Member Info for romaron

Good news for us. It shows that tax credits have a value and it also helps create a vehicle, as a publicly quoted company, for disposal at a future date by Harbour Energy. Could Spirit attempt the same with EnQuest?

Beginning to warm up now that the St. Leger has been run.

It helps explain (to me) TD's smugness in the recent Malcy interview. We all know that an auction lifts prices so whatever the outcome PMO are now in a stronger position.

Hi hitman - I doubt they'd be allowed to buy back the notes. There are some pretty complicated conditions and although bond/note holders take precedence over equity holders in bankruptcy the rest of the time they have a place in the queue. Buying back your bonds is in the same ball park as share buy-back and if we had enough spare cash to do either the bonds would be close to 100 and the share price much, much higher. The good news is that the interest rate on the RB & notes aren't excessive and we could possibly have to pay more if we refinanced today. It is missed by some at how clever the company have been with the debt scheduling.
It must be frustrating working in a company when you see your debt quoted at distress levels and a share price that is signalling aversion.
Another company went through a similar stressful time in 2009 and their bonds dropped to 10 cents on the dollar. It went on to create three billionaires and one became the richest man in Britain. I'm talking about Ineos and Jim Ratcliffe.

Build it and they will come.

Re Wed 20.28. It takes a few days for the deals to show by the looks of it. Two chunky deals at 13.47 and 16.23 which are unlikely to be what we consider a retail investor. The valuation tonight in my EQI account is 57.325 and the HYN on the Luxembourg Stock Exchange is 61.011.
The amounts have been bigger of late in the RB and it is firming up. Encouraging.

Interesting read Pelle - I was drawn to this "- We will stop monitoring the oil subcontractors Noble Corp, Valaris and Diamond Offshore as they have all applied for financial restructuring or bankruptcy"
I know somebody who worked at Moody's and the first question was always "are they on watch" meaning a warning light was flashing. This often means they end up getting that dreaded broker's opinion AVOID. We were in trouble a few years back but are a survivor. It is taking time for new investors to understand that we're not a HUR, TLW or even a PMO but could soon be sprinting ahead of this peleton. I didn't include Spirit or Delek but they aren't having the best of it either. There's probably others I've missed. The majors aren't crowing from the roof tops either. Sounds like capex will be a lot cheaper for those brave enough to drill.

"Never take life seriously. Nobody gets out alive anyway" Sydney J. Harris

I prefer looking forward so cannot get excited about breaking down the accounts, reserves and production estimates although I accept they're important. I 'm pleased that others save me the effort and are better at it then me but sometimes you miss the wood for the trees. I looked back to 2010 and all our production came from 3 fields Thistle/Deveron, The Dons and Heather Broom. We now only have Dons which is awaiting CoP but production has more than trebled and we have 3 world class assets in the mix now. Of course there have been missteps along the way but teams don't win the premiership without draws and the odd loss.
Our future will be decided by the world economy and the demand for oil. I think the management have done a good job to come through the various crisis and are battle-hardened. Our financial situation is much better than many of our competitors. A few years ago I had an interest in Cairn who are 'steady Eddies' in my eyes. If I had held I would have still been down 40% (ignoring dividends). I'm down c. 50% on EnQuest so Cairn would have been the better hold but I prefer our vision and management. An interesting few years lay ahead.

Build it and they will come.

"The forecast for the basement area in the nearby Lincoln site, where Spirit Energy has an interest was trimmed from 565mb to 45mb. Downgrades to the Warwick and Halifax acreage are also expected, but their assessments have still to be finalised."
"Spirit Energy, of which Centrica, the owner of British Gas, is the largest shareholder, declined to comment."
Article about Hurricane in today's Times.

i only mention it because Centrica have been trying to offload its Spirit investment for some time. Stuff like this impacts sentiment but also throws up bargains. It also shows the extremes that an alumnus of ours, Neil McCulloch will go to in his quest for "Type 2 fun". I expect ramifications.
https://www.spirit-energy.com/we-are-spirit/our-management/biographies/neil-mcculloch/

Hi hitman-oddly enough I had looked at this earlier and noted the four drilled appraisal wells. I was gonna ask Jan if they count as conventional DUC's. What I found interesting was in the conclusions (it won't let me copy and paste):
https://itportal.ogauthority.co.uk/information/papers/spe54623.pdf
especially point 4 which shows that at the time of the paper (1999) the market for this oil was unknown. It goes to show how far ahead you have to plan with conventional oil. It seems now the time may be right to develop Bressay.

*O/T I was reading the obit. of Alan 'boom boom' Minter. Did you know he took the European Middleweight title from an Italian, Germano Valsecchi. He is Paolo's uncle.

Good spot Jan. Effectively DUC's are a kinda 1P reserve. Economic due to sunk costs but akin to selling the family silver or a ventilator for insolvent companies at the current oil price. Once they're gone its all over for a large number of companies. A fact that the Saudi's would have been aware of. Trump can't do much about it as a US recovery will need cheap oil and he's running out of time. Maybe he considers those who rely on the oil industry to be part of his "base" vote and will remain loyal to the end. Something to consider is that the oil industry is probably close to trading production for 2021. Day traders are obsessed with the "spot" price which they think is now. There is a quite a gap between historical reporting and where those that actually produce and refine crude concentrate. The story for 2021 is a lot more reassuring.

Build it and they will come.

Seems Johnny Foreigner was right all along! A verbal contract isn't worth the paper it's written on. Or is it the other way round?

Hi L7 - I'm no expert either but there may be a couple of errors in your reasoning. Firstly I may have made a typo because the Luxembourg close for Tullow is now 55.857 and we closed at 61.24. I'm not sure that legally we can say the bonds are extended to 2023 because (memory) isn't it in October in black and white although I know AB is talking 2023 but it still shows as 2022 on the LSE page. Beggars and chooser and all that but it is one of the nearest to use as a comparison. Tullow has problems and a bigger debt than ours so hardly a paragon. You still earn on the RB and if you liked you could sell the bonds when the PIK is paid half yearly. I'm not so sure that TLW is basking in solvency and that their bonds have a higher rating than ours [always difficult to get ratings I find].
If you see EnQuest surviving and a higher oil price then the RB and HYN are no-brainers and I have a suspicion that the leverage and manipulation that can be applied by current debt holders concerning. For quite modest amounts, especially if working in concert, they can influence the price. Basically, I don't trust the bond prices and consider them an an even worse indicator (imo) than the share price.
Along the same lines I could make an argument about tonight's UT. For pennies you can move it a percent or more.

The share volume today was abysmal.

"It is never difficult to distinguish between a Scotsman with a grievance and a ray of sunshine." P.G. Wodehouse

I'll take the bet.

In probably a futile attempt to regain credibility I still think that some of the RB is in the hands of not necessarily friendly investors. We've seen what ARCM did to Premier. Luckily we don't need a refinancing at the moment. My own opinion of these holders is that the public price isn't always so public. Because of the influential nature of often quite large percentages of debt these funds play a longer strategy than the day traders that haunt these boards. They don't really care what retail think the price is and quite often play on their loyalty and inertia. They also can dance rings around the more traditional funds who are often forced out of stocks and debt by their mandates and changes in credit ratings.
Tullow bonds also show on the Luxembourg Bourse and there is one there for 15/04/2022 (65.857). I don't follow TLW but their situation is quite precarious and it doesn't make sense (to me) for it to be valued higher than EnQuest?
I'm just pleased that things are beginning to move again.

Jan - I need some of your pills.

Actually, looking at it. It is the HYN's. Why can't I read small print?

The Luxembourg quote is back:
ISIN Code XS1517932585 Market Euro MTF Currency USD Type Debt Instrument Status Tradable
61,51 i % 09/09/2020 12:25:10

It dried up in April and I only went in there to see if the maturity date was still 15/04/2022

I assume anybody investing is aware of the move to 2023 but it might discourage others who think it's 18 month debt rather than 2.5 years. Then of course the PIK is kinda like no dividend to some. Certainly not attractive to most retail investors.
Many of these pages are purely indicative and often wrong. I wonder how much of this debt has moved from the initial target investors to professional speculators? I'd imagine the mandates of many income funds moved out when the problems in oil arrived. It is possible the holders now can almost dictate and move the price around at leisure. The $HYN's track the RB price wise usually.

*don't know if it'll show up: https://www.bourse.lu/security/XS1517932585/244414

I bought some RB today. I only mention it because it might be useful to see how they record a regular trade. I bought 16,869 @ 59.21 timed at 9.40.37.

Or have I read the small print wrong and it did actually get reported on 04.09.20 at 16:33:15? That is definitely intriguing. Why then? Is somebody making an effort to be whiter than white.

I never read the small print. It does say underneath that some trades qualify for deferred publication due to the type or size of the transaction. These will be displayed at the point of publication, but show the date/time of execution as with other trades. I take that to mean the trade I was referring to is almost definitely earlier or even a day or so before.

https://www.londonstockexchange.com/stock/ENQ1/enquest-plc/company-page

It seems that the retail Bond deals are reported up to 2 days after the trade by LSE and then we don't know if the date of the deal is not delayed so the deal at 16.33.15 may relate to a previous day? All pretty confusing unless you take stimulants.
The time, if it is almost live, is in the bewitching hour. The volume of £250,000 is the largest I've seen. The grown ups are returning and they often start with a blank sheet of paper. They'll weigh up and make their own calculations. This one trade has sucked up several weeks deals in one swoop. It is unlikely to be a retail investor. Significant imo.

It'll be interesting to see what is reported tomorrow. I'm gonna follow PMO RB too which is more active than of late.