Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
ValueS - to clarify, by "no" I meant no the R Factor would not be higher than 1.18. The R Factor is not rising because we haven't been paid the massive arrears but that is separate from working out what costs can be invoiced. Model each separately. And don't double count the arrears and the CRP as most of the arrears is CRP.
Seplat. The GROSS CRP as of Dec 31 was $224 million. GKP's share was 80% $179 million. The current enterprise value of GKP is $228 million. (SP 106.7p, ex rate 1.274, FD shares o/s 230.9). So one might say the CRP is 78% of GKP's current enterprise value.
No. The R Factor is based on actual costs incurred and actual receipts. So if we aren't being paid the arrears, but still incurring costs, the R factor will fall (or not rise). This will help current invoices marginally. 1.18 was exactly what I have in my model. But the cost pool still can't be invoiced twice.
Yes. But can't be double-counted in valuation and can't be invoiced twice. So model the CRP net of the receivables to estimate future invoices. Very important re: Note slide 8 "cost recovery pool supportive of cash flows"
(aa) can't even get the basic numbers right...
No surprises in the announcement. Terrible results but expected given circumstances. Management doing a great job minimising costs and keeping the field ticking over, continuing to tread water. Little to say about contract ratification and pipeline reopening. Current cash flows still flattered by historical cost recovery. Good that payables normalisation is now complete.
Ho hum.
"as long as they don't give away their assets in the form of capital returns to whining shareholders"
LOL Give away? The shareholders own the assets anyway
GKP should only invest that which they can recover from cost oil. The CRP, including that big chunk in the receivables balance, needs to be returned to shareholders.
Mad batter Paul is back...
The conversation:
Me replying to Seplat aka Paul/John etc: ""We have confirmation from the Iraq Ministry of Oil that 1) negotiations with the IOCs are ongoing and 2) payment of outstanding arrears."
When and where? If anything we've had statements from the IOCs to the contrary."
The Cook: "Until this time, where Apikur for once didn't come out and deny this was happening, as they have usually done."
Me replying to the cook:
"So hanging your hat on no comment. Interesting.
Time will tell. Let's see what GKP management say about that later this week. And away from that, hopefully there will be drivers of stock performance in the far shorter timeframe."
So hanging your hat on no comment. Interesting.
Time will tell. Let's see what GKP management say about that later this week. And away from that, hopefully there will be drivers of stock performance in the far shorter timeframe.
"We have confirmation from the Iraq Ministry of Oil that 1) negotiations with the IOCs are ongoing and 2) payment of outstanding arrears."
When and where? If anything we've had statements from the IOCs to the contrary.
"Surprised at you putup.
With zero visibility for sales you want a buyback?!"
Yep. No need for $82 million to sit on the balance sheet and a great time to mop up the free float. A dividend doesn't do that. Most divi recipients reduce their value at work by banking the dividend.
"Let’s hope Old Joe vents his spleen on the hideously wealthy Iraqi & Kurdistan rulers when they meet soon. "
If you think Iraq/Kurdistan is a priority for the US government I suspect you are deeply mistaken
"The $ 151m is a completely different matter, and there is a further approx $ 40-50m net [for the GKP] in the CRP. So the sum is let's say $ 200m. "
That's worth more today than a discounted flat line production going forward
"$ 3.1/barrel so OPEX "
That will likely be proven too low
"40-45m in CAPEX is required to keep the production flat"
If Net to GKP that might cover it in a good year. Don't forget direct Shaikan G&A and head office G&A.
And do we keep our license if we refuse to invest because we can't recover costs?