Member Info for HeadInTheSand

Actually, it's c. 900 million new shares issued in the current FY, so not quite a billion.

It's all detailed on page 16 of the AR, if anyone feels the need to check.

I imagine he's referring to the c. 800m new shares (not counting extra warrants) that ANGS has issued within the current financial year, so since end September 22.

Correction, make that an interest rate of 18.92% (it's SONIA plus 15%)

Singhie, I think you'll find that what ANGS is actually seeing if they can get is a six month facility of up to £3 million at a 15% interest rate, accompanied by a further 150 million warrants.

Whether that's the most prudent option? Possibly - I'm not sure that a further placing could be got away so soon after the Xmas megaraise, without damaging the SP significantly, at least in the short-term. Mind you, having to take on yet more debt to cover a "short-term funding need" (Again? Really? After £7 million just 2 1/2 months ago?)) before the sidetrack has proved its chops one way or the other also isn't ideal.

I am honestly surprised that they don't seem to want to wait for the degree of success of the sidetrack to become known before getting hold of more funding, one way or another. There must be a high degree of need.

"...via sales of produced gas to...."

Both Gallder and Average_Dave are strictly speaking entirely correct in what they say about the hedges. They are purely financial transactions - and "swap contracts" (their alternative name) is a lot more accurate and a lot less confusing. Hedges are indeed future "bets", which either result in a nett liability or a nett credit for one side of the hedge (and the reverse for the other). The plus or minus extent purely depends on the differential between the fixed hedge price and the open market price at the time of reconciliation.

Gallder, you're right again - the original CPR did cause confusion, as has ANGS's continuing announcements about "meeting the hedge".

However, this is slightly splitting hairs, because from an ANGS point of view, this is all and only about cash. Generating enough cash via sales of produced cash to meet its liabilities, which include:-

Any remaining field capex required
Ongoing field opex
General G&A
Main loan capital repayment (£11.55m of loan left to pay off by Jun 25 as of end Sep 22)
Main loan interest (£149k got paid out on this in the last FY)
Knowe CLN repayment (£1.4m needs paying off by summer this year)
Up to £5.25m of instalment payments still owed to Paul Forrest for the 49% acquisition (that's after the 60.6m shares he accepted in Dec 22 in lieu of the first £1m payment he was due)
Any existing net losses on any closed swap contracts (the FY accounts reveal a "catch-up payment of £4.175m , due at the end of June this year)
Any net losses on any future swap contracts (though these could also produce nett gains for the company)

So, if ANGS generates enough gas during the period to sell and generate enough revenue to meet all those already incurred and also possible future liabilities... happy days.

With the news already communicated re the availability of the required coiled tubing, I personally suspect that Crocqman's patience is going to be extended further - but admittedly not by too much. With the current info to hand (and presuming no further delays popping up), I'd say 3rd -4th week April before we get to hear what effect the sidetrack is going to have.

Average Dave, I suspect the same thing (mostly).

I'm sure you're correct about the Q3 2022 hedge being split into 4 equal parts of 843,750 therms each. I reckon ANGS settled one of those 4 parts from Sep production and separately had to pay out to settle one other of those four parts (being enabled to do so was a prime reason for the the Xmas raise, as we were told).

The remaining two parts have been added to Q1 and Q2 2023 respectively,

The only thing that doesn't quite stack up is the pricing? Even if this was negotiated back in July, was the Q1 average gas price really 438p per therm at that time? And Q2 really 315p? And why wouldn't Mercuria merely have stuck to its guns? After all, it was (and is, largely) holding all the cards - it must have agreed to this "two part" deferment, so it could pretty much have defined its own terms.

Or maybe the above is entirely wrong, because to confuse things even more, then there's this:-

"It is also noted there is a catch-up derivative payment of £4,175k due in June 2023 which the group is forecast to meet however should there be a timing difference between cash inflows and outflows then Further funding may be required."

That's in note 3.3 on p50 of the FY report.

Catch-up payment? Got to be related to Q3 2022, no?

Interestingly, the original hedge totalled 52,125,000 therms, between Jul 22 and Jun 25. The revised hedge as set out in note 25 to the FY accounts now totals 51,281,250. That's a reduction of... 843,750 therms (a strangely familiar number, no?)

It's possible, I suppose, but then those additional hedges would have to have been agreed months and months ago, because forward gas pricing hasn't been anywhere near that level for a loooong time.

I honestly expect the most likely reason is a typo on the hedge prices for those two contracts.

If (and it's a big "if") those two additional 843,750 therm swap contracts are actually priced at 43.8p (i/o 438p) and 31.5p (i/o 315p) respectively, that would represent in both cases a c. 16% discount on the other hedged pricing in those periods (that being 52.05p and 37.55p respectively).

That would seem to make a lot more sense - unless Mercuria benefits in some way from effectively choosing with these two new additional swap contracts to "give ANGS back" going on £4.4 million.

Anyone actually got a sensible answer?

Honest question here.

As per note 25 to the FY report, a couple of additional swap contracts (or hedges, if you'd rather) have been reported as taken on by ANGS from Mercuria.

As Gallder has pointed out, at face value, these seem to be literally amazing for ANGS.

Firstly, on top of the Oct 22 to Mar 23 hedge of 10,500,000 therms at 52.05p (that hasn't changed at all) there's now an additional 843,750 therms been added separately onto that at a hedged price of 438.00p...

Similarly, on top of the Apr 23 to Jun 23 hedge of 5,250,000 therms at 37.55p (that again hasn't changed in any way at all) there's now an additional 843,750 therms been added separately onto that at a hedged price of 315.00p...

So, my question simply is twofold. First, is this really accurate info? (One would very much hope so, because it's been published... but it's so outside the envelope as to be worth asking).

Second, if it is accurate, why would Mercuria effectively agree to give ANGS back going on 4.4 million pounds (presuming forward gas at 120p per therm)? There must be a reason...

StarBright, your understanding matches mine. The nett negative or positive on each month's hedge needs to be settled, regardless of the amount of any gas produced within that month. I think Gallder believes that this is effectively reconciled on a daily basis within month - he may be right (I wouldn't know), but the overall paradigm remains as stated.

I also agree as to the seemingly bizarre (and as you say, probably GAAP-mandated) accountancy practice of being required to state the full future liability on any remaining hedge within the FY figures (as you know, that's the £110m featured in the latest accounts). Okay sure, it's a potential liability, but a fully variable one, dependant upon the price of gas used to make the calcs. Presumably then, if average forward gas pricing was actually lower than the hedged prices at the time of the audited calculation being made, this would have been showed as a net positive in the FY accounts? Weird...

But I think that the majority of posters understand that the implications of the hedge on ANGS is pretty much all about how it may affect the company's cash available to meet the other requirements, debts and liabilities which it has already taken on. From a solely cash point of view, if the company only produced enough gas each month to exactly meet that month's hedge, then it's 10 seconds' work to calculate the "net of swap" revenue that would be generated by the company each month.

Of course, the hope is that the company will produce significantly in excess of those monthly hedged volumes, a thing which if it does, would cause its monthly field revenues to be increased equally significantly, which in turn would deliver considerable extra monthly "net of swap" cash available to easily meet those various already incurred other liabilities.

Two take-out points from the FY results.

First, how short of cash ANGS was at the end of the FY came as a mild surprise. However coming as no surprise at all is black and white confirmation of how absolutely crucial a fully successful sidetrack is to the company..

@Howey, though it is of course a given that nobody knows who's behind a bulletin board ID, in my very firm view, you've called this one wrong. (And that makes it twice in a single week, as it happens ;)

Gideons is nigh on incoherent in his postings from any of his short-lived IDs. He's barely capable of stringing an intelligible sentence together, let alone a whole paragraph.

Definitely not him. I'd put a reasonable amount of money on that.

Hi Isla. You'll see a variety of opinion on this bulletin board.

There's not much connection between Angus & UKOG, apart from the fact that they are both UK oil & gas companies (though UKOG has taken on exploration in Turkey as well a few years back).

I personally don't keep much of an eye on UKOG these days, but know a bit more about Angus. For info and in case you didn't know already, Angus is well down the road of seeing if it can get up to double the amount of gas out of its primary asset (Saltfleetby up in Lincolnshire) - and if it can achieve this, IMV that would change the company's fortunes significantly.

The results of Angus's attempts (that'd be the "sidetrack" you have probably seen much mention of) should become clear one way or the other within the next few weeks - which would fit in with your late father's "wait until April" intention.

Oh and Bait's advice about ISAs to maximise personal tax efficiency would seem excellent.

Best of luck.

To be fair, George was hardly going to say "And we ARE planning/anticipating failure of the sidetrack"...

Having said that, the 99% primary purpose of the 2nd compressor is of course to handle any extra gas produced by the sidetrack. It would still have some value (albeit very minor), if it's not called upon to handle extra gas.

My guess? With a fully successful production-doubling sidetrack? 3p+ once audited volumes are reported, and then, provided that increased production is sustained, steadily rising over the next 2+ years as liabilities get paid off and the hedge comes to a close.

Howey, I can't change your opinion, that's clear. What I will say is that when I was looking at UKOG, literally every other post was by the ramptastic individual Ocelot mentioned. "Uncle Stevie will see us rich" etc etc... think Gideons on steroids. Certainly outlandish enough over a considerable period to be memorable. I wasn't aware that said individual was now plying her schtick on the UJO BB until Ocelot's original post mentioned that... but I am not in the least surprised.

The only reason for deletion I can think of is because either I typed in the name of Winnifroth's site (although that was auto-replaced by LSE with *************), or that I accused both the prolific UKOG poster and Winnifroth of attempted market manipulation in my first response to Ocelot's ludicrous claim. I am apparently now also a contributor to a very dubious share-tipping website as well as being an ageing female green-leaning journalist... who knew?

Mildly irksome though it is, I can hardly criticise you for suspicion. It's a very healthy attitude to hold when considerign the opinions and agenda of anyone posting on a share discussion board.

Having said that, you're still bang on wrong - but there you go.