Member Info for dan222

SittingDuck I'm not sure who funds who, but wealth is ultimately resources and capacity to use them. Europe doesn't have a lot of resources compared to the US, and is divesting itself of the ones it has (by cutting off Russia, for example, or closing down the UK North Sea). I think ultimately if we want to prioritise net zero and human rights (and I'm passing no judgement over what's right, though obviously I'm writing on a forum for oil company shares), that won't make us strong and it's 100% certain that over time, if we have a weak army and a cossetted population, we will lose territory to stronger countries. That's just how humans work, look at history. It hasn't changed.

Tetley ultimately the strongest country can take what it wants and nobody can stop them. I don't think the US would be strong enough to take South America, but it probably is strong enough to take Greenland, mainly because Europe is so weak, we have barely any armies and barely any industry, I can understand the point of view that why should America forever fund our defence while we put a large proportion of our population on welfare, and welcome an ever growing Muslim population which isn't necessarily friendly towards America (at strategic scale, I'm not talking about individuals)

I don't see why whether Denmark or the US owns Greenland is an issue the UK should be getting involved in on either side, they're both our allies so it's no problem to us either way. I can see the US point if view - Denmark is clearly unable to defend Greenland (if necessary) so would be relying on the US to defend it, in which case why should the US keep the responsibility of defending it but not the benefits of owning it.

On the other hand, oil and gas prices have been a lot lower through most of 2025 than was expected when the $1billion cash flow was first forecast, so Hbr will be doing well to get $1billion. I think 2026 is going to be a year of high capex, but we should see the benefit of that hopefully in 2027 and certainly in 2028.

Full year results will be very interesting, as they include a full year of WDA for the first time, which should make a huge difference compared to the previous couple of years in which all profit has been stolen by the UK gov, but I think we have to wait a few more weeks for the results?

Sounds like nothing. From the rns:

The Wintershall Dea BCA provides for certain customary post-completion adjustments to be agreed between the parties in respect of the cash consideration amount paid by Harbour to the WD Sellers. In seeking to agree such adjustments, Harbour and the WD Sellers have identified differing leakage amounts. The WD Sellers have taken the position, on procedural grounds, that the expert determination mechanism (as set out in the Wintershall Dea BCA) is not available to the parties to resolve this discrepancy. Absent a resolution between the parties, the Wintershall Dea BCA requires Harbour to refer the matter to arbitration to determine the availability of the expert determination mechanism under the Wintershall Dea BCA. Harbour does not expect any adverse financial impact on the Harbour group with respect to this matter.

Isn't debt repayment just as much a return to shareholders as buybacks are? If Harbour was debt free, presumably the total share value would increase by the value of the debt repaid (in theory - it doesn't happen perfectly, in the same way it doesn't happen perfectly with buybacks). I know our opinions don't have any effect, but for the purpose of the discussion I would be very keen to see big debt repayment before buybacks, though the board have already said they're planning buybacks

FWIW I dont think relatively small buybacks lie these have much beneficial effect especially when you promptly issue 5x as many new shares after it concludes

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I kind of agree with you, but I guess you could view it as if they paid an extra $100 million cash for LLOG and only issued $400m of shares.

You can't look at current share price and say the buyback is a 'success' or 'failure' based on that day's price, Hbr aren't trying to trade, it's long term management of the number of shares issued.

At current prices buy backs would seem to be a decent idea, though personally I'm more in favour of debt reduction. Low debt gives the company a lot of freedom to take advantage of any opportunities that come up, and also removes the need to hedge.

Yes hopefully they will get some money in from sales and use that to quickly pay down the debt. I believe 2025 they paid down around 500 million before taking on more debt for LLOG, so even without sales they should be able to make decent inroads on their debt, oil price permitting. And if there's a couple of years of low oil prices it shouldn't be a great problem, as the interest is easily manageable.

Thanks Sekforde, I'm sure you're right that cashflow is a better metric, and it's good to see you come to a similar conclusion using FCF - Harbour seems to be massively undervalued whatever way you look at it. I'm hopeful that 2025 results will start to change things, but in any case it seems a good bet that a bit of patience from here is likely to reward shareholders in due course.

Taking the 500k boe/day forecast through to 2030 that's 20% of BP's production of 2.5 million boe/day, which is their forecast to 2030. BP's net debt is $26 billion, so Harbour's debt is also around 20% of BPs.

BP's Market cap is £66 billion, 20% of that would be £13 billion, whereas Harbour's current market cap is £2.6 billion so it needs to 3x or 4x to even get close.

I think part of the reason for the low valuation may be Harbour's extremely low reported profit over the last couple of years, hopefully that will change when the 2025 results are released.

Minus legacy UK decline. The board have said production will be around 500k through to 2030. Obviously though rebalancing within that to reduced UK production and increased US production should be very good for profitability.

Interesting how Labour supporters don't like them because they're too similar to the Conservatives, whereas Conservative supporters don't like them because they're too similar to Labour. I think the real position is that both parties are completely useless, in very similar ways. I also think the whole public sector managerial class is incredibly corrupt, it's become completely normalised to be taking really high salaries (and high inflation-linked pensions) in return for doing very little work, if any at all. Then of course there's the corruption of all the private sector jobs waiting for you after you leave the public sector, to thank you for all the billions you've sent their way. Anyway, this has nothing much to do with Harbour (apart from that our share price is suffering because of politicians stealing all profits, which again is part of the corruption)

Nothing in fact to prevent HBR selling to Shell in April 2026 for at least $3bn and paying a special dividend of 150p to each shareholder!

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Nice idea but if they did that they'd still be left with the debt, but no longer have the asset!

I agree with you that Hbr is hugely undervalued, we might see that when 2025 results are published, as they will include the first full year of Wintershall. In relation to LLOG I think 2026 is a year of paying down debt and some capital expenses, the benefits from that should start to be seen in 2027 but hopefully this year we will start to see the benefits from the Wintershall deal.

Pumping more barrels will take a lot of time and a lot of investment. Look at our recent LLOG acquisition - we can't just instantly increase production, it's going to take capital investment and a few years, and that's in the US. Doing it in Venezuela where there's every chance your investment could get blown up or appropriated is likely to be a lot harder and take a lot longer.

'if I found my family murdered, am I right in murdering the murderers ?'

Yes of course you are, it's not even a question. That's what justice is, and in normal circumstances the state does it on your behalf - either through capital punishment, in countries where they have it, or through life imprisonment. I struggle to see how the haters will manage to justify criticism of Trump over this particular action - he's acting like a world leader, rather than a dim witted mid-level manager, which is the best we've had from any recent 'leaders' of the uk.

I think we can only wait for the next update for news on production. Your maths is right, but they also said UK production is going to decline over the next few years by 50,000/day - I don't think it really matters, as legacy Hbr UK production adds nothing to cash flow after tax anyway.

Cash flow per barrel on the North Sea acquisition and Llog should be a lot better, but capex is going to be higher too.

Lots of exciting things going on, could we get involved in Venezuela next? It's not far from Mexico.

If exports to China are affected, won't that make the oil price fall rather than rise? The price rose when the Russia war started because Russia is an exporter. China is an importer so I would expect disruption to lead to huge inventory builds among producers who can no longer export to China.

I really hope they're not hedging everything, as hedging of course also removes any upside. It's worked over the last 18 months as oil prices have fallen, but that won't be happening forever. One of the things I don't like about having debt is the need to hedge.

Nav Mike, I agree with you - personally I'd rather Hbr reduced debt, as the same company with lower debt would have a higher share price, and it also reduces risk. I can see the logic of buybacks, but I don't like the risk that comes with debt. In any case, what happens isn't up to us and the board seem to be saying they're going the buyback route.