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THIS is what BlackRock does - they trade it.
(Data taken from GKP website):
Date Institution Prior Latest
01/06/2022 BlackRock <5% 5.08%
23/08/2021 BlackRock 5.03% <5%
13/08/2021 BlackRock <5% 5.03%
25/06/2021 BlackRock 5.03% <5%
11/02/2021 BlackRock <5% 5.03%
02/04/2020 BlackRock 5.12% <5%
12/03/2020 BlackRock <5% 5.12%
11/10/2019 BlackRock 5% <5%
12/08/2019 BlackRock 4.99% 5%
07/08/2019 BlackRock 5% 4.99%
05/08/2019 BlackRock <5% 5%
03/07/2019 BlackRock 5% <5%
24/04/2019 BlackRock <5% 5%
17/04/2019 BlackRock 5% <5%
12/04/2019 BlackRock <5% 5%
****eye,
yes, that is what I am saying.
Read my 15:02 post and link today for a more thorough background to the issue - but there are many, many articles out there explaining how it came to be.
There's a very good article in the Washington Post from Apr-21 which sets out a lot of the background history to this FSC Art.92 stuff:
https://www.washingtoninstitute.org/policy-analysis/one-less-hurdle-iraqi-elections
It's a mess, isn't it!
According to what has been published, Art 92 of the 2005 Iraq Constitution states:
First: The Federal Supreme Court is an independent judicial body, financially and administratively.
Second: The Federal Supreme Court shall be made up of a number of judges, experts in Islamic jurisprudence, and legal scholars, whose number, the method of their selection, and the work of the Court shall be determined by a law enacted by a two-thirds majority of the members of the Council of Representatives.
It is widely reported that such a law, to be passed by a two-thirds majority of the Council of Representatives, has NEVER been passed.
Good morning TM,
I agree with the general thrust of your post but there is one factor that you do not address.
At the moment there is no functioning government in Iraq - despite the elections having been held last Oct. The attempted move away from religiously defined blocks (essentially Iran-backed Shia vs Sunni) both trying to use the Kurds for their own power-plays and towards what we in the West call consensus politics is plainly not working.
Although mostly Shia-based, Muqtada Al-Sadr's block seemed to be more interested in getting improvements for the Iraqi common man and, with its withdrawal, it's unclear if a consensus gov can be formed at all - already there is talk of new elections. The FSC opinions, without a functioning government, able and willing to implement them, are pretty toothless at the moment.
As I see it, the real danger might come from hotheads, military units aligned with one or other block, determined to make a point.
I see Aljazeera is reporting that Muqtada al-Sadr’s block went ahead and resigned yesterday.
Al-Sadr, last Thursday, had urged the MPs from his block to ready their resignation papers in a bid to break the parliamentary deadlock and create space for the establishment of a new government.
For the life of me I cannot see how such inability to create a functioning government could even think of progressing or resolving the Kurdish O&G issue.
Old news...
Too much Turkish (and private co.) influence at Genel.
@TM,
if only it were just up to JH alone, but he cannot just decide to drill another N wells here or there.
The consortium's Management Committee has a LOT to say about what gets done - that 3rd member (MNR) has the detailed overview of ALL data being generated by the operators in the KRG region and he / they will want to know exactly WHY such changes are considered necessary and if he/they do not agree with you...
The largest, currently producing oilfield in the KRG region (fully in the hands of the KRG-MNR at present, and operated by KAR Group) is the Khurmala Dome - the northernmost of the 3 Kirkuk Domes, Baba, Avana, Khurmala.
The field, discovered around 1950, was producing albeit at a low rate prior to 2005 and was at that time under the management of the North Oil Co.
Exact output figures are hard to come by, but currently estimated at approx 180,000 - 200,000bopd.
This is the real backbone of KRG output.
I see MOL are already talking to Croatia about increasing the capacity of the Adria pipeline to deal with increasing flows should the Druzhba pipeline be blocked, so several alternative routes to HU.
Our Shaikan partner, MOL, has substantial refinery interests in Hungary and is an active processor of Russian crude. The refineries have relatively high Nelson Index and could certainly manage the (heavy) Kurdish Blend. Existing port facilities at Trieste and pipeline links thru Austria and Slovenska would do it.
One important issue, however, remains the legality of the Kurds using the Ceyhan-Iraq pipeline which is subject to a Sovereign Agreement between TR and IR. At the moment the Kurds use forward financing deals with the major trading houses to get over this (heavily discounted pricing and sweeteners to the Turks) but it is questionable if the EU / Brussels would be willing to just turn a blind eye to this and they might demand some trade-offs.
From what I have read the Basrah heavy crude seems to be the one being discussed.
Assuming the field output does reach 50Mbopd by year-end (or even that fabled 55Mbopd) and if crude remains at these very high levels, SH will throw off an incredible amount of cash each month...until the R-factor / Cost Oil issue bites.
It could well be that the MNR, under an unqualified- and poorly performing management team, is trying to be too clever by half - and slowing the FDP approval process to see what happens. What issue might be driving that remains unclear.
A big reduction in CO receipts, only partly compensated by increased PO receipts, will put rather a spotlight on GKP management. Any attempt to splash out on even more Special Dividends will have to be balanced by the realisation that, as we enter 2023, the era of cheap loans and bonds will almost certainly be over - certainly for Iraq-based enterprises. That 10% coupon might grow very quickly to 14% or so.
Interesting dilemma !
putup,
Error - my sloppy typing!
Should of course read $11.2M/$11.3M per month
putup,
stripping out the divis and the bond interest payments my calcs return $371,000/ day or $12.2M per month cash burn so we're pretty much in agreement there.
The big ? of course is how much the FDP might have changed and what the implications might then be for capital allocation to fund the next stage.
Sorry,
if you right-click it, it will open in a new tab or in a new window!
https://live.euronext.com/en/product/bonds/NO0010828106-XOAM/market-information
Tick the CHARACTERISTICS window under the % 99.625 number
Scroll down the page to Loan Documents
Tick the Loan Agreement
It won't open on your screen, but will download a pdf to your PC.
putup, re yr 12:27 post re early redemption of debt.
The Terms DO allow it.
The debt can be redeemed early, at the issuer's choice, and the applicable "penalty", which is quite low, is clearly defined in Clause 10 Redemption and Repurchase of Bonds, in particular Clause 10.2 Voluntary Early Redemption.
At the moment, Clause 10.2 .(a) (iii), alt 10.2. (a) (iv), alt 10.2.(a) (v) would apply, and these state:
10.2.(a) (iii)
"The Issuer may redeem the Outstanding Bonds (in whole or in part) (the “Call Option”) on any Business Day from and including Interest Payment Date in July 2021 to, but not including, the Interest Payment Date in July 2022 at a price equal to 104 per cent, of the Nominal Amount for each redeemed Bond"
Alternatively:
10.2.(a) (iv)
"The Issuer may redeem the Outstanding Bonds (in whole or in part) (the “Call Option”) on any Business Day from and including Interest Payment Date in July 2022 to, but not including, the Interest Payment Date in January 2023 at a price equal to 102 per cent, of the Nominal Amount for each redeemed Bond"
Alternatively:
10.2.(a) (v)
"The Issuer may redeem the Outstanding Bonds (in whole or in part) (the “Call Option”) on any Business Day from and including Interest Payment Date in January 2023 to, but not including, the Maturity Date at a price equal to 101 per cent, of the Nominal Amount for each redeemed Bond"
Clause 10.2. (c) states that: "The Call Option may be exercised by the Issuer by written notice to the Bond Trustee and the Bondholders at least ten (10), but not more than 20, Business Days prior to the proposed Call Option Repayment Date"
IMO, it's always good business to have a happy bunch of bondholders who have held to redemption, and been rewarded acc to the terms of agreement; you never know when you might have need of such a facility again.
I see several leaders have now raised the possibility of major (Western?) users setting a price at which they are no longer prepared to purchase crude - Habeck, Draghi and Biden are said to be in favour.
An idea with wings, or just throwing petrol on the flames?
Already being denied by Kurdistan24, BasNews and others:
ERBIL (Kurdistan 24) – The media office of the Kurdistan Region Presidency announced on Sunday that it categorically denies the “fabricated” news that President Nechirvan Barzani asked the United Nations Security Council to mediate between Erbil and Baghdad on outstanding issues.
The media office said that it never issued a statement concerning a “request” by President Barzani to the UNSC to mediate between the Kurdistan Regional Government (KRG) and the Government of Iraq, read the presidency statement.
The news is “totally false and fabricated,” it added.
Hi Cookie,
when I read "manage the export file" I think immediately of control of the Faysh Khabur export metering- and pumping station, just 2km W of Dayrabun village and 4.6km SW of the Ovakoy crossing.
(DNO ran their own pipeline directly to FK from the Tawke PF).
You may recall the tensions here, back in Oct-2017 when the Iraq Gov gave Barzani 24 hrs to hand over to their control the so-called Faysh Khabur border crossing / pontoon bridge linking Iraq and Syria (actually also 4.6km directly W of the FK station). As I recall, the US had to step in at the last minute to prevent a full scale firefight between the Kurds and the Central Gov., as the stated intention then was to take control of both the pontoon bridge and the metering station.