Member Info for hitman1a

All the money goes to the bank.. I guess the EV trends down this year as the debt is repaid.. the equity remaining the same until such time the information changes. ie more drilling , higher Brent, FDP on Bressay.. The EV doesn't have to stay the same.. even though every £ of debt repaid increases the net equity by the same amount n the balance sheet... Even that isn't true if there are massive write downs creating tax losses.. perhaps there is someone out there that can use our tax losses better than we can.. it would increase our SP on what would be a takeover/merger?

Algo must have been gone neutral on the stock just like Barclays is on the sector..

Brent $100 in early 2022 is what I heard on Bloomberg last night.. : Say by end of March 2022. Add in accounts info and the deferred tax adjustment.. perhaps the equity will look rosy.. and we exceed 25p..

GL.

I think the market will absorb the significant 2022 drilling campaign news and improve the p/e ratio from 1.6 to say 1.8 ie it will recognise the expected 2022 output, and perhaps pencil in the same strategy for 2023 together with significant Kraken drilling. Ie 2023 drilling will be even stronger. 25p seems like the first port of call.

Thanks for your calculations Kamrat..

Magnus needs urgent drilling.. the existing wells aren't able to perform like before..

GL

Just one now , Petronordic , the other has changed to read Captain field .

$50m for a 3 well drill campaign is what I had in the back of my mind from many years ago.. Perhaps 8 wells will cost $100m plus, but I thought we could just connect to the existing drill centres at they were originally designed to cope with higher production volumes. The FPSO is designed to cope with production in the 50k /day range, so injector capability shouldn't be an issue either. Was the last well on Worcester.?. 1 well and 1 injector.. thought they just connected it to an existing DC and dropped the DC4 idea. All will be revealed next year.

RE Kraken: "However, the Group plans to carry out a 3D seismic campaign in the second half of 2021 to support ongoing evaluation work to identify and prioritise near-field drilling and sub-sea tie-back opportunities within the Pembroke, Antrim and Maureen sands discoveries and prospects in the western area, which holds an estimated 70–130 MMbbls of STOIIP."

1. We know the 3D seismic has been completed..
2. There are 4 areas of interest mentioned above that require drilling on the Kraken field.. We need to tell the market we plan an aggressive 2023 drilling campaign, just like 2022. I suggest they drill 2 wells per area (8 in total) in 2023 at a cost of say $80m.. Perhaps production of say 2.5k/well, which is 20k/day gross, ie an extra 14k production to Enquest (70%) ....Then revert back to more drilling on Magnus/Malaysia and GE in 2023 and 2024..for another 8k/day each year..

3. 2025: start drilling Bressay and tie back to Kraken FPSO..

Our 2p reserves are still significant , even if you exclude Bressay.. say at least 5 years.. so I don't know why the P/E is so low at 1.6, other than it all depends on extra drilling..., which at Brent $85, we will always have a $100m per annum to spend on drilling.

GL.. 25p soon once we move into Q2. Perhaps they will forward extra details via the Q&A at the March accounts or AGM .. I read US air passenger numbers are almost back to normal.. so £500m market cap if we hit Brent $100 is my target.

https://www.reuters.com/markets/deals/equinor-seeks-1-bln-north-sea-oilfield-stake-sale-sources-say-2021-12-14/

Wonder if we could make a bid.?

“Absent this sanctions waiver, detailed technical discussions with third parties regarding disposition of stockpiles and other activities of non-proliferation value cannot take place,” the official said.

The waiver covered the conversion of Iran’s Arak heavy water research reactor, the provision of enriched uranium for its Tehran Research Reactor, and the transfer of spent and scrap reactor fuel abroad.

The market currently values Enq based on the lower end of 2022 production forecast.
Say 44k x $80 x 365 : $1285m less $960m costs: Net FCF : $325m : x 1.6 : $520m / 1.35 / 1886 : say 20.50p

Confidence in the higher end of production range towards 51k should be gain during the year as drilling and workovers start in say March and conclude by end of Q3 2022.
Say: 51k x $82 x 365 : $1526m less $960m costs: Net FCF : $566m : x 1.6 : $905m / 1.35 / 1886 : say 35p

Barclays might be thinking something like this.
Say: 47k x $80 x 365 : $1372m less $960m costs: Net FCF : $412m : x 1.6 : $659m / 1.35 / 1886 : say 25.89p ( 25p)

Clearly we need to achieve the top end of production guidance and the price to earnings (P/E)multiple factor of 1.6 is very low compared to TLW (5) and BP.(7). Once we demonstrate high 2022 production and some sort of drilling plan for 2023 and beyond, the factor might rise to 3.0 plus. The SP should leap higher too. The market doesn't give much value on our 2P/2C reserves at the moment..

I’d say 2023 would be nearer $400m FCF , that’s after drilling Kraken Western front in 1H 2023. , refinance the last $600m via a new bond , $100m dividend , not sure what to do with the excess FCF , as we also have the extended RBL facility once the new bond has been financed , Big purchase or develop Bressay/ Bentley , via attachment to Kraken FPSO in 2025 ? Assuming 45k in 2023 at $85

Yes, your correct, there is a working interest deduction to make from the net production Enquest report on the Malaysian output. Roughly 32% , so 68% to Enquest.

Think Enq quote net production entitlement on assets.. including Malaysia.. so think 50k is the correct number rather than 47.2k. FCF $550m is about right for 2022 imv if we achieve top end of guidance.

Looking forward to seeing Accounts on 24th March.. Net equity improvement from 30 June 2021 to add 2H 2021 profits, equity injection and the all important deferred tax adjustment which should see our equity position close to say $500m.. Add in 2022 FCF and we are looking at at $1.05b equity position this time next year.

If the consensus on gas prices is correct and we should expect high prices for the next 2 to 3 yeas.. then the same applies to oil as well.. Enquest is a good example of drilling just to keep level.. Barclays in their analysis last year had production estimates of 54.8k for 2022 and 59.4k for 2023.. That said they had 51.4k for 2021 . We don't have any drilling info for 2023 and 2024 , so I have production at 51k for 2021 and 45k for 2023 and 40k for 2024.. Somewhere in there , we need to drill the Western Flank and more of the others , just like we are doing in 2022.

Barclays target of 25p is pretty much the same as mine come end of March 2022 once we see the accounts and roll into the $100 oil price era.. We just don't want any more write-offs.. that's what is holding the SP back, that and a lack of drilling info in 2023 and 2024... Enquest always manage to create more tax losses.. To be honest ..I don't want to see any more..

Enquest Producer.. needs a home.. but cash will do.. All I know is we can offer flexible terms like a lease too. I don't think it's a heavy weight FPSO so Rosebank isn't an option.. It perhaps needs a larger vessel that can withstand the harsher climate. That's what I read elsewhere and I agree with having seen pictures of our FPSO..

GL. 21.5p next week.. Brent is after all $93.38 on the April contract..

Leasing is about $100m which Enquest doesn't include in Opex
BP Share.. within Other.. looks a bit light.. plus Malaysia.. say $70m

https://www.fool.co.uk/2022/01/19/2-cheap-penny-stocks-to-buy-today/

I did see 2 Magpies in the next road KO.. looked very similar to the ones that visit me.. so this is a good sign..

Clutch at every straw.. Target Market cap above £500m.. $1 billion upside to equity over the next year..

GL. Short interest would only ever add 2p to this .. so we really need some heavy lifting via the accounts in March and Sep.

Nicely set up for Enquest to deliver a decent bullish Carlsberg RNS tomorrow..

It's more about the S1 billion upside to equity over the next year.. stick that on the balance sheet.!

I think 53k average production for 2022. Starting from 57K in Jan 2022.
2022 production range estimate will be 48k to 53k.. We will need to hit top of range of guidance in 2022

Headlines will be "Enquest see's 18% production growth in 2022 " .
CEO AB says "With these Brent prices, I'm just lovin it.. more than Francesco Mutti loves his tomatoes.".
Investors remain subdued with promises of deleveraging but no dividends.. SP up 0.5p on the day..

Maybe next month Pelle. Wonder what the Tea and biscuits will be like at the AGM ?..

I've heard some Enquest employees like oil as much as Francesco Mutti loves tomatoes.