Member Info for Biffadog

Hi IJWT,

Do you really think HUR can get two FFD projects signed off in under 20 months ?

That's all the GWA and GLA drilling and subsequent analysis work, CPR, finding a FO partner for GLA, putting the finances in place, FEED and finally FID. There is just not enough time to do it, that's why not.

It looks to me that HUR think it will take nearer 4-5 years.

Do you think it is possible ? (Yes or No will suffice).

GLA.

RT says "By the mid 20's we should (be)have two new FFDs on"

It can only mean one thing, as there is no way that HUR (and partners) will have two FFDs signed off by mid 2020, it's just not possible.

The terminology used says mid 20's not mid 2020, so I don't think it's that ambiguous anyway.

GLA.

Hi IJWT,

Didn't we do that one to death (and I mean to death) only very recently (in the last 4 weeks) ?

The deal is done and actual plans are afoot for a second FPSO, rather than just having it on a wish list for some stage in the future.

I appreciate it wasn't your preference but the deal is done now.

GLA.

"Forget the CPR, just look at the facts." ADUK.

I thought the CPR was the facts !

Anyway, Warwick looks good to me.

GLA.

Another interesting point covered in the RT/ Edison interview, is that any work required as a result of the tie-in to Lincoln will be done after Lincoln has been drilled. It makes sense, as it would be presumptuous of Spirit to spend the money on any upgrades to the AM, without having first got a result from the Lincoln drill.

So, as I alluded in my recent post any delays in Dubai are not down to the Spirit deal.

I'm really pleased that the Lincoln drill is before the two Warwick drills, as Lincoln's success is more certain than Warwick. If Warwick fails for any reason, the SP will be in a much better place to take the hit, having been boosted by a successfully producing Lancaster EPS and a good result at Lincoln (assuming they both go to plan of course).

For the avoidance of any doubt, I'm not suggesting Warwick will be a dud, as I'm very hopeful from the CPR that it will be a real winner.

GLA.

FWIW I think some of you are reading far too much into this. I'm pretty sure that the AM will start her sea trials in due course over the next few days and sail away shortly after.

I don't think it has anything to do with the Spirit deal or that there is a problem with the AM.

The AM has been in Dubai for a year, all the EPS work at Lancaster work is done and dusted and on time, so I just don't understand the "hysteria" that seems to be developing over whether she is a day or so late leaving Dubai bearing in mind she has been there for 365 days in total. It will have negligible impact on the programme with the biggest factor now being getting a suitable day or so to hook up the buoy.

I imagine that there will be the usual crowd who make a big thing of this come the 1st of October but I can't for the life of me understand why this should really matter. If you want to talk about delays and lack of transparency then PMO's Solan was epic but by comparison Lancaster EPS is a well run, well oiled project thus far.

If the AM is still in Dubai in 2 weeks time without having conducted any sea trails, then I agree, questions should be raised.

GLA.

M1keG,

I should add that I don't think the AM would sit in Rotterdam after the flare stack has been fitted anyway, so the mooring costs wouldn't come into the equation. Stack fitted then straight off to WOS to wait for a suitable day to hook up the buoy.

GLA.

Hi M1keG,

It makes sense to get the AM out of Dubai as soon as is possible for two reasons.

1) To avoid any problems in The Straits of Hormuz that Iran may initiate going forward. At the moment things are stable as Iran try and put agreements in place with the EU, Russia and China but come November when the sanctions "officially" kick in this could well change.

2) It's always better to be nearer where you ultimately want to be, even at the expense of higher mooring fees. It gives more time to sort out any issues should they arrive.
Please can you validate the point regarding the cost of mooring fees, as I would be interested in how they compare.

GLA.

Hi JK,

Agreed. However, I think my point still stands, even if the maths has changed slightly.

GLA.

Kerogen Investments 21.87%
Pelham Capital Limited 6.22%
Crystal Amber Fund Limited 5.77%
The Capital Group Companies 3.88%

I think BNB has a very good point. I think it is quite possible that CA are keen to get out quick. Previous tweets and actions support that view. However, nobody knows so it's pointless labouring this point either way.

As CA make each small disposal of shares along the way, their influence on any vote decreases. I would argue that with only a 5.77% holding, their vote no longer makes any real difference ether way anyway.

To get a TO through requires at least 75% of votes cast to agree it. So if only 88% of share holders voted Kerogen could block it on their own. I think you would get a much better turn out but you get the drift.

However, at 100% turn out, you only need 3.13% like minded investors plus Kerogen to block any hostile TO. I don't think that's going to be a problem in any shape or form. Rob Trice holds over 1% for starters.

So, I don't really know why this point was raised in the first place.

Whilst it might have been worthy of consideration when CA's holding stood at 15% plus, it is not really a valid point at 5.77%. From a voting, or influence on the HUR BOD prospective, CA are a busted flush.

More importantly, I think it is absolutely safe to say that without the blessing of Kerogen, a TO deal will not go through. Kerogen are in it for the long haul (they haven't sold a single share to date), have made this clear at AGMs and it's very much their MO, so we have a ample protection in place to fend off any hostile TO bid.

GLA.

I'm sure that the sea trails will begin by month end as per the company RNS and sail away will be shortly after.

If by chance it was a few days late, would it really matter ?

The Lancaster EPS programme has been run very smoothly, on time and it would seem, below budget, which is pretty rare in this game.

Not sure what all the fuss is about.

You'd think it was PMO's Solan project from the way some people talk about "delays"

GLA.

My understanding is that the PMO/RKH consortium will be drilling appraisal wells on Isobel/Elaine whilst they have a rig in the NFB to drill the production wells for Sea Lion Phase 1 and that rig contracts have been discussed for a 3 year period.

It may well be that they even manage to fit in a sneaky drill into Helen/Susan.

GLA.

Crude +1.85MM
Gasoline +1.53MM
Distillate -2.24MM
Cushing +461K

I noticed there was much discussion over the weekend on the duration of sea trails and whether or not the AM would travel by her own steam back to the WOS.

Taking PMO's BW Catcher as a recent example, I can reliably inform you that the Deep Anchorage Commissioning took 15 days, the sea trials were completed in 5 days and her journey back to UK waters was "tug assist", so for the majority of the journey it was a combination of tow and using her own propulsion.

So everyone's a winner if the AM uses the same method of transport.

That must be a first on here.....

GLA.

Hi SoB,

I think the sea trials are likely to take in the region of 2-5 days (providing everything is tickety-boo) and the sail time to Lancaster, including a brief stop off in Rotterdam to fit the flare stack, is about 6 weeks.

RT was very specific about the latter point in the last Malcy interview.

So one would hope to see the AM in the WOS in late November.

GLA.

http://www.reuters.com/article/us-oil-opec/opec-russia-rebuff-trumps-call-for-immediate-boost-to-oil-output-idUSKCN1M30DK

GLA.

http://www.reuters.com/article/us-oil-opec/opec-russia-rebuff-trumps-call-for-immediate-boost-to-oil-output-idUSKCN1M30DK

As you were......

GLA.

Hi rpoodle,

I think you've answered your own concern regarding PMO deliberately stalling Sea Lion with the sole purpose of bankrupting RKH and Ovet's is dead right that RKH could aways do a small raise, if it got that far, and PMO would be waiting for years. It's a non starter and more than TD's job is worth to play such games.

With regard to the $32M p.a cash burn you are worried about, can I recommend you call up SM at RKH and I'm sure he will be able to put your mind at rest. For my part, I think you need to consider that $10M was for Sea Lion and I'm pretty sure that's it until FID for RKH, the Cabot $2M is a one off and G&A is covered by income anyway.

FWIW, I would be surprised if PMO do not monetarise Zama-1 as soon as the appraisal drilling is completed in 2019.

If it makes you feel any better, I have the odd dark day when thinking about my investment in RKH and even my considerable patience is wearing very, very thin.

GLA.

Hi rpoodle,

I am a great fan of your posts on RKH over the years and have always found them to be measured and well thought out (be they positive or negative). However, I have to say you do seem to be overly pessimistic today.

The burn rate is not going to be $16M every 6 months for starters, so the bottom line is that RKH can sit it out longer than Tony Durrant can at PMO (I don't mean from a financial prospective from PMO's side but from a strategic one).

PMO cannot afford to let the deals they have negotiated slip away and as it stands the timetable for Sea Lion nicely dovetails into their long term production plans. The PMO BOD are under pressure to wrap this deal up and it's only really the ECA that are holding things up at the moment.

PMO have already screwed RKH on the deal (IMHO), albeit the deal RKH got to start with was too generous and became more so as the PoO collapsed.

On this occasion, I disagree with your thinking.

GLA.

Perhaps I should add by way of introduction that I was a regular poster on the ii board before it's "demise" and have been invested in RKH since 2014. I have attended the last 4 AGMs and put the odd phone call into RKH HQ.

I'm only invested in PMO, HUR and RKH.

I just haven't really posted on the LSE RKH board but rpoodle and Ovets will hopefully vouch for me as being a genuine poster.

I deliberately didn't mention the ECT judgement because for me, until that money is in the bank, it's not worth a dime however confident people may be. FWIW I'm hopeful of a good outcome.

GLA.