Member Info for Moleinahole

Yes they have not altered their old price target of 48p. One suspects they will do that either on first gas and/or once they have a bit of clarity on the rest of the drilling campaign.
The numbers behind the 48p are in an earlier note and are indeed conservative particularly around the gas pricing. So I think 48p should be the baseline on first gas. Where it goes from there I think will depend on them getting the wagon back on the road at Southwark and the behaviour of the institutions and LOG admin and how the gas pricing moves. The travails in Ukraine mean we have a strategic asset of value. So good time to bring a field online for IOG and the UK.

Ok so the £126m is pre tax and interest. Assume it's the net to IOG after CalE 50%+? The pre tax is £83.4m.
The target price is stated as 48p in the note. But no info on how they got to the revenue and which fields were in or out and when or assumed gas price. So can't tell beyond we are under priced by 13p at moment to target.
That's a number I've been working too for a while so I'm assuming it's a cautious one. Either way it clears the loan out and we should have some nice allowances to minimise tax.

Depending on what's in that number in terms of fields and assumed gas price from when that's @£70m pa presumably net of calE share? The PE is nice and low (due to the low share price) but that seems on the low side on the earnings at £6m a month!
Do they post what the underlying assumptions were?

It's not really a surprise !
But hopefully this is the last time they push it back. I get that they may need to work up a bit at Bacton but for them to still be doing some constructing says it all really. The irritation it that we have gone from Q3 to Oct to Q4 then Maybe Dec to early Jan to Feb to effectively march. That's the issue it keeps going back (they can't have been anywhere near ready pre Feb whatever the RNS said) and the onshore bit has gone back 6 months. I think this RNS is clear it's Perenco doing the work. So that is likely where the issues have been.
Southwark we have clarity on the issue as scouring and pads as solution. But again the date is back a bit it's now 'march'. The 2022 program is now being delayed and timing of the other drill activity going back. They must now be into Q3 for anything beyond Southwark and risking missing 2022/23 winter if they don't get a move on.
It's the missed opportunity of the high gas prices that makes the delays so frustrating.

Sailor I'm more familiar with onshore than offshore so this scour and jack ups is a new area I've had the opportunity to learn about on the university of AIM!
Reading the HSE stuff off the O&g site it had a nice flow chart of this issue. Basically for us to be where we are the scour issue must have been not expected. Had survey shown it they should have prompted pre emptive action. Beyond the rock and mat options it went down the decision tree to relocate to new site.
I've speculated before if this has been aggravated by setting the rig and then having to take it back up to send back to port. It's not going to have helped lowering and lifting and in between leaving for a few weeks before doing it again. The ground conditions problems were obviously reported as an issue once they started and stopped drilling in Jan. What's equally odd is that Southwark platform has been installed for a while so why the sudden change? They were slow setting it up when it came back out and ROV malfunctions I'm guessing won't have helped losing more time before they got going. Are they being exceptionally cautious due to the previous issue with the rig?
Obviously weather and currents vary over time so as a natural process it will do what it does. Have the other delays pushed us into sub optimal times to be drilling at this location?
Just need that survey and plan of action as posted earlier they are inside the timeline of last RNS and no point asking company about this as it's too price sensitive. So it's a wait and yes I'm hoping it's a remediation solution. You would think they would try that first.

NPM just looks like a bit of a wobble. No real volume as ever behind the move. So hard to draw any conclusions.
News is due and that will set the direction. It's disappointing that at what should be an exciting time it's been diminished somewhat by the delay and overshadowed by the ongoing uncertainty around Southwark. A smoother transition to first gas and we should have been well north of here by now not nervously waiting.

Alligator first they are still inside times of last RNS. Just. This week is obviously key and the presence of the vessels at Blythe would tend to indicate they are up to something. That delay is costing us in terms of missed revenue. It's costly make no mistake missing the best gas prices for the season in a generation has been really poor and like others I'd really like to know the real reason why Bacton is effectively 6 months late given first gas was originally planned for Oct and they were confident of Dec and then early Jan. To be then effectively March from so close is difficult to explain.

Southwark is a bigger concern. It's key in the chain of development out to the next phase. It's delaying everything else now. I didn't like the bit in the last RNS that mentioned relocation in addition to remediation as an option. That is obviously the last resort but relocate to where one wonders. Alot now hangs on the new survey and whether they think scour protection will work or not. Southwark platform is installed and they were as has been discussed through the platform. So exactly what would relocation mean. I agree with Dunderhead this is not about communication this is about understanding why we have had the sequence of events that leaves us (not calE) paying for the over run. Insurance I very much doubt would cover these kind of eventualities. Maybe a bit of quid pro quo around Hans rig given the original failure but not seabed conditions. Again on Southwark painful as the delay is they are inside the previous RNS of 4 to 6 weeks.
The lost revenue from first gas delay would have gone along way to cover the over run which is why that is so irritating. First gas is coming but it been alot harder to finish than it should have been.
If it's going off beam then calE will no doubt have a close look at how the campaign has been managed so that lessons are really learned.

We have both LOG admin and Lombard (who have a habit of selling chunks).
LOG will always be the most likely as at some point if they want shares they need cash for conversions and to stay under 30%.
Doubt any of them know any more than us. But the delays will be testing the patience of the larger stakeholders including CalE.
Still think we should be on for first gas that would be a shocker and they should have cash. Southwark is less easy to call. Pipe or GG may have a better idea of why the seabed issues have taken so long. You would think it's either availability of a vessel to dump rock or the issue is more complex to resolve. With gales back end this week you would think we are marooned for a bit longer regardless.

Lemming the history of he the ownership profile built up is simple.
IOG used LOG for the pre FID funding. I presume you know the history of LOG and why it's in administration. Faced with a funding gap pre FID IOG decided to dillute existing small shareholders heavily by gifting shares to institutions at a very low share price post the disaster of LOG implosion. The final mix on the funding was also not what it could have been with 50% with CalE and the bond. Part of the funding was used to pay off some LOG debt but it has still left them holding a large position and overall it has been a very profitable investment for LOG. They are in no need to sell as the financial compensation scheme has pad out to the ' missold' investors!

So far the board have blown 2 large pots of money on Skipper drill pre FID and Harvey drill post FID. We are now back to the original fields for development with first gas on Elgood and Blythe imminent and waiting on Southwark timeline.
The cost of the over run if CalE were canny enough to cap costs on the farm in at £125m means having a rig sat idle is likely burning IOG money as the full field is now £300m with a recent declaration of an over run.
CalE were smart enough not to invest in the relinquished Harvey and Redwell - leaving it to IOG to run the risk of drilling. They have however partnered on Kelham for 2022.
Getting Bacton and the Thames pipeline have been good acquisitions but the recommissioning has taken alot longer than it should have. The high gas pricing has to a large degree masked the failures and the cost over run will be capitalised and offset once we get revenue.
Looking ahead they have to pay off the bond at some point and deal with LOG. The large institutional holdings are a threat to the company being a target in a takeover.
This is a pivotal week for IOG. We need that gas switched on and clarity on when we are back drillng at Southwark and the revised timings for 2022 as a result of this frustrating series of delays and cost over runs.

Dell on Bacton I would be peeved but not surprised not to hear by next Friday. On balance of probability I would say however more likely than not. First gas is most important but I am keen to hear about Southwark as I don't like seeing a rig that set out to drill it in October (already late) sat idle in mid Feb. It's turned into a long delay so the sooner they sort it out the better or if they can't at least send it off to drill Kelham! It's when I see Deltic romping away that the static IOG share price grates.
They won't RNS as I've explained before I think they have larger stakeholders and while they are not unresponsive to shareholders if you contact them they are not going to tell you anything price sensitive. As of today we remain inside the previous more detailed than ever guidance. 93% to what is anyone's guess. 97%? Either way one day closer......

Reread my comment when I asked GG on this one and the point I was trying to make it that IOG have been lucky to get the pipeline (and that it will last the 15 years we will need to extract what we have). Not that it's a problem was typing quickly on my pad. Mind we are burning into our 15 to 25 years with these delays.....

Know about the pigs as well but with IOG if something can go wrong it will so when they do get to the maintenance if I'm still invested I'll cross fingers. News that it's gone smoothly on back gas will be a relief as well. Also from previous oil investments well aware about the problems getting tools stuck cause. I live in Lancashire and I believe cuadrilla left a drill undergroud in the fields next to where I live that got stuck. It always amazes me how you can drill as deep as they do and not have problems.

What I was interested in was how long that checking process might take. You would do it in summer presumably in some sort of annual maintenance window. The access points or at least some of them must be subsea unless they really can run it from Bacton. The new connections Elgood to Blythe and when we get to it Southwark is new pipe so should be good.

Got to be next week for an update. Southwark will be interesting when we get that as that delay will be happier once they confirm their remediation plan.

Also interesting to see Deltic on the move today. There's and after Southwark our Kelham drills are significant exploration events for 2022 in SNS.

GG I was rereading some old RNS other day and did notice the pipeline has to have another check after 2 years use - I thought it said around the integrity due to wear. When you think it had been flooded after decomm IOG will do well to get the 15 years life they planned for it. Don't know how that survey would work once we are live with gas in the pipe.

Froggy they have plenty to sell that had 30% of equity and I think still have some unconverted on top but not got time too look now! Anything they sell at moment is at the margins. The only way for them to unload in full is either to sell back to company or to an institution or the real risk a predator accumulator.
Nearly there hopefully.

GG amen to that! It's been excruciating at times here and a real test of nerve particularly when the LOG mess unravelled the company finances throwing us into the institutions. That was accompanied by a direct attack by the prophets of doom. That series of events fundamentally changed the shareholder base of IOG leaving it in the main with institutions and LOG administrators. The free float and traded volume has never recovered and the board main stakeholder became the institutions, CalE and the LOG administrators. Combined with covid it's just been under the radar and not really marketed to PI holders.
The gas price news today will amplify the first gas news so let's hope we have no further delays and get the plant processing gas. No tax on producers so far! Risk v reward at times here has been tough and we have had alot of value siphoned off but it's still a good time to be in the gas business. So please IOG no more problems. Like others I added a few as a speculative buy this morning to add to my main pot which I hope finally after many years to see begin to appreciate in value. The posters on this board likely account for most of the trades on some days which says something.

Peak that was taking a risk trading when you did as had they actually progressed more on Bacton it could have landed with a different first gas date and locked you out as you well know on occasions IOG is difficult to buy any volume unless you are using CFD or spread bet to hold. I figured you must be trading more because of your fascination with the spread and share price!

Dell I tend to look at the impact of the delay and how it's been communicated and whilst I'm peeved it went back it is I think just one of those things. The cost over run equally I'm not pleased to see but at least they finally put it out and quantified what to me was highly likely given first gas has gone back by 5 months since the plans of a year ago accompanied by a catalogue of expensive issues offshore.
The unexplained bit for me is why it was not there for October the original date or shortly after that but I suspect we may never know that maybe it was simply a knock on from the delays caused by Elgood. With alot of the work on the Perenco side it's not 100% in the gift of IOG to deliver so alot of the irritation is in us trying to guess dates without the full facts. The last RNS has (I hope) drawn a line in the sand for Feb which they feel is achievable else they would not have been so specific. I read the Angus update today out of interest and there commissioning work has also slipped over this same period at their facility.

I really hope they get the offshore work going again quickly as the delays/issues there really do have to not occur again and we are due a bit of luck. It's really not good having a rig on hire and idle for 3 months. So we await the revised plans for that.

Bacton delays is losing revenue but Southwark is burning cash. We should have full viability of both as we exit Feb. In the meantime we have a realistic deadline which we can now look forward to. The one missing piece of news is the review of Elgood volumes. They will release that one suspects having flowed it a bit.

Peak where have you found a pot of gold! Not been trading this have you!

I agree it's been hidden and building up since the summer with the cost of delays at Elgood and Southwark and no doubt Bacton running up the bills.

First I assume this is the full project cost of which we are on the line for 50% but would need to back check whether CalE have any caps on their farmin costs. I think they already get an enhanced split of the early production so the numbers would need crunching.

They knew they were over when they raised in sept I think. But Southwark and further delays must have piled up the costs.
So the sept raise and the facility which was also previously mentioned in RNS were the clues.
This cost overrun may also explain in part why we have had such a muted share price in the face of strong pricing even allowing for the issues and delays at Bacton and Southwark.
I think they have tried as much as they could today to redraw the slate.

In terms of the cost it will go into the pot of sunk costs and be capitalised. If the govt come up with the gas tax then this may well simply end up being offset as capital allowances especially as this is a small field which is supposed to enjoy some favourable treatment.
The facility may or may not be used especially if they can actually hit Feb and get some cash flowing in which they need to do.

GG understand that I think what I'm getting at is if they have to move the location now the platform is in place do they have to drill through and second is moving the platform a possibility to a better position or are they going to have to work around what they have already done? If it's currents that seems less of an option than seabed itself.
I guess there area also other options but we will have to see what they come up with.

There you have it.
Delays cost money.
On Bacton limitations on staff on site, covid and perenco. And now at 93% complete which begs the question what was it in Dec! But it is what it is.

On Southwark we knew they had moved from marine track but that is a hefty delay with a rig on hire. That well was supposed to have started in Oct it be won't get going till probably march. 6 months late. Just out of interest why don't they drill and then install the platform?
And the left field news 20 to 25% cost over run. That was in my opinion the real reason for the raise in sept.
So a firmer but late date on first gas but completing phase 1 at Southwark needs more work. They have been very lucky with the higher gas prices which they have missed a significant opportunity so far by being late which will mean the cost over run can be absorbed not least if the govt try to tax gas as it will go into capital allowances.
Pleased they have issued an RNS but not that impressed with how it's been played out. They now really must deliver and stop the mistakes and issues on the offshore activities.

Peak I would like to think that is the case. My "but" however is around execution here. They seemed to be doing ok but I don't understand why Bacton was not ready for October let alone December the original revised date. it's never really been explained.
The short answer is that we should not be in reverse with imminent gas in the climate of potential European shortages and high prices. We are because the delays at Bacton and Southwark remain unresolved and unexplained. They don't need to RNS yet as the previous vague statements give then cover for a short while longer.
But that vagueness is why the price is not being supported and adrift and the price gradually eroded especially so in a soft risk off market.
They may have nothing yet to say. Personally I'm hoping for Bacton to come online iminently and if Southwark has gone back then say so. I think the fundamentals of revenue will trump a modest delay at Southwark. That feels almost priced in.
What is not priced in is anything fundamentally wrong with phase 1 and so far we have not been fed anything to suggest anything other than things taking longer than planned. Southwark remediation plan and what they intend to do with the rig if the delay carries on will either be tacked on end of first gas RNS in same way Harvey was lost in the RNS in Dec or they will continue to just not report it like Bacton at moment and leave us guessing.
Could not be a better week to switch on and I really hope the drilling fleet having gravitated to Blythe/Elgood supports first gas activities or is just a convenient place to lay up and not for yet another left field problem.