Member Info for romaron

This isn't a corner shop. AB sees further than most. A year of consolidation in the North Sea in 2022? We are of a scale that means we have to be considered (AB was at the meeting with Kwasi Kwarteng) Exciting times.

Build it and they will come.

Neil McCulloch has been appointed the interim CEO of Spirit Energy following the stepping down of the current CEO. That follows the departure of Phil Kirk from HBR announced today.
NM was a director of EnQuest & left us in March 2018. Forget FCF and debt for a moment. There are a lot of balls currently in the air.

I think it only fair to give the EnQuest team a break. Of course they're not perfect but at least we've held on to our CEO when others have failed. PMO and TLW the closest to us changed theirs. I don't even necessarily think they're bad companies but they didn't have the quality of leadership we have when times got tough. Over my timespan of holding EnQuest it would have been far worse if I'd been in TLW or PMO (now part of HBR). Not to mention HUR, SOU, XEL, RKH etc... I don't even think steady Eddie Cairn have done that well either. Then we have Centrica wanting to get rid of Spirit and Neptune being thwarted in divestment timing too. It goes on...............
Then there is luck. I remember a rig helicopter pilot telling me he flew over a field most days that could keep the UK going for 6 months a year (memory but it was a big number) in gas that was not used. That field was on ice because it was half owned by Iran and shut down as part of sanctions. I haven't researched it but who would have thought the US would grant a waiver and allow production. I'd say that the investors in Serica (SQZ) couldn't believe their luck. I don't think the pilot was invested either.
It sounds repetitive but the world still runs on fossil fuels and to abandon them too soon will adversely affect the wealth and competitiveness we presently enjoy.
I'm hoping the world realises what a treasure the North Sea is and I hope the turnaround of our fortunes is soon. As Juan kindly pointed out. I'm not getting any younger and I'm running out of runway.

posted before I read mrc 13.59 post

You're getting grumpier of late E. Your comment missed my point and (I think) that of mrc. "That's not boastful, as MRC and Romaron characterised it." see TU 22.43 & 23.28
I was referring to the fact that highlighting excess or high cash flow is not a good look with fuel poverty currently a popular band wagon added to oil producers not getting a fair press either. The people that count don't need the window dressing or hyperbole that US & Canadian producers (you say) add. i'm no expert on North Americahn oilies but I know what goes down well in the UK and I wouldn't want to be provocative towards people struggling to get by and blaming (along with sections of the media and activists) the UK oil & gas producers. I think the company just needs to give the actual figures and let the market extrapolate. Eric Nuttall is a self-publicist with a large following on Canadian stocks. Blame the analysts and stock pickers from the UK not our team for not bigging up the potential.

I wonder what makes a poster spend all day on a message board? So many do but this board has one in particular who ruins it by obsessional posting. Trying to pretend ignorance and directing the more gullible to think that they thought of it first. Take this KKR fluffing. They were early investors and have basically cleaned up. I don't have a problem with that as they will have failures to offset their wins.
No mention of their 4.5 % sale from IPO but trying to whip up a frenzy for a 0.75 increase? Yes, it's encouraging but there is a big picture here and of course large investors have a better route to the company. There is still governance and insider trading does have severe consequences. I'd say that this is still a very young company and we aren't even a year in yet from IPO. As for trades good luck. I actually got involved in them but was still in the dark most days. What we've seen originally was a company brought to market by initial investors and founders and the shares being divvied up and passed on to the next level of Institutions and Pension funds. Even retail has got involved (that's us).
If it helps pass the time keep posting but these (for me) are growing pains and don't really tell as much as you'd like to believe. Many here are day traders but the smart money tends to be ante-post. That is what we are seeing.

Be Lucky

I tire so of hearing people say,
Let things take their course.
Tomorrow is another day.
I do not need my freedom when I'm dead.
I cannot live on tomorrow's bread. (From Freedom by Langston Hughes....or was it Juan?)

I think we're safe from any boasting over FCF. It isn't EnQuest's style. There has been talk of windfall taxes but they create a few problems for the Government. Taken over the past years and taxes paid I'd expect the same treatment to be applied to, for example, Starbucks, Facebook and Apple too. Can anybody see that happening?

Of course you've seen it before E but it doesn't make it less true imo. I didn't ask you to listen to the shale part. I think JB's comment was to explain the difference between the UK and Canada towards ownership and the way we reward executives. There aren't many oil companies that have a CEO with as large a percentage holding as AB. For a 2013 speech I'd say it has aged fairly well.
I'm beginning to see a resistance to the climate change activists. More ordinary people are becoming aware that during the rush to green and renewables the costs were minimised in the narrative. I think what many were unaware of was that fossil energy was underpriced anyway and investment had almost stopped in fossil fuels. For true balance you need an economic cost for fossil with environmental carbon savings costed in. That will still be cheaper than the promises made regarding the true cost of renewables. The battle will continue but now fuel poverty is a reality for many millions more. The security aspect also has a higher consideration because of Ukraine which is also about energy. 90 percent of Ukraines O&G comes from the Dnipro-Donetsk basin whilst Crimea is strategic in offshore reserves. Russia is fully aware of this!
We're never going to become fashionable yet the reasons for investing in EnQuest are just getting stronger. I liken it to London and property. They keep finding land and building on brown sites. Ideally they'd prefer Green Belt (moose-pasture?) but the closeness to market and jobs means London consolidates its position and the value increases. I see the North Sea basin with many of these qualities. We are experts on the NS and getting the most out of ageing and declining assets.
I've regularly posted that I accept the low rating but once the FCF is reliable and consistent we will have more decades left for EnQuest and the NS. I'm not getting too excited about the update (should be Thursday) because we've been disappointed before but this is the best market EnQuest has had for some time and debt repayment looks a formality.

The meaning of life is not to win, it's to play.

Hi E - for the umpteenth time: https://www.youtube.com/watch?v=WdjTi-uhoqI
Jim Buckee (ex EnQuest Chair and founder). Listen from 08.00 - 09.00 where Canada and EnQuest get a mention (also Tullow at 06.40).
We might not have a Canadian listing but we have the next best thing. A CEO who has mortgaged his house.

*Jim Buckee's last role was with Black Swan Energy that got taken over by Tourmaline last year.

MAGNUS
from the RNS 03 December 2018: "§ approximately $500 million of net present value to the Group at $70/bbl long-term oil price, as outlined in the Competent Person's Report on Magnus included in the Prospectus dated 7 September 2018"

The next 3 year average for Brent was $58.92
To make the CPR people right (and they're independent experts) we need the next 3 years to average $81.08

Doable imo but you wouldn't have been too confident in April 2020.

Quite stark. It is easy to forget just how difficult the last 7 years have been looking at the history of crude with 2020 being particularly challenging.

https://mcdan.com/forecast/data/downloads/20220101/G220101.pdf

Look at the second chart. $65 seems a go to figure. I'm guessing but most here expect the actual price of crude to be higher. I do.

*in case it doesn't come out go to mcdan.com and click on 'Price Forecasts'

Timomortis Sun 18.00 wrote "and it's always true....Nobody Knows!"

.....and he's perfect.

One thing for sure. The Board, Directors and Auditors have triple checked the sales procedures and bookings. Their reputations wouldn't withstand a re-run of Autonomy. This company gets more scrutiny and negativity than almost any other in the sector. I wonde what would happen with a tail wind?

I think mrc sums it up nicely. L7 - I wassn't trying to be a smart arse and I read your posts closely. You know your stuff and I wanted to be sure I'd got it right. Annual Results 2021 aren't published yet but they'll have a good idea. When reporting they are (as we are) living in the present and affected by current thinking and prices. What I took too long to write is that they have an audience that they cannot frighten and need to comfort. It doesn't really get past the more discerning but a report or RNS that said "we see oil $20 higher and will borrow up to the back teeth to buy reserves whilst they're cheap" would really frighten the horses. Of course I couldn't run EnQuest - I leave that to L3 and chilting.
I rememebr my first AGM 2015 when Jim Buckee told me he had a bet with AB that oil would be $80 later that year (not sure their positions). We know full well that we they couldn't put that in writing but every CEO/Chairman has these thoughts but prepare as though the current expectations are set in stone and the downside is protected/hedged.

*I'm not Spurs forever. I did watch them as a child but have a friend who is a lifelong Fulham supporter and have been following them for a while. It is one of the nicer grounds. They are the first results I look for. Barnet is a lost cause.

Hi L7 - I don't always follow what you write and was confused by AR 2021. I'm guessing but they are Annual Results for 2020 released March 2021 (you forget some of us are in the shallow end with arm bands)?
When those numbers were released Brent had (after a turbulent year) just climbed to about $60 and although the oil price was higher around the November update there was conflicting forecasts over Covid and COP26 had just ended.
In reality we have been making money hand over fist the past couple of months and if it extends throughout 2022 the company will be able to engage in more adventurous plans and the covenant restrictions will be weakening, putting us in a stronger position with lenders. I've always thought the Hibiscus interest puzzzling and there is a strong Malaysian element (it is memory but I think they decided not to hedge their production and did well with that move). I think you may be on to something there.
I was discussing EnQuest with another investor and commmented that when oil was around $40 our very existence was threatened but at $90+ both he and I could run EnQuest. What I mean is that the skill is at the $40 end and we've successfully navigated that and have a useful scale in a depleted sector.
To be successful you need professionals. Problem here is that even if you have the best exploration and development teams if they coincide with a downturn for whatever reason (geo-political, climate change) their efforts are wasted. In the post by Modestus 16.57 I like this quote "This is why they say that bull markets make everyone look like a genius." Oil hasn't been in a bull market for 6 years. So does a bear market automatically make us dopes?
I hope you'll agree but the price of crude and for how long is more important than investigating the entrails. Boards have to be seen as prudent but the pressures from lenders and regulatory environment means they have to be seen to be conservative.
I think there is room and funds (internal & external) for the company to acquire or develop reserves.

Build it and they will come.

Nice phrase from Eric Nuttall. Everybody listening to this will be using oil for the rest of their life. We are seeing the results now of the pathetic capex spend of the last few years. About time more people appreciated the far sightedness of AB and his team [and of course the LTHs]

https://www.ninepoint.com/commentary/commentaries/2021/122021/ninepoint-energy-strategy-2022-outlook/

Build it and they will come.

Hi E - sounds like you're considering contango? onedb said it couldn't happen, something about a curve? - I just throw ideas out there. I'm usually wrong but the world is getting stranger by the day.
I found out something today that I'm not at liberty to repeat (not about EnQuest) but the renewable industry is the one facing headwinds this year. They can release SPR's and make future promises but Japan has already broken ranks and China has banned phosphate exports. I wonder if the cost/shortage of ammonia has anything to do with it?

*as always it's about timing. Holders of Sirius Minerals were right but they didn't have an AB at the helm

Build it and they will come.

Not ours I'm afraid. He does occasionally turn up looking for scraps. Try the Clown School on the corner. Stop feeding him and he'll go away.

*you do know he's not house-trained?

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