Member Info for DiveCentre

if you are a times subscriber there is an interesting comment from one andrew preston in responce to the s****horpe article "british steel latest"

i won't copy the full comment but this is a flavour:

"you can see the end of netzero today. miliband slunk out of the debate early having been nailed by someone for closing the new cumbria coal mine which could supply s****horpe .... rather than continuing to bring it 6000 miles in diesel tankers from the far east."

i view the whole business as a positive in that it shows the government is rowing back on the net zero ideology.

Hi Laser

Good to see you are keeping watch. With brent at 65$ not a good time for an offload so I'm hoping it will be a few more weeks and a bit of a price recovery. The more positive news is that the gas price is holding up better, currently 85.5p.

JS

Reading your posting history it would appear you were once a fan of Trump. You now seem to have changed your mind. Care to explain why.

Speculative buyers/traders have taken a view that the rally is over.

I'm waiting for the real news.

Sensman

All Laggen area production is piped to the Shetlands so I expect the income stream will corelate with production.

Senseman

I can see no reason for Prax to terminate the AM contract. If is does happen it will be from Bluewater and in my opinion only when a FID has been taken on Sea Lion. If and when RKH will RNS.

I estimated 0.3p as the potential contribution from the Laggan area provided the deal completes as forecast. In my post 10th March I made an error when I said " if my figures are anywhere near correct it could contribute as much as 0.03p/DCU." A lot will depend on whwn the next offload happens, and of course when the TE deal completes.

Hi Laser

Yes I have seen the figure and it is encouraging after the drop in January.

My revised estimate for the February offload is 324mb

We are each responsible for our investment decisions. If they go wrong you have only yourself to blame.

Thanks for that explanation Jim333

It always helps to have an understanding of what is moving a share price.

Yes.

Share of revenue up to the end of 26 with last payment March 27.

Boxers2020

noted.

Machin

Apologies, my mistake, you are correct.

Machin

The September 23 payment was 0.39p not 0.309p.

My reckoning is a further 3.975p max.

28th March.

My provider has advised the payment rate is 0.00742p.

So the December offload was in time.

Corryvreckan1

I am not overly concerned about temporary fluctuations in the oil price. What matters is the price when offloads happen. The next one should be in May although late April is a possibility as Prax seem to have been doing short loads over the last year. Long term is guesswork depending on world events and we could spend hours discussing that. There is also the matter of the Bluewater contract.

I am more interested in the gas price (UKNG) as in my opinion the larger proportion of future revenue will be from the greater Laggen area and 90% of production is gas. I used 90p/therm for my calculation of expected returns for DCU holders and it is worth noting that UKNG has since risen to 105p, but what matters is what it will be from May through to the end of 26.

Following on from my post 01/02/25 the sterling dollar rate has moved against us and if the currency conversion date for the last payment is guide I think it is reasonable to assume conversion has already taken place and the likely rate will be 1.29 or thereabouts. Accordingly my predictions are 0.00496p for 2 offloads and 0.00721p for 3 offloads. Knowing that the tanker transfer started on the 31st December it indicates that a sale had been arranged before the end of the year which in my opinion will result in 'sold in period' hence 0.00721p. Computershare will notify certificated holders within the next few days so hopefully the information will filter through.

As they say, that is a good question. Given no reported news you have to wonder what has propelled this buying spree and I can't help thinking something has leaked.

Production information for the TotalEnergies fields up to the end of last year is available on the NSTR’s website and I have been meaning for some time to look at it with a view to assessing what it could mean in terms of value for DCU holders. When the deal was announced we were told: ”Current production (for FY 2023) for TotalEnergies’ interests at about 7,500 barrels of oil equivalent per day, made up of around 90% of gas.” and “Upon completion of the transaction, which is expected in Q1 2025, Hurricane Energy Deferred Consideration Unit holders will commence to receive a 17.5% gross revenue royalty from the acquired assets, according to the terms of the DCU deed.” TotalEnergies holds an 80% interest in partnership with Kistos.

Of the 5 fields included in the deal Glendronach has not been developed as a producer and Edradour appears to have ceased meaningful production in early 2023. This leaves Laggen Glenlivet and Tormore, with Laggen and Glenlivet being the two largest producers. I have looked at production figures for 2023 and 2024 for guidance in order to make an estimate of what future production will translate to in terms of value for DCU holders.

There are numerous variables so the actual return could vary quite significantly from my estimate.

There is also the ownership transfer date and for the purpose of this exercise I have assumed this to be the 1st of May. The other variables are production decline rate, oil price, UKNG price and the dollar exchange rate. Using production figures for 2023 and 2024, a decline rate of 0.85, oil price $70, UKNG price 90p/therm and 1.29 for the exchange rate, I have calculated 1.207p/DCU for the remainder of 2025 and 1.551p/DCU for 2026, making a total return of 2.758p/DCU.

If the ownership transfer goes ahead as expected there will be 2 months income to be included in the September DCU payment and if my figures are anywhere near correct it could contribute as much as 0.03p/DCU.

Zues highlighted capital allowances, the scope 3 emissions consultation and the Uk tax regime post 2030 as the three issues which would affect a final investment decision by NEO and Serica. Given the news so far I would be interested to here the views of members on how they interpret that news and whether they see it as being favourable or not on each of these issues

Senseman

Kistos is the other partner with TE in GLA holding a 20% interest. In their trading statement (08/01/25) they said “The anticipated change of operator in the Greater Laggan Area is expected to take place in H1 2025, with the expectation the new operator will provide additional momentum in sanctioning development projects to extract near-term value from the area, such as Glendronach”

Jockbob11 has previously posted 30th April as handover date and relied to my enquiry as to the source. I realise this cannot be verified but I am inclined to believe it given the public statement by Kistos.

Cont'd

David Whitehouse, chief executive of trade group Offshore Energies UK, has pointed to forecasts suggesting the UK will meet less than a third of its oil and gas demand from domestic production between now and 2030.