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Eazy - If current production is already at 1500 it would be great news.
I have spent time investigating where the money is being spent before deciding to invest. Its all going on the loan, bonds and CapEx on plant upgrades. Completing the JV last year would have been a fire sale. The company is now in a much better position for negotiation. The JV is a route to a speedy production ramp rather than a bailout.
Q2 netback was about $2m (crude @ $71.75av & 1103bbl/d)
This does not cover loan and bond interest payment which are over $3m per Q.
However increase production to 1,500bbl/d with current crude price netback is something like $4.6m.
2,000bbl/d puts it at $6m per Q.
I think we will see production at 1,500 - 2,000 per day by year end which makes the company profitable, funded and sustainable. Add in the JV and it just gets better.
“Nonsense “ was a bit strong Wolster.
The RNS at the beginning of may said H1 was producing steady at 17 mmscf/d and the gas prices were around the £1 mark.
I think we are close to the point it will be viable to open H1. But that’s just my opinion.
Vos Enterprise has been very busy at Blythe for the last few days. Going to make an assumption and say they could be bringing H1 online. Current gas prices will make it viable.
Ah well at least they haven’t forgotten about it.
Thanks for the info.
Something going on at Southwark.
Putford Jaguar has been working in the area and is now within 100m of platform.
Can sell 1m shares at 1.7p no problem but can not get quote to buy 200k shares.
This market is f’ed up.
If no shares are available price should be going up, simples
33rd round licences to be granted in September
With further rounds to come.
Article in todays Times
“Rishi Sunak will commit himself today to pressing ahead with oil and gas exploration and production in the North Sea as he seeks to open up dividing lines with Labour.”
They need about £1.5m a month after royalties and production costs to cover quarterly bond payments, wages and administrative expenses. Current gas price is providing this and with the forecast of a severe winter in Europe gas prices are going to get high and the cash will build. It’s likely they will be able to fund their share of a drill, maybe two during winter. But the bond remains an issue. I await everyday for an RNS update on this. The return on the bond is significant and I don’t believe there will be any need to give much more away other than an extension but this needs to happen soon.
Bedeto you should have divided by 12 not 4 for the monthly calculation. The quarterly payment is 1/3 of your calculation.
Its disappointing flow stabilised at 32 and not closer to 40. But it’s a comprehensive update and outlines a clear strategy. The BOD are working hard to deliver and I am reassured and happy to hold. I expect we will see some movement upwards today.
26th June flow rate was at 20mmscfe/d and was being built to to the full rate over the coming week.
We have absolutely no reason to doubt that gas flow is not around or even over 40mmscfe/d and it’s even possible that H1 is being feathered in.
See last RNS. No mention of 22mmscfe/d.
used admin/wages from last year accounts.
lasts years opex was £0.24p therm, that was with many production problems and water issues.
there is data the suggested a opex of £0.14p therm with good gas.
i added a bit and used £0.18p.
don’t think there is any need to factor in tax when currently loss making and massive losses to offset.
my calculations are rough back of a *** packet but give a guide.
I guess writing off Southwark would signal phase 1 complete
Should have added figure are based on 40mmscfe/d of dry gas.
I agree it’s 40% left for IOG
Mole that was an excellent post and summary although very sad.
I ran figures again now that I have a better understanding of the charges and royalties.
At 60p therm bond interest and administration fees and wages are made but nothing left.
£0.80 leaves about £1m a month surplus
£1.00 leaves about £2m a month surplus
£1.50 leaves about £4m a month surplus.
The BOD need a new plan.
Wolster you were correct. I contacted investor relations and they provided the following:
“It’s a 50:50 JV, so everything is shared half half, albeit the royalty arrangement for Phase 1 overlays that (CER also provided a development carry of £60m in the Phase 1 construction phase). Each party has their own gas sales arrangements for their respective shares.
The Phase 1 royalty is 20.2% of IOG’s net share payable to CER – it is paid via adjustment of respective gas entitlements between the two parties and is capped at a total of £91m (i.e. that is the maximum aggregate amount that could be paid to CER). It is in respect of Phase 1 fields as defined in the 2019 farm-out agreement, i.e. Blythe, Elgood and Southwark.“