Member Info for romaron

I think the difference is that the US knows that energy independence is still a priority and that fossil fuels are an essential ingredient for transition. They also put their money where their mouth is and the $17bn merger of Cimarex and Cabot shows that the grown ups are back in charge.
"The pledge has mostly held, with producers eschewing a new drilling surge despite a recovery in oil prices, instead using the windfall to repair balance sheets, reduce liabilities and return capital. Mergers have mostly been completed using equity, not cash." From FT

Meanwhile in the UK half-truths abound and we have a Prime Minister who says what he thinks will win him popularity and damn the cost. Remove the uncertainty and UK oil stocks would fly. We can't afford care for the elderly and hospital waiting lists are becoming third world yet evangelists believe that billions should go on Net Zero with arguable benefits.
Yes, the difference is breath taking.

Whilst I appreciate the effort in calculating the saving in paper clips by going paperless and the unexpected expense in redecorating the toilets on the 3rd floor I think I may have found some FCF that was overlooked.
"Even aggressively assuming a restart in July, we estimate that Brent prices would still reach $80 per barrel in fourth quarter, 2021."
--Goldman Sachs (the July is reference to Iran sanctions being removed)

I've calculated it as an extra $100mio for the second half of the year, roughly.

*I've heard we're in for a bad spell of wether.

The claptrap continues. No mention of RCP8.5 because it destroys a large part of the ESG argument.
https://www.carbonbrief.org/explainer-the-high-emissions-rcp8-5-global-warming-scenario
No mention either of the cost of renewables compared to fossil. Fossil fuel benefits (cheapness) have been cancelled.
Targets and "aspirations" now trump science and economics. XR are 'non-violent' but won't be taking their protests where they might meet real resistance. China, Myanmar, Russia, Egypt to name a few.
The tune is gradually changing and Boris now has a real threat and rightly so. The baby faced assassin Steve Baker MP is now a trustee of the Global Warming Policy Foundation and says "I’m increasingly concerned about the astronomical costs of the current Net Zero plans. If ministers don’t obtain and maintain the consent of the public for Net Zero now with full and frank explanations of the costs and changes ahead, eventually there will be a terrible revolt." He is a king-maker and his power was evident during Brexit negotiations.
EV's, heat pumps and cost of hydrogen seldom mention cost and are hidden in the promotional literature if there at all. There is a negative or downside to very human action but sometimes the benefits far outweigh the minuses.

Off to club some baby kittens. They are serial killers of songbirds. Tonight I'm having baby panda in honey. There is a glut and China want to keep them as a luxury brand and demand high. The poor of the world can have walruses. Another glut though David Attenborough portrays a different narrative.

Hi L7 - an excellent find but just as much amber lights flashing. The Noreco website is clearly not up to date or have the 2 hedge funds been less than transparent. I'm fairly sure they could disguise the holdings with Euroclear of Goldman's for a while but you can't suddenly get 2 new directors days before an AGM and they obviously needed a large holding for leverage. Looks like arranged change of ownership to me with little clarity judging by the recent price movements. Like most stories this was fed to the FT imo. Why? In the scale of things Noreco is tiny. They even mention Waldorf which is smaller still but share Kraken. Bearing all that in mind it could be worth a punt. Hedge funds tend to not funnel money down a drain. One thing to take home is that they probably couldn't get away with a similar attempt on EnQuest.
More importantly oil gets a front page outing on the Sunday Times: "Ex-Centrica chief readies gas giant for £7bn float"
That's Sam Laidlaw and Neptune being brought to the market. Using their figures they plan to raise production by c.40% to 200,000 boepd. So current production (say) 143k. It is expected to be valued at between £5.5bn and £7bn. Forgetting debt that means we are worth between £1.9bn and 2.4bn (49kboepd and we're more oil). Possibly they're valuing Neptune a bit on the high side??? but I'm not complaining. They say that with this proposed valuation Neptune would be a FTSE100 stock.
200k would put it on a par with Harbour they say MC £3.745bn so even more confusion. Is HBR undervalued or Neptune over-hyped???
Whatever way you look at it I'd say EnQuest are under-valued. Seems that either the oil market is warming up nicely or the PR companies are on a push and charm offensive!
EnQuest has a lot of the attractiveness of the companies involved (PMO especially) but because of the large stake by AB and friends is unassailable. That means the only people buying at the moment are not buying us. Not because we're not a bargain but our unique structure. If the hedge funds know what they're doing then we are several years in front of them.

Build it and they will come.

You've excelled yourself here L7. Which funds have taken key positions on the board? Most here, including me, don't subscribe to the FT. From Noreco major shareholders they show Euroclear 30.05% and you don't get much more opaque than them unless you pick Goldman Sachs 24.00%. BNP Paribas with 5.83% would hardly not be involved as they seem to be involved in practically every RBL deal going through. Far too complicated for me to read through anything but they seem to be struggling even more than us.

I suppose it's time to come clean monkey. I'm developing an engine that runs on single malt whiskey (renewable). The concept is proven (Glenfiddich works best) and all I need now is a backer to help me get the price down to below £300 a gallon. In extensive trials it has the potential to out perform hydrogen due to availability and price. I think I may be on to a winner.

Don't disagree. I also have overdraft facilities that I don't use but there comes a time. Not because you're brassic but short notice events. One thing we can guarantee is that there will be opportunities or death throes in fossil fuels depending on what side of the fence you're on. Some want to be on both sides. Meanwhile the fossil fuel industry climbs out of its torpor and makes obscene amounts of money. Others follow Moody's.

Hi Slift - without getting into the detail I imagine EnQuest will want a war chest and realise that going back to shareholders will not be welcomed. I agree that we'll build in headroom. We won't be in the same position that Tullow found themselves in. Just a shame Moody's don't feel the same way. To them $35 oil is always around the corner and renewables are happening tomorrow.

I missed this bit. An article suggesting that the UK hasn't necessarily become more Tory but that the Tories have moved to the Left. It goes on to explain that the effects of China and Covid have turned a generation of politicians off the idea of letting the market decide where something is manufactured. Every prosperous country will now want the ability to manufacture vaccines and other essential supplies in its own territory.
Now call me old-fashioned but I still include energy in essential supply.

The renewable dreamers (how's hydrogen doing?) sound more like Seventh Day Adventists. The second coming is also imminent apparently. No more please. Facts work. Slogans don't.
Excuses are already being prepared for missed targets on renewables and governments understand that people can only be pushed so far and they're still expensive. Ok they've made a small advances but this is an EnQuest board and frankly 15 years is as long as we need though I see it lasting much longer. In fact 5 years of rinse and repeat make us a company throwing off large amounts of cash.

Build it and they will come.

Extracts from articles affecting energy:
13.6% of cars sold in UK pure electric or plug-in hybrid. Sounds impressive but this represents only 1.3% of all cars on the road. The average car on the road is now the oldest since records began as drivers held on to existing vehicles for longer. Encouraging drivers to upgrade is essential for the UK to meet its ambitious climate change TARGETS. You don't say Sherlock!
Corporation tax going up to repair some of the damage Covid has done to public finances. Demands for spending coming down the track - social care and money to fix backlogs in health and education. Umm - care or EV subsidies? A hard call that for some!
Biden administration targeting aggressive expansion in offshore wind. From almost no project to date to 30 gigawatts in a decade. Over 10 years? Will anybody even notice? It is the proverbial p*ss in the ocean.

I think the time of hand outs to renewables is coming to an end for the simple reason that there isn't the money. Politicians will make gestures to appease a minority of voters (every vote counts) which encourages me no end as Boris, Shapps and co can be relied upon to break practically every promise.

I agree with Tigar. Firstly the RCF is a kinda overdraft with gearing covenants. The lenders have built in protection over rate movements whether its LIBOR to overnight or 3 months. A bit different when you have to make decisions on covering a 5/7 year bond. It usually has precedence over other finance so is cheaper. Regarding RBL It is in the name to an extent. It means that Reserve levels encourages prudence and good practise. The hard negotiation may well be around setting the covenants.
Here's an example: https://www.tullowoil.com/investors/corporate-bond-and-credit-rating/
Yesterday's closing on these were 102.98 for the 2026 and 85.00 for the 2025. I've calculated that as a YTM for the 2025 of 12.09% and a YTM for the 2026 of 9.49% As you can see SECURED brings the rate down but of course when things breach or go close to covenant levels the creditors influence grows.
That is not the case with EnQuest. We are engaged in SELF-HELP possibly because the Shylo0ck's demanded too much but whatever your view at current production and prices we are out of the woods.
It is the industry and the incessant ESG rhetoric that weighs heaviest. BP cannot lift their share price despite buying large amounts of shares most days.
The BIG LIE isn't the US election. It is that renewables are cheap enough to replace fossil fuels and they will be readily available in the next few years. Piffle!

Hi Pelle- I made a mistake in my first reading what IEA said about COP of any new fossil fields immediately to reach the ambitious goals of net zero emissions by 2050. Perhaps they were playing a responsible devil's advocate by highlighting the gap between rhetoric and reality? What is required (according to ESG lobby) against what will be achieved are in the realms of fantasy but the oil industry will use the current confusion to secure their future whilst making plans for the next 5,10,15 years. The majors leaving the North Sea is as much about scale and an ageing basin and would have happened whatever the emissions from Greta, Green Peace, Extinction Rebellion etc... The markets have been more busy with bitcoin and tech so the sub-editors have been given free rein over headlines for the back water that is oil. We just ain't newsworthy atm.
It is time to step back out of the wardrobe into the real world. I don't see Gaza , Syria or Lebanon being held up as poster children for this brave new world. They would just like electricity full stop and don't mind where it comes from.
The NS is a confusing place. The majors accept the kudos of moving their emissions away to places where public disapproval is hidden or repressed (that's a huge chunk of the world) and those countries welcome economic advantage. The real world does trump fantasy island eventually. As long as they can feed tidbits to the noisiest fringe groups the majority of voters get on with their lives which depend on cheap energy. It is a fine balancing act between the two but again most voters don't really care. It may be different in Sweden and even the Scots will show token allegiance to Net Zero but will not abandon reliable income.
I don't know the next move but the large funds that backed Neptune and Chrysaor as well as Spirit seem to be looking for an exit from the NS so I'm not sure how much we can trust this Government. They don't seem to. I'm relying on pragmatism and perfidious Albion to get us through. Self interest runs deep in the English.

..... and we might be in the market for a suitable FPSO (or two) for Bressay/Bentley. I'm no expert but imagine that all FPSO's aren't made equal.

..........we're practically a private company anyway so if it becomes impossible to carry out business without activist intervention over "principles" or polar bears then it is the obvious option. It won't be long before the uninvestible market is bigger than the "acceptable" and ethical market. Next they'll ban profit as it goes to the wrong people.
I'm siding with history and centuries of people being greedy and looking after themselves. In this country we have messed up residential energy saving by using dangerous but mainly cheap wall cladding. It is quite easy to refute the green arguments when you bring cost into the equation. China must love what's happening whilst Trump was purely transactional but had a lot of support. People get tired of being pushed around by do-gooders who have no financial or social interest in what they're attacking. It's a scorched earth approach where only natural homeopathic solutions are acceptable.
Even the French revolution of 1789 made concessions to the wig-makers who saw their business fall (in the basket) dramatically. Modern governments should not need reminding that there is a sans-culottes in each of us.

Ignore it Pelle. They're a government agency and have to be woke. AB's mission is not to change the earth's temperature but to ensure positive shareholder's return. Leave virtue signaling to those that can't avoid it or see political advantage. The cant and hypocrisy is deafening. Blackrock criticised Proctor & Gamble for using palm oil whilst at the same time being the biggest investor in a company that seized land from local farmers.
File it next to this https://www.bbc.co.uk/sounds/play/w3ct1j4p or hydrogen boilers. It is so easy when you're preaching from the pulpit but have no significant financial stake or interest in shareholder value. Bullying pensioners and their investments is gonna bite them in the arse. If everything made sense and is so easy why hasn't Palestine got a homeland after 73 years?

Energy Voice today: TechnipFMC clinches a contract with Ithaca Energy for the Captain enhanced oil recovery (EOR) project in the UK NS. Captain is another heavy oilfield in the NS with similar cp to Kraken. The API is higher though with 19-21whilst Kraken is 14. Jim Buckee told me that its the centipoises that count above API for recovery. The Ithaca FID tells me that EOR works and there is a revived interest in heavy oil. Bressay is 540 cp and Bentley 1500 cp. Xcite were talking about EOR when they couldn't even lift conventionally so maybe not get too excited there but Bressay looks encouraging. Waldorf bought the Kraken interest from Cairn and they aren't mugs. Nobody made them buy it. I'm also intrigued by the 35% holding in Waldorf by Paal Hveem. He's not an oilman but the other 2 large holders are Erik Brodahl and Jon Skabo.
Maybe we should have 2 message boards. Spot and forward? Spot looks handy whilst forward is even more promising.

Be lucky

Thing is a large amount could have gone through but not an AT. Doesn't even have to be reported today but a MM will know and a few of his favoured clients will have been informed. Two nice off-book trades 300k and 332,964 around 08.30. Somebody knows who (likely) bought. Always the possibility of a trade being booked after close. Markets are leaky but not at our level.

Schroders had 5.07% as of 30 Apr 2020 from FT but I trust Enquest figures more. My records are as messy as my mind.

EnQuest have updated their site with major shareholders. The last time I took figures they were:
9/9 2019
AB 10.12
Aberforth 7.40
Baillie G 5.05
Dimensional 4.32
As of 31/12 2020
AB 10.6
Abeforth 8.06
Schroders (new) 6.75
Baillie G 5.65
Dimensional 4.06 The latest Employee benefit Trust I can find was 4.32 %
I get around 40% above 3 % so imagine that other institutions might (at a guess) hold another 10%.

I didn't include Hargreaves to avoid double counting as they are more likely to be individuals using their platform.
Comments; surprised to see Aberforth and Baillie increase despite negative ESG press. Schroders aren't dopes but tend to be more short term. So PI's could hold around half the shares 848 mio. I wonder how many of us there are. A holding of a million shares doesn't appear to be that rare. I know one Swedish guy with 6 mio (he doesn't post). I've got no idea what this means but it feels (to me) that even the day traders have abandoned us. I don't think there is that large a free float of shares if this stock decides to break out. Daily volume is risible.
Just browsing and looking at Neptune. They have similar backing to Harbour. Smart money has a strategic stake in the NS.
Covid did us a favour in that we had nothing to spend our money on. The whole world is gonna start spending soon. Break out imminent imo but the problem with EnQuest is we need new money. Many here have become ossified.

I hope this comes out: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1056808

It explains how Moody's come to their rating and the methodology they use. A bit beyond me because you need accounting skills but fundamentally shows that Moody's are risk averse and to achieve higher ratings you need to put creditors interest above shareholders (see Factor 5 P.15).
This appears to be the latest guide for "The Rated Universe" and once again up pops "exploration" as in (E&P) industry globally.
I thought it might be a bit of fun to use their scorecard for EnQuest but it isn't that simple though I think Tarmak and Pelle could have a good stab at it.
I know an ex Moody's employee but her experience was 30 odd years ago and likely out of date. She covered Europe and was fluent in Spanish and Italian. I remember her saying that Fiat was always happy meet her (looked good on expenses) but refused to pay for a rating. Reasoning that the banks had their own criteria and they were big enough to not need Moody's. We have obviously decided that we want a rating to tie in with our ambitions when in fact most of our bonds are likely in the hands of vulture funds. It's a bit like having a gym membership with a gammy leg. I'd go as far as to say that since 2014 our membership to Moody's gym has been a waste of money.
The credit market is open to us whether you have a Moody's rating or not. On top of that Moody's perpetuate the myths and reinforce their way of judging us. If you wish to avoid all risk then stick with Moody's or better still avoid equity altogether. BNP don't need Moody's and neither do we. Add to that the ESG tyranny that certain companies are appeasing to and Moody's certainly lean towards appeasement as it runs away from risk.
Conversely Moody's and its followers (including ESG) are creating unmissable opportunities in fossil fuels if you believe that energy should be at an economic price.