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Interesting day to not announce an EPL floor....

Hopefully this increases the imperative to get it announced meanwhile long-term oil bull case remains extant

That is a worry although the counter would be that they are missing investment allowance, depleting their reserves when this could very well be baked into a deal as contingency.

Linda Cooke is American, HBR was founded in 2014 by EIG, a US PE firm. Check the board - the ethos and philosophy of the company leadership is US.

My point is their mindset is not Equinor. They'll be double miffed with lily-livered UK plc.

Harbour is a US company and Linda Cooke is exasperated with UK Gov, she's had enough. Producers in NS will wish they'd never got involved in UK NS. All sorts of late-life projects have become uneconomical due to EPL. This sentiment is not changing due to a floor in EPL.

The owners of Ithaca are desperate to exit their investment and falling SPs across the board are killing companies cost of capital. It's a zchitt-show.

However, there are plenty of smart people that will assess this as the worst it can get, readjust their models and... Calmly and rationally, for the right project, do deals to take advantage of the allowance and avoid EPL. There is only upside in policial risk now.

I believe JOG is one such deal.

PS I don't see Labour in 2024 as detrimental to NS. Politically they now try and portray Tories as not going far enough whatever they do. And then when in gov they'll go quiet as they won't have the imperative to do anything, and know they'll kill the industry if they do more. Much like Tories do all the defence cuts - because they can get away with it. Labour will not need to hike taxes in NS.

https://twitter.com/baroninvestment/status/1635662049928781826?t=LsZQxKT_xucfTDmAkH7lig&s=19

Looks like if it comes it'll come in the autumn statement.

I think this will make up a 'contingent' element to the deal... and it it'll just get signed.

But hopefully it will get a mention or made more substantial soon

This is very very good for us.

https://www.politicshome.com/news/article/treasury-windfall-tax-price-floor-budget-energy-profits-levy

Sorry for ramping but I'm all in myself

Morning all. Took some advice from a friend of a friend who works as a Nomad on AIM (not JOGs!). He confirmed they would have to inform the market if the process had stalled, and also that they could not update the market if nothing had changed.

We are in the last week/ weeks of this story. They will be the sweetest.

Thanks Dickupham. I've re-written this line several times to get it within the bounds of my own tax-understanding....

JOG has previously mentioned tax synergies. If 75% could be rebated on the way in, and previous losses be used on 'the way out' to reduce the non-EPL 40% of total tax, (carried forward from Trap?) that would make deal dynamics better.

https://wp-jerseyoilandgas-2020.s3.eu-west-2.amazonaws.com/media/2021/03/02230445/CS-RNS-3-March-2021-vF-website.pdf - page 16 on this - that's a lot of tax synergy.

Morning all.

Can someone clarify - the tax losses carried forward with JOG relate to GBA field, and can therefore avoid the 40% corporation tax on JOG, at least realted to GBA development correct? The further 35% windfall is unavoidable, so JOG effectively would pay 35% tax on pre-tax profits up to whatever the carry over from trap is?

The horror message on tax may be more complex as some members on the Harbour board are seeing it as a tax strategy to optimise post-tax returns. 75% does not wipe out profits unless you make a huge provision to that end as Harbour has done.

'UK capex targeting high return, near field and/or infrastructure-led opportunities'

'2023 total capital expenditure is estimated at $1.1 billion, split 85 per cent UK, 15 per cent international. We reduced our planned 2023 UK capital expenditure following the changes to the Energy Profits Levy (EPL) announced in November, with certain investment opportunities delayed or no longer being progressed. We also rephased some of our decommissioning activities.'

Who knows what this means for JOG, but there is still potential for Harbour to chuck a couple of 100 million in the pot for a consortium for GBA.

It's certain these results are communicating to UKGOV they are miffed with things. Hopefully if Hunt communicates an EPL floor on 15th (Ides of March anyone?) And we near results of Serica and Ithaca the RNS may land...

Apologies, just excited on two big up days as we come to the end of the story (end of the beginning?).

Obviously no idea if there's a leak but does seem odd a massive bounce. But it's AIM...

Just idle talk. DYOR as obviously I have done loads for that last comment.

'Our board' reads like a Private Eye column sometimes (that's enough on climate change, Ed.)

I would like to call a leak. Oversold is fine, but this is one helluva deadcat bounce. Who is buying today after last couple of days? I can't believe recent NS deal activity has prompted any institutional investor to get more exposure, and all us retail goons are simply breathing a sign of short-term relief rather than raiding granny's proverbial mattress or whatever 'our' vernacular was again?

RNS this week! The Duke of York, Fitzrovia!

A large windfarm in CNS would have a huge impact on a deal; electrification economics, which means Investment Allowance super-deduction.

https://twitter.com/offshoremgzn/status/1631090191778578433?t=oK7Z5HkWCmG0SBIqYwp3YA&s=19

This project is a long way from certain and doesn't fit our timeline but things like this may factor into optionality in a deal. Maybe. Perhaps a partner is getting comfortable with the ideal that timelines should tie up here and that gives a good chance upside to economics.

That's a chunky deal for pre-production assets in UK NS... https://www.reuters.com/markets/deals/norways-equinor-nears-deal-buy-suncors-uk-oilfields-2023-03-01/

There are a lot of assumptions here about how the technical accounting works. I also made these in my own thoughts. It all seems plausible but is there anyone out there with the actual knowledge on this - ie and O&G finance background?

Surety - apologies if you know this for sure but your post comes across as very reasonable educated guess.

Nice political analysis Surety; I agree likelihood of further negative political surprises is minimal. I personally think any political damage has already been done and probably only affects after tax profits rather than likelihood of deal.

GBA is not exploration and its scarcity increases in one sense as NS exploration becomes less attractive (or prohibited) but Investment allowance is generous and needs to be accessed.

My feeling (as said before sorry) is that JOG's negotiating position isn't that great and their feet are being held to the flame hence the wait. Multiple counterparties in consortium (which is my guess as to the outcome, diversifying their risk but still getting revenues through the Investment Allowance mechanism) could mean little leverage for JOG.

Having said that........... JOG is well-funded way past the timeframe NS operators would need to grab the allowance if they wanted it. I had speculated that FY end April may be a deadline for JOG's potential partners. So a deal must be done.

So praying DU is correct and we get our good news soon.... maybe they just wanted to get started and agreed to JOG's 30%.... lols. fingers crossed.

Interesting. I think the raw volume number for the day is probably the only useful data and the rest is just astrology/ tea leaves.

Perhaps if they make a market internally it reports that way, and if they need to go the market it shows. I don't know.

Some chunky sells on the unknown trades. I had assumed these were internal trades done by brokers like Hargreaves. So PI trades. Anyone else have a view?

I use a similar broker and my trades do not show on the trades list.