Member Info for Boyobach

Hi Hydrogen - yes, at least they are communicating. Fair point!
And good luck with the RDSb too.

For Thursday 31st Jan 2019

Today’s RNS lifted G like a lead balloon filled with concrete so, being in a sadistic mood, here’s today in slow motion so you can relive it in 15’ segments as G deflates whilst OP makes limp progress: https://invst.ly/9xxa3

Meanwhile, all the others havin’ fun: https://invst.ly/9xx9z

Finally, rewind the clock to late November and déjà vu!: the black boxes here highlight the same trading range for the same OP range https://invst.ly/9xxa9
Does that mean that G will be 227 and OP will be $71 in a month’s time? Mmm, only if time really is going backwards!

$65 by 18th Feb?

It needs something/someone to put a foot on the gas if it's to be sooner.

https://invst.ly/9xvun

I fail to see why this is interesting in anything other than a negative way - it's simply announcing a delay in the essential precursors to proceeding with both Bina Bawi and Miran. That is not good. At best it's an indication that something is happening, ie the can has been kicked a bit further down the road. Terrific. No wonder the sp isn't zooming anywhere.

Someone mentioned reading between the lines - eh? there were three lines and the message was properly succinct and not open to nuance of any sort.

I'm not sure which is more frustrating- watching our inept politicians flounder with Brexit or waiting for G to get cracking with Bina B.

It's not AIM listed:

Genel Energy is an independent oil and gas exploration and production company listed on the main market of the London Stock Exchange

For Wednesday 30th Jan 2019

Picking up on bunks’ comments, the lack of movement despite OP etc. today’s comparison chart presents a fresh view that looks at the G and the other sp’s since minimum OP in late December: https://invst.ly/9xh1p

This period is covered in the ‘From Peak Oil’ chart, of course, but isn’t it now time to look more specifically at the recovery period and to re-zero from that starting point? As I’ve said before, G made excellent progress ‘off the blocks’ as OP started to rise, although it pulled back, as anticipated, from 21st Jan. But that raises two questions: ‘has that pull back been overdone? And ‘ why should there have been a pullback if the company has been making progress whilst the OP was falling?’

The chart suggests that the pullback has indeed been overdone, for although G seemed to ‘get ahead’ of OP at first, it is now lagging. Furthermore, I have to ask myself why, after the TU and Chevron deal, the pullback hasn’t been neutralised. If the company has genuinely made progress since October then shouldn’t we expect the sp to be progressively climbing back up ahead of OP? After all, if OP suddenly returned to $86 would we expect G to just make it back to 248p (where it was on Oct 3rd) or would we expect rather more?

Today, with OP on a consistent x day rise and approaching $63, https://invst.ly/9xh0v there’s a strong rationale for suggesting that G should be at least 200p. Here’s the G v Brent hourly chart as a reminder of the potential gap that has developed: https://invst.ly/9xh66

Is the 20p ‘shortfall’ in G’s sp a compressed spring awaiting release? And what would trigger that? Some might point to the FY results in March - but the market has so far been uninspired by company announcements and the figures should prove to be in line with guidance. The only other stimuli would be new company news or OP reaching a certain threshold. In my mind that could be if OP reaches $65. Under those circumstances 216 would be a conservative expectation based on:
187 (today’s sp) plus 9p for the increase in OP (3p per $) plus the 20p currently held back.

For Tuesday 29th Jan 2019

This is the short-term hourly comparison between Brent and G (still ‘zeroed’ from 4th Jan, although first week not shown here): https://invst.ly/9x1oc
It shows G dropping back sharply in relation OP over the last week. However, yesterday’s long term comparison, zeroed on October 3rd, showed that G surged ahead of OP during the first three weeks of the year - so the drop back was very likely to happen as the OP recovery wavered. A disappointing fall at the end of today despite OP slightly stronger.

The lesson here is that G’s sp becomes increasingly volatile around $61. Whilst Brent was rising the market was confident enough to match $61+ oil with G at up to 208. So it seems G is unlikely to return to 200+ levels until OP is firmly back above $61.5. Meanwhile, a drop to 172 cannot be ruled out if OP goes much below $60. Here’s Brent’s progress on a 1 hr chart: https://invst.ly/9x1pa

Despite the drop-backs, the lows are progressively climbing so it may be consistently over $60 by next week:

ComeOnVog: I think you mentioned possibly buying RDS A in one of your posts? I've always believed that for UK based people the RDS B are the appropriate ones because of the Netherlands withholding tax deducted from the A divis. I just copied this quote from Moneygrower (link to full article below):
Let’s take Royal Dutch Shell for instance. It is a dual listed company. The A shares (RDSA) are listed on the AEX in Netherlands and the B shares (RDSB) are listed on the London Stock Exchange in the UK. The A and B shares have the exact same voting rights, ownership stakes and dividends declared. As a UK based investor, it makes economic sense for me to buy the B shares as opposed to the A shares even though. This is because the A shares being based in Netherlands pay their dividends after deducting withholding tax of 15% for non EU residents. With Shells current dividend of $1.88 a share, this essentially means that A shares pay $1.60 whilst B shares pay the full $1.88. Most investors make this simple mistake of buying Shell A shares instead of Shell B shares.

http://moneygrower.co.uk/2017/03/which-royal-dutch-shell-shares-to-buy-to-avoid-paying-dividend-withholding-tax-rdsa-vs-rdsb/

Thunder: '....discount to the NAV that is reflected in the current price, there must be a reason.....'

I guess the market doesn't recognise the intangible assets - about 70% of assets I think - especially as there's a big chunk of them that G is not moving swiftly to exploit. I assume that's why the price rocketed last year only to fall back to current levels. It's why many people expect to see £4 here - but I now doubt it'll happen any time soon. G may be holding back because they think energy prices are likely to firm up in a few years - not much joy for investors meanwhile.

Thanks Ocelot - good to have confirmation I wasn't completely nuts!

Those price/book numbers don’t look right Thunder-
Eg: BP is actually 1.3 according to Yahoo today.
G’s price/book should be a lot lower - looks like a currency error?
G’s book value per share is given as $6 by Yahoo today,
would make the GBP price/book 182/450=0.4 ?

Interesting numbers, Thunder, and I tend to agree with your conclusions although I don't believe political risk is a major issue. It was a different matter when Baghdad (under al Maliki) - Erbil relations were at a low point and ISIS had taken Mosul - resulting in a situation where IOCs in the KRI did not get paid. There is always a political risk, of course, in Turkey - where the pipeline is exposed to tensions between ethnic Kurds and the government of Recep Erdogan.. Ironically, it was Kurds that caused some outages in the past - although one may well sympathise with their grievances and their desire for a homeland.

Hi COV - On the basis that I think there are 279,025,723 shares and that G puts $25m per month in the bank (as per our last convo estimating $300m pA) then that’s potentially worth $0.0896 per share per month = 6.8p I think - do check that for yourself in case I’ve missed a digit. It’s less than today’s drop for G but obviously worth 80p over a year - less any reduction of value in resources left in the ground!

I don't think it's a path to riches in itself - unless OP picks up. As I've just pointed out in a separate post about RDS - it's starting to look like there's 20% to be eventually made there without half the stress of holding G. The gas is where it's at - but until they do something with that I think G's sp (in sterling pence) will just bob along within +/- 5% of 3 x OP (in USD) - with another seasonal fall back in OP likely again after the summer. All IMV, obviously, and to be treated with due caution.

For those that yearn for relative safety plus recovery of their G losses since October, it’s worth keeping an eye on RDS. Had I known which way Brent was going a week ago, for example, then selling G at 207p and stuffing the cash into RDS today at £22.27 would have moved me from one horse to another that were both 17% down from peak oil, except one pays divis and may well recover to the 0% line (ie the Oct 3rd price) first.
https://invst.ly/9wjqa

If you have sufficient cash then, of course you may be able to pull this trick in reverse - albeit with risks - by buying RDS at a favourable price (say -18% on the chart) and selling off G to the same cash value when it rises back up to -18% (assuming it will get back to that level) Ha! I’m finding it a tempting proposition as I’ve done ok with RDS in the past. This is NOT a recommendation - just blue-sky thinking. Don't forget - we have no guaranteed 'bottom' for either.

For Monday 28th Jan 2019

For the purposes of this note, G and Brent are ‘at par’ when they are at the same level on this chart:
https://invst.ly/9wj7a

With OP going down, G is as perky as a dead sheep and, on past history, 176 seems a likely near term destination unless OP picks up. From the chart, G is currently 10p above par with Brent, which seems to be all that’s left of the surge it enjoyed in the first weeks of the New Year, which, when G hit 207, was worth a max of +27p according to this picture. It’s pretty apparent, reading across this chart from early October, that G needs an OP of $62+ to remain within striking range of 200p.

Here’s the same basic comparison chart with the GKP, DNO and RDS added:
https://invst.ly/9wjao

20Thunder2040 - 199
Boyobach 202
Broadland 205
JustinD 207
Stockbuster 210
Without 215
Ocelot 220
L3Trader 225
Hasiba 230

Last week I compared Brent’s apparently erratic price swings to a bus clipping a corner as it turns from its brisk post NY upward trend (red) onto the more steady one of December (blue). The analogy might still hold it seems: https://invst.ly/9w6ar
I’ll be content to see it resume a mildly upward trading range between 61 and 66.

Hasiba - on your point about ‘Ftse is more related to oil price than any other measure’ I think it is more that both are dependent on global trade and outlook.
Stronger world trade = stronger FTSE + stronger OP. I think OPEC’si production cuts would have had a greater impact by now had it not been for the headwinds of global weakness resulting in great part to Mr Trumpington.

Hi Comeonvog, Tartine -
I see you guys are trying to get to the real value of this business - I’m glad someone here is - it’s not something I’m too adept at!

Tartine, re Sarta: you seem to think it could be just weeks to production (with revenue obviously a month or so later ) ? That’s much quicker than I imagined but I suspect the market will only recognise it when cash does start to flow. When it does I might invest in a good bottle of Nuits St Georges to go with the Comté that’s invariably in my fridge!

Comeonvog: you asked me 'in the last Presentation they stated $100m free cash at $45/bbl. Do you know what that would equate to at $61.5 /62 ?' - I was about to say ‘no clue, I just do silly charts’ then reflected: to me it would logically mean an extra $17/bbl (ie $62-$45). At 30k bopd (approximate working interest from same report), so that might be around : 30k x 360 x 17 = $200m. However, that takes no account of any discounting and assumes that G would see all of the increase. I may have missed something there - so it could well be a totally stupid answer!

Is the Chevron (Sarta) block currently producing? Not worth a bean till it is - it just represents less cash available for returning to shareholders (after seven years)

$1m per day going in the bank -that's around $30m per month? I thought it was probably about half that - plus they are now spending cash on the Chevron deal.... which I don't think is producing yet.
By my last reckoning I estimated the Sp could rise by about 27p per $100m put in the bank. Ie around 5p per month. So, unless OP continues upwards, I think It'll take a few months to push this up significantly.

For Friday 25th Jan 2019

Just a reminder for everyone today that with OP at $61, G has recently been anywhere between 175p and 198p - so 191 is not as bad as it could be.
https://invst.ly/9vv7-

G is arguably doing no worse, in relative terms than RDS at the moment:
https://invst.ly/9vv9i

When G hit 211 recently it had got well ahead of Brent, so, in the absence of any stunning news, some pull-back was on the cards, it’s just a pity it didn’t find enough support at 197:
https://invst.ly/9vvcv