Member Info for hitman1a

Definitely the target I'm looking for.

In the meantime here is a service update from DPD:
"Due to the severe delays at the port of Dover following the decision by the French government to close the border with the UK on Sunday, and the consequent backlog we now face, our European road services to continental Europe are suspended until Monday 4 January 2021"

Think my replacement starter motor from Germany is stuck on the French side.. Wonder how many other car parts are stuck in transit.. ?

The FPSO charter rate reduces massively in the extension period after 2025. Bumi might even offer it to us for a fixed price. I’ve seen it in the docs somewhere . It’s a much smaller amount .

Note Chrysoar own all their FPSOs : no leasing charges

Brent $60 Pelle : but will we still be at 12p.. I really wanted a Mercedes for Xmas.. but guess i'll defer the capex to next year.

Linda Cook is clearly is very smart. Dec 17 webcast: She says something like "people with lots of money but with narrow options, tend to make mistakes". Harbour have so many drilling opportunities, they will rank them and decide accordingly..

With Bressay, they are the Minority share of 18.38%. Linda in general prefers to be the lead partner.. but they need the FPSO. I can't see Bressay being a priority for Harbour.. until Enquest are ready to provide the FPSO... which we clearly shouldn't do for many many years.. I wouldn't "contaminate" Kraken oil with Bressay.. Perhaps run one train for each at somepoint and split the cargoes, but running one injector and a return producer to the FPSO would take ages to fill up.. So that means quite a bit of capex at somepoint if there are available slots on the FPSO...which there aren't at the moment..

I was watching the webcast 6 Oct ..

L7 : hitman1a, you say, "I appreciate the explanation she gave and why other larger funds won’t buy Enquest ."

Yes that's my interpretation.. Linda explained which Peer group investors like and attract a "premium valuation"...Ie Norwegian type. I concluded Enquest aren't in it. but Harbour were . Hence I said larger funds won't buy Enquest..

Listen from 9.20 , she refers to PMO having current UK North Sea Peers (1).. At 9.28 i hear "Cairn and Enquest". Enlarge the screen and the bottom the the powerpoint also confirms these 2 companies. She then talks about the Newco being in a different league.. Hence my interpretation that she didn't think much of our end of the scale.

Hence I said

We should have been higher than 13p end of today given where Brent is now.

Be content we are earning good cashflow now .
And have probably run out of assets to write down. Maybe we will see a decent 1H 2021 set of results next year in Sep 2021 without any further writedowns.

She’ll certainly get a shock with her new Harbour market cap , Comparing to the dividend paying stocks without a dividend isn’t the best start , but I appreciate the explanation she gave and why other larger funds won’t buy Enquest .

Secondly the old BP deal PMO had pencilled in is now off the table. So perhaps that deal is now on AB’s table , Heck ! more waterfall explanations . Just whenever you think you’re heard the last of them .

Linda Cook definitely mentioned Enquest in the context of “PMO moving away from the Enquest type Oiler’s “ and moving to the more bigger Norwegian ones that had sufficient scale , had access to lower cost finance and were valued better by the stock market due to investment grade status , Sort of made sense. got the impression she didn’t think much of Enquest .

Brent $53.50 also pays off all the debt

Brent $50 doesn’t lead to restructuring , just an RCF in Oct 2023 for any remaining balance , Assuming no acquisitions in the time frame from Nov 2021.

We should see the following push up WTi:

1, US stimulus bill passed very soon
2. Biden installed in Jan
3. More Vaccine news especially J&J at end of Jan
4. Brent being guided to $60 in June 2021

13p EOD tomorrow. But we really need a good Q1 next year so the cashflow is substantial.. If we take the Brent low point in Oct 2020 and average into todays price.. Q4 2020 doesn't look good and perhaps is the reason why the SP hasn't moved yet.

Clearly 5% of a very large pie still gets you a very small slice .

Enquest would also be in a position to pencil in a dividend at the end of Q4 2021 as well .

Pretty sure we will be very close to paying all the remainder of the RCF in 2021.. especially as we already hold cash in the bank.. and not all of it can be ring fenced. Perhaps a question to ask Enquest next year.. There are always other bills we can settle in 60 days rather than 30 days so think chance of success is 99% . Will know if we are on track in April 2021.. For the moment we are ahead of the repayment schedule and Brent is performing better than expected. No one leaves cheap sub $50 WTI barrels for someone else to take moving into a recovery phase.. Expect those left to be snapped up sharpish.

13p by EOD this Friday.

BOA analyst on Bloomberg just confirmed again he expected Brent to stay on the trend, continue it's heading and reach $60.

He only had 20sec, but if I could have asked a question.. I would have asked : if he agreed we have just had many many years of a Shale Ponzi oil scheme based on Tier 1 acreage and now are facing many many years of the same based on Tier 2 acreage.

https://oilprice.com/Latest-Energy-News/World-News/Permian-Drillers-May-Face-Freshwater-Shortages.html

New Mexico’s State Land Office is putting an end to the commercial sale of fresh water for oil and gas developments to protect the state’s scarce freshwater resources. Effective December 15, 2020, the State Land Office will not issue any new easements for the purpose of commercial sales of freshwater for oil and gas development, and will no longer re-issue or renew existing easements for such use once they expire, Commissioner of Public Lands Stephanie Garcia Richard said in a letter on Tuesday. every little helps.

Correct, ....with Shale you don't get the retail WTi ticket price..

New large capex $$$ will only be deployed in US when near $60. which leaves a supply deficit in 2H 2021 which will push prices up. I can't always dismiss what Goldman says.

"EnQuest has c.0.7 MMbbls of oil hedges in place at an average floor price of c.$41/bbl." Not much left to run for the final 2 mths of 2020.

but I guess the market is wondering about our current production : thinking Q1 2021 average might now be 53k /day.. without 60% of Malaysia. based on expecting to be slightly below the midpoint of 60k for 2020.

Based on the expectation the J& J vaccine will be issued in late Jan 2021. . WTi will be pushed above $50 by then.

So it's only the SP that isn't reacting, but I think they can bank $40m/mth for Q1 2021 and pay $120m off the RCF in April 2021... It's still a sector that isn't in the right place.. there is no shortage of oil.. all those articles will be written towards the end of 2021.. Indeed a lot of people in the US are reanalyzing the land banks and concluding the break-evens are much higher than $50.. They also need WTI above $60 to be comfortable to invest more.. which slows down the pace of new capex in the US until conditions are right.. the same as Enquest really.

We still have the tail end of 2020 hedging to run off.
The SP in the past can go up quite a bit in Q1 and then fall massively.
A value stock without a dividend isn't attractive.
12p is a joke , but Brent at $50 is a big plus.. Opec+ agreement done and Vaccine program started.
Waiting for mid 2021 when commodities shortage cycle starts.. pent up demand and they all need oil.
Will target 24p by end of 2021. perhaps 30p if we are $65 in Dec 2021.
Now we have less hubs, Enquest could cull a few more from the workforce in 2021 if there is no work. AB should continue to shape the business even more in 2021.

Still too early ...Russell 2000 stocks have only just started to catch up with S&P . Movements only occured in last 6 weeks. We have a long wait before this end of the spectrum sees some capital come in. There are so many other value stocks out there that will get picked before Enquest.