RE: Funding, Bond and Production9 Dec 2020 13:03
Slift,
It's nice to see a grounded comment here, lately all people seem to be taking notice of is the POO and the fact that there's a new BOD's (which are positive developments for HUR) albeit not the whole story.
I guess it's to be expected whenever a company starts hitting the risers board, that all we see are people trying to ramp the living the daylights out of it.
For disclosure, for all of the people who will jump on this saying I'm a de-ramper or miffed I'm not invested here anymore... the funds I took out of here at break even have done very well elsewhere and the reason I'm still keeping an eye on HUR is that it COULD still be a play for the future, provided the new BOD can demonstrate that there a clear path to success. Currently, all we have is radio silence and broadly the same headwinds that were facing the company at 2.5p as they are today at 5p.
In terms of the hasiba post:
"Hedge in place to protect Hu of oil price price fluctuations"
A hedge @ $35 made sense at the time, granted, but is irrelevant now since the POO is unlikely to fall to that level, and even if it did, the economic circumstances in play for a $35 POO environment would put HUR at significant risk as a going concern.
"The bonds as you mentioned is not due foe the next 18 months"
This is an irrelevant comment, since slift also pointed this out in his post. A response to this would be your predictions as to how exactly you see HUR being in a position to repay the bonds. Even within a $60 POO environment next year, HUR still will not have enough unrestricted cash to settle the bonds, once the water injectors have been funded.
"Remedies are taking place to sustain increasing production"
This is not true. Please point me to the RNS that states the water injectors have been funded and are being implemented.
The truth is that the BOD's have discussed what their options are on the last investor conference call, which included using water injectors. Since then we've had no communication from the BOD's to confirm or deny that ANY further measures have been signed-off, funded or implemented.
"Exploring further of their valuable assets in collaboration with partnerships are in the planning"
This is completely fictional. The ONLY update from the BOD's has been that they will "engage with all key stakeholders regarding its forward work programme" and that talks with Spirit will be included within these discussions. However, to suggest that there has been some form of material new collaboration or farm-in partner is completely false.
As it happens, my view is that HUR could indeed be a multi-bagger over the next 2-3 years, but how many other companies could we say that for on the FTSE never mind on AIM. As it stands today, HUR could just as easily falter if it cannot agree to refinance it's bonds. The likes of TLW could at least dispose of assets to raise cash. HUR doesn't have this luxury.
Nate
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