Member Info for Pelle

Thanks HMH and Modestus,
I like Enquest profile better, maximun FCF here and now.
And I think AB will operate very good in this market with assets for sale at low prices.
He already proved himself with Magnus and GE and thats under debt preasure.
Also a lot potential in the already existing assets.

If enquest double or tripple in value, maybe I would consider move some parts into other oil shares or sectors.

“Opec now has control over balancing the price when shale oil producers in the US prioritize returns to shareholders and reduced debt over increased production. In addition, investments in the oil sector remain small, which dampens new assets. And on top of all that, recovery after the pandemic is not complete. We will see high oil prices for a long time ", he says to Di in connection with Wednesday's report.

Which oil price is sustainable in the long run?
“Opec wants stability and high prices, but not too high. We should therefore see prices at these levels or slightly higher in the future ", says Nick Walker.

Hello HMH,
Thanks for your input.
1b FCF is a lot, if Enq now making 700-800m to keep 60k in longer run maybe we need allocate another 200m capex.
Still MEG will be about double price, guess that’s only the Canada/Europe diff.
Any ideas about this difference still between US and Europe valuations?

Assuming now Enq hedge up 1-2 years 50% + maybe you end up with a probability that Enq will make 1-1,5b over 2 years FCF to 75% likelihood something.
Will market value this in with some discount?

HM,
Ok, let’s see if HMH answers.
I also don’t understand why Enquest have such big discounts towards others. Not only US and Canada.

HM,
You on Avanza? I saw HMH talk about MEG.
Why not swing the question back, why HMH choose to buy some MEG instead of increase at Enq?

I don’t think it’s about optimist or pessimist.
A pessimist would say it’s 40 now let’s lock this at least we survive.

Probably now is not the best time hedging, because I think prices go higher. Not 100% sure…
And it’s not been so during last 1 year up cycle.
But I don’t care, secure the profits and debt reduction at very healthy levels.
Worst thing that could happen is that price go higher, but we get it anyway later on with continue hedging.

I am very happy the banks now put requirements to hedge. And extremely happy we have quite high price now when this need to be done.

Yes and Kraken only been approx half of Enq production. Autumn 2018 it was possible hedge 12 months flat out at 80. Completely missed it.
If they really nailed the hedging we could been close to debt free now.

Hope they secure it now, can’t stand another collapse

And what was the actual average you compare with?

Chilting, that would be an excellent task for GKB.
He have too little to do. lol

Sipp, there is no way he managed get average price so low when he started buying at 100p plus.
Not sure what deal was when company was founded.
Think Squif assumptions 50p is correct

Hello mrc,
I know it was different time then and don’t blame him.
Personally I would not gamble that much with borrowed money when something expensive.
I remember when he got first sense of prices going down he hedged very much and if I remember correctly they made 500m profit on that hedge.
Remember production was low back then so the hedge was huge. It helped.

All in all I am impressed by the way he keep on fighting to clean up the mess.

Reduce debt bit more and going forward we might have an excellent market for AB to operate in.
Buying fields with 10-20k at the price of 2xFCF backed with a 60k production is low risk.

And I hope he don’t forget some Swedish shareholders wants quarterly dividend also. Lol

Good morning Squif,

Sometimes it’s better sit on your ass for years waiting for the investment opportunity when things are cheap.
Both for AB and in general for us also.

About 80 average, think we need make an volume weighted average.

I think the biggest mistakes last couple of years is reduce hedging when prices where very profitable and we consider high. A couple hundred millions lost there.

Now it’s third time we have good prices and very profitable. Good the banks demanded hedging.

Magnus and GE have been and will be excellent investments.

Let’s hope this finally comes good now.
Development made us also sit with an unhealthy amount of shares:-)

Squif, I wonder what SP we would have if today was 2010? With 700-800m FCF projection.

As Mrc says after borrowing 2b for investment in top the cycle. And with years of low oil prices following and on top of that Covid.
Without making these capital raises we would be bankruptcy long ago.

Now it really looks like we can come out of debt fairly fast and 100-200p could be possible in 5 years.
I have two fears government trying to punish oil, or that AB trying to take a bigger piece of this somehow.

But who know maybe in 5-10 years the lack of oil in world is so severe that it’s the hottest sector and highest valuations.

2-3 year ago I made calculations of EV and it was around 2,5b the 1b we reduced debt have been eaten up by going to EV 1,5b.
At the same time now we have the highest FCF projection I ever saw.

Will be very interesting this over next 6–12 months.

Tigar, you say:
Unfair but costs make it best for company and all shareholders had plenty of warning and chance to buy shares well below 19p after GE deal was announced.

Did you know that it would be 19p and Swedish shareholder could not participate when the deal was announced?

Tiger
Can you explain this?

All new shares were subscribed for in the placing, the OO shares will be clawed back from the placed share's

Didn’t AB participate in the firm placing?

BananaJoe,
If you like email me at per_L57@msn.com
We can exchange phone number

But how does it work?
We had 1700m shares before and divide with 89 times 5 equal 95m.

But not all 1700m shares was allowed to participate.
There 450m shares in Sweden for example

Hello Therapist
Think this version is slightly different.
Difficult for me read compare and understand.
Can we connect second part with the increased production estimate from 2019 capital market day ?

https://themalaysianreserve.com/2021/07/22/sapura-energy-bags-rm1-2b-deals/

Hello Tiger,
Fully agree, my more advanced file says 777m with 72 oil.
Just wanted make it simple for L3 :-)
I won’t be surprised if he starts saying oil prices are wrong also. Lol