Member Info for mrc_mrc_mrc_mrd

Lol, only if the SP goes down!

If you take up the open offer then dilution is only about 5%. The $50 million being raised by the company is being used to add value, so IMHO the SP should rise significantly.

Do your own research of course!

It’s a sea of red on the recent trades

Very few buyers coming in.

Probably best to wait and see where it lands?

I agree we are not treading water - the SP is trending up accordingly.

A bit of a slo-mo re-rate

I think we are probably still too restricted until we get the debt right down and refinance what is left of the bonds. It would be great if they can give us a bit more on the future after GE completes. Either way I am happy. The FCF will start to be reflected in the SP.

KO - this is what the company has announced. Anything new will be a change in strategy and will be announced as soon as it is known!

They have said they are looking at deals and near field developments. They have said they are deleveraging.

It sounds like you want to be invested in a different company- BP maybe? They are paying a dividend and investing heavily in green projects.

They are never going to give you a percentage breakdown of FCF.

KO - the plan is debt repayment.

Analysts have been demanding it for some time.

If you want green you will be disappointed. This is a pure oil play. Best case we will be greening up our existing assets (which may include participation in a large scale green hydrogen operation at SVT!)

I actually think the market would punish any move away from focusing on debt, or towards renewables.

Price just ticked down

There seem to be a lot of blocks getting sold off. IMHO we have a large seller offloading smaller chunks. Terrible liquidity here so it might take some time?

Pelle,

If a good deal is there and finance is available then ENQ would grow to 80k IMHO. I think that is highly unlikely but it would only take one really great deal.

We know that priority is debt reduction and from the GE deal we know that banks are supportive of acquisitions to help bring debt down (with conditions attached).

Once debt is repaid then it becomes Enquests choice whether they prioritise growth or shareholder returns. I think this is what you would like to know? I think the decision will depend on the opportunities available at that time. If there are good assets going cheap, and culture of MER at the OGA is still in place then I would prefer growth - the basin will be declining but that is ENQs speciality.

KO, Pelle,

I am confused about what you want ENQ to tell you?

This is the oil industry which has NEVER been predictable. It will be even less so during the energy transition.

All ENQ can do is keep developing and operating their assets safely and efficiently.

Dividends are not an option at the moment, but the re-rate is ongoing. Check out our performance relative to TLW. Returns here will be through SP appreciation.

Pelle, we are speculating because we are dealing with unknowns. Unknown to me, unknown to you, unknown to Enquest. The most they could do is state a scenario, I.e. IF realised oil price averages $80 for the next 2 years, AND IF bonds are refinanced, AND IF all finance removes restrictions on paying dividends, THEN ENQ will prioritise dividends over growth. IMHO.

I think your FCF numbers probably don’t allow much reinvestment. For me I would like to see 60k barrels maintained going forward. I would also not be that comfortable with net debt of 1bn and declining production.

Pelle - what they want and what others are willing to lend without restrictions on dividends are different things.

Unless longer term sentiment changes lenders are going to be nervous. Particularly where we are just refinancing old debt. It would be different if financing a new project I think.

I am not expecting any announcement on dividend for at least 2 years.

I also think the 500/500 was from pre-COVID? Remember we have lower production / reserves now to secure against, and banks will also have changed their criteria.

KO - it all depends on finance and oil prices. Enquest are not keeping anything from you. They don’t have a crystal ball.

Priority for the next year is going to be debt repayment / bond refinance and maintaining production. Probably 2 years of that at current POO. We will see near field drilling campaigns or additional bolt on acquisitions.

After that it’s a choice of returning cash to shareholders, reinvesting in BBK / acquisitions, or a mixture of the two.

I don’t think dividends will be mentioned until the bonds are refinanced and overall debt is a lot lower.

Price action this morning reinforces for me that this is ready to re-rate once Brent uncertainty is removed.

Seems September could be a Big Crunch. Maybe we get some price reaction if the shale numbers start dropping. I have to agree with this article...can’t see how they can lose as many rigs as they have and hold production steady all year.

http://www.artberman.com/2021/01/15/duc2k-drilled-uncompleted-wells-wont-save-u-s-oil-production/

Any views on the big drops in DUC wells?

Is US shale production going to drop when they start running out of old wells to bring on? Presumably drill rigs are going to have to increase substantially if they are using up well stock to maintain 11mmbpd?

Starting to look tasty

L3 could have this right with a push to 26p this week

Oh wow it worked - the next sell went through at 0.90p

That is the lowest we have had for a while.

Must be about to tick down? Is that how it works Chris?

Lol, I take my cues from Ammu TBF - when he sells I buy!!

Has worked for me so far

Also who is losing their heads?

Seems the ruling sentiment around POO is fear at the moment...

IMHO the fear is unjustified.