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More projects given the go-ahead this year than in the previous three years combined, demonstrating "an improved landscape for the sector after one of the most testing and prolonged downturns in its history" says Mike Tholen of Oil & Gas UK in today's Times.

With low, low capex and increased production EnQuest will be playing a numbers game. As long as the oil price holds it becomes a matter of time as the company assumes on many of the characteristics that the pension funds find so irresistible. Steady and reliable income forecasts for a set number of years.

Build it and they will come!

These guys don't expect to lose money on them (MGT/BOA). There's always a price and they may already have placed them. They needed the confirmed numbers before acting, obviously. They are insiders so would have known before the RNS. I have no doubt bargain hunters would have been sniffing. There may be some interesting reading in major shareholdings.

No me neither so I looked them up. In the US they have 754 bio client assets. They have this to say about oil.

"There are three primary reasons that we are raising our oil price forecast for a third time this year: First, Venezuelan oil production
continues to deteriorate at a much faster rate than we had predicted at the beginning of the year. Secondly, the sanctions that the
U.S. has placed upon Iran are already having a much greater impact on Iranian exports/production that we thought just a few
months ago. Finally, it is increasingly clear that the consequences of IMO 2020 will effectively mean a 1 to 2 million bpd reduction in
global oil supplies starting late 2019. The consequences of these lower oil supply estimates are that oil prices must increase to levels
that are sufficiently high to begin meaningfully slowing global demand growth over the next few years.
Accordingly, we are raising our 2019 forecast by $10/Bbl (or ~15%), to $77.50/Bbl WTI and $90/Bbl Brent. For 2020, the cyclical peak
year, our price deck rises even more sharply, to $92.50 WTI and $100 Brent (representing about a 25% increase from our prior
estimates). Beyond 2020, we are raising our price deck by $5, to $75 WTI and $80 Brent. Not only is our new price deck at the high
end of consensus, but it is even more striking when compared to the longer-term backwardated futures curve. Specifically, these
new out-year oil price estimates are now about 30% above current futures “strip” pricing. While we do not think that triple-digit
oil prices will become the new normal, at least temporarily that is what the market should require to squeeze demand out of the
system."

It's a crystal ball forecast but then; so are all the others.

Source Today's FT.

Is my impression of the RI. We know they often come from a position of weakness and ours was/is the level of debt, declines and Kraken bedding in issues. If we were a growing technology company needing finance to buy another company it would have likely been a placing with friendly funds getting first dibs. A RI with its prospectus, level of transparency and the time it takes is never undertaken lightly. The pundits don't like them and rightly so in many cases.

So we 'only' got acceptance of 95.51 percent of the 485 mio new shares on offer. I imagine Robert Mugabe and Kim Jong-un would be unimaginably happy to get an audited result like that.

The oil market is having a flattish, slightly down day today and the market is still digesting the result. The blended price comes out on the 30 October it seems so not quite all over yet. There has been no reaction so far today on that basis and I expect us to rise in November unless we get side swiped by something we are currently unaware of but that's investing for you. The RI was a mixture of raising cash and (mainly) the Magnus transaction. It is not inconceivable to describe that as a company growing its production and reserves. The market usually likes that but is confused with EnQuest's determination to have a business plan and not go into a shell until debt is down. I'm happy with Magnus. I wouldn't be so happy if they had taken on a new field requiring Capex of the Kraken size.

Build it and they will come.

Hi Auson, I don't really pay much attention to pundits because they're not a lot different to politicians and always cover themselves so you usually get ambiguous comments. Is it a 'trade war'? Trump is using the US power to bully a competitor. It's the only thing he knows and understands. There are grown ups in the background who will back him for selfish reasons. Eventually self-interest takes over and there isn't much of a change. I don't think 'the cycle' is really understood but it is a regular event every few years. If the US wins a 'trade war' it'll be a Pyrrhic victory with those at the bottom of the pile suffering most. He'll then return to normal trade arrangements with Trump telling the voters he's won and made America great (again) in time for mid-terms and re-election. It makes sense to be friends with the biggest boy in the playground and even more so if he's a bully. None of this is surprising and we should all have sold some stocks when the bellicose threats from Trump began. Do any of us expect the US to put morality over the possibility of losing business to Saudi Arabia?
I hate being tied to a screen so avoid trading. I'd have mixed results anyway but at least I'd get the mentality back that half of all trades are sells. If you live in London you'll have looked at house prices in disbelief.
I have been a seller for the past 10 years but my wife loves the house. We kinda knew that the RI would impact adversely on the sp (they usually do) and taken evasive action but I didn't. I truly expect the company to do well once the new fields have bedded in and work-overs caught up.
Your question about the rights is spot on imo but how you trade them is not easy I'd imagine. Do spread betters allow you to short them? The funds look at rights because they expect to get chunks at a discount to the market price and this is what we're seeing imo. Those playing in the part paids or whatever they are now need to understand the market a lot better than me and I expect it is professionals mainly. They have an interest in getting the price down because underwriters have to put in a 'back-stop' on the price (where have I heard that term before?) and everybody knows this. It kinda gives a base and human nature being what it is it isn't surprising when a price heads in that direction. Add to that recent price movements that have nothing to do with the RI and we are where we are. If we could deal backwards we should have sold practically everything, including EnQuest.

As the subject has O/T I'll throw this in for those with time on their hands. It helps explain day traders and accountants. https://www.youtube.com/watch?v=TjZyEuPQ3ic

My pal sent me this yesterday saying he is now a guru.

https://www.cnbc.com/2018/10/18/goldmans-david-solomon.html

I think he equivocated (my pal) and we can all deal backwards. I don't think David Solomon does much better.
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Back to EnQuest

Build it and they will come.

It's practically legal to smoke it now anyway.

Hi members - I haven't done the sums but if there hadn't been a RI you may well have seen EnQuest moving lower for a variety of reasons. If I sold my Rights today I would be in at a higher level on my original holding (as at today) although not at the c.43p we saw prior to the RI announcement. I'm not trading the rights because my timing is usually wrong. I am taking a longer view and like what I see. Confirmed imo by my reading of the article about DGOC in the Tempus column in today's Times discussed in other posts. The ADVICE was 'Speculative buy' and the WHY was 'Well-run, high growth at low-risk end of the market'. I think we are a far better prospect.

*On 6 October EnQuest was in the Times under Share of the Week and I posted on here. EnQuest got a HOLD with a verdict I disagreed with.

Thanks MO. It would have been easier if I had said calorific energy value which I kinda understand. I still think oil is getting harder to source/rarer and has a premium over gas in a general sense. I think we come out well in a comparison with DGOC. To paraphrase Mark Twain "The reports of the death of oil are greatly exaggerated".

KO 13.16 - I disagree. Not with the sentiment but the comment that sellers are being flushed out. I think there are always sellers during a RI, especially if there is a premium on the rights. Then you have those who do not want extra exposure or haven't the finance (it goes on). Rights are often issued from a position of weakness rather than strength and some will disagree with us that this puts EnQuest in an excellent position going forward. That's why I've always stuck with November for a re-evaluation of our prospects. I'll be disappointed if some new major shareholders haven't arrived. There are bystanders waiting for the smoke to clear before making decisions. The selling was to be expected and didn't need flushing out. A bit like an auction - how low before the serious bids come in is my opinion.

Be lucky

Hi MO, pleased you looked at it. My main reason was to show the comparison and wondered why DGOC seems to have its supporters and can raise finance relatively easily. Personally I think HSBC would do better looking at EnQuest. I had a spat some years ago over gas v oil. My opponent thought I was thick because I wasn't accepting that from a physical/chemical point of view oil and gas are equal. The amount of energy produced from each is at a fixed formula. I argued that they are valued differently and it has little to do with the formula e.g. WTI and Brent differ largely for transport costs. We even have different oils and though it's beyond me they probably burn/produce energy at a similar rate. The bulks can change and C5's etc. can probably be included but they are cheaper than Brent/WTI but depend on demand for the product and a multitude of geographical and environmental reasons. I may be wrong but I feel that the 70,000 boe production a day (mainly gas) by DGOC is worth less than 70,000 barrels of oil. Am I right or wrong about the e in boe? I think same in energy but different prices for a variety of reasons and I haven't even mentioned geopolitical yet. Happy to be wrong and learn.

I agree that decomm is a consideration for DGOC but they suggest that the market is pricing it incorrectly (they would say that). I'm not investing in DOGC but think we come out favourably in the comparison stakes.

Almost but not quite. Mainly into Gas. Another company specialising in buying old fields and acreage that existing owners have moved on from to follow their own strategy (mainly fracking). A major difference is that they pay a dividend, are based in the US and are surprisingly quoted on AIM. The company is Diversified Gas & Oil (obviously not Diversified Oil & Gas) and the code is DGOC. The numbers are quite compelling and it still has the original founders with their largish shareholdings. Not the sort of company that will attract the PI I feel but very interesting. HSBC became the largest shareholder in September. Not for widows and orphans but worth running the slide rule over.

Raises an interesting point. The underwriters can better see or get an idea of the flows. If they have to pick up any orphaned amounts it is best at a lower price. Now I'm sure they're too professional to manipulate the price but parties close to the action will be lined up to take up the slack (unallotted shares). Many holders cannot restrict a quick profit and have already sold their unpaids. They have been right so far but in the bigger picture it is too early to say. I would say it is looking like a successful RI and the company may tick different boxes now for Funds looking at an EnQuest recovery. Decent amounts are now available at a good price and Funds like a bargain the same as the rest of us.

I've changed my mind about an oil spike. I think the Donald has done a deal and the oil price is spookily stable. Don't forget this is the man who said ""I love the Saudis," Trump said when announcing his presidential run at Trump Tower in 2015. "Many are in this building."
They dug him out of threatened bankruptcy in the past and his behaviour suggests he's looking too smother any blame attached to MBS. "Rogue assassins" and a reminder $100 bio plus of arms sales means no change to me.
The UK will do nothing too.

The world gets more cynical by the day but from an EnQuest perspective this is to be welcomed.

Pointless guessing because there are so many possibilities/variations on reactions to the murder of the journalist. They could affect us massively but on balance I suspect the Saudis will not roll over and increase the production of oil to appease the US (our influence is secondary). I think the US and Saudi both have leverage. I doubt the Saudis will pour a boiling kettle of water over their head by forcing the price of oil lower. That would encourage domestic dissent and I doubt Russia would be too happy either. The Saudis can also afford mercenaries and there is an agreement with Pakistan for the supply of nuclear weapons should the situation arise. All quite worrying and I suspect oil to go higher in the next few days.

I was hoping for a quiet month as the Rights Issue beds in but it looks unlikely.

Hi MO - keep up the good work we wouldn't want to lose you to bellingcat. Your ability to analyse open source material is very much appreciated. What people do with it is their decision. Remember they aren't paying you so don't feel you have to respond to every request.

You explained it better than me. Smoking is almost a class A drug (I am an ex-smoker too) but there are similarities in the wider sense. Both are deemed by Society as bad for people and the environment. I can remember the smog of the fifties so coal only took c.70 years for the UK to be almost coal free so your chronology is pertinent. We are seeing ethical funds avoiding and even the Norwegian Wealth Fund has proposed dumping oil stocks (admittedly diversification involved). This means that both industries carry a large amount of negativism. This means they miss out on the premium associated with growth and newness.
The biggest factor though is the cheapness and high energy intensity of oil. It gets distorted by taxes and is a political football but there are a lot of plusses that tend not to get the media exposure of the downsides. Always better to print bad news if you want to sell advertising. I'm happy to hold an oil stock because like you I see it being around for a long time still. Longer than us. The noise though does prevent PI investment and funds don't always want the opprobrium holding them attracts. Once the EnQuest plan comes together we'll see an advance just on traditional ratios and profits.

*I held BATS for a decade and they did me proud. I'm not holding at the moment but would consider returning.

Sorry - posted under wrong header. Should be cake O/T

Really shouldn't post when rose'd (actually Amarone'd). Should explain that when shown the hieroglyphics it was pre- lunch and Vodafone in which he is heavily invested in had gone up. It seems that whilst we reminisced New York decided to sell off. The other danger he said was a false start because when the Funds get seriously involved the amounts are staggering. If they read a signal wrong then it is very, very expensive to correct due to the huge size. I just asked him and he now thinks some Funds were using their black boxes yesterday. Me, I haven't a clue but the overall market in the US did appear overblown with the accompanying Trumpetism about markets not helping.

I am not so concerned about EnQuest as I don't think we are anybody's particular darling so weren't at giddy heights.
The POO will obviously have its influence but the signs look good. Here's a thought. The oil business has comparisons with Tobacco imo. Tobacco has largely fallen into a few very large companies and they are protected by a moat. That moat is the extremely high cost to a new competitor attempting to challenge. Tobacco sales have been falling over here but growing or stabilising in other parts of the world. Countries are also are trying to wean us off oil for a variety of reasons.

There is for the foreseeable future a demand for oil but also a lot of reasons not to search fore new reserves. This balancing act should work in our favour as demand only has to stabilise or reduce at a lower level than natural declines for us to be in the money. It should also help the POO.

Be Lucky

He's now covering his bets. I think he doesn't know and that, strangely, comforts me. That's why they're called hedge funds. There is no Canute out there (other than Trump). Believing in invincibility and prediction is better practised in a church. All imo.

Can you take comfort in a company doing worse than your own? It does throw light on Luke Johnson whose position was already threatened by being an outspoken Brexiteer and a pundit for the Sunday Times. He wants to drive back the staff that sell Patisserie Valerie products (overpriced imo) whilst recently boasting in his Sunday Times column about controlling poor governance and the ponzi schemes of cryptocurrencies. How're you leftshag as the FX market would say? Anyway, I digress. I spent an enjoyable day with an old pal and we drowned our sorrows of the current market in the traditional way.
I asked about black boxes because that's what he used to do. However, he explained that it had moved on since his day (early 2000's). He actually said the market wasn't showing excessive weakness because "the funds haven't entered the market". He then showed a Bloomberg chart that (he said) indicated the markets last big movement was in February (he used Euro Stoxx to explain) and were basically hovering around the same level (I just saw lines and colours). He said that the last hedge fund he worked for doesn't even use black boxes preferring to rely on research (inside knowledge?). He is not particularly enamoured by the use of boxes and gave me a bit of history. When he worked for HSBC he actually used something like an egg-timer. When an order was exceptionally large you had to feed it into the market gradually so he timed it to place amounts at 10 minute intervals. It was all based around VWAP. Nowadays there is AI which means the makers of egg-timers are redundant but the herd is now following each other removing big profits. I mentioned to him that I read that markets were 90 percent algo driven. He disputed this. He thought it was higher.
He moved to Man group and they played a mixture of boxes and old fashioned trend following until his final job in a small Mayfair hedge fund (where he still has a 'consultancy' interest.) I only mention this because people want to believe that there is a system and a way of profiting when others lose. There is but Ladbrokes and Paddypower are better at it than you. Our advantage is that most on here understand that it is not easy to pick winners but as long as you look for fundamentals you stand a chance. I haven't a clue what Trump will do next or the Brexit talks development which is why I will wait until November when the situation should be clearer.