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Good news this week and an easy 10% rise
Bought back in on Friday
Will accumulate sub 30p
US investing big in the future
Greenland hopefully seen as a friendly state with easy access to Graphite
The Biden administration on Wednesday said it will award $2.8 billion in grants for projects to expand U.S. manufacturing of batteries for electric vehicles and domestic mineral production.
The grants will enable manufacturing and processing companies in at least 12 states to extract and process more lithium, graphite, nickel and other battery materials.
The licensing process will be fast-tracked in parts of the North Sea that are near existing infrastructure and so have the potential to be developed quickly, according to the North Sea Transition Authority. It says the average time between discovery and first production is close to five years but that gap is shrinking.
Bought a few this morning
Were just the 3 100+ stones sold for $13.9
Or were other large <100 stones also sold at that tender so giving more post half income?
Over reaction
NICE cash pile following post period big stone sales $13.9
Reduce capex
See dividend maintained and profit
A few more big ones will always help buying more now
Back above 50p next week
See page 78 etc https://www.uogplc.com/wp-content/uploads/2022/05/United-Oil-Gas-Annual-Report-2021_WEB-1.pdf
I was incorrect on Tax
Just had a very thorough reply from UOG as below
Whilst the company made a Gross Profit of $12.3 million in the year, there are a number of other costs that need to be considered before you get to the Profit after tax line. These costs include Operating and Administration cost, Finance costs and finally tax. (see below extract from our annual report). The full annual report is available on our website.
United’s income from Egypt is taxed in Egypt. Under the PSC terms, any tax that is due by United is paid for out of the Government take, therefore, whilst we don’t actually pay the tax directly to the tax authorities, it’s paid for on our behalf. Under the accounting rules, we then show that tax under the tax line and also under the other income line (see below).
I appreciate the above is a little confusing, but the key point to remember is that no additional tax is paid for by United in relation to our Egyptian operations.
In the UK, no tax is paid on Egyptian income, as the tax charge on Egyptian profits is taxed in Egypt.
Cost Pool
In relation to your query on the cost pool, as you have seen in our presentations etc, our share of net production under the PSC is c42.53%. This is made up of 30% for recovery of costs (“Cost Oil”) and 12.53% of profit oil.
Therefore the historical cost pool is available to United (through what is called Cost Oil) as we produce and we will get value for that over the life of the field.Under the terms of the PSC, 30% of our net production is available to be taken to repay costs, (ie costs in the cost pool). The higher our production is, the quicker we recover that “cost pool”.
2021 Financial summary
· Group Revenue of $19.2m (2020: $9.1m)1
· Gross Profit of $12.2m (2020: $2.5m)
· Profit after Tax $4.1m (2020: $0.9m)
· Realised oil price of $68.9/bbl (2020: $37.8/bbl)1
· Cash collections of $17.3m (2020:$9.5m)1
· Cash operating costs of $5.90 /boe (2020: $5.77/boe)1
· Repayments on BP Pre-payment facility $5.4m (2020: $1.7m)1
· Group Cash balance of $0.4m at the period end (2020: $2.2m)2
1From the completion of Rockhopper Egypt acquisition to period end, 28 February 2020 to 30 June 2020
2 Payment of $0.8m from EGPC received on 2 Jan 22