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So what was in that RNS that meant it could not be released earlier and that it had to be delayed until the Friday before a Bank Holiday?
No, me neither: there was no current news!
The expected weather conditions were responsible for the delays to the projects and together with pricing volatilty has resulted in a necessary re-forecasting of NOI, down 17% from 241 to approx 200 [note they dare not suggest it begins with a 1, lol].
A 9.4% decrease is attributed to the softening in full-year 2022 commodity pricing predictions since the May forecast, and while inflationary pressures are predicted to increase costs (royalties, opex, transportation and processing) by 3.0%, it suggests that the remainder is due to reduced production from the delays, even though they will still deliver peak 2022 production above 24,000 boepd after adjusting well-timing.
afaik, the company did not suggest a boe/d figure for the year, but WHI have and state that they remain comfortable with their 2022 full year production estimate of 21,077 boe/d.
If Q1 delivered 18095 and Q2 19502, then Q3&4 would need to be >23,300.
If the whole of July delivered 20000 and all of August 20500, then the final 4 months have to run at 24870 per day, and whilst possible, given today i3E said a material percentage of the associated production is expected to come onstream in late Q3 or Q4 2022, it seems a remote possibility.
G_G_G and Tony comment on Serenity spud in mid-September which suggests that Repsol Sinopec Resources have had more luck with this well than the previous where the well programme was foreshortened as it was found to be a dry hole and i3E will get Stena Don towards the end of the window, but they were never going to spud on day 1 of the contract start.
But there was also the reminder "Any well costs exceeding £15 million will be funded by the companies in proportion to their respective working interests."
The EOG presentation had an interesting line on costs:
30 day well (dry hole) budgeted cost $US 17.7 million (GBP £14.2 million).
If the current $/£ rate of 1.18 is used, $17.7M is £15M.
As a dry hole is not expected, it would seem that the costs could exceed the cap, especially with inflationary pressure.
i3e have never said how they will pay for the drill, or whether they have had to put the necessary into an escrow account,ie no longer free cash, but they have suggested that another farm in could happen prior to spud.
The 2022 Capex declared and subsequently increased up to $97 million, was titled 2022 Canadian Capital Programme, and then Enlarged Capital Budget, but still for "the expansion and acceleration of i3's key Canadian development opportunities."
Patiently waiting for real news...
Stena Don has been anchored at this location for several weeks where it is working for Repsol Sinopec Resources on the producing Blake field.
It is very close to the wellhead for 13/24a-B2Z which is being re-entered and for a sidetrack, -B2Y.
The well programme for -B2Z was foreshortened as it was found to be a dry hole with no commercially viable hydrocarbons.
The nearby i3E Liberator East drills similarly disappointed, leading to the relinquishment of their P1987 Licence.
The Serenity find that EOG have farmed into is in the P2358north licence. The 13/23c-10 well is around 7 miles further north than Stena Don's current position and the proposed appraisal drill, SA-02, that EOG is co-funding is a couple of miles to the west of Well SA-01 (13/23c-10).
Reference to the map on page 10 of the June presentation 'Meet the Team' shows all of these locations.
Co-ordinates for wells are available here: https://itportal.nstauthority.co.uk/edufox5live/fox/edu/WONS_WELLBORE_SEARCH_PUBLIC
Hope that clarifies the current situation: more patience needed.
Stena Don is anchored at this location which is very close to the wellhead for 13/24a-B2Z (compare ship data with data here https://itportal.nstauthority.co.uk/edufox5live/fox/edu/WONS_WELLBORE_SEARCH_PUBLIC ) which also shows that it is outside the Blake field but not in i3E's Licence. It is working on another sidetrack for Repsol Sinopec Resources, 13/24a-B2Y, as at the previous drill, 13/24a-B2Z, the well programme was foreshortened as it was found to be a dry hole with no commercially viable hydrocarbons.
HTH
ELSteve- here is a taster for you, from our partner released yesterday:
At Marten Hills, the final eight-leg multi-lateral well of the four (2.0 net) well winter drilling program was rig released in early April. Two of the four winter drilling program wells reached the end of their initial 30-day production periods, recording IP30 rates of 142 bbl/d and 139 bbl/d as compared to the Marten Hills type curve(1) IP30 of 120 bbl/d. The remaining two winter-program wells reached the end of their initial 30-day production periods during May, also performing slightly stronger than the Marten Hills type curve with average IP30 rates of 186 and 179 bbl/d. With the rig racked on location at Marten Hills over spring break up, dry field conditions permitted the spud of two additional horizontal multi-lateral wells in June prior to re-locating the rig to Figure Lake. The two new wells were drilled at the Marten Hills Area’s after payout working interest of 30%. The first well was rig released in mid-June, reached full recovery of its oil-based mud load fluid on July 6th and achieved an average IP30 rate of 188 bbl/d. The second adjacent well rig released in early July, reached full recovery of oil-based mud in late July and is performing positively, commensurate with the neighboring well.
HTH
uncertain, plenty of time yet today or tomorrow for the perfunctory voting RNS to drop - academic though that may be with the KO CP holdings.
But what a c0ck-up!
Fancy announcing the AGM before the FR would be available, and then not rescheduling it to meet the delay and having to organise a second. Anyone would think they were scared of the SP dropping in the event they had to do announce a change...
It's not just the drilling that's fubar here!
Anyone know?- How large is the drilling workforce?
Can they manage 24/7 operational drilling at more than one location?
jimo
joe
Paul, noted your post and your Liberator comments.
Wondering if you had read the Relinquishment Report for P1987 and how it stacks up with your view Pre drill and
their earlier view.
https://datanstauthority.blob.core.windows.net/external/relinqs/2021_06/P1987_13_23d_i3_RelReport_Mar2021.pdf
DM - I think you are overthinking it.
If your shares are held by a nominee broker, they will all be lumped together and your broker will be just one of the holders on their register.
Which would mean that there are many more shares than that per broker, esp if KK and DD share a broker...
Resolution 13 is only an extension of the same 10% rule that was voted in last year, but the volume has increased due to the number of shares now in issue, primarily from the option take-up.
What they want is Resolution 11, then they can award themselves some more options.
Move up the trough!
The three years has passed.
According to the Circular for the Conversion, she only held them 'beneficially'.
Notes:
The currently held Ordinary Shares noted in the table above held by the various members of the Oraziman Family Concert Party are held beneficially by the family member concerned. The underlying shareholdings are managed by Akku Investments, a Kazakh entity with Kuat Oraziman as the sole director and decision maker. 100,021,432 Conversion Shares will be issued to Akku Investments and 19,854,007 and 19,854,007 will be issued directly to Aibek Oraziman and Aidana Urazimanova respectively. Aibek Oraziman and Aidana Urazimanova are the sole beneficiaries of Akku Investments and own the Ordinary Shares of Akku Investments equally.
HTH
;-)
KK, no.
I'll look at the statement tomorrow (an assumption on my part: still not seen the AGM Circular on the website) and see where the spin is now!
I know the CAB is important for a divi, but imo the CAB number has been manufactured by selective borrowing, opportunistic purchases and timely debt repayments, and as others have said, it could now be increasing rapidly.
But it might not ;-)
Clarity and not doublespeak is needed. Sure, it's a risk business and statements are forward looking so caveat emptor, and dyor should not have to rely on Bico!
We have not heard about the decline rates in the wells, just sporadic flowrates. We know workovers are needed, but what is the trend for the horizontals?
I note particularly the insertion of the word capacity in recent docs.
4000bopd production capacity is not 4000bopd revenue!
The debacle with 3AB, still no renewal, no payment of dues, and no reclaim of 2/3 of the indemnities starts to look like a quick rinse through of RO's assets. How can the new partner be responsible for the next work, when licence terms are unknown? It's been written off the books, how long before it follows Beibars?
enjoy your pret.
Another enigmatic RNS...
KK comments on his need to understand "the $9m CAPEX entries especially cars and other."
CC replied with "see Note 13"[Property, plant and equipment] with headline numbers and text from Note 21 [Provisions and contingencies].
The Property, plant and equipment Table shows the changes for 'Proved oil and gas assets', 'Motor Vehicles' and 'Other'. But as I could not see where the content mentioned in Note 21 appeared, I looked back to the H1 Report, expecting that the capitalised sum would be more evident. (It's always a tad disconcerting when the largest entry is in the column titled 'other')
However, there were NO Additions to the PP&E in the 1/2 year to June, which did not accord with the earlier narrative of $1.5m increase.
"Plant, property and equipment
The value of plant property and equipment increased to approximately $51.5 million (2020: $50.0 million)."
Closer examination shows that the increase was over the same period last year, not on the ongoing status at Jan 1st 2021 as inherited from the end of 2020, which was $52.8 million. Also, the 'Disposal' for Motor Vehicles of (14) does not carry over to the year end report at all: 'Unaudited' covers that then.
wrt the CHAIRMAN'S STATEMENT
"We are producing record amounts of oil and selling it at prices greater than at any time since we commenced production. Debt has been paid down or converted to equity and we expect to declare our first dividend later this year. "
Headline bullet point "Aggregate production for 2021 was 533,857 barrels (2020: 545,667) a decrease of approximately 2.2%"
20 Short-term borrowings
2020 $5.6 million
2021 $6.425 million (of which $6.2m was converted to equity in 2022)
Advances received (deferred revenue) increased to $3,925m from $2,986m.
This includes the "significant amount of prepayments from the oil traders in relation to
increasing production on the BNG oil field".
cf. the August 2021 update "We are now close to repaying all the historic local oil trader funding provided with respect for domestic sales. Once done we expect a greater share of our total production to be eligible for international rather than domestic sales." and
now "FINANCIAL REVIEW OF THE 12 MONTHS ENDED 31 DECEMBER 2021 (CONTINUED)
· The Group continues to forward sell its domestic production and receive advances from oil traders with $1.8m currently advanced and the continued availability of such arrangements is important to working capital."
"International vs Domestic sales
The proportion of oil sold on the international market in 2021 was similar to that in 2020 as the export status at South Yelemes was not received until late December 2021."
and in 2020
"the domestic price at which we are obliged to sell 40-45% of oil produced",
which is well down on the 25/75 split many thought.
Further clarity will be provided at the AGM, Rodney...
And the approval of the licence split and then EOG's 25% take-up is still awaited from NSTA (nee OGA)?
They gave us plenty of notification of the AGM, but has anyone seen the Resolutions yet that we will vote on? We know that it is academic with the CP, but surely there is a minimum period needed from the release of the AR to process those votes.
Is the website 'Error 504' for all or just me?
OT KK re crypto, did you see this one from yesterday afternoon? Keep up with the office youngsters!
https://investegate.co.uk/bybit/eqs/bybit-unveils-first-ever-bear-market-guide-for-traders/20220614134004EXFTY/
Was it only Wednesday when, amongst other things, I asked about the options?
The surprise, perhaps, is that they have taken up virtually all that have vested. Or rather the number of shares issued was minimised by the company providing cash to pay the tax due rather than selling sufficient shares to fund the tax due. So, of the 114,547,030 ordinary shares ("Option Shares") of the Company that were taken up, the Company has issued 66,305,381. Which means that @ 28p, 48,241,649 shares would have had to have been sold. This would seem to be a somewhat novel approach. Of course, with the current approval to purchase (buy back) shares this could be construed as simply a short circuiting expedient.
Given that the Bybrook placing of 60M only realised 27p when the SP was much higher, it is very unlikely that the market could have immediately absorbed the 48+M @ 28p, meaning that even more would have had to be sold at an even lower price to cover those taxes due, and only serving to exacerbate the current market malaise. Hope that not many of these new shares are cashed in and also that HMRC are approving of this inflated price exchange and the retention of more beneficial shares than would be the case in a free market encashment.
Having taken up all the options, we can now expect a new tranche to be awarded. As there is provision for up to 15% of the issued shares to be available as options, that would mean up to 155M could now be awarded. It is unlikely that they would all be awarded in one tranche, but given the history of awarding options with soft targets for the early vesting it will be interesting to see how quickly the next tranche is awarded and the early vesting terms...
The PoO and the cash flow will have exceeded all BoD expectations, (and most PIs!) generating huge income and potentially a cash pile.
In the bigger picture though, the question is can they spend that cash responsibly and successfully run a production company. Seems the jury is out at 27p ish.
The recent placing came from Bybrook's 294M. He had provided the earlier loan note funding which came with certain requirements, and subsequent amendments connected to the 5p fund raise for Gain, and more investment from Bybrook, leading to the completion of the fraternal opportunity that satisfied some of the requirements.
Why sell some now? His approval has to be gained, along with the NSTA (nee OGA) licence split and EOG acceptance.
Would that make him an insider wrt the planned drill?
How is the licence split affecting the current Dolphin contract?
What are the plans for Liberator West and Minos High?
Are there any other unknowns or impediments? Remember the BHGE block on dividend was never declared.
How long does it take to find a chairman? Linda has been Interim chair since September 2019, is she not worthy of appointing to the position?
Why has she, as 'the standout candidate', now become a new Non-exec at Hurricane?
Why are there still unclaimed 0.01p warrants?
Why have the BoD not taken up any of the 5p options (with the exception of Linda, who didn't have any @ 0.01p)?
How much longer is the ESG going to take? Due in Q1, then with Q1 update but still undergoing 'final review'.
Why is it so late, whose finger is not on the pulse? Or are they over optimistic with time lines as evidenced by the dividend process which was also months later than initially suggested?
Will there be some new info for EOG to share on the 16th, it's already 4 weeks since the signing?
Perhaps the new PRO-moter on Advfn can help shift the 60M...
KK it was my impression that it was a buy for an USA at £19.9k, it could even have been a B&ISA; as I understand not all brokers will perform back-to-back trades but wait until the cash is cleared. A fortuitous event as it happens. lol.
If only all posters were as upfront and honest with their trades...
wrt the 4 RNSs, OK two resulted from the second, but who expected the first amending the divi planning?
The plan had been to have two Resolutions to vote on at the Debt GM, but they didn't and then advised it would be with the AGM. Now it has its own earlier GM. At least that should enable an earlier payment, assuming its voted through - KO gets to vote this time I believe!
So if they can't organise a vote that has been on the table since early August, what chance do they have with the drill when 5h!t happens regularly?
As for the 'update', some see positives, some sold out.
Sure, there was some disappointing news, but hardly Black Swan events, any could have been predicted as risks, but unfortunate to hit the jackpot and for all to materialise.
But was it a sell or buying opportunty?
Yes, the realised price is now c. $35 lower. However, look back to July when they calculated the August RNS and POO was $70-75pb so they must have thought the business was ready for divis and able to sustain growth with CAPEX at that POO rather than at what we now have for Brent.
Or did they expect to have cash in from 142 though?
Or A8?
Or the Boat?
Or 3AB?
Interesting times continue, what will tomorrow bring the PI?
jimo
joe
How long now before the next RNS? Seems they didn't have one on ice!
EOG have set the ball rolling but there were a lot of conditional steps in the earlier FO announcement, as listed in G_G_G's recent post, and Tony is looking for an update on the status of the rig contract.
Cannot really see the Loan Note holders objecting, when Bybrook has just put c£1M into EOG, and imo the OGA licence split was also awaiting evidence of funding, because if you recall this from the H1 2021 Report (Sept 27th) "2. The farmout of its UK licences to conduct further appraisal drilling at Serenity and/or Liberator;", at the time they only had the one licence, so was the plural a slip of the brush or insight into the status of the way forward discussions with OGA and tacit approval of the split?
The real intrigue is with the rig contract, where Dolphin get up to 10% of the old licence. The terms were summarized in the ReAdmission document, as were the thoughts on the drilling campaign at Serenity. The EOG presentation suggests that has been tweaked. But what of the contract deal with the split licence and a single well?
The only clue is the EOG GM statement, "the Serenity acquisition is for a 25% stake in a discovered oil field, which is majority owned by i3 Energy and requires further appraisal to delineate the field and progress the Serenity field to the development phase. " suggesting that there is a third party involved.
iirc, the management plan was always to use another's cash to prove up, they have settled for almost 50/50, unless there is another deal waiting in the wings.
To run to the 82days of the rig contract, G_G_G's wished for wells in Lberator/Minos High would be needed on the other Licence. Perhaps they have another fo to announce, or do they fund it all?
The December RNS was carefully titled 2022 Canadian Capital Programme and Dividend Guidance, and did not mention NSea, but did say more could be spent.
We know that the prices used were very conservative and many here have been anticipating a special divi or a hike, but, of course, any spend now on the NS has to come from that same Canadian fcf.
That update is needed to remove the uncertainty hanging over future management actions.
jimo
joe
PS. Marten Hills update from our partner:
At Marten Hills, the planned four (2.0 net) well drilling program commenced in early February of which two (1.0 net) eight-leg multi-lateral wells
have been rig released. One (0.5 net) well has recently commenced sales production while the other is just beginning OBM recovery operations.
The remaining two (1.0 net) wells in the program are expected to be rig-released prior to the end of March or early April. New wells will continue
to be brought on in a step-wise fashion and operating conditions will be optimized through their early start-up production periods.
Drilling costs have escalated somewhat due to increased OBM costs which are directly related to the price of base oil.
KK
They must, surely, have some further success anticipated to plan to pay a divi, unless, of course, they just want to grab the excess cash the PoO is throwing off. The new licence should add some more cash unless those wells need a rework to produce again, before the re-drill horizontals. I never understood why production from those stopped while the application was in progress/deliberation, it did not apply to BNG.
We know about Carverspeak and his ability to convey a factual message about the state of the assets, but KO is the man with the plan: SS is working it. Remind me, why did they want Tim onboard?
Have you seen the ad for 3 red bus drivers yet?
Keep looking!