Member Info for G_G_G

Supuser, it will drop f'all from this level even if the WFT is increased and extended. The company has $100m in buybacks over the next 12 weeks. And guess what, in another 12 weeks they'll have at least the same, and so on. We may drop to the 350's on the day if it's truly bad news (extra 5% and end-2028). But by the end of day we'll bounce to the 370-380 range. And by the end of Q1 we'll be i the high 400's on the back of negligible net debt, dividends, $200m (minimum) in share buybacks, and oil hedges starting to close. Every quarter from this point will be a step up. It's just a matter of whether the sp drops for a short period of time, or rockets, on the back of the WFT position on the 17th. Fundamentals even with the added WFT are impossible to ignore. And if the market does ignore them, well we have $100m every quarter to buy back our shares at such distressed prices. My position is simple, I've got 65,000 @ £3.84 at the moment. If we drop to the 370's or below then I'll at least double my position to a maximum of 150k shares. Worst case scenario I'll make 20-30% in 6 months (450-500p) and get a dividend for my time and patience. Truly easy money on this stock. Ultimately fundamentals win.

Butterscotch, what shorters do in the lead up to the 17th will largely depend on the sp level. If we're at 450p then I'd imagine they'll open shorts. If we're at 375p then I imagine they'll be closing. You're right an increase / extension of the WF tax is baked into the sp. But that doesn't mean there won't be an initial negative reaction in the worst case scenario, especially if the sp is 10-20% higher than now. I'm still not sold on the WF tax going through as both and increase plus extension. Perhaps one element, but not both. It would be too punitive to smaller UK based producers and I don't think Rishi and Hunt are that f@cking stupid. Will see next week I suppose.

SP as usual is dumbfounding. I don't expect us to drop too far back from here as the company has more ammo than shorters when it comes to manipulating the sp. Perhaps they're waiting to see what the government does first before acting. In the event of a sudden drop to 350p they could buy another .5% of the company versus what they paid in the past. If we drop back to the 370's then I'll double my holding. Worst case WF tax we're still worth 600p all day. It may just take until Q1 2023 results before we see that sp. By then we'll be debt free, have bought back another 5% of the company and be paying a +5% dividend on current sp. Hard not to see us in the 500's (+30%) from current sp. AIMHO GLA

Well this is depressing to watch. Hopefully HBR are using this weakness to buy up shares. We should be attacking $4bn mcap right now, and not bouncing off $3.5bn. If we go back to the 300's I'll be buying more. Also betting on the gov.t not increasing the WF tax on the 17th. I'm hoping common sense prevails but you never know these days. Politicians are far more interested in what will get them votes, rather than what's right for the country. Hopefully a decent close and we try again tomorrow.

Reckon we'll move to the +460's and +$4bn mcap on the back of the $100m buy-back. It's a quite significant sum for a relatively low volume stock. Plus the company would know they can pick up +2.5% of shares in issue in a strengthening commodity price environment. The rises in March and August show just how quickly this company can move. Any word on the WF tax remaining 'as is' and 500p will almost certainly go. Still a very good price at these levels, whish is no doubt why the share buy-backs are in place. AIMHO GLA

Sekforde again you've misinterpreted what I said. I mentioned $1.75bn would be able to purchase ENQ and pay off its debt (around $800m). So accounting for debt the total cost for ENQ would be less than $1bn. And because I'm cynical about gov.t intentions is why the $2bn in accrued tax write-offs is valuable in an uncretain, high tax environment where a company is making tons of profit. The gov.t cannot wipe out tax breaks that have been built to date. They can only change rules today on future tax returns. And with the less than$1bn cost of ENQ you get the +50kboepd production alongside +40% 2P reserves. The tax pool and reserves are the most valuable component of any deal. The +25% production is a very big cherry on top. ENQ would be a great purchase at these prices, which are so low because of the uncertain regulatory environment. The very same reason why we're so under-valued. AIMHO GLA

Sekforde I think you've missed the reasoning in my post. 'Little Enquest' comes with $2bn in tax write-offs, which is pretty handy when you're dealing with a f@cking ******ed government that's taxing the hell out of O&G. And buy-backs don't buy you 40% more 2P reserves or +50kboepd. With current commodity prices it pays all its own debt down by end 2023. So imo far better for them to throw money at this company whilst the UK gov.t is keeping its valuation low (like ours).

Disappointing sp action today but still moving in the right direction. I agree that we could move very quickly from this level in the coming weeks, but the short-term direction of travel will ultimately come down to what the government plans to do with the WF tax in 2 weeks. If it remains unchanged then 500p will be beckoning in a very short time-frame. If they increase the rate and length of time then a drop to sub-400p before a recovery is on the cards. If we drop below 400p then I'll be increasing my holding quite heavily. With or without a change to the WF tax we're only going higher over the coming months. And by end Q1 2023 we'll be debt free and have re-purchased another 5% of stocks on current run-rates. With hedges closing and supportive commodity prices we're then in a position to do a $1-2bn acquisition. I'd love to see us diversify away from the UK, but companies like Enquest are there for the taking. For $1.75bn (max) we could swallow Enquest and still be debt free by end 2023. For our money we'd get the best part of $2bn in tax breaks, +25% annual production, and +40% 2P reserves. Only issue is UK production but would still be throwing off a ton of cash. Certainly one for mgt to consider in the coming months.

Thanks Tony. It would be great see your workings, especially given they're far more accurate than i3e's :)

I just looked at AECO prices, which have surged the past few days to +$5CAD (+USD $3.70) so reckon your average gas price for 2023 is pretty good. Not sure about $95 WTI, which would be fantastic if this is the case next year but not sure we'll have such a high average price....? On production I think (hope) the average production for next year will be closer to 26.5kboepd if we're exiting at +24kboepd and adding $80m for development costs. Just my thoughts. Really appreciate you sharing your workings. Very helpful.

Ultimately the sp is going one way, which is up. The major near-term catalyst is WT transparency. If no change then expect high 400's within a day or two. If they add 5% and 2 more years to the WF tax the sp will likely drop initially, but doubt it will break the recent 370p lows. And it will then start its climb back toward 500p over the following 3 months. The main reasons being poo and gas are likely to increase, plus hedges will start to lapse. Give these things it's highly likely that +$2bn fcf will be on the cards in 2023 as well. So still massive cash being generated even with a higher WT. But more importantly investors will at least know the government position, regardless of whether it's slightly worse than our current situation (which is already accounted for in the current sp). Then we also have $100m in buy-backs over the next 3 months, which is hardly insignificant when you have our value sitting near a distressed level, relatively low volume, and active short positions. This will provide decent short-term support for the sp without taking into account more and bigger buy-backs are on the cards in the coming 12 months.

Ultimately, if the gov.t decide to f@ck HBR further and the sp drops back to the 370's then I for one will be loading up again with at least another £250k. I imagine funds and other much bigger PIs will be doing the same. It's impossible to lose if commodity prices stay near these levels for the next 6 months. We'll be net debt free in this time-frame as well, which is unheard of for an O&G company of our size. And finally, you'll get a +5% divi yield for your time.

Just needs commodity prices to stay within a 15% range of current levels and all will be very good here and the sp will be nearer 600p in 6 months. If we drop below 370p I'll kitchen sink it. AIMHO GLA

Thanks Tony. I hope mgt are looking at these acquisitions and recognizing the need to do something about our sp before a bid of 37p lands on our doorstep. Fwiw I'd take 37p right now and I imagine many others would also. If we don't want a derisory bid to land they will need to do whatever possible to boost our sp. To my mind that leads to a significant divi increase next month. On that note, have you run the numbers on the divi yet?

Forgot to add on my last note the impact of the $100m buyback. I think many have missed this announcement. If you consider how the sp has been manipulated of late, the low volume, and how grossly under-valued we happen to be, this is a great move to support / promote the sp. If the government announces no more changes to the WF tax then 500p is definitely on the cards. And if they do announce a change, the company has enough cash to buy over 2.5% of shares in issue over the next couple of months to support the sp. And when that's finished they'll have another $100-200m for buy-backs in February. At current rate by H2 2023 they will have bought back 15% of shares in issue in 18 months, have a net cash position, be generating +$2bn fcf regardless of taxation policy, and be allocating +5% in dividends (likely closer to 6-9% range at current sp). As I said, very little downside here and another 25% upside depending on government energy policy in the next couple of weeks alone. In 9 months I see +50% no matter what the government decides to do. Looks like the results and buy-back are starting to sink in :) AIMHO GLA

Good to see a bit of a sp bump. Will be far more interesting to see what happens in two weeks though. If the government decides not to increase / extend the WF tax this will be at 500p in a flash. Current sp has baked in an additional WF tax. So little to zero downside for any extended period of time even with a lot of manipulation. However the upside is 500p in a few weeks when fiscal policy is updated. It will get to 500p on the back of the H2 update even with more taxes as the fcf is far too great. It will just take another 3 months to reach.

Who knows next move for the sp. I have a feeling the sp may be 'let go' over the next week or so before shorting / profit taking drags us back down to the 400p mark pre government news. If not, and it drops below 380p again then I'll keep building my stake here. I've got at least another £250k to throw in here if those levels as it's as close to a 'sure thing' in he next 3 months that one can find. Even with a ret@rded government energy policy the sp is only going to increase. I'm looking for a significant decrease in net debt in the H2 update ($400m minimum) plus another significant buy-back program ($100m minimum). October poo and gas were solid. November looking better. And December will be huge. We then have the likely strongest quarter for commodities in Q1 2023. It's not often I look at broker reports in agreement but do believe without any major black swan event we'll be at least 50% higher in 6 months, regardless of how the rest of the world economy is faring. Oh and you'll likely get a +5% divi yield for your time. AIMHO GLA

Very simple short-term investment thesis for me here. If they add another $100m in share buybacks on the back of the Q3 update, which they absolutely should at this level, then I expect a re-rate to the 450p range ($4bn mcap). Shorts will be forced to close so the sp increase will be as swift as the last update (perhaps even quicker), adding 15-20% in a matter of days. Generally speaking I hate buy-backs, but when you have so much fcf being generated, a sp clearly disconnected from current and future fundamentals, and you're being shorted, then it makes sense to divert some fcf toward buy-backs. You also have the ability to burn some shorters who are less likely to make the same mistake before the next update. If they use all fcf to pay down debt I don't think it will have the same +ve impact on the sp. One only needs to look at SQZ as evidence. For HBR I'd throw money at buy-backs first, and dividends second. They also need to be a bit smarter in how they allocate cash over the next quarter by spreading more evenly so shorting cannot take hold again before the Q4 / H2 update. So I'm hoping for another $100m buy-back at least. Looking forward to tomorrow. AIMHO GLA

Oh and yes those bigger sells was me Stas.

Agree Tony! But it doesn't change the fact they f@cked their own guidance twice by a significant margin. This sort of thing suppresses the share price as we've unfortunately had to withstand in the past. They can force fix the sp by increasing the dividend, which they should do anyway given the amount of money they've put toward production and not shareholders. And the amount of money they will be printing next year. Or they can wait for the market to 'right itself. The problem with waiting for the market to wake up is the fact it has never happened in the past, even with all the NOI and production gains. If Majid doesn't force fix the sp then I think someone else will kindly do it for him. He may not hold onto his massive salary, but at least he will get a massive payout. We'll of course be fine in the long run, but it's f@cking annoying seeing these amateur slip ups and never realizing peer multiples. GLA

Absolutely mind boggling sp action. Cannot for the life of me understand how it can be going down with a big Q3 update due tomorrow. Really hope the company throws a big chunk of cash (min $100m) at buy backs and f@ck the shorts where it hurts.

Mixed bag this rns, but overall negative as can be seen in the share price. Ultimately the market is going to judge the company on how much they're making. And if you can't get your forecast right (twice) then you have to expect to get punished, regardless of how silly the NOI multiples happen to be. Mgt get so many of the big things right, but then fall at the last hurdle in this company. A miss of $28m on top of the previous significant reduction in forecast NOI is massive. And that in turn puts a large boot into confidence. PIs such as Tony shouldn't be better at forecasting NOI than mgt. They need to get on top of the financials, alongside getting updates to the market regularly and on time. What is clear is the market isn't putting much emphasis on increased production versus financials. Something for mgt to note.

Otherwise everything looks great for lths. Production growth has been very strong in 2022 and will be pay-back in 2023 as it continues to grow alongside higher commodity prices. Plus they're doing a good job of proving up the Canadian acreage. Having said this, unless mgt actually do something to +vely impact the sp I fear we'll be down here for a good few months. Tony suggested earlier this morning what they can do to impact the sp in the short term, which is to increase the current committed monthly dividend by 20%. I'd personally like them to go further than this and increase to .18p per month (26%), but any increase will certainly be welcomed by the market, especially with inflation eating into savings. Whatever is left over from this increase goes into production. But they should commit to a strong dividend increase now, and have the development budget as the variable. If commodity prices strengthen then you get more than Tony's estimated $80m development budget. And if prices weaken you get less. Either way you're going to exit 2023 near 30kboepd, whilst putting a +30p floor under the sp as the yield would still be in excess of 7% at 30p on a .18p monthly dividend payment. I've already emailed mgt with this suggestion and if others feel the same way they should do the same.

Full disclosure I sold 750k shares this morning in the low 24s. I knew we'd be hit hard so have dropped into HBR pre Q3 results. Feel free to scream 'trader', but before you do this is something I've done multiple times over a number of years now, and have never dropped below 3.5m shares. So hardly 'trading'. ut I do want to be open / honest about my position as I've been in the past. I intend to come back here if I make some money in HBR. Last time I did this I got f@cked so not sure about how good I happen to be at spotting opportunities :) Will see soon enough. GLA

Well I've just dropped in here again with 65k shares at 384.5p. Crazy valuation at the moment so couldn't resist. Not sure what to expect, but feel some headlines such as net debt being reduced to $600m and ideally another $100m in share buybacks should put at least 20% on the current sp. I'm not a big fan of buybacks as they so often do little to impact the share price. But when there's a situation of huge fcf, and a grossly under-valued sp, it makes sense to throw some of it at buy-backs. Definitely want to see them continuing to unwind debt as quickly as possible right now. With supportive commodity prices the company will be cash positive early Q1 regardless of what the ret@rded Tory party have in mind for the industry. Funny how the gov.t did nothing to support the O&G industry during Covid. The definition for Windfall Tax should also go the other way as well. The poo went negative, which is unheard of. Anyway, hopefully another big quarter of results tomorrow. GLA

Gusto, I'd love to see us at +24kboepd but I don't think it's a given that we'll get there. That's another 2kboepd in October alone and most of our wells deliver less than 250boepd. I'm also unsure all the wells you've listed will have coe online in the past 5 weeks. I'd truly love to be proven wrong as I think +24kboepd delivered with some decent PR and +ve forward plans (+$200m NOI target to be hit, 2023 divi hike etc.) and we'll be back above 30p. Reckon we'll be looking at the end of November before we reach that number though. Hoping (expecting) +25kboepd 2022 exit rate though.

I can't see a bad update, but I think they really need to push the +ves on this one, and hopefully deliver a nice surprise for shareholders. Personal preference would still be to get taken out for 40p or thereabouts. AIMHO GLA

My disappointment in mgt's lack of regard for the little things only grows with every day the Q3 update is delayed. One can only hope they're going to deliver a very solid Q3 without any snags. To be late and bearing negative news would be f@cking disappointing. Majid needs to start thinking about sp and production growth, because his current strategy is only growing one side of the equation alongside growing the target on our backs. If he doesn't want a derisory t/o offer to land in the high 30's then he needs to start giving a bit back to shareholders.