focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
Just realised I posted the wrong link below, was meant to be this one "North Sea oil and gas veteran Les Thomas has called for cross party-political backing for the industry.
This is needed “now more than ever”, he said, adding: “Unfortunately, domestic oil and gas has been leveraged for short-term political gain, threatening the energy security of the UK and damaging long-term economic growth.”
https://www.energyvoice.com/oilandgas/north-sea/553461/north-sea-oil-bosses-pull-no-punches-over-uk-energy-policy-jersey-oil-and-gas-buchan/
From this in the RNS today "As a result, working alongside these sector experts, we are evaluating the Jersey Government's potential interest in creating a utility scale wind farm in the Channel Islands." Seems to to tie in with this https://www.gov.je/Environment/ClimateEmergency/JerseyClimateEmergency/GreenHouseEmissions/pages/offshorewindpower.aspx
They built a team to extract oil from late life oil assets in the North Sea, and are now looking to get involved with windfarms off the coast of France/Jersey, do they have the expertise for this? and how much will it cost? It also says to me they're probably not looking to sell the business post FEED which despite all the confirmations everything is on track, albeit with no new information, with what to me is an indication they're not looking to sell I read it as a dissapointing update.
Western Isles getting closer to returning for its refurb soon https://kingfisherbulletin.org/notice-map?noticeId=4100
I always wondered if JOG would look to pick up more licences in the 33rd round but after todays announcement it now looks almost certain they haven't https://www.nstauthority.co.uk/regulatory-information/licensing-and-consents/licensing/ I can see NEO have picked something up in the latest tranche. The way I see it JOG is now more or less a minority equity partner with Neo holding all the cards. Given verbier didn't turn out as planned when Equinor walked away I hoped they might have picked up a new licence to polish up like they did with Buchan and something to focus their efforts since Buchan is out of their hands. Does make you wonder what all the remaining JOG staff have to do day to day now Neo are running things.
This has it moving down now for H2 https://www.energyvoice.com/oilandgas/551595/definite-potential-for-neo-acquisition-with-risk-to-buyer/ although having regularly checked in on its position recently there does appear to be more than usual activity around it latley and this has a pipeline connecting to it being disconnected on 24/4 https://fishsafe.org/en/news/ "The 6" gas export / import pipeline between the Western Isles and Tern Developments will be decommissioned.
The Pipeline will be disconnected from the Tern subsea isolation valve (within the Tern platform 500 m safety exclusion zone) and the Western Isles North Riser Base (within the Western Isles FPSO / mid-water arches 500 m safety exclusion zones). Surface-laid connecting spools and associated mattresses at both ends of the pipeline will be removed. The pipeline sections back to the existing rock armour cover will be cut and recovered. The exposed ends will be temporarily protected useing concrete mattresses, and subsequently permanenty covered with new rock armour." I know serica have said the final decision will be made until the latter part of 2024 https://www.oedigital.com/news/513280-esgian-week-17-report-new-contracts-for-the-north-sea I hope this is simply political postering by Serica on behalf of Neo to try and stop the EPL going any higher, and as long as it stops by the end of Labour's first term, maybe the cost of the Western Isles and other costs could be capitalised to keep profits and tax down until the EPL is removed and ramp up profits soon after, although our resident accountant will know more about that than me.
Based on this I'm not expecting any new Buchan information today from the Serica presentation https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://www.serica-energy.com/downloads/presentations/AR_2023_final.pdf&ved=2ahUKEwj19bLE79qFAxXNYEEAHXZABYwQFnoECCoQAQ&usg=AOvVaw1sxNIYCHoRy3mu9-pW-9KM that they refer to it as 'potential'Buchan Horst project might partly explain why the SP of JOG remains subdued, I would have liked some more definite language, those approvals can't come soon enough.
Several documents on here relating to Buchan approvals with letters back and forth between Neo and secretary of state, most recent from a couple of weeks ago https://www.gov.uk/government/publications/buchan-redevelopment-project
Nice little summary https://www.offshore-technology.com/projects/buchan-horst-oil-field-uk/?cf-view
This is what was announced woth respect to contracts for the refurb Onthe6 https://www.pressandjournal.co.uk/fp/business/6269212/pivotal-work-on-giant-western-isles-vessel-is-happy-landing-for-apollo/
"The agreement with equity partner Neo Energy stipulates that production from the North Sea vessel will cease "on or around" March 31, 2024" https://www.oilandgaspeople.com/news/story/dana-petroleum-announces-end-of-production-for-western-isles-fpso Western Isles is due to starts its return for refit any time now, could be a good indication things are still on schedule or not when it does https://www.vesselfinder.com/vessels/details/9736171
Cuphalful, my thinking for revenue not coming to jog from day one is down to thinking the oil will need to be transported and processed before it's sold, presumably through its own Ltd company such as this https://find-and-update.company-information.service.gov.uk/company/14746451 there might be assets capitalised on their accounts and depreciation deducted such as maybe the Western Isles depending on who actually owns that along with other costs before what's left is distributed to the shareholders of Buchan, and Jog gets its 20%, which is what I'm not expecting to be on day 1 of oil being extracted hence my comment I'm guessing that is still at least 2 years off.
Is it not just more simply Neo I assume won't be paying a dividend to Buchan shareholdeds from day 1 of oil coming up so it's still minimum 2, maybe 2.5 years, until Jog start to receive a proper revenue stream, that's plenty of time to wait and buy-in and if I wasn't already a LTH and seen how the SP can double I'd be tempted to come back in 12 months before buying in. If there was any hint of Neo not coming through on this I've no doubt the price would be closer or less than money in the bank like it has been in the past as without Neo in my view Jog are effectively owning 20% of nothing. Given they've handed out now 80% of their share and the conjecture of Neo not proceeding (which I don't see any reason why they wouldn't, the 'P' is afterall an integral part of any E&P company) it would still be interesting to know if there's any penalty clauses for delays within Neo's control to keep Neo honest on the progression or at least if Neo decided not to proceed something to say Neo have to give their share of the GBA back. In the meantime I'll keep my shares tucked away and hope someone sees the long term value and buys them for a sensible price, if not, either way in 2 years time I'm sure I'll be very happy with my investment.
Https://bnnbreaking.com/finance-nav/waldorf-production-sets-sights-on-uk-north-sea-acquisitions-amid-rising-windfall-taxes they already have a few stakes around the 20% surely at these prices it's only a matter of time before someone like this comes in and swoops up Jog
It seems a pretty safe bet the investment relief could be gone by the end of the year when the government changes, unless someone manages to reign milliband in. I do take some comfort in Labour's position on the NS has been known for a while, as much as you can say their usually vacuous policies are known, with Serica only recently finalising their part it should still go ahead even if the investment allowance is removed.
Doesn't mean a great deal since it's almost a certainty we'll have a new government come October but https://www.reuters.com/world/uk/uks-hunt-set-extend-energy-windfall-tax-by-one-year-sources-2024-03-04/
Https://www.telegraph.co.uk/business/2024/02/27/labour-north-sea-tax-raid-oil-production-fears/ not great reading for any LTH
Another new one here https://youtu.be/Sayz-DCNHQ8?si=oK1A49cS5QHYbqVx or this https://www.cruxinvestor.com/posts/jersey-oil-gas---leveraged-returns-from-north-sea-oil-discovery I suppose there's no point dwelling too much on what might have been but I do wonder where we'd be now if they'd just offered Equinor 80% 3 years ago instead of the 50% equinor turned down, always easy to say in hindsight. I also wonder if not wrapping Verbier up in a parralel Buchan FDP submission might have something to do with the payments triggered to Equinor when the Verbier FDP and first oil happen. I think the 3.5x will be like the aim to leave themselves with 25%-20% and ending up with 20%, and in reality they're expecting more like 3x than 3.5x it doesn't look much like a sellers market to me at the moment. GLA and remaining hopeful of a quick sale.
Https://www.energyvoice.com/oilandgas/north-sea/547590/analysis-labour-windfall-tax-north-sea-values/ I read the Politico piece at the weekend and thought about posting but seemed overly gloomy, having just found this link perhaps it's not, it gives a few case studies with drops in portfolio value between 18-43%. Would be interested to see if the brokers revise their target price when labour get in, £4 might be a looking more realistic to me right now, with Labour wanting to make the oil cos feel the most pain possible and still a chance Neo might decide to moth ball and with the Serica signing dragging on. I'd love to see them bought out but I think cornishoilpirate has been getting over excited about his iminent takeover rumour and his 2 and 5 keys on his keyboard have become stuck together. If only Truss had the sense to cancel the white elephant that was HS2 at the same time as announcing unfunded tax cuts we might not be staring at a government who are getting ready for unfunded benefits increases instead
Https://www.telegraph.co.uk/politics/2024/02/09/rishi-sunak-latest-news-labour-green-pledge-starmer-live/so increased and extended but not backdated, could be better, could be worse.