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Saw this also HTL.
With structuring techniques such as taking a stake via injection of equity for X% and debt fund the carry on FFD then initial investment can be minimal (relative to fund size). When using debt, there are all sorts of ways to give comfort without handing over cash - funding a DSRA (debt service reserve account)through cash holdings which backstops any delay in production but does not involve an immediate transfer of funds. Providinneed g a partial guarantee etc.

Often times, firms like Equinor can borrow at a corporate level on a Cov Lite basis. One should remember, values of barrels in ground if being sold as barrels in ground do not need to discount FFD cost again as it has already been discounted in arriving at the value ($5-7 mentioned in previous link shared when Canaccord were discussing Namibia).
People have mentioned potential for HUR to retain 20% or other amounts in FFD situation so the value per barrel would have to be relinquished relative to the FFD amount being retained in any transaction (for instance the example of JS field below contemplates c.$11bn CapEx and cost to HUR of retaining 20% with a carry would be $2.2bn or say 450m barrels off the reserves being valued for sale).
This can help people again thinking about the potential, I'm not putting any actual numbers pout there as there is alot of drilling and other activities to come first before we need be too concerned with such things - if we ever are to be.

Ricfle
Seems an interesting read across certainly.
86bn krone, so around $10.5bn to develop four platforms with three water subsea installations for water injection.Using existing gas export pipelines.
660,00 bopd is quite a number and indicates a field life of c.12.75 years.Depending on the debt/equity element the field could be cashflow positive very quickly and at $65 oil, have repaid CapEx and all revenues hitting the bottom line post OpEx within 2 years. With $40 a barrel at $60 oil that is $8bn p.a...........
Note that Utsira High (is this not the part of the Rolvsnes field based on Lundin description) will be online for production in 2022 with a b/e below $25 a barrel.
One interesting thought comes from all of this, with the information derived from the drill of the Rolvsnes field how much does this give Equinor (major shareholder in Lundin) a competitive advantage with regard to possible interest in HUR and how the FB works from a production perspective.
With the funds already at disposal of Norwegian SWF ($1trn), despite their moves away from O&G would the prospect of HUR be a tempting one for them given their direct FB experience and modelling.....

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Equinor, Partners to Develop Next Phase of Johan Sverdrup
by Matthew V. Veazey|Rigzone Staff|Monday, August 27, 2018

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Equinor, Partners to Develop Next Phase of Johan Sverdrup
Equinor and partners submit the development plan for the second phase of the Johan Sverdrup project.
Equinor and partners Lundin Norway AS, Petoro, Aker BP ASA and Total S.A. submitted the development plan for the second phase of the Johan Sverdrup project to the Norwegian Ministry of Petroleum and Energy Monday.

“The Johan Sverdrup field is the largest field development on the Norwegian shelf since the 1980s,” Equinor CEO Eldar Sætre said in a written statement. “At plateau, the field will produce up to 660,000 barrels per day, with a break-even price of less than USD 20 per barrel and very low CO2 emissions of 0.67 kg per barrel. Johan Sverdrup is on track to deliver vast volumes of energy with high profitability and low emissions for many decades to come.”

Equinor has described Johan Sverdrup as “one of the most important industrial projects in Norway in the next 50 years.” Phase 1 of the Johan Sverdrup project, which is 80-percent complete, includes the development of four platforms, three subsea installations for water injection, power from shore and the Mongstad oil and Kårstø gas export pipelines, stated Equinor. In addition, the estimated NOK 86 billion Phase 1 is expected to begin production in November 2019.

Phase 2 will entail developing another processing platform (P2), modifying the riser platform and field center, five subsea templates and power from short to the Utsira High in 2022, Equinor noted. In addition, the company reported that the break-even price for Phase 2 will be below $25 per barrel and that production should begin in Fourth Quarter 2022.

In its statement announcing the filing of the Phase 2 plan for development and operation (PDO), Equinor noted the resource estimate for the entire Johan Sverdrup field has been raised from 2.1 to 3.1 billion barrels of oil equivalent (Bboe) to 2.2 to 3.2 Bboe. The company also stated that the expected estimate is 2.7 Bboe, adding that the PDO includes the following improved recovery technologies:

Water alternating gas injections (WAG)
Permanent reservoir modeling (PRM) for the full field
Stepwise implementation of fiber optics in wells
Step-by-step development of digital twinning
Technologies for automatic drilling control on the drilling platform
High-speed telemetry drill pipe
Improvements in cement quality
Virtual rate monitoring on subsea wells
Margareth Øvrum, Equinor’s executive vice president for technology, projects and drilling, stated that Johan Sverdrup “will be best in class” both in terms of digitalization and new technology. She explained that digitalization will bolster the effect of the improved recovery te

This is like the Sound Energy board where you have to preach the gospel according to Bob Trice.
Yes
, SIPP and AdUK people invested may be aware of the risks but equally they will be aware of the rewards too. If we posted about neither it would be a very quiet place.
Pijoe, Ricfle, Wellwell etc yes there is.another forum so what it is no different to DSPP posting here and on Lemon fool.
Wessex tried to validate a seemingly innocuous photo which looked to give some insight, hardly a crime. More context might have been useful instead of stating the Sea Trials date as a hard fact but not the end of the world - none of the above is.
It will be the end for many who contribute to or monitor this BB if they keep having to wade through pages.of **** to get a kernel of useful info.
Please, let's debate the share and points people make not each other. Not everything is a deramp or MM conspiracy.

Genghis
It was in response to Arbitraders question - why hold cash.

Genghis
It was relating to the question why you would hold cash (I.e. unallocated funds in an account). There are of course any number of reasons.

Buffet recommends holding 85% in an ETF that tracks an index (your domestic one being a good bet if you intend to retire there) nd hold 15% in cash. He reckons it willmoitperform any fund over the cycle and has bet many managers $500k to back it up. Don't think he has lost a bet yet.
15% can be used in many ways once one feels a market is nearing a peak, hold in reserve to invest on a crash. For new investment opp that comes if waiting for news/event/divi in other stock.
If retired and drawing down can be used to fund income while market is in doldrums meaning you do not become a forced seller.

Genghis
The post was a call to arms for more positive engagement from folk so we are debating more the issues (even if sometimes tangential) and not resorting to character assassination.

Given the money management may make from a dale, I would argue i-NED's are extremely important even if a sale was imminent.

Governance issues remain, I believe RT to be quite bull headed and in many respects HUR would not exist were he not. However, we are beyond that stage and need velvet glove to cover the iron fist in some of the upcoming discussions. Effective i-NED's can ensure the smooth course of such conversations and work toward a credible plan that benefits shareholders and management alike. The plan B is part of creating the value.
As for the mistakes that story would be interesting - perhaps if we ever get to a TO then there may be drinks after the event (EGM or some sort) where it may become apparent. The BoD would likely never need TO work again so honesty may out....

Pijoe
I can think of myriad solutions around various funding structures depending on the pockets of the bidders and how advanced HUR may be in the proving up process. If we get to such a stage it will make for an interesting time indeed but a few hurdles to cross first...

Pijoe
I'm thinking on a CPR base where the drilling has been done and enough is.known from company analysis to make the barrels commercial even if not officially 2P at that point.
In HUR case a data room may demonstrate to analysts for a major for instance without waiting for a CPR to.fo so.

We are a bit in danger of getting like many BB's on here where anyone not spouting the party line is jumped on. Too many people playing the man not the ball.

Fwiw - I would seriously doubt there are any paid derampers or rampers on this board simply some who are wary of the risks nature can unexpectedly represent and others who have considered those risks and elected to remain invested as the potential reward is commensurate with the risk being taken.

Then there is Ifonly1.

The BoD has some governance issues still - the absence of a plan B for going it alone with EPS revenue and lack of word on NED's being prime among them. The historic mistakes also being an issue. However, not withstanding those they have achieved much and there are some fantastic prospects if all goes well. Being invested does not mean they get a free pass though - they stand to gain massively from this potentially on a similar scale to Persimmon but concentrated in the hands of only a very select few. Perhaps more openness about how business is conducted is therefore warranted.

Pijoe

And anyone else interested, this is from Canaccord Genuity and is a commentary on fields in Namibia. However, one could say it goes some way to providing input on the debate about the $ value of a barrel in the ground. Fwiw - they reckon $5 a barrel for standalone discoveries c.150m barrels plus (to be commercial) and $7 a barrel for larger fields (400m barrels plus).

This will be for fields with exploratory drilling activity and other data being sufficient to demonstrate presence of oil and commercial viability. So not a 2C value. As HUR prove up they are keen to get as much of the fields to 2P as may be possible so one could perhaps use these as a yardstick. Market may have a different view but it can add something to peoples views on potential company value.

https://gallery.mailchimp.com/c8ce19146fdeb5b5892b7679b/files/e4a7aad0-5019-4113-a4a9-b459e60822c8/Cannacord_Genuity_Namibia.pdf

Additionally if they get Oil in December 2018, they have 2.5-3 months of data before they have to confirm option (probably) on the rig.

Edison estimate the EPS budget had $50m in contingency.
Add to that the saved costs in the budget from anybrevenue derived by achieving FOIL early (I.e. EPS budget funds Ops to end H1'19 - so if self funding that cash is released).
This provides funds if producing but not yet paid for oil to pay for drilling rig.

https://youtu.be/xQi-XMSG04I

Cebo
My post is what they would (I think) like to do, what they will actually have the time to do as an independent company (if EPS is deemed successful) is beyond their control and if it gets taken out of their hands in the way you suggest then it is probably not the worst outcome for any of us.

Dspp
Don't think the current use of Costain is either here or there to the pertinence of the info therein - it is potentially quite an instructive slide. As I do think that if cashflow permits drilling then a variation on the theme of the concept in the Costain slide is what they company aims to complete during the course of 2019 - to prove the performance of Lincoln and/or Halifax depending on the technology for heated pipelines etc to ensure they stay within the maximum distance.

So if they can do this (timing of initial cashflow and BP payment terms not such a big deal as flowing EPS will release contingency in EPS budget and the funding element to takes ops through to end H1'19). So if they can do this and prove up those 3 fields as commercially operational they would I guess be happy then to field offers.

Obviously this needs a functioning EPS and remaining independent in the event it does flow as expected.

Malcy is meeting Gil in early Sept, saying CPR is not far away and seismic is almost ready also.

With a Q1 drill target there is probably a lot of paperwork to submit in early Q4'18 so would expect the detail in 4-6 weeks.

Most likely the delay is down to corporate machinations beyond the control of ECO. For TOTAL/Tullow, there is likely a significantly greater deal of scrutiny about what they announce to the market. Further complicated for TOTAL around exercising option or going further.....

https://www.rigzone.com/news/wire/after_billions_in_blowouts_mega_oil_and_gas_projects_are_back-14-aug-2018-156618-article/?utm_source=EMEA_UK_ENG&utm_medium=PD_SM_FB&utm_campaign=ENGAGED

AdUK
If the oil flows to the extent corporate actions start being analysed/proposed, a TO would not take years to put together. Models can be built very quickly across a range of financial variables and interested parties will already have crunched some of the data room numbers and know what they want to see from reservoir.

In the event of such, who any buyer might be and how a deal is structured is anyone's guess.

The Donald is a curve ball the world could do without, that's for sure. In some respects so is Brexit but if pound hits parity we look appreciably cheaper to most suitors whose cashflows are in $'s.

The potential for buyers to be absent if Poo reacts badly to any of the geo pol risks does mean an IFD is a good age in the hole but by June it may be a moot point.

My expectation is 80-100p at FOIL, possible drift back then a run up from there if all the signs are good. 3-6 months of EPS data confirms Lancaster/or GLA as commercial and gets toward 2P values.
It also reduces the risk discount being applied across the rest of the 2C. So if FOIL is in Nov, that change in Risk outlook should price in February through May.
Will let people apply their own 2P and 2C values to their own quantities of each as they see appropriate.