Member Info for romaron

I think the Israel/Palestine question is insoluble and we have been interfering in the region for centuries. If you want to talk energy security I think the UK government should pose the question to Ukraine and ask them how important oil is? That is in extremis but oil will be essential when peace returns as well. We are mollycoddled in the UK but countries that have been invaded more recently would not be so casual as we are about our oil reserves and so quick to demonise it. There is a reaction in Europe towards the headlong race to ditch fossil fuels for intermittent and expensive electricity which only partly solves the problem of emissions (CO2) which aren't as high as they've been historically.

Most people want air travel to continue and without oil powered shipping and trucks you will not be able to enjoy the benefits of international trade and holidays.

I'm crossing my fingers for the removal of Sadiq Khan in May. If he loses (or it comes close) and it is felt due to a reaction against ULEZ, LTN and other 'green activism' then we could see a massive reversal by Labour for whom winning the election is all that counts. I get a sense that the public are becoming tired of the empty promises of politicians and the scare stories based on unscientific 'models'.

Why should the public trust politicians on energy? They've been let down and lied to on most other policies. It doesn't feel like EnQuest are going to remain unchanged until the first election (Mayoral) because they've said there are projects in the pipeline. A shame actually because the longer it takes the more the importance of oil and the sticking plaster fantasies of renewables. I imagine countries like Israel and Ukraine cannot believe the complacency and ignorance of the UK. Norway aren't so silly.

They're not games if you are an Israeli. This lays out the background and is quite fresh:

https://oilprice.com/Energy/Energy-General/How-a-New-Middle-East-Alliance-Could-Reshape-the-Global-Energy-Landscape.html

Without oil Israel could not defend itself. They were getting most of their oil from two Muslim countries and I expect that is always under threat and Russia's alliances with Syria and Iran does give cause for concern. I imagine that may not now be the case. Look at the maps. The Israeli port of Ashkelon is 6 miles from the Gaza strip and is their major port for oil imports. They've even used Aqaba in desperation https://oilprice.com/Latest-Energy-News/World-News/Israel-Said-To-Divert-Oil-Imports-To-Red-Sea-Port-To-Avoid-Targeting.html

It is interesting that Upstream (the oil equivalent of Reuters imo) a reputable source puts Ithaca and Energean in the frame for M&A. It does appear that Israel could be in the position of requiring a kinda Berlin Airlift with the added problem that flying crude in won't work. Saudi Arabia looks landlocked to an extent and you can see why they are at war with Yemen. Oman is hardly onside and at best looks neutral. The US blows hot and cold and seems more interested in the Far East. Against this there are unwanted reserves in the UKCS currently close to worthless with both major UK parties actively undermining their future.

I doubt the UK could block Israel from buying UK assets and even if the UK doesn't want them [oil fields] they can hardly refuse Israel on humanitarian grounds as without oil Israel would be the victim of genocide.

The military and grown ups know the importance of oil.

"but trying to be more positive! " - give up old son. Its not in your DNA.

This ties in nicely with the 'War Games' I am playing elsewhere. My favourite was Delek (oops sorry, I meant Ithaca). Currently Israel imports crude oil mainly from 2 Muslim nations. I suggest that a military strategist might say that has risk attached if you are a besieged Jewish state. Another powerful and friendly state has decided its future doesn't lie with oil and is hurriedly divesting of its remaining reserves and industry. Supply lines would go through the Mediterranean and helpfully this country has a powerful military and Navy and controls the pinch-point of the Strait of Gibraltar. Israeli companies have extremely close ties with the IDF and many have employees that have served (compulsory) and are reserves still. They value oil and its importance concerning tanks, aircraft and shipping. Existential threats do concentrate the mind (7 October).

We almost tied up with Delek in 2016 so know each other well and they were my favourite. However, I'd forgotten about Energean and was actually the only PI at their May 2022 AGM. I was very impressed and spoke to most of the Directors. I think they were impressed that I'd made it with the late change and security. I spoke to Roy Franklin at length especially about his time at Premier (Friday champagne parties and barbecues on the roof) but notice he's no longer listed as a NED (14/11/2023) and his replacement may well be a certain Martin J Houston whose name rings a bell.

By all means carry on arranging the deck chairs and arguing over the polish used on the handrails but I think there are bigger things happening.

https://oilprice.com/Energy/Energy-General/Israel-Sends-Battleships-To-Escort-Drilling-Rig-In-Disputed-Gas-Field.html

Hi Sekforde = re buybacks. I've seen many instances where buybacks haven't propelled the share price higher. It does filter through eventually in most cases but if you need money now you may have to redeem shares at a loss. Dividends are real for the receiver.

I get the theory but in practise (as in the Modestus link) companies can be notoriously poor with timing and if the trend {ESG] is strong enough it will cancel it out anyway. My own opinion is that we are heavily oversold and undervalued. If only we were as popular as coal companies (sigh).

Alright Stevo - have it your way but closer to 50% is still not 75%.

I quite liked the Modestus post of 18:45. basically we're deplorables and reserves are worthless. Profits are fleeting and FCF is sooo last year. That is the narrative promulgated by the eco-warriors and vegans. However, the grown-ups are beginning to take an interest and it looks like the voting age is not being reduced to 10 years old and a 16 year old is still ineligible to become our prime minister. However they're still trying to make Climate Change denialism a crime. We've moved on from "crisis" to Catastrophe" to "apocalypse" to "Armageddon" and are now heading towards "looks like a nice day tomorrow".

The politicians ran out of time debating the Post Office scandal and Gaza. It will be rescheduled and heard within 2 weeks.

Kinda karmic that its been delayed due to state security issues and Government department incompetence.

Meanwhile the supporters of Net Zero are becoming fewer and quieter. Events dear boy!

Hi M - I think this is moot anyway as all the signs are a total restructuring or merger and examples given don't apply to EnQuest. I'll accept we are a 'deplorable' but dispute any argument that you don't do buybacks or pay dividends if you have expensive debt. There are two reasons for this. I've seen buybacks elsewhere that don't move the needle on the share price and feed those still redeeming existing shares and getting the hell out of Dodge. Perhaps it's coming to an end but it has been a long run and the trend is almost embedded with algos joining in selling anybody with the temerity to buy O&G; and winning. Dividends give respite to long suffering shareholders and they are owed a debt by EnQuest. I also see nothing wrong with buybacks if you accept (say) 10% debt p.a. but they are 25% undervalued.

Only Stevo and L7 can work this out (probably incorrectly) because in addition we have tax losses and will pay closer to 35% tax rather than 75%.

Sir Alex Ferguson left Man Utd. with a complete team left behind and still competing in the Premiership. We are the opposite with the team gone and only the manager remaining. The current executive/senior management look like they were put together using the corporate equivalent of Uber. That is why I think the discussion is moot.

Https://twitter.com/EvaVlaar/status/1744326475669451120

I wonder if our farmers did the same in London would Sadiq Khan invoke the "inalienable right to protest" that he used for juststopoil. I doubt he'd understand the message anyway because the narrators are 'foreign'.

Hi KO - your 10:53 "The only other thing Labour are now stating is that our North sea oil is sold on the open market and is exported. So it doesn't lower our carbon footprint if we import oil as we export most of it anyway so it doesn't aid our energy security either." That is an over simplification but also not easy to refute. Tessa Khan uses it all the time. On here we've ignored refineries a lot because they're so complicated. It's highly unlikely any new ones will be built and most refineries only work for a certain type of oil or product so not all shipments are suitable. 'The UK imported £30.0 billion of oil in 2021 (£17.6 billion crude oil, £12.4 billion refined oil), and exported £28.3 billion of oil (£17.9 billion crude oil, £10.4 billion refined oil).' Source ONS. Try explaining that to Brenda from Bristol. I struggle to get my head around it.

If we stop exporting crude we'll make the eco-evangelists happy but will have a big hole in our tax revenues and a lot of lost jobs. It is unlikely that the world reliance on oil will disappear and it is an essential requirement for civilisation for Plastic, Steel, Cement and Ammonia. Try rebuilding Syria, Gaza, Ukraine etc. without diesel for example and what will you make wind turbines and smart phones from?. How are you going to protect your borders if you can't move tanks, ships and aircraft around?

Our car industry shows the interplay between import/export. The British aren't particularly loyal to home-built cars.

Is there a simple response to Labour and Tessa Khan slogans?

I didn't chose the subject but another investor pointed out that the date of my previous message was posted on Epiphany and had elements of what the feast name can mean i.e. "a sudden, intuitive perception of or insight into the reality or essential meaning of something, usually initiated by some simple, homely, or commonplace occurrence or experience."

Very observant of him and he is correct. Excuse the pun but 'the Penny finally dropped'. I think I now know why a big-hitter like GP joined little EnQuest. I'm not quite ready for the ridicule that may follow if I'm wrong and the war-games continue.

The Chinese company BYD overtook Tesla this week to become the world's top selling electric car maker.

BYD has been backed by Warren Buffet since 2008.

I only mention this to point out that sometimes staring at the minutiae for too long may take you away from the macro perspective. People will say they do follow the macro but it is usually from the wrong end of the telescope and using it to explain the particular gyration or current trend of the share price. I am as guilty of this as the next person.

Today I tried something different with another LTH and we played a 'War Game'. The results astounded us both. Using the Bellingcat method and our combined experiences we arrived at where we think EnQuest are going using the open source information available to all of us. It is good news I believe. The second reading of the Offshore Petroleum Licensing Bill 2023-2024 on Monday is crucial and possibly all that is holding back an announcement. Exciting times ahead I believe.

Chimo - it helps if you have a time or channel and we can do catchup. I'm not too sure what the debate is all about on Monday: https://whatson.parliament.uk/event/cal46430

I don't know if there'll be any crumbs for us but the legislation will go through because of the Tory majority. Labour will vote against it but I'm guessing won't repeal it if they are the next government. It will mean more to the lawyers and bankers who facilitate new projects which are drying up from both sides because of a punitive taxation regime and hostile politicians. Energy Security is a worry and any government that makes a misstep here will be removed post-haste. You cannot forecast these things but history and recent events mean that we will be impacted one way or the other at some time. A SWAT attack by our highly trained roofing-insulators won't do the trick - especially on a dull, windless day.

Maybe there is something for us in the Spring Budget on 6 March but that is still 2 months away.

As there is a bit of publicity stimulated by this it is worth all of us sending off emails and the like to remind people that we have a rarity in our possession. Keir Starmer quoting numbers. He assiduously avoids anything that reveals the true cost of Labour's policies. He refuses to put numbers on things and doubles down on Tory mistakes (and TBF there have been many).

As the £28bn and GB Energy are so crucial to his "mission" then I think he needs to explain last year's NY quote which actually included something close to a figure. More importantly it is at the heart of the Commons debate regarding the carbon intensity test:

"The carbon intensity test is met in relation to a relevant year if the carbon intensity of domestic natural gas produced during the 58/4 Bill 9 1 Offshore Petroleum Licensing Bill assessment period is lower than the carbon intensity of liquefied natural gas imported into the United Kingdom during that period. "

Surely costs are a consideration as well. On Keir Starmer's figures LPG is an irrelevance? We will be using the abundant renewables anyway. I'd love to see him put on the spot regarding his year old public statement (repeated later at Davos).

Especially for those not resident in UK. Chris Skidmore resigned the Tory whip over the Government's intentions:

"Next week, the government is introducing the offshore petroleum licensing bill in the House of Commons, which would allow for more licences to extract fossil fuel from the North Sea. The latest IPCC report makes it clear no new fossil fuel projects can be opened, so doing so goes against the recommendations of most of the world’s leading climate scientists.

He has been critical of this government before, and previously told the Guardian the Conservative party was heading in a “very dark direction” around misinformation and climate change."

I will concentrate on 'misinformation'. In a timely coincidence Mr. Skidmore (a Teresa May flunky) announced his martyrdom on the anniversary of Sir Keir Starmer's New Year speech at Stra6tford E.15 on 5 January 2023 when he announced:

"That mission builds on an opportunity – that clean British energy is nine times cheaper than imported fossil fuels. It’s backed by investment – public and private – in wind, solar, nuclear, hydrogen, green steel and carbon capture."

Shout it from the rooftops. This is a "gotcha" moment. I got onto LBC tonight at 18:41 with Lewis Goodall. We can do slogans too. The BIG LIE about renewables is being exposed.

Source: https://labour.org.uk/updates/press-releases/keir-starmer-new-years-speech/

And this morning's RNS from ITH only adds fuel to the speculation. There has been a cull of personnel at EnQuest and AB is almost the last man standing. Any of us who have worked for a company engaged in 'resizing' or whatever the change was titled knows that there are often two people for one job in the new entity. At the last AGM there was an absence of NED's. From memory only Malik, AB and Penny were there. Usually they tie it in with a board meeting. Then there was the delay in the AGM. So many things that feel 'not quite right'. Will Veri include SVT. I'd imagine that could be complicated and include various other parties.

The AGM really wasn't that long ago in the scheme of things. Negotiations can be slow but they warm up towards the end. What happened with the clumsy in-out of Karina Litvack?

I don't think the next chapter is months away. Could be weeks - even days.

Keir Starmer made his New Year speech today. I've read it slowly looking for any reference towards renewables and O&G. This is what I found.

"That’s why the national missions we’ve set, the measurable goals. Whether it’s the highest growth in the G7, halving violence against women and girls, clean power by 2030 – they are unapologetically ambitious."

" Cheaper bills, with GB Energy, a new public company, using clean British power not foreign oil and gas."

On the Tories - "The so-called party of business which now hates business, that boasts about tax cuts, while raising taxes higher than any time since the war, that claim, even now, to be the party of sound finance, but that crashed the economy and made you pay." - an oblique and meaningless political phrasing later - "The same is true for our NHS. For our schools, climate change and energy security, securing our borders, restoring Britain’s standing, crime and justice. Only Labour will make a difference. " and finally - "Why Labour? Because we have a plan to take back our streets, switch on Great British Energy, get the NHS back on its feet, tear down the barriers to opportunity, and get Britain building again."

---------------------------

A year ago on the 5th Jan 2023 he said ""renewables are nine times cheaper than IMPORTED fossil fuels".

Make of it what you will and no doubt he'll drop the '9X cheaper' if he attends Davos later this month. No reference at all to the 'windfall tax'. Both parties have a problem with boosting investment. Problems with supply lines and grid concerns, heat pumps and EVs etc.. and doubts over just how much more subsidy is required to be balanced against an essential and proven industry that stands on its own feet that has decades of life ahead of it. I've no sympathy or preference for either of the two main parties. They're both populist. Now they're searching for reverse gear. They have a choice - rescind EPL or rely on imports within a decade.

*remember - Jefferies are only the messenger.

Hi Frac - I think we should applaud Jefferies. I don't think they're being hard or spiteful toward the industry or the company. EPL is killing any future growth in the UKCS and both parties seem happy with the situation.

Some achievement by Hunt. I wonder what title he'll choose when he enters the House of Lords - Lord Hunt of Gawdelpus has a certain ring to it.

Good post Nobull. The numbers are the numbers. If we could only get this message to the politicians. All the rest is forecasting which requires a blindfold and a pin.

The only good thing to take from this is that the politicians have unequivocal proof of what their actions have done to the once proud O&G industry of the UK. Being elected supersedes every other consideration in the life of a politician so we shouldn't expect any watering down of their policies until the election is over. That does of course mean that the atrophy of the NS will continue until we're possibly beyond the point of any recovery. Then it will be a reliance on imports. Norway can't support the whole of Europe so we will be at the mercy of those nice people from the Middle East and possibly Russia. The US will do what suits the US - including NATO.

Https://www.reuters.com/business/energy/bangladeshs-2023-coal-fired-power-output-tripled-easing-shortages-2024-01-03/?mc_cid=176855beeb&mc_eid=35cf3821be

I wonder how many people they sent to COP 28? My opinion is that they just go for the Western handouts whilst choosing the cheapest energy even if it is the most polluting.