Member Info for epiphany121

Two words to sum this up - Trump Dislocation!!!!

US and responsibility just don't mingle, irrespective of the administration in question. Less so with the buffoon in the current white house.

in my previous post, I should've said the 'operatorship' transferred over in December 2017.

Speaking purely from the financials viewpoint - the upfront cash investment is $100 million and ENQ should start receiving the 50% share of the cashflow in circa 15 to 18 months, in order to facilitate an NPV calculation. I'm sure that it will turn out to be overwhelming positive. And the revenues will accrue to ENQ's P&L statement and net asset calculation.

Let's see if AB pulls the trigger...

Romaron - Enquest is already the operator of Magnus, SVT, and the pipelines in question. The ownership transferred over when ENQ formally acquired the 25% stake in these assets in December 2017.

Magnus 2P assets are in the circa 50M barrels range. There may possible be more with EOR, as you've stated. Should ENQ choose to go ahead with the option, note that $200 million out of the $300 mill, will be vendor financed by BP, payable out of the net cashflows from these assets. After this $200 million is paid off, BP will then receive 50% of the net cashflows form these assets, till they receive the remaining $700 million.

It is low risk option for ENQ given net cash outflow is $100 million, but I suppose AB/ENQ may be reluctant to pull the trigger given the slight increase in net debt this will entail. My take is they should do it..

Best

Whatever happened to the Flu in the last hour? Maybe this new strain of cold is the antidote to the Flu??? Lol..

And this is why the direction the Flu takes is hard to predict on a day to day/hour to hour basis, and daily ramblings on this board sure won't result in a change of direction...;-)

No doubt it was a good thing that the market wasn't opened. That Trumpty headline would've pulled POO down by $2 to $3.The market always reacts to Trumpty, even though they're blatant lies.

Jan - I'd broadly agree with your assessment. There'd almost certainly be a knee-jerk reaction lower on Monday, as the oil markets digest what Trumpty actually meant by his statement and what Saudi would actually followed by a slow realisation over the next few days/weeks that Saudi production will nearly be at it's upper/untested limit.

Here's something that could rock the oil markets/prices to the downside on Monday - Trumpty has reportedly struck a side deal with Saudi to supply additional barrels (Trumpty says 2 Million BOPD) to reign in oil prices. And we know what that means to ENQ's SP at this point in time....

https://www.cnbc.com/2018/06/30/oil-deal-may-stir-the-pot-in-the-middle-east-and-test-saudi-capacity.html?__source=twitter%7Cmain

Lol...cracking

KO - admittedly, I haven't been holding it for as long as you and hence, no I'm not frustrated. There's just been the one real update in the past few months and that's the AGM update, which the market viewed as negative, maybe because of no upside on production and no debt reduction news.

I'd be frustrated if the H1 update is still 'bad' (which I don't expect to be, BTW) and at that time I'll decide what to do. That's still a good 2 months and we may have additional good news in between in terms of AK sign-off, POO rising. Till the H1 update happens, I'm not going to be looking at the SP every hour and banging my head against the wall as to why this isn't moving up, in spite of all the perceived strengths including a rising POO. The SP will eventually take care of itself if ENQ keeps executing.

KO - you repeating this nearly every day isn't going to change anything is it?

To rejig the old phrase - the market can be irrational for longer than KO can be patient, which is usually not more than a few hours!!! Lol..

Wine or no wine, that was pretty clear, Jan. ;-)

It's hard to predict day to day movements of either WTI or Brent, but suffice to say the underlying bullish undertones of POO are still intact. How else can we account for the fact that USD has now hit yearly hits and Brent/WTI are also at or near 52 week highs. I got the reading wrong from Wednesday about US crude production - it actually increased marginally over the previous week. IMO, WTI should ease back next week, once the Canadian production issue is resolved.

With the US economy going strongly, and supporting global growth (numpty trumpty not withstanding), we should see a steady climb in Brent over the summer.

One last word about ENQ's 'aggresive' hedging - take the likes of TLW, who're more than 50% for H2 2018 at a barrel price of $52 and 25% hedged for 2019 at $53/54 - ENQ is only hedged circa 25% for H2 2018 production and that too at a much higher $62 per barrel. At the current Brent levels, ENQ will be realising more than $70 a barrel for the remainder 75% production.

And with Alma workover as well as Kraken staying where it is now, we should see a BOPD production upgrade by the time they announce the H1 update. Patience is needed and fundamentals will soon be reflected on the SP. Till then, I won't be surprised to see it re-visit either low 30s or high 20s OR low 40s, depending on POO and global stock markets.

Good friday to all...

Not to worry, ENQ's time will come very soon!!!

It's a no-brainer that that the last update wasn't well received by the market and that accounted for a big chunk of the fall from 45p to 30p. But then, does it market get it right every time- NO. And hence, there's bigger value here.

If there's no additional news coming out of ENQ, I'd agree with your assessment, Squif.

WTI - Brent spread is now down below $5. WTI is where a lot of buy action is at the moment.

Chaps - here's another important piece of news in the EIA report, and is bullish for POO.

US production fell from 10.86 Million BOPD to 10.76 million, which is the first week on week fall in about 3 or 4 months.

Trumpty decides against the very harsh investment restrictions to be placed against China. That's one monkey off the crude oil market's back.

https://www.forexlive.com/news/!/trump-decides-against-harshest-measures-on-china-investments-20180627

Morning chaps - these are short term trading swings at this time, but a welcome move nonetheless. SP will probably meander in the 30p to 40p, until we get positive news to break out decisively above the 45p level to new 52 week highs.

GLA

https://www.cnbc.com/2018/06/26/oil-buyers-must-cut-all-iranian-crude-imports-by-november-state-dept-.html

WTI and Brent moving up as a consequence...

I wouldn't be selling AK 20% unless it fetches a solid premium (think $800 mill for that stake) and that isn't likely unless POO gets to at least $90 and AK is at an average 50K BOPD production rate. I'd be happy for debt to be whittled down with the output from the Kraken. It's a slow burning story is ENQ.

Thanks for that info, Chilts. I didn't realise that Olombendo final commissioning was dragged out for more than a year from the time of first oil being produced.

We know that once final commissioning occurs, AK receives $500K a day. And ENQ is paying them of this 50% at this time. Why throw away an additional $7.5 million a month, if indeed we're not seeing at least a low 40K BOPD production.

MO - enjoy that Rose..We'll get to the mid to high 40K BOPD as that heat wave lingers for the next few weeks. ;-)

KO - why is manipulation only downwards? Is it not manipulation when someone is moving it upwards? ;-)

As in someone is manipulating it upwards at this time. Bottom line - it's all demand/supply, and perception of the majority on a given day whether it should manipulated up or down..