Member Info for OilViking1

Hunbah

I disagree.

Stevo12 is long-term in his calculations for Serica and Harbour but very short-term in Enquest. He keeps mentioning FCF 2025 but for the other companies he can mention FCF at least 5 years ahead. Why does he do that? Can't he do the same with Enquest. Assume a PE ratio of around 6 and 70 USD per barrel in Brent.

He can do the same thing for all the companies but he doesn't.

Serica and Harbour can make the world's worst and most expensive purchase and he is still positive. Enquest can make the world's best purchase and he is negative.

Don't forget Harbour's very large net debt of about 7 billion USD after today's deal.

Stevo12

I'm waiting for your calculation that shows that Harbour makes FCF of around 500 million USD in the UK alone. When they pay tax at 78%.

I'm sticking with Brent at around 55 usd per barrel for breakeven for Enquest next year. Dont forget that the Company has hedged around 3.3 million barrels at around 69 usd per barrel and that Vietnam production is sold at around 10% above Brent. And you say 70 usd per barrel is breakeven.

We dont have any bet on net debt. Our numbers are too close. But let's bet on breakeven Brent price for next year. I bet 200 GBP to charity

But you made a share price forecast.

How will Harbour make 500m usd in UK if they pay 78% in taxes? Please could you provide a calculation?

Harbour will have a production approx 150k barrels per day. Opex approx 19 usd per barrel. Decom maybe 80m usd?. 78% tax and capex approx 700m usd.

I agree, Enq will be around breakeven FCF in 2025 for Brent approx 65usd but next year the production in SEA will grow by approx 150% and lease cost will go down to approx 40m usd and no extra EPL for Bressay sale. Next year breakeven approx 55 usd per barrel.

Stevo12

You know why Harbour is paying 3,2b for 32k barrels per day? Or paying 13b for WD?

It's because of a desperate company that pays 78% on its UK production. Harbour probably needs 90usd per barrel of Brent oil to break even on its UK production. They have to sell some of the production in UK.

Stevo12 you are a funny boy. You have been wrong so many times. How is your great analysis going, that Harbour would reach 300-350 GBX within a few months? Or that no one would lend money to Enquest.

You know why Harbour is paying 3,2b for 32k barrels per day???? Or paying 13b for WD????

It's because of a desperate company that pays 78% on its UK production. Harbour probably needs 90usd per barrel of Brent oil to break even on its UK production. They have to sell some of that production because all the money goes to Ed Milliband.

Enquest has a breakeven of around 50-55 USD per barrel. At a Brent price of around 70 USD, Enquest will generate around 170 million USD in FCF per year. This is really good considering the small net debt the company has.

Amjad will wait until the right deal comes along. If nothing comes along, the company will do very well.

9. Dividend and/or share buyback approx 15-30m usd depending on the oil price.

10. All points above 1-9 will not happen because I think Enquest will be consolidated with 1-2 companies in the UK.

Thank you for your predictions Stevo12.

I think you are too negative when it comes to Enquest.

My predictions for 2026 are as follows:

1. OPEX approx 23 usd per barrel

2. CAPEX approx 220m usd

3. ABEX approx 60m usd

4. Lease costs approx 40m usd. Lease cost reduced by approx 70% compared to previous years

5. Net Interest costs approx 65m usd

6. Production approx 50-55k barrels per day. NS sea flat. SEA up. Exkl BP:s share of Magnus approx 47k barrels per day net to Enquest.

7. No amend to EPL in 2026. Talking to politicians is like talking to deaf ears.

8. Average Brent Price in 2026 approx 68 usd

My projection is 400m usd in net debt.

Yours is 425m usd.

£50 to charity

Stevo12

Yes I am absolutely sure that FCF would have been around 120 million USD if the company had not had the one-time costs along with the high cost for Kraken FPSO lease.

I can bet £50 on the net debt. I'm saying about 390-400 million USD by the end of 2025. And you're saying about 440-450 million USD in net debt by the end of 2025? Am I understanding you correctly? To charity

Forgot to mention that the company is also paying about 20-30 million USD extra for Kraken FPSO lease cost compared to 2026 and beyond.

Without this, FCF would have been about 120 million before all one-time costs, which means that net debt would have decreased by several million USD.

I like Stevo12 but he has been constantly wrong. For example, there was a lot of talk that Enquest would have problems with refinancing the loans, which turned out to be completely wrong. Enquest will be allowed to borrow 1.6 billion USD, more than double what the company needs.

Regarding FCF and Net Debt.

FCF this year will end up at about 90 million USD but the company has some one-off costs in 2025, such as paying extra tax on the sale of the Bressay stake of about 55 million USD, the purchase of the Vietnam assets of about 22 million USD and dividends of about 15 million USD. A total of about 92 million USD in one-off costs.

This means that the company's net debt will increase very little by the end of 2025. But then you should not forget that the company has, thanks to these investments, increased the company's production by about 7-12 thousand barrels per day.

What is important is the free cash flow in 2026 and beyond.

The tax losses from Waldorf can only be used after 5 years. Harbour still has 150 thousand barrels per day of production in UK which they have to pay 78% tax. FCF about zero from this production. Better to sell parts of this production for cash and future production that comes after 2030. Or consolidate.

Feels like M&A is very difficult to get through for both Serica and Enquest. Together the companies would have been much stronger for growth. Strategic mistake

So please Stevo12 can you do the same calculation for Serica with 30k in production for 2025. Also include the purchase of Prax and BP's fields.

WHAT IS THE NET DEBT FOR SERICA AT THE BEGINNING OF 2026????

FCF this year will be approximately 60 million USD. Average brent price approx 70 USD per barrel.

But since the company will pay about 50 million extra in EPL for the Bressay sale, about 20 million for the purchase of the Vietnam field and about 15 million USD in dividends, the company will make about 20-30 million in losses this year. But as I said, this is mainly due to growth and dividends.

Net debt will therefore increase this year. But so will Serica. Serica will increase net debt by about 250 million USD. Also due to growth. Companies have to grow and for that they need money.

Stevo wrote that Harbour shares would go over 300 pence. Instead they went under 150 pence.

Stevo has always been wrong. Unfortunately he has brought along someone called Sekforde. Both of them make up numbers. A few months ago Stevo wrote that Harbour shares would go over 200 pence. Instead they went under 150 pence. He is almost always wrong. But unfortunately he has succeeded in spreading fear here. Don't listen to him.

Sekforde, believe me, you are too optimistic about Serica and oil prices of about 60 USD per barrel. Serica will barely be able to pay dividends if oil prices are about 60 USD per barrel and you are talking about no net debt until the end of 2026. It was the same when you were invested in Enquest, you were too optimistic.

Serica and Enquest are almost identical companies.

Let's see what happens on November 26th and then we can write more. But right now there is a risk that you will influence people to make the wrong decision.

Serica no debt??????

Serica will buy from BP about 33 million 2P reserves for about 232 million USD.

After the deal, Serica will have a net debt of about 350 million USD.

Let's do a comparison of the companies.

Serica:

About 155 million barrels of 2P reserves and about 350 million USD in net debt.

Enquest:

About 175 million barrels of 2P reserves and about 380 million USD in net debt.

If Enquest shares have no real intrinsic value then it's the same with Serica's shares because the companies are very similar.