Member Info for longtermthinker

I cannot see that happening, surely the lawyers on a no win no fee would have something to say about it, stringing it out until the company folds! And how exactly can they string it out? Ok we may not get any news from OM before the New Year (although any competent organisation would want to clear the decks ready for the New Year IMHO), but the cannot leave it too much longer as they have said the last argument was summited on 5 pages from each party, it was a side note to at least show the arbitrators had listened, I cannot see it changing the outcome of the decision they made back in July/August. What that decision is, is anyones guess, but 2 months to read and decide on 10 pages is a bit crazy!

LTT

Well that is very philanthropic of you Godder99.

I suppose you are in a win, win situation then, if RKH do go bust they you can say "I told you so!" and if they actually turn things around, now they actually have control again, you can cry into you share dealing account at the small fortune you will have made!

Regards LTT

Godders99,
you can't be bothered about a lot of things yet you hang around here, posting doom and gloom, day in day out, I'm finding it hard to understand you motives. You say you have emailed RKH a number of times and got a standard response. I have also emailed a number of times and got quite the opposite, so what is the difference, is it your writing style? Or they just don't like you, one of their larger shareholders? It seems very strange to me!

Better to dump this stock and take the cash you have left and put it elsewhere, you can offset the loss against you income and positive returns from other investments. You'll feel a lot better and you can move on with your life, just walk away and don't look back.

LTT

Godders99,

Why don’t you sell up then, oh wait I heard this one before, you want sell just in case it comes good, so what you are actually saying is despite your negativity you have some belief in the company, that they will come good!

LTT

Godders99,

What makes you believe they will get an extension? If I was FIG I’d imagine they will hold them to the 90days, it’s more than enough time and they will want them out and everything transferred back to RKH so they have a chance to move forward, seeing as Harbour have walked away at the 11th hour.

LTT

Have Cairn been linked to RKH in the past? I seem to recall rumours but I might have been thinking of something else, but why not?

Firstly Cairn are expecting a massive payout from India, ok they are paying a huge div and doing a share buy back, but still they have quite a war chest left over. Secondly they have assets in Mexico, they must be in two minds about throwing more money there at the moment while the nationalistic gov is still in power. Thirdly they just sold off Catcher and Kraken, their cash cow they trumpeted in the 2020 annual report! and fourthly Keith Lough is a a none Exec, is he not allowed to promote RKH as a staggeringly good investment opportunity? Is it classed as nepotism?

They had 21k barrels of production on 2020, not sure what it will be having just sold off Catcher and Kraken, but the rest of there portfolio licences and acreage, where is their revenue coming from going forward? Or are they transitioning now in to a green none producing oil company, can't see them lasting long if that's the case. Maybe they are planning to buy into producing assets like Harbours business model, but if that was the case, why not keep Catcher and Kraken, their cash cows?

Or it could just be, after RKH being in the hands of PMO and then Harbour for all they years, now RKH and SL have come back in to play, Keith is going over the data with Cairn and showing them what a compelling opportunity the North Falklands basin really is, he has 70,000 documents he can show and a worked up, good to go development plan!

LTT

P.S. You can tell I have some free time on my hands this Saturday morning! LOL

I suppose the real issue is the development needs to be small enough to be cost effective but also big enough to be worth while. What I'm getting at is Hurricane getting a rig in the North Sea to drill a couple of producers and an injection well with all the rigs and services nearby must have been a no brainer (prior to finding out the reservoir is fractured), they could slot in a rig here or there, with the Falklands it's a different kettle of fish.

To make it worth while you would have to be looking at a 9 to 12 month rig contract to drill 7 or 8 wells. So what is a semisubmersible these days? $300k per day? probably closer to $500k with extras. So you are looking at $180m for the drilling, maybe $200m including travel time. If they could drill 5 producers and 3 injectors averaging 6k barrels a day, it would be a respectable 30k barrels a day which would be pretty sweet with oil set to hover around $75 to $85 for the foreseeable. If the FIG could do a little magic with a sliding royalty payment that moves with the oil price to keep in viable and the oil pumping, that would be good, or better still a tax break of some kind to support the development.

All we need is to clear $100m after lawyers cut and we are game on. I wouldn't mind a fund raise if the share price was was rerated to 30p after an OM award. IF and it's a big IF, the board and Navitas are signing up to 50/50 development; FID is on the cards for the end of 2022; Navitas shows they have the funds for their share of a smaller development and RKH have reserves based lending in place to match the funds raised by the issue of equity. Then it's doable!

Yes a know it's a long shot and depends on lots of ducks all lining up in a row, but without the millstone of PMO around our necks, saddled with debt, ragging us down with them, we have a opportunity here to be masters of our own destiny, but it all depends on the OM result and if we can get the cash in time!

LTT

I don’t think he’d have a choice if we have no news from OM and there are bills to pay, a legacy from Harbour walking away! Something is going to be due at some point and without Harbour of Navitas bearing the cost, he’d have to go around with the cap and I don’t see The City full of charitable organization!

Roll on OM then we can see where we stand.
LTT

Interesting read about Hurricane , their May 2021 presentation about the wind down of Lancaster. It would free up the BlueWater FPSO from June 2022, of course the timing would be off for us, but looking at the Lancaster field they have a small footprint, just two producing wells that were producing 12-14k barrels a day. I think currently they have only one well online and they have discovered they reservoir is highly fractured, hence they plan to possibly shutdown production and terminate the contract with Bluewater if they cannot come to up with a smaller extension to keep producing.

We know that SL is extremely easy drilling, I believe they on average took something like 40days from spud to TD so why can't Navitas and RKH think out of the box, start off with a much smaller development, 3/4 producers and a couple of injector wells, then add to it as and when they have the cash.

There must be suppliers up in Aberdeen chopping at the bit to get a project like SL off the ground and secure contacts that will be worth millions and more importantly be in there first on what could be decades of work.

However we are still dependant on the OM award, if not we are over a barrel with regards to anything Navitas can offer us. A fund raise is out of the question with regards to shareholders, who in their right mind would buy into that! They would need to have a very good reason to ask shareholders for money other than to keep the lights on and the same old same old, "possibly, we are looking at, we are hoping to, etc!" Of course they could offer up the shares to institutions but that would wipe long term shareholders out! It would make the deal PMO got from Harbour look excellent and generous!

I just cannot see what is holding up OM. They said they would make a decision in July, then the 11th hour 5 page submission. Surely the decision had been made back in August, so how does the 5pages effect that judgment, would they reduce any payout on the back of that, I think not as it would be like they are saying there is some merit that affects the case. Did we lose? I think not either as we would have known by now, how long does it take to write a document saying we rule in favour of Italy!
No surely the hold up is the wording of the rebuttal and the amount of compensation. IMHO

We will see.

LTT

Hi Surfit, that would make a lot of sense, either RKH would have to get in a team with experience (very costly and impossible at the moment) or get a third party. Delek does sound interesting and does have the Israeli connections that's for sure!
But as you say, pure speculation at the moment, but that would have been a good question for the board at the shareholders meeting, "Without Harbour onboard, how can you meet the criteria to be a field operator, Navitas can maybe get access to funding, without any production or development nohow we are dead in the water!"

LTT

scaramanga69,

I think that is what Sam and Navitas will be looking to do, it's the only way now, they will have to do it themselves or it's not happening at all. A small development to kick off and then scale it up from there, it might not be the most efficient or cost effective route, costing more in the long run, but it would be a start and get them up and running and the cash coming in. Then who knows, with Navitas and RKH splitting 50/50, one they are pumping oil, they can give up some percentage to a bigger player to come in and work up a bigger plan, bring in cash to get a bigger FPSO and boost production.

But the main thing is to get this thing off the ground, even 35k barrels a day of production at $75 per barrel, with lift costs of $40 per barrel would bring in almost $0.5B a year. That leaves plenty of money for further exploration and add on development.

LTT

Interesting idea......... if Hurricane extend for 1 or 2 more years, RKH could get it after, at 35k per day it might just suit a smaller production footprint, plus Bluewater have no assets or projects in Argentina.

Of course it all depends on Navitas taking up the reins, or at least having a large none operated interest, but with a $900m development, $500m put up by Navitas, $200m vendor financing, $100m OM award, we'd only be looking at raising $100m fund raise of why not reserve based lending? Of course no-one would twice in the current sitution, but with Navitas on board and heading around with the cap, someone without interests in Argentina might come join the parts. Why not, oil and gas is going to be around for some time; coal is on its way out long before then.

LTT

"70,000 documents are RKH's bargaining chip with Navitas." you'd like to think so, but as we have heard PMO was the only realistic offer way back when, and now it seems Navitas are the only player interested, so they can dictate the deal or walk away. What other choices do we have? There is no long line of suitors around the block, majors are green washing themselves and returning money to share holders and under invesing in new production/exploration, so very few companies are looking to invest in a new oil province, with long lead times and field life of 20/30 years. I thought Harbour was going to take the bull by the horns, with their view of oil and gas being needed for decades to come, and they would not shy away from producing, but alas they have let SL go and here we are, scraping the bottom of the barrel again.

For what it's worth and I am not defending Sam and the board, I give them benefit of the doubt with regards to out progress so far, they have been been in the back foot since the deal with PMO, ok they have also been slow to cut costs and have ridden the gravy train without a doubt, but if covid hadn't come alone we would have had FID by now.

So now is the time for Sam and co. to step up to the plate, the ball is firmly in their court, (well hopefully firmly, the transfer of 70,000 documents seems to imply Harbour are walking away in a clean break), hopefully they are looking at every avenue, leaving no stone unturned to get this thing off the ground. Time will tell, but there are no excuses to fall back on now.

In all honesty I wouldn't mind if we only kept 25% of the whole acreage, if it means getting this off the ground, getting a start, then it would be worth it as once FID is signed, the value of the company will increase massivley and the nearer we get to the bit turning, never mind once production starts.

Roll on some news of OM and Harbours exit, then I will expect some progress.

LTT

But what a badly research article, it goes on to say Harbour are 40% operator and Navitas and RKH hold 30% each and that FIG have extended the license out till Nov 2022 with no commitments on Harbours part!

LTT

Cheers for the update hairydavey, (more than I got when I emailed Sam recently),

it does make sense though , hence why they allowed the submission at the 11th hour in the first place, they need to set a legal precedent that puts this to bed once and for all, if it goes the other way, and they rule in favour of Italy on this issue, then they are opening Pandoras box and they will never get it shut again. All the current cases that are on going would need to take the ruling into consideration, then they would need to set a back date to look at closed cases that could be reopened. It really would open a can of worms, so can't imagine them going down that route at all, but stranger things have happened!

I cannot understand what is happening with Harbours exit, why no word form the company. Are FIG involved, insisting they pay RKH's free carry so they can get their tax payment? Are Navitas in negotiation to take over Harbours 60% and become operator and take over terms of the free carry for RKH? It would make sense, Harbour might be glad to get shut and then Navitas would not need lengthy negations with the RKH board, plus FIG might be up for it I am sure. Particularly after Navitas raised funds and got FID on the Gulf project.

Or are Harbour just going to hand it all back? Can't see that myself as they would have done so by now wouldn't they? All very strange indeed.

Hopefully the arbitration will come through before Christmas, I still feel they dragged their feet a little so they wouldn't announce during COP26, but we shall see. We should have a better idea of where we are by the New Year as Harbour will be out of their 90days grace/handover period.

LTT

Just wondering, if we get a payout of say €100m went do the interest payments start? Do the start from the day the award is announced so any delay starts racking up interest or is it from when the arbitration started?

It’s just there will be a hefty interest payment awarded on top if it’s from the start of the arbitration!

I’m still expecting an announcement from next week onwards, once COP26 is out of the way and the discussions about gas emissions from Biden Butt spread by Camilla are over!

LTT

Pity it doesn't mean parachute as that would be more fitting something to save us from a fall! Just one more week from tomorrow then we should get some news from the week after, if they are leisurely dotting the i and crossing the T, so as not have to say anything until after COP26. If you believe that is the cause of the delay in a ruling after reading two, 5 pages submissions from both parties.

LTT

Just wondering if we will hear anything now before COP26 starts this weekend. My guess is no, they wouldn't want the media jumping on them talking about the little British oil company winning damages from the Eco friendly Italian's who were only thinking of the environmental impact of drilling for oil off their coast! "Now RKH will take it's winnings and plough it into an oil
development off the Falklands!!!!!".

The media will spin it this way and that to get traction during the COP26 event, they will be digging out all the news it can to embarrass the government, so can't see us adding fuel to the fire.

Hopefully after COP26 we should get the news we are waiting for and some sort of update with regards to what Harbour are doing. I was wondering if Harbour might be in discussions with Navitas to take on their 60% of the acreage, it would make some sense as they could become operator and possibly offer us the same carry on the smaller project. If they did that then we should have no issue with getting hold of some RBL as it would be a lot better deal than the 15% loan PMO/Harbour were offering us.

LTT

Ha ha, which year, Nice one! Although I cannot understand what the holdup is, 5 pages from each party putting their case and I think we can agree that the issue raised was thrown out in 2019, so how can they back track on things and go "Hhhhhm you have a point there Italy!", it would be crazy! But can't think what the hold up is, as giving a deadline for the submisson implies that they planned to look at it around that date, otherwise why give a specific deadline date.

But hey ho, crazier things have happened as far as RKH and the Falklands are concerned thats for sure.

LTT

By the end of the month? It's should be as back in July they said they were progressing well and expected to give a decision on the Award (disclaimer Award meaning the outcome) in July. So they must have pretty much decided until Italy asked in Septmeber for the European Court of Justice judgment related to inter-EU Energy Charter Treaty disputes, to be taken unto account.

So what will they do, can they go back no their decision due to a 5 page document outlining the EU treaty and a European Court of Justice judgment?, would they really allow that can of worms to be opened? Would they allow the opening of Pandora's box because they would be no way of shutting it again! They would have litigations from years ago which had rulings against the EU coming out of the woodwork!

No I just cannot see how the 5 pages would make any difference, the die as been cast.

LTT