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If the CPR was already factored into the SP ..... guess all those institutional investors who ploughed £millions£ into CHAR at 18p/s thought the same and just wanted to do it for the kicks.

PBJjr > PBLJr ....

See our three ATHS are only minutes away from commencing operation with PBJjr

https://www.marinetraffic.com/en/ais/home/centerx:-4.073/centery:57.684/zoom:14

Sasa, "Bear mkts are invariably indiscriminate", sure are !

NBP sat at ~$114 boe, Brent ~$111 with NBP futures for winter 2022, ~$268 boe. OK futures are just that, but it does signal prices to be much higher than current $114boe imo. SQZ was a mega cash machine before WFT now it's just a great cash machine. Mr Market will see what's right in front of them .... eventually !!!

aimo & dyor

Mommur,

Perplexed, for sure, esp when you have the likes of Carnival that recently took on $billions$ in debt and Aston Martin that are looking for ~40% equity injection, both of whom are well up today and both of whom have been said their equity is worth $0.

Against SQZ who, due to purely the WFT, which in real terms will make not a great difference given pre-announcement profit are safe and those going forward are to off-set with 91% allowance. A company with ZERO DEBT, massive cash hoard and revenue of ~£10m pre tax per week (post opex/hedging/admin/divi.) at $109 Brent / 160p NBP on avg guided production.

I keep on about SQZ being a target, if they don't qualify then the industry as far as NS production, is over !

aimo & dyor

Upomega .... Thanks.

ACW stated yesterday about looking abroad if WFT is not conducive to the industry .... for me, I think a lot more NS producers should not only talk the talk but walk the walk .... SQZ should look towards at the very least farming into an overseas project, maybe something like CHAR or alike.

UK Gov WFT has tried to buy votes but come mid-winter Rishi will need to buy the same votes all over again, hand over another £650 to pi&& up the wall ...... how will he do it then. Probably, as he should of this time around go after the commod traders and counterparties not the producers ( who are keeping UK PLC going ) that are making even more money than the likes of SQZ ... they have zero CapEx and expenditures basically massive bonuses paid to the traders ... who do you think benefits the most from hedging, certainly not producers atm. Although trying to explain hedging, counterparties, commod trading etc to Joe Public would never work on a cerebral level, best stick to BP, Shell making $billion$ in profit, which as we all know was from Worldwide operation not just UK.

aimo & dyor

We are producing on a monthly basis almost the largest net volume for in excess of 18 months (over 5% of the UK’s
gas production). Sat at ~55% Cash (~£420m) to MCap (~£770m) with zero debt. NBP and Brent set to stay very much elevated for foreseeable, progressive dividend of ~5% pa just announced. Major drill of NE to commence imminently, looking to double reserves by adding +60mmboe with follow-on upside too. Cost of drill and well interventions covered almost entirely by HMRC. Oh, then we have the +66% uplift in attributable revenue (at zero cost / CapEx to SQZ btw) that commenced only 6 months ago at which time our SP sat at ~250p (250 + 66% = ~415p) that has coincided with massive rise in commod prices, yet Mr Market only looks at what it wants.

SQZ even with WFT should be easily trading above 300p and I would argue closer to our ATH ~423p, imo that would still not reflect SQZ's fair valuation.

aimo & dyor

No, would have if it wasn't for an important health appointment ... :-(

As you say chinch, be good to find out more on the Q&A.

Flexmw,

Well other than max pay for non-exec's resolution was passed today that increase the amount from £400k to £600k .... Now I wonder why that that was !!!

aimo & dyor

See ACW statement was all but saying .... 'Rishi, you idiot'

I like the quote "We intend to continue to look for new opportunities in the UK but, if the Levy proves to be anything but short term we shall be looking overseas in the longer term..."

https://www.serica-energy.com/downloads/presentations/Chairmans-2022-AGM-statement.pdf

https://www.serica-energy.com/downloads/reports/Notice-of-AGM-2022.pdf
https://www.serica-energy.com/downloads/presentations/Chairmans-2022-AGM-statement.pdf
https://www.serica-energy.com/downloads/presentations/2022-AGM.pdf
https://www.sharesmagazine.co.uk/news/market/LSE20220630161827_4424268/result-of-agm

"Resolutions 1 to 11 will be proposed as ordinary resolutions.."

"ORDINARY RESOLUTIONS
1. to receive the consolidated financial statements and the reports of the Board of Directors and of the auditors
for the year ended 31 December 2021....."

Not sure why the vote for resolution No1 was as such !! Could it be an error on someones part I wonder, voting or otherwise, or either I'm reading it wrong.

aimo & dyor

"Well (M1) is now back in production and rates have increased by ~1,500 boe/d as a direct result of these operations"...

That's around ~£1.1m per week .... additional revenue.

If M4 comes in the same, we could be looking at >£2m extra per week, just on these two well interventions.... as i said, why have we not done this before ?

If we add circa ~3kboepd just with these 2 interventions, add in the remaining 3 well, would that not mean current 2022 FY guidance that currently remains unchanged at 26,000 – 30,000 boe/d net atm will need to change, for the better !

aimo & dyor

• Progressing multiple Bruce hub investment opportunities
• Acquisitions of new assets requiring investment will be considered

Not sure what the first one references .... maybe setting up an AirBnB facility on Bruce Platform !

The second appears to point towards a farm-in / acquisitions that is currently only at the proven reserves stage ... ie, no infrastructure and possibly drilling of production wells. Quite a departure from what I thought we were looking at imo. Not my preferred route tbh as payback is usually several years down the road, an instant accretive would be a better option esp if we have NE production to finance also.

aimo & dyor

"Well (M1) is now back in production and rates have increased by ~1,500 boe/d as a direct result of these operations"

OMG, why the 'ell has it taken so long to do this !!!!

"A similar work programme has commenced on a second well (Bruce M4)
Results from first two (M1 /M4) wells will be used to identify further candidate wells for future intervention
campaigns (both subsea and from the platform) "

https://www.serica-energy.com/downloads/presentations/2022-AGM.pdf

Only need to wait 6 hours for ACW & Fleggs plan to takeover the world ...... hahahah ( evil laugh )

See BlackRock let some go just before Ex-divi .... possibly reflects on our poor dividend yield given amount of cash we hold imo

https://www.lse.co.uk/rns/SQZ/tr-1-notification-of-major-holdings-3m9cp2bemnlilvd.html

TS / Upomega, thanks .... just don't take what I say as investment advice.

Just post what I see as options, which are not always +ve. However BP's Andrew has intrigued me since SQZ were linked to the asset back in early 2021.

BP (Looney) have their on-going green agenda part of which was to sell off £billions£ in aging and none material O&G assets. Late 2021 BP were in talks to acquire Nippons holding of the Andrew Platform / assets taking BP's control to ~94% which would have implied Andrew is no longer up for sale however but also flys in the face of Looney's green agenda ..... The deal with Nippon was supposed to be concluded during Q2 2022, so far to-date nothing more has surfaced on that story either. So maybe, not only are SQZ looking to gain BP's Andrew but also Nippons too. Mitch was recently quoted as saying the next deal, he would want to double the size of the company, what better way. Remember when SQZ acquired BKR, ACW et al had to effectively manage multiple deals from multiple parties to conclude at the same time, BP,Total E&P, BHP and Marubeni. So we have been there and got the 'T' shirt. Andrew is an aging asset with relative short CoP .... once again one of the criteria always mentioned by Mitch, 'value over volume'. SQZ could easily extend Andrew's CoP adding value imo, esp if we are able to take advantage of Rishi's tax allowance in the next 42 months. It would also make us owner-operator something else SQZ are keen on too.

Either way, if not Andrew then a deal, of any kind is way, way overdue.

aimo & dyor

3DF,

"Not sure why they are holding so much cash...."

Neither does the market, which is part of the problem, or maybe the market does !

For many months coverage on sales of BP's Andrew has been none-existent !

Back in early 2020 BP agreed terms to sell its interests in the Andrew area in the central UK North Sea and its non-operating interest in the Shearwater field for a then fee of ~£475m.

"BP operates the Andrew assets – comprising the Andrew platform, the Andrew (62.75%), Arundel (100%), Cyrus (100%), Farragon (50%) and Kinnoull (77.06%) fields and associated subsea infrastructure. It holds a 27.5% stake in the Shell-operated Shearwater field"

https://www.bp.com/en/global/corporate/news-and-insights/press-releases/bp-agrees-terms-to-sell-north-sea-interests-in-andrew-area-and-shearwater-to-premier-oil.html

Then Jan last year, 2021, sold its holding in Shearwater to Tailwind after the original sale fell through, which would have reduced the asking price of the remaining asset base significantly, probably to sub £400m.

In March 2021 BP asked for final bids for these remaining NS Andrew assets ...... bidders at the time were said to be Tailwind Energy, Serica Energy, Ithaca Energy, EnQuest and Waldorf Production. Since then nothing, news blackout, probably due to NDA's. We then had the surprise and rapid exit of BP's ~5% holding in Serica, co-incidence !!!

So back to your question, "Not sure why they are holding so much cash.." in one word Andrew, just saying, I have no insider knowledge just my spider senses are on alert .... Getting Andrew with commercial discovery at NE would significantly alter Serica's profile. Should a BKR style deal materialise all the better as it would be circa 2026 when the levy ends on 31/12/2025 after which SQZ would receive 100% attributable revenue.

Absolute game-changer to say the least, if ACW et al pull off Andrew it would be one 'ell of a story to tell you grandchildren.

Fingers crossed, as I guess Rishi's reckless levy added another layer of complexity to any deal that may of been in the final stages of signatories, which in turn, delayed things further.... but for how long ?

aimo & dyor

sasa,

Well put ... although I don't particularly want to hang my hat on N Eigg being successful which is exactly where we are atm. Yes wait by all means, but then what if we fail to find a commercial discovery, rightly or wrongly, our SP will be initially hammered, not to mention Mr Market will also see through SQZ's emperors clothes ! We will have nothing left in the cupboard, it will be 'bare', other than our cash accumulating, which, btw, the market will view as mainly Rishi's. These are difficult times for SQZ just as well we have elevated commod prices atm, ~£420m cash with zero debt....

PS Volume has fallen off a cliff recently, very weird.

atb
aimo & dyor

Comrieman,

Share buyback are generally an admittance of BoD failures in my book for any company in SQZ position even more so with Rishi's Levy.

Companies are not valued against 'current' O&G price as that would be ridiculous but on going NS rates for boe reserves (which has remained fairly flat over the years ) plus usual CoH, debt etc etc, going NS rate would be around ~£15boe to buy / farm-in to a producing asset.
For the very reason you state "Value will be through success with the drillbit with the WT in place.." is the reason why BB are not the way forward unless of course our SP sinks to silly price, imo that's well below 200p as it stands. SQZ need to make use of the WT allowance in full or return cash to shareholder, not artificially inflate SQZ performance figures with BB.

If, as you say CoH will be in the region of 60-70% net cash against MCap at YE, then why not keep it at current levels ie ~50% cash and return difference ie ~20% to shareholders, that would be around 30p/s dividend. I would add that a 'value' instantly accretive acquisition would be much preferred.

Yes, cash is king but there's a point when it also becomes a drag on the SP and the market sees it as a failure of the company to deploy it in an accretive manner ... I think we are already at that point so you could argue as I do, dividend payment of 9p/s for 2022 is woefully low.
atb

aimo & dyor