a slightly less bullish scenario, the same will be achieved by the end of the year if the current cuts are reversed around October.

Via the oil price app
Interesting read

Oil prices have lately lost their forward momentum, with both Brent and WTI crude plunging this week. A rather puzzling trend is being observed in the oil markets: there’s a big disconnect between inventory data and oil prices.

Crude oil inventories have fallen below the five-year average for the first time this year. Last week, implied gasoline demand rose by 992 thousand barrels per day (kb/d) w/w to a 15-month high of 9.511mb/d, taking the month-to-date y/y increase. Despite this positive inventory data, WTI prices have declined from $83.26 per barrel on April 12 to $68.85 on May 3 while Brent prices have declined from $87.33 to $72.54 per barrel over the timeframe.

Normally, U.S. inventories and oil prices have a strong inverse relationship, with falling inventories pushing prices higher while rising inventories have the opposite effect. However, large inventory draws over the past couple of weeks have failed to prevent significant price falls. As commodity analysts at Standard Chartered have noted, these dislocations tend to be temporary and come at times when prices are moved primarily by other oil market fundamentals, expectations, broader asset markets and financial flows. In this case, recent optimism regarding OPEC+ production cuts has failed to counter worries about demand linked to a weakening economic backdrop and a hawkish Federal Reserve leading to oil prices remaining range-bound. Further, there are reports that Russian crude shipments remain strong despite sanctions and embargoes: Reuters reported April oil loadings from Russia's western ports are on track to reach their highest since 2019 at more than 2.4M bbl/day.

Inventories
Source: Standard Chartered Research

Thankfully, a cross-section of Wall Street still thinks the energy sector remains good for the long haul.

Goldman Sachs has advised investors to buy energy and mining stocks, saying the two sectors are positioned to benefit from economic growth in China. GS’ commodities strategist has forecast that Brent and WTI crude oil will climb 23% and trade near $100 and $95 per barrel over the next 12 trading months, an outlook that supports their upside view for profits in the energy sector.

"Energy trades at a discounted valuation and remains our preferred cyclical overweight.We also recommend investors own mining stocks, which are levered to China growth through rising metals prices," the investment bank stated in a note to clients.

Indeed, energy stocks remain real cheap, both by absolute and historical standards.

The energy sector is the cheapest of all 11 U.S. market sectors, with a current PE ratio of 6.7. In comparison, the next cheapest sector is Basic Materials with a PE valuation of 10.6 while Financials is third cheapest at a PE value of 14.1 . For some perspective, the S&P 500 average PE ratio currently sits at 22.2. So, we can see that oil and gas stocks remain dirt cheap even after last year’s massive runup, thanks in large part to years of

What I mean to say he comes across as a very down to earth bloke and nowt wrong with that

And not forgetting that PG would also do very well out of any dividend payouts considering his substantial share holding, but having said that he doesn't come across as someone who would enjoy living the high life...

No problem, I do it all the time...

Thanks

Hi BVR,
what page is that on, regarding your:
"MOU-NE areal extent now 126km2 (a 23% increase on the previously reported figure)"

Interesting Thanks

All or part sale of the Moroccan Assets (depending on conditions) and a return of value via a Dividend payment to shareholders (page 33):

Forward Work Programme:

Commence drilling MOU-2.

Well planning for MOU-3 and MOU-4 and procurement of long lead time well equipment.

Rigless testing of MOU-1 and, subject to drilling results, MOU-2 and MOU-3.

Successful drilling and testing results would facilitate a Gas Sales Agreement with end-users in the Moroccan
industrial sector based on an accelerated Compressed Natural Gas development scenario. At this point the
Company may seek, if market conditions are attractive, to monetise all or part of its Moroccan asset through
a trade sale of equity in the Group’s subsidiary company Predator Gas Ventures Ltd. If this scenario were to
occur, and subject to independent tax advice, the Company would consider a return of value to shareholders
in the form of a dividend payment.

Further regarding Corrib South (page 23):

Enter into value adding joint venture and farm-out transactions.
This measures our ability to mitigate risk, share capital expenditure with partners and assist in
meeting licence commitments.

This objective is as yet only partially realised with the entering into of a confidentiality agreement
with an indigenous gas producer in Ireland for a potential acquisition of the Group’s Corrib South
asset, 18 kilometres from the Corrib gas field. This asset is subject to an application for a successor
authorisation being approved by the Irish regulatory authorities.

https://wp-predatoroilandgas-2020.s3.eu-west-2.amazonaws.com/media/2023/04/POGH-2022-Annual-Report.pdf

Corrib South bid:
Towards the end of 2022 the Company received an unsolicited approach from an existing gas producer in
Ireland in respect of its Corrib South successor authorisation. A Confidentiality Agreement was entered into,
and a Data Room was set up The potential introduction of a Windfall Tax in Ireland to address excess profits
made by energy companies during the Energy Crisis may deter companies from investing further in upstream
activities.

Cory Moruga:
The Cory Moruga Licence has seen several wells drilled on it in the past by PAREX and then by TRex and is
covered by 3D seismic. Unrelieved tax losses of at least USD45 million within PAREX and their acquirer TRex
are available for offset against future Petroleum Profit Tax applicable to all production from the Cory Moruga.

In summary, for a Gross Consideration of USD9 million and a net Cash Consideration of USD3 million the
Company is acquiring 1,523,449 barrels of P50 oil resources at the equivalent of USD1.969/barrel and a further
15.5 mm barrels of potential P50 oil resources that are subject to appraisal drilling at USD0.19/barrel.

The Company is looking forward to completing an independent Competent Persons Report on Cory Moruga in
the first half of 2023 incorporating and validating a new subsurface understanding generated in-house by the
Company.
(just reading through this document, will post anything that may will be of interest to people here)

That's interesting Jimmy, I missed your number 2 (that's the downside in trying to read documents on a smart phone , can be restrictive at times).
Time to warm up my laptop I think...
Thanks for your post

Oldandwiser, I'm as confused as you, Under:
a) Going concern and Inter-company loan recoverability.

In the case of Predator Gas Ventures Ltd., recovery of inter-company loans is dependent upon the Guercif drilling programme successfully recovering commercial quantities of gas that can be developed and brought to market. The Moroccan gas market is commercially attractive and even relatively low volumes of discovered gas are likely to be economic. A partial sale of equity in a future potential gas discovery is the preferred strategy for recovery of inter-company loans rather than a longer term dependency on a gas development.

A security deposit of USD1,500,000 (2021: USD1,500,000) is held by Barclays Bank in respect of a guarantee provided to Office National des Hydrocarbures et des Mines (ONHYM) as a condition of being granted the Guercif exploration licence. These funds are refundable on the completion of the Minimum Work Programme set out in the terms of the Guercif Petroleum Agreement and Association Contract.

(That reads to me as a refund to Predator, others may disagree ?)

Nothing new, but interesting none the less:

MOU-1:

On 7 March 2023, the Company announced an update on the proposed testing of the MOU-1 well drilled and completed in 2021 in the area of the Guercif Petroleum Agreement onshore Morocco.

In conformance with the current Moroccan regulatory procedures for rigless well testing, the Company has expressed in writing to the Office National des Hydrocarbures et des Mines ("ONHYM") the intention to test MOU-1.

The Company will begin MOU-1 rigless testing at the very earliest opportunity once the regulatory process has been fully complied with.

MOU-2:

On 25 January 2023, the Company announced that MOU-2 well had been suspended with an option to re-enter after reaching a depth of 1,260 metres Measured Depth.

Wireline logs were acquired from the 95/8" casing point at 677 metres to 1,010 metres Measured Depth. The wireline logging tools were not able to log deeper than this depth due the presence of extremely sticky clays in a geological formation overlying the Moulouya Fan primary objective.

The debris flow potentially forms a highly effective seal on the underlying Moulouya Fan. The thickness of the Moulouya Fan reservoir interval is expected to increase between MOU-1 and MOU-2 based on the sand content of the debris-flow penetrated in MOU-2 allowed an extrapolation across to MOU-1 to be made. A re-entry and deepening of MOU-2 will be fully evaluated once a solution to optimising the drilling mud programme and mud properties has been completed.