Member Info for Itsriskythat

The Liberal Democrats demand ministers bring in a tougher windfall tax and scrap loopholes.

https://www.mirror.co.uk/news/politics/tories-let-energy-giants-hook-29820484

https://www.theguardian.com/commentisfree/2023/apr/25/tory-mp-net-zero-rosebank-oilfield?CMP=Share_iOSApp_Other

Where did you see the date for the results?

Were you aware of this?

This week Labour MP's pushed for a review into the effects of removing the investment allowance and lost the vote in parliament by 230 to 290

https://www.theyworkforyou.com/debates/?id=2023-04-18a.211.0

Backed by the SNP

https://www.theyworkforyou.com/wrans/?id=2023-03-29.176672.h&s=speaker%3A25294

Were you aware of this?

This week Labour MP's pushed for a review into the effects of removing the investment allowance and lost the vote in parliament by 230 to 290

https://www.theyworkforyou.com/debates/?id=2023-04-18a.211.0

279,017 shares sold by Richard Griffiths today

The H2 well consents have been posted by NSTA

https://itportal.ogauthority.co.uk/edufox5live/fox/edu/WONS_WELLBORE_SEARCH_PUBLIC

Enter the licence number: P1736

The table retrieved shows consents were given on 27th Feb for the planned H2 well.

Wolster69. In answer to your question about future production from Blythe.

I found these notes in the last presentation

H2 success case:

- Gas rates expected to be initially in 30-40 mmscf/d range after a period of displacing liquids in the Saturn Banks Pipeline
- Potential to drive higher cash flow

I think this implies that in future Blythe H2 production will replace H1 production.

I'm still worried that H1 will be shut-in before the H2 drilling starts and this will mark a period with no production for IOG and hence no revenues until H2 first gas.

Also they cannot restart production from Elgood until the liquids in Saturn Banks have been flushed from the pipeline.

To me it looks like three months without any revenues and, in the success case for H2, they will be able to ramp up production and later restart Elgood production once the water has been displaced.

Seeking any confirmation that it will be necessary to shut-in Blythe production prior to the Noble Hans Duel taking its position over the platform. I'm worried there are safety requirements that production from the platform is stopped whilst Blythe H2 well is drilled. Hope that production is not affected for the three months of the drill.

The Noble Hans Deul rig has now arrived alongside the Blythe platform.

Three tugs are now in position. The FFS Arion, FairPlay 31 and Aurora Sandefjord look ready for the lift on Monday.

Hello SpArmada. Having spoken to a fund manager, did you then check how the bond price reacted to the presentation yesterday? I think you said the bond initially fell on the news from Southwark so you are checking the price.

False. It is now the close period between year end and release of results and directors and management are prevented from dealing in the shares.

I’ll wait for news on the latest water production figures before concluding all is well from a satellite image of a gas flare.

I'd still be cautious about assuming that the water problem at A2 is fully resolved.

I found this wording that concerns me from the broker finnCap's latest not on IOG: "Production logging data from the Southwark A2 well has identified that water production is predominantly emanating from three of the six stimulated zones in the well."

It suggests that there may be residual water production even after isolating the three main zones where water was being produced after the initial testing.

As the Saturn Banks reception facilities are already at maximum water handling capacity due to the water being produced at Blythe, going forward and adding production from Southwark into the pipeline will be another problem.

IOG's Nordic Euro bond has a demanding covenant requiring bond interest to be covered 5 times by earnings. The interest rate on IOG's Euro 100 million bond is currently 12.1% and rising with the EURIBOR rate. That's Euro 12.1 million per annum in interest payments. The bond interest covenant might potentially be breached if the current operational difficulties didn't get resolved in the next few months or other scenarios play out like the gas price falling over the summer. Any chance of a covenant breach would be reflected in the bond price. Does anyone know the current price of the bond?

What's it worth now?

I would say now that the volumetric estimate of the reservoir is likely to be reduced significantly based on the results of the A1 well control problems and half the A2 horizontal being outside the intended gas bearing rock and in water.

Additionally the poor initial flow rate of 4.2MMcfgpd from A2 compared to an expected rate of 40MMcfgpd from A2 may be related to cementation in the pores of the rock. It takes someone with better knowledge than me to understand geo articles, but there is an online extract from a research paper brought up by a Google search of "cementation" and "Vulcan South" renamed to Southwark.

I think this might be why they've decided to move the well location for A1 further EWest where the reservoir properties are expected to be better.

finnCap says "We estimate IOG has invested over £100m on Southwark, which if the second well does not come in could have to be materially written off. This will clearly have a significant impact on Saturn banks Phase 1 cash flow and the timing, if not the viability, of Phase 2 of the development being called into question. It also raises concerns over the refinancing of IOG's €100m Nordic bond."