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Hi Epi121,
Sorry to hear that. Hope all recovered.
25p SP very close. Then you will read the day traders here turning negative...

Hedging news were good. No complaints from me... But they have to hedge more very shortly given RBL conditions. Given futures curve, they can get puts for all 2022 above $62/bbl.
https://www.cmegroup.com/markets/energy/crude-oil/brent-crude-oil.quotes.html
I am expecting ENQ to pull ahead with its FCF generation in H3, especially after GE completes.

What happened to ICD that has drooped from early July?

ATB

To the number crunchers,
Suncor announced 2nd quarters results on 28 July. They stated completion of GE deal in September. So, bear than in mind in your calculations. In other words, make it 8.5 months (or 9 months) of GE production, post-tax economic profit will be subtracted from the $325M price of GE. ENQ has guided such post-tax economic profit at around $85M if I am not mistaken.
Last 3.5 or 3 months of 2021's GE production will generate profits that will not be taxed. Such production will enter into the the calculations of the required hedging as determined by the RBL.

Hi Therapist,
I am looking forward to the OGA data on Sunday/Monday...Hopefully you can share your very useful graphs with us.
Offload #98... not #101 (i got the # wrong last time), in progress. Assuming it departs tomorrow, July production around 32.5kbopd.

Hi Jan, my 25p reference price is coming very soon. As I wrote to you on 18 July "Jan2: Tomorrow I will take up the OO, but might not sell anything, unless I get a price I want. At 21-22p I am not selling. Can wait a few weeks..."
As I told you I took up my OO shares, and now what i have to decide is whether I am selling them at 25p or if I do not sell them at all. I have yet to sell a single ENQ share, since first buying in 4 years ago. Enjoy Morocco. I had a great time there. Rented a car and travelled all over (except to Western Sahara, as I was not allowed to go there...) for several weeks.

Hi Pelle, I will not comment on FCF for H2\2021 before H1 results are out. You know i try my best to get it right. You have my H1 estimates already. I am now revised my H1 production estimate and it will come in just a tiny bit (maybe a couple of hundred bbls) below 46Kboepd.

You can always get reliable and accurate estimates and projections from HMHn who I filtered back in 2019, as he is very rude. I leave you with some of his estimates back from July 2019... "ENQ would generate $6 billion+ of free cash flow at 85kboepd/$65 brent 2020-2025." "Dividends of $500-900 per annum in just a couple of years at $60 oil and the current production numbers." " $1b of free cashflow in 2020 at brent $60 ", "Kraken producing 50Kboepd". I have no idea of his more current estimates and projections.

ATB

https://www.channel4.com/news/revealed-north-sea-oil-company-chief-exec-claims-climate-emergency-is-fake

IRC's TU is absolutely shocking in what it reveals about how it was run in the 2/3 previous quarters. Now that POG's PIs can no longer benefit from IRC's good fortunes, the cash has stopped from vanishing. IRC is even paying chunks of its loan way ahead of schedule, and by an amount similar to the one I posted they would some time ago.
In other words, now IRC's cash no longer disappears... and instead it stays with IRC's new shareholders. You have to wonder who the ultimate beneficiaries of the company buying POG's position in IRC are.
Make no mistake POG's position in IRC will be worth $150M easily.

POG's Board, as POG is being quoted on London, should be hold to account for all that is happening.

Hi Pelle,
Not everyday. I will be silent until Tuesday night...
But, yes I have questioned you last week.two weeks ago:
"I have no clue how Pelle is getting those FCF $800M for 2022, bearing in mind that WI generating FCF will be no more than 47.5Kboepd (always exclude BP's stake in Magnus and 1/3 of Malaysia production), including GE in the figure."
$72/bbl oil ? that is nice, but I would not count on more then the $65/bbl at which they will have to hedge 60% of the production.
Capex &Abex $120M? No way it will be that low. Make it $150M or more.
GE's 2022 production as per projection in prospectus is no more than 9kboepd.

i will do more precise calculations after H1 results are announced, but I know 1 thing. Enquest's DNA is about Acquisitions, etc., not about having low levels of gross debt.
ATB

Hi gkb47,
the username is followed by @gmail.com
Hi Pelle,
Enq also stated they hedge up to 75% of production for the next 12 months, and yet they hedged hardly anything a few times in the past. So, take the content on p.85 bearing that in mind....
ATB

Hi Therapist,
You really are exceptionally good at figuring it all out.
2 /= things:
- Fire (replace of the riser and pipeline; the latter delayed because of bribery alegation in procurement of pipeline (see Prospectus...). Sorte now "The contract award from EnQuest is for the replacement of a ten-inch gas lift subsea pipeline and risers. The scope of work includes engineering, transportation, installation of risers, subsea tie-ins and pre-commissioning of the pipelines."
- Increasing production (or so I am led to believe) "The contract awarded by EnQuest is for the provision of maintenance, construction, and modification for its PM8 Extension Production Sharing Contract (PM8E). Works include project management, fabrication, offshore maintenance, construction, and modification works."

So this is good news...
ATB
p.s.: Please keep coming with good news to keep Pelle's dreams about ENQ generating 700M of FCF in 9-12 months alive...
p.s.: Krakie, you can now conjecture that I bought a lot of shares OTC after the marker closed...

Who needs fossil fuels?
check it out, almost real time data:
https://www.gridwatch.templar.co.uk/
pay attention to the CCGasTurbine dial...

Hello gkb47,
like you I'm not enthusiastic about Bressay. Yes, hardly any information there in the propesctus, except for justifying CoP in those fields we have discussed. Do you have calculations on decline rates? You know my email l3traderuk
i doubt any capex in near future besides Kraken, Malaysia and Magnus.
There is no money... Debt is still way to high given "actual WI" production levels (i.e., 1/3 of Malaysia and 37.5% of Magnus have to be subtracted). ENQ has to have gross debt including RCF/RBL and all kinds of other loans they usually have below $750M to avoid tanking when the cycle turns...
ATB

Hi gkb47, I really do not want to know more... apparently he followed HMHn advice and bought mini shorts...or so I read in Pelle's posts as I filtered HMHMn back in 2019.
I am looking for the 25p, so that I sell the quantity of shares I picked up in the OO on Monday. And I know I will get my 25p.
ATB

Pelle, that is b/w you and him...

SQM "During 2017, we increased our iodine production capacity at Nueva Victoria to approximately 10,000 metric tons per year." So, that is 4,000 metric tons per year. One month of stoppage time is 300Mtons, basically half of Iofina. Prices will only shoot u if stoppage time goes into Q4.
But since Iofin has production issues (it always has...), other producers will benefit the most.

All,
I rarely post here, and I really regret not getting out at 40p. But I have sold down and only have 130,000 shares now. Still in profit, as most of thse were bought at 5p in the RI, and I only came it a bit before that at 30p. So, have not suffered the losses others have.
My view is that this is a company with extremely talented and skilled staff (see their research staff, and mining college for example) that unfortunately has always been run for the benefit of a few. And until this continues it cannot fulfill its huge potential.

On to the TU:
Good news: launch the Pioneer flotation plant 1-month ahead of schedule, and they have now secured 3rd party concentrate in the second half to meet their production guidance. I am extremely confident they will end up above it.
Revenue; production x price = $335M (not bad, but could be better). The question is what happened to the cash...
ZERO information on costs. No information usually means bad news... It always does...
Assume CAPEX was half of year guidance, thus $70M, and that Own Gold TCC came in at $900/oz. So that is another $144M.
The cost of those 3rd party 36Moz? No idea, but assume with processing costs it came in at $1400/oz. That is another $50M.
So, $265M. What is left? $70M to cover everything else from interest expenses to taxes and G&A. Another $55M. $15M left...

What do we know? US$26.7m decrease of the prepay gold (which is not treated as debt as I recall). But debt increased by $35M. Given cash is the same as 31/12/2020, net debt went up by more than the reduction in the prepay gold loan.... Always a mistery how the cash from operations always disappears...
Now they are in the process of getting rid of $200M of the $500M 2022 bonds, for a loan with better conditions, but as usual keep the lender's name private. Always, hush, hush... In theory, reducing the interest rate from 8.125% to something like 5% would be nice, but what are the finance costs associated with doing that? And who will redeem their bonds for bonds that earn them less? ... Is the new loan being extended by a 3rd party that is related to the shareholders, etc.?
No mentioning of the IRC sale...

Great potential, but a business that is not run for the benefit of its many shareholders,. Instead it is run for the few.
will it improve substantially in H2? perhaps. But first the main shareholders need to realize that they could benefit from increased transparency.
ATB

Hi Pelle,
There is evidence they stop hedging on the way up, like some people here who when the POO was at $75 were convinced it would go to $80 and above. In the short and medium term it is never guaranteed to work that way.
Even if they placed hedges for 22Q2 & Q3, given that futures were $5/bbl lower, and given that they would buy a put 10% lower than that price, they would be hedging the downside at $64, which would have been fine. But, I bet they did not.

Chilting: Harbour's issues are really disappointing in light of strong gas prices. Always remember Londonr7's wise words "stuff happens". That is why for my ENQ figures I always check what if production comes 10% lower than the bottom of the guidance. Can it pay the bills? At the moment ENQ is being kept going by Kraken, and lets us all hope, it continues, until the GE deal is complete. As time goes by the CoP of those 8Kboepd (allowing for declines) of Heather/Thistle/etc. is looking a worse and worse decision. At $40/bbl OPEX it would have earned ENQ FCF of $70M in 2021...
ATB

Pelle, Do you think they add more hedges? We know how the operate. They though that since Brent was at $75 it would got to $80, so decided to wait until it got there to hedge meaningful amounts... If that were to have happened it would not be the 1st, 2nd or ... time...
As I wrote, all might work out very well, but for that to be the case ENQ needs to produce plenty of oil and sell it at prices above $65/bbl.
ATB

Hi Pelle,
Very bad of them. By the way my target is 60p but I am not releasing my assumptions... What a joke!
I hope you can sleep well at night with the 1-0 score no longer guaranteed... Anything could happen... Relax, it won't!
Simplyme and you have posted content suggesting ENQ can thrive at any level of POO. Not quite. Remember the RBL facility only lasts until 2023 (and with smaller and smaller credit limits) if there is no renegotiation of the HY bond. It will be delicate to navigate the credit constraints until the renegotiation. And by the way, the interest rate attached to the new bonds will impact the re-rate. the bond will have to be junior to the RBL facility and have a longer maturity date. So, not an easy thing to do. It seems to me that the issuance of bonds should be as small as possible, and no more than $500M. But can ENQ find the cash to repay the difference b/w the outstanding balance and $500M, w/ declining production next year? No production CAPEX this year means lower production next year. Even GE's projected daily production goes down to 9kBoepd, so 10% less.
ATB

Just doubled my ISA holding in anticipation on Thursday's interims. I expect results to show lower net debt and good FCF.
ATB

Yes E121, we always have to guess blindly. It is unfortunate that ENQ does not release guidance on FCF like other oilers. This makes it even harder to try to guess. Anyway, you will have read my projection, which is an informed blind guess based on the prospectus. They do have net debt there at the end of Q1. And it was up to $1323 (page 256 of the pdf file). Could be the result of many things affecting working capital.
ATB

Hi E121,
Any views on ENQ's H1 FCF?
ATB
p.s.: I do think the markets are over-reacting. I plan to add to my small EZJ position.

Hi Pelle,
See what krakie is writing... your 1-0 is not guaranteed.
It is a terrible agreement the one struck yesterday, for the short -term.
What we need is the other Kaken to keep pumping oil...
ATB