Member Info for G_G_G

Tony, the point I was making is our increasing production doesn't seem to move the needle on our sp. We've seen our production increase from 18kboepd in Q1 to being 21-22kboepd for Q3. We're talking about an oil skewed 20% increase in 3 quarters here. And yet the sp is still down at this level.

What has moved the sp in the past is increasing the dividend, as one should expect. By increasing it further for a very small capital outlay we'll garner PR and attract new investors, especially in this inflationary environment. It's a simple fix, and very low risk given we have the cash to do it. Everyone wins and Majid can stop talking about how under-valued we happen to be. And if we only get to a 3x NOI multiple then it's still better than 2, and we'll all be able to continue re-investing our dividends at a lower rate until we move to an industry average of 4x. The problem I've got is he's doing nothing to fix the disconnect even when he has ample capital to do so. The miss in the Nth Sea doesn't bother me at all. I'd love to be a multi-millionaire on the back of it, but it's happened and we need to move on. Nothing is going to come of the Nth Sea for years unless they sell it. The here and now is about getting some coverage by doing things that will attract investors. Another great production report with a divi hike will get everyone's attention, including funds like Eric Nuttal's, and we can move back to the 30's where we should be.

More than happy to provide everyone with an email template this weekend.

Tony they had enough spare cash to double the Canadian development program this year, and pay £5m for a well in the Nth Sea. And that's without +24kboepd. So I'm quite confident they can take some of the cash we're now generating and boost the dividend next year. Providing WTI stays above $80 and AECO above $4.50 the +24kboepd production will pay an increased dividend many times over next year. And I disagree the sp will catch-up by just drilling. We've gone from 18kboepd in H1 to recently announcing 22kboepd and the sp has done nothing. This was also accompanied by a statement of exiting 2022 at +24kboepd, which will increase further into Q1 as the remainder of the 2022 program is brought online. I cannot see why anyone would be against them upping the dividend. You get a higher sp, plus higher monthly income. And it does bugger all to the number of barrels we'll produce at the end of next year as we're talking an extra £6.5m paid over 12 months. I'm all for them pumping money into Canadian production. But I also want them to generate a higher value and income for shareholders, which can be done through a dividend hike. This is the only thing that has worked in the past and it will work again. I think you've previously mentioned your holding is around 3.5m shares...? With a hike to .185p your holding would generate an EXTRA £1500 or so a month in income. Plus you'd be £350k wealthier as the sp re-rates to 33-34p. And it costs the business an incremental £6.5m. Bonkers not to do it wen staff, mgt, and major shareholders all hugely benefit (especially Majid). I'd certainly prefer they do this then print another 100m shares to give to themselves. To be honest if they do that again I'll sell out and put my cash into HBR and PTAL. Dividend won't be as great, but they'll catch up by mid next year and the sp capital appreciation will be far greater.

Otherwise they should put up the for sale sign for 40p, because there's no way we'll get to that point if they just keep drilling and doing some additional PR in Canada (that has so far yielded nothing). AIMHO

I've pretty much given up on the Nth Sea now. If something comes of it then great. But if Repsol offered anything in excess £15m then I'd say they should take it and drill 3 more of those expensive +500boe wells in Canada. Get your money back and move on.

Depending on what they're finding in Canada at the moment I'm hoping they can add an incremental 3kboepd next year alongside upping the dividend payment. At current commodity prices it should be an easy ask. That's a +12.5% production increase to 27kboepd. And they should be aiming to pay .185p per share monthly dividend, which is a 30% increase on the current monthly payout, or £6.5m total for the year. The dividend isn't a huge increase on current levels and wouldn't eat into potential incremental production all that much. It would however mean a 34p sp for 6.5% yield. And I believe we'd be nailed on to achieve this level. There's not a lot of other levers they can pull to increase the sp and clearly production jumps aren't having the desired effect. So push the guaranteed dividend. The other great thing is you're paying the £26.5m in dividends over a 12 month period next year, which means the coffers are being re-filled with every month of production and it's far easier to plan ahead with changing commodity prices. I imagine we could cover the dividend all the way down to WTI$60, which we all know won't happen next year as NOPEC won't allow it to happen. Otherwise I think the share price will stay in a 23-27p range (6-7.5% yield) until they increase the dividend or we get bought out. We become far more attractive every month the sp flounders whilst we build cash and production. Majid needs to do something. And it's not about getting more Canadian coverage. One would have thought they've been doing this all along the past couple of years and it has yielded nothing. Docjones did more for the share price than anything mgt have achieved with PR. And the best PR they can generate will always be on the back of giving shareholders value. So hike the dividend with a great production report. The q3 operational update would be the ideal time to do this, otherwise they should announce the dividend increase for the January 2023 payment i.e. announce at the beginning of December. But do nothing and Majid can talk all he likes about us being under-valued, because nothing will change. Another thing is shareholders, including staff and mgt, all benefit from a dividend hike. And it will encourage staff to invest in the company because of the guaranteed additional income. So he'd be rewarding everyone that matters, including himself. Small and simple thing to do, and he could save himself talking about us being under-valued. AIMHO GLA

Joe, a divi hike would increase the sp. The reason why we're in the low 20's is because of the yield we currently offer. And if we're to increase the divi by 30% the sp will increase by a similar amount. Do you think such a thing would go unnoticed by the market? In this environment? Do you believe we'd get a lot of PR? Do you think PIs would likely invest for a 10% yield when there's such low risk to our operations? Simply implausible the sp would't increase and find a new, higher base. My suggestion isn't a special divi either. It's better they pay a monthly dividend as the coffers are getting replenished every month following each payment, rather than a one off large payment that would deplete cash reserves and most likely cause a spike and subsequent drop in the sp. A hike to the monthly divi has proven to be effective at increasing the share price in the past. And as much as I agree the entire market is struggling, the fact of the matter is we're valued at half our Canadian peer average. Time for them to make some decisions in the interest of shareholders.

And yes I'd still have put another well in the Nth Sea. I didn;t realise they were stepping out to such an extent as well. Shame as I think it would have been smarter to step out a little on 1 well and then further on the second. The time and hassle to get that 1 drill completed feels like it was a complete waste. At least if they drilled another well we wouldn't be sitting here wondering whether it's worth pursuing. For the sake of another $7.5m it's a missed opportunity imo.

Jolly, creating more coverage in Canada is something they've been saying for years. PR is never guaranteed. And when we do have someone talk about us the effects are normally quite small. No-one cares we're undervalued. No-one care we're slowly increasing production. He didn't even get out there and crow about the potential 200m barrel appraisal drill. He hasn;t crowed about the Canadian production or given details on hwo prolific some areas in our acreage happen to be. Majid speaking to a few people won't make a difference if he's saying the same old **** in the same uninspiring manner.

Majid needs to actually do something that will generate PR i.e. something that creates shareholder value so that people write about how investable and under-valued the company happens to be. They have 2 options. One is to do a share buyback. I'm not a fan of this as I don't believe it has much of an impact on the sp. It also requires a reasonable amount of capital to be deployed in a short period of time to have any real effect. I mentioned the other day that buying back 2% of shares is the equivalent of putting 40% on the monthly dividend. If you put that money on the monthly dividend the yield sky rockets and the sp will increase until we get back to the 6-7% range we seem to occupy, which is a mid-30's area. Good thing for PIs as we get a market leading yield and capital appreciation. Good thing for staff and mgt as they also get the same benefits. Good thing for IIs as they have a safe harbor for their cash over the next 12 months. But best of all we know this works. And we certainly have the cash to do it and still deploy enough to increase our production levels over the next 12 months. We're printing money at the moment that can't be deployed quickly enough with the drill bit. So give it back in divis. If Majid is unwilling to return this money to shareholders (and himself) then he should put up the 'for sale' sign. Production growth has been great, but it isn't doing anything for the sp. Everyone wins if he significantly increases the dividend. And he can stop talking about us being grossly under-valued for once. AIMHO GLA

£450m mcap broken. Question is whether we'll go back to +£500m mcap before the silliness started early last week. There's a list of things that could have caused it, from the chancellor's stupidity, large b/g seller, margin calls, bot trading, and any combination thereof. Looks like seller has cleared (for now). Bots are now working the other way. Margin trading positions revised and taken. And the chancellor's stupidity has so far been absorbed. No reason why we shouldn't head back up to £500m (40p). Previous range was £450-500m mcap and we've just crept back into this range.

So annoying listening to Majid talk about how under-valued we happen to be. We've been this way for a while and the only things that pushed us into the 20's (and 30's for a short time) were the dividend hikes. So it's a really bl@@dy simple fix. Mgt need to hike the dividend payment. It's the one thing that has attracted new investors. And the sp tends to stay in the 6-7% yield range. Use some of the incremental production revenue to pay an extra 30-40% on the divi. We'll re-rate to the mid 30's immediately with a week or two. Especially in this environment where yield and low debt are key. The fact we're making so much cash and can't drill fast enough to run it down makes it all the more important to give some back to investors and boost the sp. We're talking about raising the dividend payout by £6-8m over the next 12 months. With 24kboepd we can cover that with pocket change and still add another 5kboepd with the drill bit next year in Canada. I'm going to email the company this week with my suggestion. If you guys agree then do the same. F@cking painful to be accumulating cash at our levels, with no debt, then listening to Majid talk about how we're grossly under-valued versus peers. So make us more investable Majid ffs.

Nice 1m share buy.

I'd love to see a bid land for us. Anything around 40p and they can have my shares. As mentioned previously I sometimes wonder if they're not releasing any 'stand-out' Canadian wells in Clearwater / Montney / Simonette areas because mgt don't want to encourage a 40p bid for the company. And in some ways why would they want to do this. Majid makes something like £600k per annum not including the shares they like to issue themselves. Easy money that would require him finding another job. AIMHO

Not sure I'd say the sp has rocketed Tony, keeping in mind we're about 10p under-valued on Canada alone. Agree with what you're saying about the +ve impact of say 20m share re-purchase on the short -term sp. The issue though is PIs will sell into this strength and you end up back around where you started. And the cost of 20m shares (less than 2% of share issuance) is £6m (assuming 30p average). I'd prefer they use this cash to increase the current divi by 30% (£2.2m per month), which can be distributed over time from the cash we're generating. Given we tend to sit in a 6-7% yield range it should in theory make the sp re-rate to 32-37p. And it should stay in this range thanks to the yield. We've seen how the sp reacts to divi hikes. So why change a mechanism we know works well. Personally I'd only prefer a share-buyback if a fund wanted to reduce exposure by +5m shares.

Would be great to hear your thoughts on Harbour. And no I don't own anything there. More value here at the moment imo. AIMHO GLA

Pearls, yes those numbers sound good but lets' make sure it's presented in the right way. They have a 600m Euro loan note. So let's call it £440m in debt. The £500m cash you refer to includes a £156m banking facility i.e. debt. So they're going to be circa £250m net debt by year-end. And that's providing they have a cash generative end of year. Now add another £150m in capital outflows next year and you have about £400m net debt at year end 2023 when they're meant to be 'broadly fcf neutral'. Not horrendous as they'll still have cash on hand, but they need to prove fcf neutral is a given. Ideally they would also prove they have a good rein on costs and minimize the £150m capex. And even more ideal would be to make another non-core asset disposal (or two). If they can exit next year with closer to £300m and fcf neutral with an improving outlook then we're going to be well north of here. That's the challenge and real position of the company.

But to my mind it will make no difference. The company will have been taken private by then as MM in now way will allow this to be taken over unless he can get +£2, keeping in mind his golden share is gone in 1 year. But this simply won't happen unless he can get the sp up to £1. And that will happen only if he can get margin above 8%. He simply doesn't want to believe that margin is what will change the share price, instead of saying 'look double digit growth again'. If you're a growth stock you need to show two things in this market 1. A strong balance sheet (tick), 2. Profitability measured in positive fcf (cross). Growth figures just don't matter at the moment. When the economy changes in 3-5 years then yes it will matter. But not now. If he was delivering 5% growth but 9% margin the sp would be above £1 right now. AIMHO GLA

Thanks B1nky. Interesting we had a drop from 36-40p range since the beginning of last week. Last Tuesday saw quite a shift to the downside. And that's after a couple of monster insider buys. Pretty crazy what's happening here. If MM can start playing ball with the city a little more this will certainly move fast. He just needs to show that margin improvements can be made in this environment. It will give confidence to fcf neutral next year, and set them up for fcf positive in 2024. And if another t/o offer is made public this will certainly go silly. Reckon he has until end of q1 to make a play for taking it private. Any longer and shareholders will choose to wait for the golden share to expire. AIMHO GLA

Harbour is an interesting one Tony. I've been meaning to ask your views on that company. To me it looks like a very strong blue-chip play on O&G sector. The buy-back would have undoubtedly had a +ve impact on the sp. But you need to keep in mind the recent strengthening in oil and gas. The strengthening of their production profile in the coming years. The fact they raised their dividend. And perhaps the most important point they made - they will have zero net debt in H1 next year. For a company producing over 240kboepd it's an astonishing position to be in. It means they can go after other companies, relax hedges etc. But it also means they can pay out even bigger sums of money or buy-backs next year providing poo stays above $80. If commodities stay at just 90% of current prices then Harbour I imagine will be 50-100% of their current sp. And if I were the ceo I'd make a play for Tullow. It would diversify their production base, give them another 25% production overnight (predominantly oil), significantly increase their reserves, give them exposure to Guyana and Africa, and they could still relax the Tullow hedges that alongside debt are holding back the sp for that company.

Bottom line I don't think the buy-back has been the main catalyst for the re-rate over there. It looks like a very good place to be though. Would be great to get your views.

Thanks B1nky. So if 96% of positions are long, and they've communicated this to existing margin traders, could this have caused the recent sp demise? Pretty f@cked up as it would also mean opening a short at this point in time would pay-out as there's going to be a significant portion of that 96% who will need to sell some of their position to cover the 100% margin. When did this happen?

Sorry guys you'll need to excuse my ignorance on margin trading. I've neve done it. Can one of you more learned posters simply explain the significance of IB raising margin to 100%, whether it's for long and short positions, and the potential impact this could have had on the sp over the past couple of weeks. A simple scenario would help my uneducated brain.

Well done mgt! Reasonable buy from Majid. Great buy from John. Now we just need some production figures with detail on stand-out wells. And an increase in the divi. Not a fan of buy-backs. They have to spend a lot of money in order to make any difference in the sp. A jump in divi payment is far easier to manage, especially if you're paying out monthly from significant free flowing cash. It means you can continue drilling wells every month for the remaining fcf, which further reinforces the ability to pay even if/when commodity prices drop by 10-20%. One of my key things ticked off. Just some detail on the Canadian production and divi increase to go. I often wonder whether they don't provide the details on Clearwater and Simonette because they're concerned the added interest could lead to a t/o offer...? As I've said previously they can have my shares for anything above 38p. Reckon the IIs would go for it as well.

Great news today. Roll on Q3 production update. AIMHO GLA

Simple dividend hike will re-rate the sp and keep it higher. This combined with some strong production results and we're back in the 30's. Hopefully to be announced soon.

Unfortunately I think we have to wait for the next Canadian update before we see an end to the current sp malaise. Majid needs to put in his best performance and really speak to the strengths of the company. It's rock solid. But to be this under-valued versus peers for so long should be telling mgt they need to promote the company harder. It's a cash machine ffs. In a cyclical bull market for our commodities. With huge untapped reserves. In a safe jurisdiction. With no debt or need to take any on. With an industry leading dividend that has significant scope to be improved. Crazy.

Reckon the first thing they can do after really shouting about the next set of results is to increase the dividend. It's a huge statement of confidence and highlights the strength and security of the company and our balance sheet. Pay 50% divi and pump the rest into Canadian production. We should still be increasing boepd next year and the divi will be so huge the sp will need to re-rate to the mid 30's just to maintain a 6% yield. Sell the Nth Sea acreage if a decent offer lands, and use the proceeds to drill a few more wells in Canada. If commodity prices in 2023 follow the same pattern as this year then 30kboepd by year end is possible, alongside a 0.2p monthly dividend. There's no way the market won't mark us up to 35-40p on the back of such a simple move. Annual yield would still be +6%. And it should be easy for us to do. Until the late October update then. AIMHO GLA

Thanks HeresHopin, makes sense. Another reason for MM to focus on generating shareholder value for this environment. Question as always is where's the bottom here. Absolutely bonkers what has happened to the sp over the past year.

If there's a big seller in the b/g then surely its Jupiter. Can't see why they'd have sold to under 5% at a significant loss and not continued i.e. they're obviously forced sellers, which often results in clearing the entire position. If I'm correct then I'd day they have a lot more to run. They had 60m shares still on-hand at 08th August and there's been nowhere near enough volume to shift that amount of confetti. Add some bots and you've got yourself a fire sale. If there's some good news the correction in this company is going to be quite spectacular. Cant believe there hasn't been a 'long attack' given how coiled this company has become. Its chart looks like Gamestop except this company has a long and profitable future ahead of it.