Member Info for pauldrayton

Hmmm, do they mean FID or project sanction in Q3 2019? I'm hoping/assuming Project Sanction which is a slight slip from "mid 2019" but not the end of the world.

Puts more pressure on OPEC to cut clearly and significantly. They will see that any ambiguity won't be good enough.

Fingers crossed.

Zama 2 spudded 29th November.

Zama 2 spudded 29th November. It will be "drilled to the north of the Zama discovery well to confirm the oil water contact. The well will be deepened to test the Marte prospect and also side tracked, with the side track being flow tested".

Crude inventories +8million. Not ideal for tomorrow!

I don't think Saudi and UAE can afford another oil price slump. Neither will Iraq want one.

I think they will be cutting already but need to reassure the market that they won't let inventories grow again.

It is relentless indeed. Can we expect more murmerings from OPEC?

Their meeting isn't for 3 weeks and they need to put a floor under it before then!

Guessing it's going to be a crude build given today's price action.

OPEC need to come out with some stronger wording soon I think.

They can't make a final investment decision without the money to invest.

I thought it was the Ocean GreatWhite which has been earmarked.

Maybe a bit over-specced though?

They are currently converting LOIs into LOAs.

FID will be Jan/Feb.

"The Company confirms that, contrary to rumours in the market, it is not planning an equity financing"

Fecm, Tony Durrant said 3-6 months from August. That's November-February.

I'm expecting finance resolution & FID in early Q1 2019.

From what I'm hearing recent discussions have been positive.

Tony Durrant mentioned in August that it could take up to 6 months though and he's probably right. PMO want FID asap like RKH, but these things take time and the timing to get them signed off is out of PMO & RKH's control. So my bet is FID in January or February, but we'll see.

SecretBlueprint, that is exactly why UKEF is involved. It is also why PMO needed to get the supply chain set up with LOIs etc - to reveal how UK companies are involved in the project and the associated value to the UK. It is also in the UK's interests to see the Falkland Islands economy doing well.

Seller slowed or finished?

True value must be well over £1 even without funding so this drop has created a huge opportunity.

Much, I was told by somebody inside PMO that they intended to farm out a % once funding was secured, but the increase in oil prices meant they were getting approached already. Whilst discussions were only in their early stages, these approaches were being taken seriously.

I don't think any farmout negotiations will hold up FID or sanction, but I believe it's a genuine option.

This was about 2 months ago so things can change. I guess we will have to wait and see - the next 6-9 months will reveal all.

PMO want their balance sheet to look stronger before sanctioning Sea Lion. This comes from two sources:

1. Paying down debt - oil at $80+ will be helping massively with this.
2. Zama appraisal.

Internally, FID will have already been made and unless there is a huge crash in oil prices in the near term, then Sea Lion will be approved.

So as far as RKH shareholders are concerned, let's hope oil stays above $70 for the next 6 months, and the Zama appraisals are successful. Whether they decide to monetise all or part of Zama after appraisal is yet to be seen but success in Mexico will strengthen their balance sheet regardless.

PMO are considering farming out a % of their Sea Lion equity, and news on that and/or development funding could come at any time in the meantime.

It has always been PMO's internal strategy to sanction Sea Lion once they saw consistent Brent prices above $68/bbl.

I think the interest from finance houses and potential farminees will be growing by the day at the moment.

With oil prices as they are, I wouldn't rule out financing news and/or a PMO farmout coming sooner rather than later.