Member Info for PUTUP

" aahhh bless Broadfraud, no one wants to respond to you"

Perhaps because the post was about right?

I wonder if Opulentia can now estimate the company's revenues for the year and, for a given production and Brent oil price, their revenues for next year? (assuming there is sufficient CRP and R factor to maintain the current splits of CO and PO and shares of PO just to make it easier)

Hint: revenues are gross of the CBC while receipts are net of it

“ with regard to FDP notice the use of the word 'Draft' rather than 'Final' and then the caveats that followed ...”

Why on earth did you expect anything else? It was always going to be a proposed plan submitted for discussion with the MNR.

I thought it was a decent update. Draft FDP submitted on time. (You can understand why it’s probably not sensible to impute the entire potential field production into the share price today.) Operational challenges encountered and seemingly dealt with. Production increase to 55k expected just a few weeks late. CFO slowly waking up to the need to distribute even more capital. The share price doesn’t reflect 55k production (or even current levels of profit oil production) so it’s not like one was paying for it already.

All good. Carry on.

Well, well, well. Ain’t that just funny. Carry on.

"When was SH-13 finally connected up - Sept, Oct, Nov, Dec or not yet?

When was SH-14 finally connected up - Oct, Nov, Dec or not yet?"

IMO if SH-13 and 14 had been producing well before recent days we would have heard about it much sooner. If they began producing recently, say within the last week or so, it would make sense for the company to wait and include such information in a fuller operational update. If, however, they've been chugging oil for some time the company would have almost certainly have felt compelled to update people earlier. As noted in the company presentation - with photos - both are being drilled from the same pad. Even a lay person would expect both to have been drilled with the same drill equipment before such equipment could have been moved to allow other requisite operations. Things certainly haven't been a 'slam dunk' else we would have had good news earlier. Here's hoping they've dealt with the inevitable operational challenges that will have arisen and are on track with respect to both wells and the lift in production from end Q4 or very soon thereafter.

@titan, you nutter through both sides of your mouth. It is blatantly clear you've got a bit in your teeth re theoryman merely because he raises issues. The last thing this board needs to return to is an echo chamber of hype and positivity only. Everyone should raise negatives (alongside positives) and we ought to openly debate them. Get off your high horse.

Ugh I meant the "reporting of the financial year" is next year.

"Said Q4 runs to next year."

Whenever did I say that? Quite the contrary. In very early December I'd said there were 4 more weeks in Q4! Doof.

Obviously the last quarter of the financial year is next year but I believe the reference to SUBMISSION of the FDP was with respect to the calendar year. I'm expecting an update with respect to SH13 and 14 soon. But I expect the statement will be made when they have something conclusive to say and not merely because people are eager for some news to cheer themselves up. This week, next week or the weeks shortly thereafter, I'm happily waiting.

I wouldn't expect a div announcement before the FY results in March next year

I prefer to consider how it is in reality :)

The R factor is a different discussion and, yes, it isn't reset. When the CRP is large one has to wait for capex to be returned. When it is low or 'cleared' each month the return of capex via CO is swift.

Of course the R factor affects the share in PO and it will mean a share below 30% eventually.

I disagree. A fundamental point to understand here is that the "beyond 55k" investment scenario should not be modeled standalone. It benefits massively from the ability to "push" 55k production from PO to CO. Were it standalone the investment would accumulate in CRP 2 and only the cash flows of beyond 55k could provide recovery. As a result, the payback period of the additional investment is longer and the returns to equity lower. Instead, recovery is 'immediate' (albeit 2 month delay) because production from 55k is pushed from PO (when CRP is normalised) in which the contractor shares little into CO in which the contractor gets the lot. This works when there is enough headroom in the 55k production to absorb the investment via a shift from PO to CO. This shift is limited by the PSC formula. For a given oil price scenario you can work out how much investment can be absorbed into CO and repaid immediately without accumulating CRP.

The presentations have the bullet points. You don't see the nuance in the voice overlay. And it's only the case once the CRP is normalised. Before that point, they do indeed need to fund the capex for longer periods. When it is normalised, the capex of one month is repaid in two months' time - assuming of course the KRG stick to a two month payment cycle. Because production is pushed from PO to CO (and the contractor gets little of PO and all of CO) the capex is borne by the KRG. The cost to the contractor is the delta in their PO share which fell as production was pushed from PO to CO by the capex.) Once you understand the PSC, realising the foregoing is just a skip away. You can work out how much capex the company can 'afford' on an annual basis without building the CRP again (and thereby pushing out payback periods and lowering returns to investment). Hint: at $70 oil they have plenty of headroom.

And ain't it just funny that the timing will coincide relatively nicely? Pure coincidence? Nah. Give management some credit. No point pushing hard beyond 55k until the CRP has normalised.

But agreed re communication on buybacks. It's easy for many company management to fall into the EPS accretion story as a rationale. Yes, they can be EPS accretive and more accretive if purchased at a lower price. But that assumes the market doesn't impound excess cash in the EPS multiple applied (and that all businesses are valued on a PE basis). Far better, in my view, to stick to the simpler rationale of returning cash to shareholders while allowing those who perceive the stock to be cheap to increase their holdings rather than receiving a taxable dividend (unless your pithy stake is held in a tax exempt manner).

Part of your dissatisfaction stems from an expectation that they should do everything for the financially challenged (or illiterate), often lazy (as exhibited so often here), retail investor. If you did IR you would realise quickly that you simply can't cater to everyone and that you need to draw the line somewhere higher up the register. That said, GKP has always answered my questions in a full and clear manner including helping me understand a worked example of the PSC on a monthly basis. Once you have that, and many examples have now been posted here for everyone to follow along, it's a relatively simple extension to understanding the P&L (Opu still can't calculate revenues) and cash flow of the company on an annual basis. You can also work through a month by month estimate (it won't be perfect but perhaps 'good enough') of the CRP and even the R factor. IMHO investing in this company without a thorough understanding of the PSC and the CRP is extraordinarily foolish.

The FDP isn't relevant to the cash payments being made between now and when the CRP is normalised (about 3Q next year). They're just paying out from the CRP. The SUBMISSION of a FDP is due by the end of the year. After that there might well be some discussion about it with approval following that. But once the CRP is normalised field development can be funded through a debt working capital facility. That said, once the CRP is normalised one can only pay from PO which is a lot less (only circa 20% of current payments). The large payouts currently are a one year thing.

"But we will need $500m, at least, for the next stage to 75k bopd"

Nope. Understand the PSC and you will understand they only need working capital (a couple of months). When the CRP is 'normalised' the capex burden is mostly borne by the KRG with just a small portion borne by GKP and MOL (the foregone PO).

The Opec+ group, which includes Opec members and other producers like Russia, said they would increase supply in January by 400,000 barrels of day as previously planned. However, in an unusual move, they said the meeting would remain “in session”, suggesting Saudi Arabia, Russia and other large producers could intervene quickly to prop up prices if necessary.

Opec+ “will continue to monitor the market closely and make immediate adjustments if required,” it said.

Spot was in the 80s but the market was in very steep backwardation and forwards were a lot, lot less. Still...

When is this "MASSIVE" golden cross thingy meant to happen?

Agreed re buybacks and dividends. They should have done buybacks instead of dividends since COVID and concentrated returns for the faithful. No production is hedged currently.

"There appears to be differences of opinion"

Well we're about to find out. It's been detected in the UK. Just in time for Christmas and winter. Good luck all.

"It's interesting, perhaps, to note that the weekly Brent last day finance chart BZ=F reached a post late 2014 peak in the week of 30 September 2018 of $86.72, plummeting back into the $50s shortly thereafter. Three weeks ago the same hit its recent peak - at $86.72. "

Hmmm