Member Info for dickupham

........should have said that about 75% of Equinor is state owned - not sure about other Norwegian oilcos. So it isn't only tax revenues the SWF benefits from.

The general point about a windfall tax at this juncture is that it would send out completely the wrong message to companies the OGA and others in Government have assured that the UKCS is "open for business", there's a lot of oil & gas still to land, albeit not as easily or in the same volumes as it was 25-50 years ago, it's politically stable and a fair place to operate in. Then (if Labour had its way): "Bang - give us 50% of what you've made because our efforts in the past have caused the UK to become either directly or indirectly dependent on Russia and other unfriendly nations for the oil & gas the companies we frightened away with our ignorance and greed aren't producing".

Put all 650 of them on a boat, tow it to a deep part of the Atlantic that's within range, then scuttle it and run. I'd call that a good start. Move on to the Civil Service after that. No on second thoughts make that No3 and move Local Authorities up the list instead. Gawd............forgot about the tens of thousands of NHS 'administrators'. OK, get a bigger boat.........

I loved the way LSE edited former health secretary Matthew Han*****'s name in my last post...........

I'll now shut up for quite a while.............

dyor

Where was the credit from Government for "the impact of a substantial fall in commodity prices during the year (2020)" I ask ...........
https://www.investegate.co.uk/serica-energy-plc--sqz-/rns/results-for-the-year-ended-31-december-2020/202104150700025131V/

If successive UK Governments from Thatcher on hadn't raped and pillaged NS oil & gas companies, there wouldn't have been any need for windfall taxing. But HMG chose to reward decades of high cost/high risk activity by NS explorers, that occasionally led to the drilling of an exploration well where the chance of discovering commercial oil/gas was roughly 5%, with punitive taxes that at their peak (bizarrely when Osborne was chancellor in 2010/11) hit 62%. Every last penny of taxes so raised were pi55ed away in the usual fashion by politicians intent only on popularity. In her defence, at least Thatcher tackled some of the old chestnuts that had held Britain back for so long.

Compare what Britain did with its incredible windfall (half the NS - enough oil and gas to last decades and maybe longer) with how Norway dealt with the situation. The UK pi55ed it down the khazi. Norway decided it wasn't fair for only one or two generations to benefit from the new-found riches in abundance (I'm talking early/mid 70s - Forties/ Brent etc - Norway had their equivalents). So Norway decided that the exceptional tax collections should go into a sovereign wealth fund (SWF) that is now reportedly worth US$1.4tn, making Norway one of the world's richest countries. It has a national debt of close to US$200bn, but this is dwarfed by the SWF.

...........meanwhile everyone in Britain is concerned only about when is a party not a party and how much Han**** should have paid for PPE for NHS staff. But it's agreed it's very good for a new type of law to have been invented that permits - nay encourages - vandalism by about 10,000 rioters who totally defy Covid lockdown rules to be "on the right side of history" in tearing down a statue of arguably Bristol's biggest ever benefactor (Colston) and throwing it into a conveniently located harbour.

Anyway, the point (if there is one) of the above is to say Britain is not self sufficient in oil and gas because HMG drove oilcos away with high taxes which, when combined with unreasonably high operating costs charged when Brent Crude sat at $100+ for nearly 4 years from 2011 to 2014. It all changed PDQ after that. HMG didn't get a penny in tax after the proverbial hit the fan.

Enter the OGA with its "MER" mantra and thankfully things have been patiently and skilfully turned around (to an extent at least), projects like SQZ has taken on doing their bit to repair the damage. My view is it's likely JOG will soon do their bit too.

Ignore the short term price here. The time we're likely to see fair value is when the industry decides what it is. Windfall tax? Rishi would be mad to go down that route. But he'd be popular with life's failures so.............

dy

Yeah - last year was a bull year, wasn't it?

Good find, Parge. What's interesting (if the article is factually correct) is that Ithaca is prepared to spend £150m to lay its hands on 5.5m boe in the deep NS. Puts JOG's est £1bn projected cost of Phase 1 infrastructure in the GBA in perspective. The £1bn has probably been revised downwards in light of refs to sharing electrification and other costs with nearby neighbours.

On a different note, the cretins who bang on about the UK becoming a fossil-free zone or whatever are not only hypocrites but they must also be incredibly thick. In former times they would have been hanged for treason. Over the last 25 years or so, the UK has led in taking a responsible approach to (so-called) global warming. What this actually means, although it is never said, is that the planet is overrun with humans, to the detriment of every other living creature. Politicians across the globe would never dare to suggest that the people of Asia and Africa (in particular) even start to consider if they might be being irresponsible in producing as many children as they do. Look at the statistics if you think my comments are unfair. Other countries are fully engaged, with no compunction whatever, in cutting down rainforests as fast as they can, focusing only on short term economics. Over-population is the reason for global warming. The rest is semantics - it's just pushing the real issue further down the road. As for Tessa Khan, director of Uplift, a campaign group working towards a fossil fuel-free UK, if she had her way the UK (and particularly oil companies like JOG) would cease activities immediately, regardless of the fact that she and other thick hypocrites like her will continue (for instance) to heat their homes using gas or oil, travel all over the world using transport reliant on the same and they'll carry on without thought using the 6000 or so products in everyday use in this country that rely on fossil fuels (principally oil - the petrochemical industry is vast) in their manufacture, oblivious to the fact that if the UK doesn't produce the required oil some other country will. And most probably the country the UK will become most reliant on for the imported oil and gas the UK population will be screaming for, complaining all the time about the excessive cost and how the Government should subsidise it, will be Russia. The fact that the oil being imported will have had double or triple times the Carbon effect on the planet won't even enter the thinking of these noisy idiots.

And whilst we're on the subject, why is Britain not self sufficient in oil and gas? Answer: successive UK governments from Thatcher on, who have looked on the NS as a cash cow, rewarding 15-20 years of huge risk and vast capital spend by explorers to achieve success in one opportunity out of about 20 they actually get to drill, with extortionate tax rates that resulted in the UKCS becoming a no-go area for explorers.

Until the OGA and MER arrived, that is................

dyor

SQZ has performed exceptionally well for me and a lot of others. My average was 22p but the co has long since ceased to owe me anything thanks to a bit of top slicing. I’m hoping JOG will perform even better. I’m presently holding more JOG than I ever have in the past. Seeing it get past £5 would be encouraging. The best time to sell imv is likely to be when the FDP is approved. That’s as far as I’m concerned anyway. I’d be looking towards a valuation supported by a price of $8-10 per barrel at that stage. If JOG managed to retain 50% on a farm out this would result in retaining about 80m barrels ignoring the prospects. You can do the maths.
I have every confidence in AB and his exceptional team to get this across the line – sooner rather than later - thus locking in what would become a very exciting future.

Careful you don’t miss the bus..............or should that read "rocket"?
Never underestimate risk/dyor/all imo

Thanks for your friendly comments, MPO. No harm in a bit of light-hearted banter from time to time.
But it’s important occasionally to remind others why I hold the views I do. I’m never going to go into long and detailed explanations about why I value JOG a long way ahead where it presently stands. Besides, what I think the shares are (or might be) worth has nothing to do with what a lot of short-term chancers think they are (assuming they can think at all). There are still risks involved but I don’t reckon the so-called market “gets it” where JOG is concerned. An announcement could come at any time that completely transforms the company. Whatever those saying they’ll buy in when the situation is de-risked might say, there’s no chance of scoring heavily when the cat’s out of the bag.
As for how the market is presently valuing JOG, to quote Warren Buffett (whose investment strategy throughout his life has been to acquire shares in companies he rates, at prices that are lower, then wait for the fundamentals to play out): “price is what you pay; value is what you get”. That said, I doubt he’s ever bought shares in a junior oil explorer listed on AIM, whose future depends on events outside the company’s direct control.
The longer I stay in this crooked game (owning shares quoted on the crooked enterprise known as the London Stock Exchange – in particular on AIM) the more I am convinced that people trading the shares (I won’t lend credibility to them by calling them investors) and therefore the ones setting the share price under the normal rules of supply and demand, don’t have a clue about the fair value of what they’re buying and selling. They trade only the short-term price. Some even apply “chart theory” to shares that are entirely news-driven. How dumb is that?
You may have noted that my comments about JOG have tended to be somewhat “up and down” these past few months. This has mainly been because of the delay in getting a good farm out agreement signed – exacerbated by the changes at this late stage in the personnel responsible for getting a deal across the line that gives JOG a significant carry on infrastructure costs it hasn’t got a hope of paying on its own. My occasional pessimism has also been partly been caused by variable moods that have been a feature of my ongoing tussles with medics who seem to revel in finding new things wrong with me. All things considered, I reckon I’m doing ok and I continue to give them a run for their money. I’m optimistic about seeing a good result here in a timescale that’s meaningful to me. In other words I don’t expect to curl my toes up any time soon. I’m looking for a big result from JOG which would allow me to do a few things I might otherwise not have.
If you want to get a feel for what a good announcement would do for the SP I suggest you look again at the target price the 3 main brokers come up with and take an average – say £6ps??

tbc

dm...........see my post of Fri @ 15.03 hrs............

https://www.youtube.com/watch?v=BGQC95eYTXg

Markyboy - the IC coverage you referenced in your 16.41 hrs post was imo a lot better thought out and focused than most efforts written by ANALysts. Can't say I recall having seen it at the time - thanks for bringing it to my attn. Since the article was written, JOG's case has improved markedly, particularly:
i) the appointment of the ex-Ithaca senior team to build on and complete the job started by Ron, Andrew and others;
ii) the final recognition by our beloved government that Britain is going to need as much oil and gas as the North Sea can sensibly produce for decades to come:
iii) in regard to ii) above, JOG's "net zero" credentials and capabilities are an example to the whole industry;
iv) since Simon Thompson wrote the article (27 Sepy 21) oil prices have increased significantly (now $90). All JOG's projections were premised on a BC price of $65pb and the results of that exercise were pretty impressive as they were. The $25pb increase in price goes straight to the bottom line as costs only have to be recovered once.
https://www.investorschronicle.co.uk/ideas/2021/09/27/bargain-shares-profit-from-the-energy-crisis/

Fwiw, my view is that it's more likely than not that JOG will announce a farm out by the end of Q1. There's no particular science behind this - just a feeling we're in the final stretch . Why wouldn't oilcos that see a future in the NS NOT want a slice of the action. There's been practically no exploration going on for the last 5 years or more and producing oilcos have to replace reserves if they're to have a future. Think of the synergies available to a company with nearby interests in regard to shared costs etc. There could well be more than one party interested. Maybe the farm out will be to more than one other oilco. Who knows? All options on on the table. JOG's people won't be sitting on their hands, that's for certain.

Marky, you asked what others thought JOG's shares would be likely to trade at in the absence of a farm out, implying you'd reduce your holding if the price was likely to fall significantly. JOG won't be making any announcements to the effect other oilcos just aren't interested in the 400m barrels of discovered and prospective oil in the GBA. They'll just keep trying until either a farm-in partner signs up or more cash is needed to keep paying their salaries. A guess if the latter? 50p? How the market reacts to whatever deal is announced (if one is announced) is also anyone's guess. If JOG manages to get substantially carried through Phase 1 for ceding, say, 50%, the shares should fly. I say 'should' but it doesn't mean they will.

You're in the wrong sector if you want a safety net. Just never invest more than you can afford to lose. And always take enough shares off the table to cover your investment cost on the few occasions you manage to back a winner. Let the rest ride.

The term: "loaded catapult" comes to mind.

I'm probably wrong (again). Who needs a yacht anyway?

all imo/dyor

Markyboy41 - it would take a book and a decade to explain all the variables one has to consider before being able to assess how a particular stock is likely to be valued by the market on any given day in any given circumstances. No matter how long they had, most people wouldn't be able to understand how to value shares. More often than not it's companies that are valued, although there are other forms of ownership (eg sole traders or partnerships). And different sized interests in companies are valued differently depending on whether the holding being valued is an insignificant minority (less than 25% of total shares owned), a significant minority (26-49%), a majority (51%-75%) or 75%+. I'm talking unlisted companies. Other factors have to be take into account where partnerships (for instance) are concerned. Much will depend on what a company's articles of association (a co's 'rule book' if you like) provides where transfer of shares is concerned, or in a partnership, how the partnership agreement provides a partner's share should be valued in given circumstances.

I'm not going to even try to cover what's involved with listed companies like JOG - post IPO (Initial Public Offering) a process designed to raise money for the co or its owner by offering shares to the public at a price set by the vendor and his advisers. It would take too long. The same principles of valuation apply except that shares in a listed co can usually be traded easily between willing buyers and willing sellers, at prices that vary according to the usual rules of supply and demand. How much are your shares worth? What someone will pay you for them.

Organisations known as Market Makers (or 'MMs' - there are many of them; most are owned by investment banks) supposedly make a fair market in the shares they deal in. I understand there are about 5 different MMs who deal in JOG's.

All the above is just scratching the surface of a subject that is enormously complicated and difficult for the average person to understand. The whole process is prone to astonishing crookedness by people and organisations out to make a buck however they can, regardless of whether their conduct is ethical, moral or even legal. A collective name often used to describe this whole basement subject is: "The City", or more specifically: the "London Stock Exchange".

I can tell you how I would value JOG if I was giving evidence in court as an expert witness (which I did on numerous occasions blah blah blah). I would apply knowledge, understanding and experience, take account of the many different variables, then apply a discount for risk. What I can't tell you - nor can anyone else - is how countless different people (aka 'the market') who haven't got a clue about the fundamental value of anything, let alone complicated things like shares, might think JOG's shares were worth in various different circs.

The oil is unlikely to evaporate, but cash does.

I contacted JOG earlier on reading the cerebrally-challenged Joe's disingenuous post suggesting there were divergences of opinion (at this late stage) among JOG's very capable and experienced team. I was sent a transcript of what appeared on LinkedIn. There are no divergences of opinion - everyone's views are (and have at all times been) positive.

Put simply, what HarrowJoe posted is b.ollox. Do us all a favour and head back to the sewer from which you have thrice emerged in recent months to make your worthless and dishonest contributions

all imo/dyor

..........pushing $90 pb

https://tradingeconomics.com/commodity/brent-crude-oil

jasehem - to me it comes down to whether it's preferable to shareholders generally for the directors to capitalise on what's been achieved in recent years or risk what could be all on a sizable acquisition in an effort to guarantee future growth. What SQZ has achieved of late has been against all the odds - SQZ had a market cap of c.£7m six or seven years ago. By selling its assets to a bigger fish, the latter then seamlessly melding these with other assets, significant risk could be avoided.
The alternative, as you say, cannot simply be to keep on producing from existing fields because the bulk of SQZ's producing assets are medium to late life and production declines with age. Whilst N Eigg might look very promising, the risks associated with a solo exploration drill cannot be underestimated. Other licences acquired in recent licensing rounds will take a long time (and cost a lot) to develop so, if the aim is to turn SQZ into a bigger NS producer, the growth has to come by acquisition/merger.

We are all individually influenced by our history of buying into SQZ's story. Today's share price is more than 11 times my average acquisition cost, having more than recovered my original investment cost along the way. Many others will have done even better. Whilst I still regard the Company as fundamentally undervalued, experience has taught me that the unforeseeable can sometimes happen, so my approach to risk is somewhat tempered. It's always wise to consider that the markets doesn't always behave rationally. Consider also that certain shareholders might at some stage decide to convert paper wealth into cash. And that gas prices might not continue to move in our favour for much longer - who knows?

All just food for thought - all views are valid. I'm just outlining a few of mine. 350p+ at some point this year would seem fair enough to me. Always leave something for the next fella..................

dyor

I doubt very much the directors have any intention of selling any time soon, NK. You only have to look at the last 3 changes to the Board to see this. Two are definitely acquisition-focused and the jury's out on why the CFO appointment was made. Why appoint a CFO (everything worked fine before the appointment) if you're intent on selling - he would just be seen as baggage by an acquiror.

I fear an acquisition that would use up a lot of SQZ's cash pile. Given there are no more BKRs out there, an acquisition would expose us to way too much risk and would likely serve only to dilute what's a pretty impressive model.

No point in going into all the risks involved in making acquisitions. They're fairly obvious. In the years I spent doing what I did I rarely saw synergies achieved that had been loudly put forward to support the M&A case. Being tied in with IOC at Rhum is risk enough for me. Who knows what might happen if things kick off again with the middle-east troublemakers? And btw ,the IOC won't have the slightest interest in disposing of its interest in the UKCS. It's peanuts to them but does have the potential to annoy.

Back to sleep now.

dyor
GL

Shredders - another possibility (looking simply at the prices at which the trades were executed) is that the 185k parcel was a buy and most of the other sizable trades were sells. We're all just guessing but the above would make a bit more sense, not that the behaviour of MMs usually makes much. They're supposed to make a fair market in the shares they cover. What a hoot.

GL - shouldn't be too long to wait now. Not sure what for, but it shouldn't be too long :-)

Shredders - the 185k and 60k trades might have been reported late on, but they were executed at 09.36 hrs and 15.04 hrs respectively. Someone with LSE level 2 membership might be able to throw some light on the subject? Given the price was marked down early on, my guess is the 185k was a sale and MMs dropping the price by close to 5% encouraged a few to buy. It's impossible to say whether the other chunky trades (2 x 25k 1 x 50k and 2 x 10k) were buys or sells.

Exactly as the MMs no doubt intended. They're honest sorts, virtually all being owned by investment banks and involved in the London Stock Exchange, which a few years back expanded by two words the motto it had proudly presented to the world since time immemorial: "My word is my bond". The two words added were: "my ar5e".

In regard to things generally, hope springs eternal. I'm adding "my ar5e" to this in future posts in case anyone should read any confidence in my deluded rants

"Spes aeterna my ar5e". Has a certain ring to it, n'est pas?

DYOH

NK - begs the question: "who's selling"?

A few might be interested to read a post made on the other board yesterday by highlyunlikely. For historical reasons that's the name I post under on that site. The person I refer to at the outset is JT Southern, who had evidently won the heart of the person (gowlane) I was responding to. gowlane had shown up out of nowhere a couple of days earlier urging everyone to pile into ADV, which plunged from 5p to 0.68p the next day after announcing a poor result from an exploratory drill. You couldn't make it up. Anyway, here goes:

"Anything is possible, gowlane. He might turn out to have been right, but there's more than a dog's chance he'll turn out not to have been. I personally found his stubborn determination to paint everything JOG has sought to achieve in a bad light irresponsible at best, when he hadn't had access to the data many well-respected industry pros had (Schlumberger, Rockflow Resources, Petrofac and others) who reached different conclusions clearly had. These also included JOG's own team of seasoned pros, plus any number of hired consultants).

I suspect JOG launched the farmout at a time that turned out not to have been ideal in that many big oilcos had slashed budgets in the wake of oil prices in the $20s when Covid struck. So I'm guessing that this, plus sector negativity in the face of constant attack by the buffoons in the "save the planet" brigade, then all the uncertainty and delays caused by COP26, made attracting and doing a deal with a suitable farm-in candidate in a timeframe that many were expecting nigh on impossible. Many things have turned in JOG's favour since then and I'm more optimistic presently than I've been for a long time.

To cut to the chase, I'll stick my neck out and say that JOG will announce a farm out before the end of Q1 - maybe to more than one party. Favourites to sign on the line to me would be companies with existing operations in the area - JOG has some mighty powerful neighbours in the likes of Buzzard and Golden Eagle. See P8 of the linked presentation.
https://wp-jerseyoilandgas-2020.s3.eu-west-2.amazonaws.com/media/2019/12/CMD-Presentation-8-October-2019-vFINAL.pdf

All just my optimistic views and opinions. Make up your own minds after doing your own research. Risk can never be eliminated - it's the nature of the sector. Put your money in a building society if you want the certainty of at least getting it back. It will never buy you a holiday pad on an island 10 miles from the coast of France, however.

GL whatever approach you take to investing in JOG.

https://www.energyvoice.com/markets/379686/commodity-trader-king-eyes-200-oil/?utm_source=Sailthru&utm_medium=email&utm_campaign=EV%20Saturday%20Personalised%20Round%20Up%202022-01-15&utm_term=Energy%20Voice%20-%20Newsletter

The report is littered with basic errors. Typical of the sort of c.rap produced by ANALysts who should be doing something for a living that doesn't require the application of knowledge and intelligence.

jmo of course