Member Info for CrudeTrader

Remember this post 9.15pm 12 Feb 2020 - this will end in tears.

No.
When a coompany is sold holders of warrants and option has plenty of time to erxercise to after a deal is announced.
These guys would exercise unless they where looking to sell the stock. Clearly looks like they are trying to get ready to sell the stock as soon as possible when its trading again.

Board meeting. This is b-s. I talked to Katy Mitchell and she was very clear she couldnt say anything except for what was stated in the RNS.

Preparing with their own test https://www.gov.uk/government/news/phe-novel-coronavirus-diagnostic-test-rolled-out-across-uk

No RNS from NCYT this morning further confirms that they didnt have any involvement in PHE own test. NCYT being frontrunned in their own home market by the government.

https://www.gov.uk/government/news/phe-novel-coronavirus-diagnostic-test-rolled-out-across-uk

invester2015, do you hope that there are ni cure for the virus? You are a pretty sick person.

NCYT loan provider was granted 6m warrants when they signed the loan 6 Nov 2019. HEGC must be pretty tempted to exercise them as they are deep deep in the money.

HEGC is granted warrants over 6,017,192 ordinary shares (8.5% of the principal loan amount) with a conversion price of €0.0698 each, representing a 5% discount on the volume weighted average price ("VWAP") of the ten trading days prior to completion, exercisable for a period of 7 years from completion

The sentiment for E&P are terrible at the moment, due to environmental movements and now very weak oil price.

GKP clearly doing very well from an operation perspective. Now with two payments in a month the risk around payments should be lower. The stock is getting very cheap.

Yes but still PHE went for their own test. NCYT clearly getting frontrunned in their home market. Not great.

I suppose the market wont like that PHE has developed their own coronavirus test? The stock will struggle tomorrow I guess.

https://www.gov.uk/government/news/phe-novel-coronavirus-diagnostic-test-rolled-out-across-uk

Yes Optiva apparently taking investor inside for a potential placing in Feb. Optiva calls it "Project Target".

Vast has been struggling to get enough and stable funding for several years. In 2018 the company signed the Mercuria take-off facility, but in Jan 2019 Mercuria refused to payout the 2nd tranche of the facility. Vast made a CB deal with Bergen, but after a few months, Bergen pulled the facility as the stock traded below the SP threshold. In the spring of 2019 Vast sent out several RNS about a potential Swiss bank loan, which never happened. In Oct 2019 Vast announced that it had signed a $13.5m CB facility with Atlas Capital Markets. The facility was conditional on AGM approval, which was received, a standstill agreement with Mercuria which Vast hasn’t written clearly if it has been achieved or not. The 2-4 tranches are also dependent on receiving the Zimbabwe diamond concessions and certain progress. Vast has made several smaller placing to cover ongoing cash burn.

- 2 Jan 2020, Vast announced “the Company has submitted a drawdown request for the First Tranche Issuance to Atlas” this would clearly indicate that all conditions had been received and that the money would transfer in days.
- It's now 24 Jan, 22 days have passed since the drawdown request, it is starting to look like something has gone wrong with the drawdown or that Atlas is not willing to provide the funds.
- Based on Vast cash position as of 31 Oct 2019 and historical cash burn, Vast would need the Atlas money immediately.
- Cash situation:
- £1216k cash as of 31 Oct 2019 + £50k from warrants exercising
- £384k cash burn per month (H1 cash burn £1959k SG&A+£345k cash interest)
- £114k estimated cash as of 31 Jan 2020 (3 months of £384k in cash burn)
- This calculation assumed no capital expenditure, this is unrealistic as Vast spent £1184k in the past 6 months period on PP&E, and it’s fair to assume that there has been capital expenditure in the past three months as well.

The bottom line is that Vast will have at the end of the month around £114k in cash (estimated) which would cover less than 2 weeks of cash burn. If the company doesn’t receive the Atlas funds very soon, they will probably have to do equity raise.

I dont think so, WEN is assuming its first coming back mid 2020.

The stock is finally catching a bit of a bid. Maybe AXA cleaned out some overhang.

Wentworth will come with 2019 update and outlook for 2020 before the end of Jan. I guess it wont be any big surprises as usual.

No, I am not in London this week.

Regarding the dividend, I spoke recently to the company and they said, the $25m normal dividend should be a floor. They have a preference for share buyback over special dividend, esp. now when they think the stock is very cheap. Last year they paid the special dividend because the cash balance was to big due to the delay in the 55k bopd phase development.
I don’t think one should assume a special dividend in 2020, however if the 75k bopd phase isn’t approved by the KRG when its time to propose the dividend I think its likely that they will do a special as in that case there won’t be much capex in H2 of this year.
Ideally GKP want the approval for the 75k phase before the last well in the 55 kbopd phase is completed so they can keep the rig and start to drill the wells for the 75k bopd target. The bottleneck seem to be i) MNR is slow, ii) The MNR isn’t completely satisfied with the has injection plan.

Rafrider, I am Pareto client so I received a schedule for the conference and I spoke to GKP rep last week and he said that they are presenting at the Pareto conference and some conference in Norway next week.

Regarding Capital selling down, it shouldnt come as a surprise given it was Mark Denning who was resposible for the GKP at Capital. Capital seem to have dumped a number of his portfolio companies after he was sacked in end of Oct 2019. I think Capital selling out is putting pressure on the stock but it dosent mean anything really for the fundamental view.

GKP is presenting at the Pareto conference on Wednesday, They are also presenting at conference in Norway next week.

From @OilGasTracker

Tullow Oil Trading Update & Investor Call Oil & Gas Tracker

Tullow stock is trading up slightly after todays trading update. There was limited positive news in the update, but the stock is more likely holding up due to the lack incremental negative news. After looking into the details of todays RNS and listening to the investor call 2020 looks like a challenging year for Tullow Oil.

Key targets for 2020

? Production est. 2020: 75000 boepd down from 86700 boepd in 2019
? Expected free cash flow 2020: $150m down from $350m in 2019
? Total capex and decommissioning spend est. 2020: $450m down from $571m in 2019

Tullow is targeting $150m of free cash flow based on $60 Brent. Based on our model they need $50m of cost saving from SG&A and other cost to reach the free cash flow target, which seems optimistic.

Ghana
At Jubilee he J-54 water well has been tied-in and the company is currently planning for the maintenance period at the end of January to increase gas processing capacity. At TEN the drilling of the production well on the Ntomme field has commenced.

Uganda
The management was unclear on todays investor call if they are still looking to sell down Uganda. In the RNS the company wrote that FID is dependent on a reduction in Tullow equity stake. It looks like the Uganda asset will be in limbo during the next year. The Uganda sell down was also Tullow best option for debt and future capital expenditure reduction. The company is planning to spend $15m in Uganda during 2020.

Kenya
The operation in Kenya has been delayed due to severe damages to road caused by adverse weather. 2020 is likely to be another year of slow progress in Kenya. Tullow partner Africa Oil announced today that they have closed their Nigerian acquisition from Petrobras, which further shift Africa Oil focus away from the very delayed Kenya operation.

Exploration
Tullow didn’t specify how many exploration wells they are looking to drill in 2020. $75m of the capital expenditure budget of $350m is allocated to exploration down from 2019 budget of $140m.

Tullow Oil has been on path of debt reduction over the past years, 2018: $410m, 2019: $350m and now assumed $150m in 2020. With the weak operational development 2020 might be the last year at current commodity price when Tullow can reduce its debt. 2020 capex budget is all maintenance capex as it doesn’t increase the company production and going into producing assets. Unless Tullow can divest asset during 2020 it looks more and more likely that the company will have to raise equity to improve the balance sheet before 2021 when production will fall further. For us its difficult to see any reason to own the equity at this stage.