Member Info for Boyobach

What are your expectations of G’s sp in 2021?
I’d hope to see the sp recover to at least ‘pre-Covid’, ‘pre-Price War’ and ‘pre- Payment Deferral’ levels - ie 2019 price ranges, where I reckon the average sp for the year was 195 with a maximum of 231. The revenue from contracts was given in the 2019 FY report as $370 for a year in which Brent averaged about $64. Some of that revenue (around $54m) appears to have been paid after the year end, due to the KRG issues. Other revenue amounted to about $8m.

To the extent that G’s sp broadly reflects contracted revenue (other factors like cap-ex should be managed according to the cash flow generated) I'm inclined to think that G would need to be receiving just over $30m/month from the KRG on average for the market to restore the sp to those 2019 levels. I’m assuming here that Bina Bawi and other undeveloped assets are largely ignored by the market currently and that nothing significant is imminent in relation to them. Each month that passes with KRG income below $30m makes it progressively more difficult for G to match 2019’s average this year - so with January’s payment probably falling below 50% of that target (assuming Tac Tac contributed around $2m) the average needed to match 2019 has already shifted up to $31.3m for the eleven remaining months.

However, this is not an unattainable level: Oct 2019 production was apparently worth $33.2m, at an average OP for the month of around $59 - slightly lower than today. G additionally has Sarta in production and override payments are due to recommence this month.

Obviously, although the numbers here are given in good faith, they are up for challenge and discussion and not guaranteed to be correct.

Here’s a chart of Brent with G overlaid (red) - the reverse of my usual G v Brent.
https://invst.ly/ttcel . It somehow serves to emphasise the disparity that has developed between the two since G last peaked on Jan 18th. and over the last week in particular. I’ve maintained the 3x relationship as closely as possible (so G is x0.33 approximately).
Historically, when G’s sp has been performing well, it achieves better than 3.5x Brent - which would put G in excess of 210 currently. On Jan 18th the ratio was 3.29x, which would have seen G at around 200 today.
Whilst the £ has been strengthening against the $, it's not been sufficient to make a great difference here.

We must surely be due a BSD bunks?

ICYMI:The Oil Deal That Could Break Up Iraq
https://oilprice.com/Energy/Crude-Oil/The-Oil-Deal-That-Could-Break-Up-Iraq.html
Worth a read unless news about Rosneft's grip on the KRG and potential budget independence from Baghdad is likely to stress you out:
'According to reports from Iraq, the KRI’s government, the KRG, is currently in the process of preparing its own separate annual budget for the first time since a new working budget agreement was agreed in November 2014'

Yes indeed Tartine. Hope you are doing ok too, bunks.
Have you seen Brent this last hour though? It's up to 62.6 - if it holds that sort of price over the weekend then it will surely reflect in G's sp.

At least PFC finished the week on the right side of 120, with the market generally higher and Brent putting on $1 in the last hour. A strong breakout towards 130 next week would be good but I'm not holding my breath.
https://invst.ly/tt68t

A rubbish end to a rubbish week, guys. I obviously don’t know why G did so badly.
I often suspect that people flip between G and the noisy neighbours. As a strategy, I can see that it can be profitable when one is at a high and the other at a low in their respective cycles but that wasn’t the case this week.. Apart from the unusual circumstances a year ago, I think today is about the worst performance of G v OP that I’ve ever seen - down to below 2.5x
The usual runners and riders for the week: https://invst.ly/tt60a
And G about to drop out of the 3month rising trend: https://invst.ly/tt60q
Tartine: you may get a cheaper deal next week, I'll be watching for that possibility myself. GLA

Ha! How far back would you like me to go Cheapsharesboy?
I'll happily draw a positive long term trend for you - just tell me where PFC's positive trend started and I'll do the rest.
In reality, there isn't one is there? This is because PFC has only just come up from an all-time low. In the absence of useful indicators, an investor's rationale can then be reduced to unsubstantiated faith that 'it can't go lower or stay at this level indefinitely' - it's at this point that many an investor starts to lose money.
Words come cheap when there's no evidence to back up an observation or opinion. PFC apparently has the fundamentals so the next thing is to watch the market reaction to them. 15' charts will obviously tend to show changes quicker than daily ticks - I use whichever makes the point clearer or helps me choose my trading points.
Most people on this board are interested in the direction of PFC - some want it up and some want it down, they all have a common interest in knowing as early as possible which direction it is taking and what the likely support and resistance levels might be. I bought back into PFC recently at an average of 110 based on my long-term plans and perceived chances of a timely recovery to around 145. It has performed less convincingly than I'd hoped and I've revised my expectations for a longer haul. So, do I now just sit on my hands and wait or do I assess whether the cash could be better used elsewhere whilst I keep an eye on PFC for signs of it waking up? I'll probably be generous and give it a month but, frankly, if the oil majors start to move and PFC doesn't get off the floor fairly smartly it'll be a no brainer to shift the cash elsewhere.

Well, ICC, I think you’ve identified the problem - which is not with charts but with their interpretation and the comfort that some gain from burying their heads in the sand. A chart is a factual presentation of what has occurred, to which trend lines etc can be added to show possible outcomes. Those outcomes are not certainties and some are patently more likely than others. It’s not hugely different from weather forecasting. I assume you meant PFC would be 160 not 260 were it not for Lufkin’s latest case BTW?

The trick is to re-evaluate the trends as the story unfolds and not to fall into the trap of only seeing what we’d like to see. Trends are there to be broken: when they are they tell us that the price direction is changing. PFC has broken below three upward trends over the last couple of weeks so, for now, it’s obvious that it has levelled out. Tomorrow we could see it resume an upward path - which will require it to break above 125 - but until then it'll be stuck around 120.
https://invst.ly/tt0xi

I can see why some people don't like charts, they can make uncomfortable viewing. As a record of what has happened they don't lie, how you choose to interpret them is another matter.
https://invst.ly/tszej

It seems that any hopes of a steady recovery to 160p are fading fast. With oil majors off recent highs and Brent possibly peaked, PFC seems to be levelling off around 115-120 for the time being:
https://invst.ly/tsyd4

Whatever GKP’s price, G continues to move in line with other oil co’s and is still on the upward trend that goes back to the end of October:
https://invst.ly/tslqo
Most companies have fallen behind relative to Brent because the current price, around $61, reflects Saudi cuts rather than actual demand. However, for the KRI companies the price should have a more direct effect because it translates into improved monthly revenues. For that reason, G’s sp is disappointing as it would probably be well over 180p today if it were not for the poor payment record of the KRG and the shortfall in revenue experienced last year.

For reasons discussed ad nauseam many moons ago, GKP did run at a higher SP than G after it was rescued by restructuring a few years ago. This was basically because of the respective market caps and number of shares in issue at that time. Any similarity in price is, to that extent, coincidental. The old ‘reality check’, based on OP at it’s last peak of $86, puts their relative performance, along with a few others, into perspective:
https://invst.ly/tslw7

It certainly has ben a convoluted process Pokerchips. It will be frustrating if the outcome of the current court proceedings leaves an element of doubt - which I rather assume it will. Thanks for your input.

Yes PC - I've been unable to find details of their sentencing - nor an SFO statement referencing the US case.

Pokerchips/Icouldntcomment :
Maybe the SFO have dropped that line of inquiry (Unaoil/Warner)
According to an article published nearly 18 months ago (link below):
The SFO quietly dropped its investigation into the Ahsanis and Unaoil on 25 June 2019 and Unaoil agreed to pay a criminal fine of more than $296m to resolve foreign bribery charges related to the company’s misconduct in Brazil and Iraq.
A legal filing shows that at the centre of bribery schemes, unrelated to PFC, “was a Monaco-based oil and gas services intermediary that provided sales and marketing services” The same filing mentions three individuals “whose identity is known to the United States” and whose citizenship details are an unusual mix of British, Iranian, and renounced American. They are placed at the centre of the Iraq bribery scheme as executives of the Monaco intermediary, but not named and not charged. They are the Ahsanis – Ata, Cyrus, and Saman – who are back where they have always been: in Monaco, striking deals.
Source: https://www.tortoisemedia.com/2019/09/14/sfo-ahsani-190914/

Has the SFO confirmed that they are not pursuing Warner any further, PC?

Whatever the result of today's court process, the issues of bribery surrounding PFC are unlikely to be fully resolved until there is an outcome concerning Peter Warner’s alleged involvement in matters which apparently remain under investigation, as summarised here:

https://traceinternational.org/TraceCompendium/DetailPDF?id=734&type=1

Paul Bond was ex-SBM not Unaoil.
At the time of his first trial last July it was reported that:
'The SFO has stated that it will conduct an independent review which it appears will take place once its retrial of Paul Bond is over – a retrial that the Judge has suggested may not be in the public interest. '
https://www.spotlightcorruption.org/unaoil-a-very-complicated-win-for-the-serious-fraud-office/

Nothing to see here: PFC continues to track oil company sp’s fairly closely:
https://invst.ly/tsg9l (PFC v RDS 15’)

I can’t see how even in a multi billion dollar [organisation] [they] would not notice 30$ million going missing.....

Money paid in bribes is invariably accounted for within legitimate transactions such as consultant/agent fees/ services etc. etc.

If only the US Shale producers had grasped the importance of value over volume.