Member Info for romaron

Just throwing this in. Ithaca is basically Delek and they treat energy security in Israel very differently to the UK. I suspect that there is close collaboration with the state of Israel as there is with Energean also. Ithaca's investment in Cambo is a no-brainer imo because they plan many years ahead. Without reliable fossil fuels Israel is weakened.

Whenever their is a spike of hostility in the ME Energean seems to hold up pretty well and they have a ship within range of Hezbollah. I imagine that an attack on the FPSO and the US will unleash a carrier strike combined with attacks from Israel. Symbolic low level attacks keep the lid on escalation to an extent. An attack on energy would be existential to Israel and retaliation would be immediate and deadly.

Energean moved their AGM at short notice some years ago and I was the only attendee. One thing I remember is that they weren't impacted so much when oil and gas jumped about. That was because they have long, long contracts with customers. They don't treaty energy with the casual, ideological treatment that the UK give it. Did Keir Starmer really believe that renewables were 9X cheaper when he spoke at Davos? We know Ed said it but he is a lost cause. He is too invested in NZ and cannot go back. Starmer has wiggle room.

We almost sold 20% of Kraken to Delek in 2016. We know Delek well and (memory) I think AB was involved with Ithaca at one stage. Not surprising as the UKNS is getting increasingly incestuous.

It would not surprise me if lobbying is coming from Israel. They value security above profit and I expect Cambo to go ahead. That would possibly carry Bressay in its wake.

There is still a lot to play for.

There is a very teasing article on Doomberg today. You can only read the preview or £240 a year. It revolves around internet speech crackdown and finished with this: "Lost amongst the media’s focus on the riots and the government’s reaction to them is a cascade of radical energy policy changes underway that will have a far greater impact on the British economy and way of life. Ed Miliband, career politician and the newly appointed Secretary of State for Energy Security and Net Zero, seems to have observed Germany’s approach to energy and decided that its only flaw was temperance. Let’s explore the changes he has been swift to implement, and why his policies are all but certain to result in catastrophe—while it is still legal for us to do so (we think)..."

I'm not happy to pay £240 for an opinion piece that may or may not add to my/our knowledge. On the off chance that anybody can access it I'd be intrigued to know if it is reveals anything.

There does seem to be opposition building and Ed Miliband seems to have a muzzle at the moment or is that temporary respite before a final coup de grâce to the O&G industry. Labour seem glued to ideology and have more or less kept most of their promises to date; one of which is to drive a stake through the heart of the O&G industry. I hope they know what they're doing?

I don't think Ed Miliband (career politician - can there be a worse insult?) is capable of running a bath - let alone the energy sector.

"The Bentley losses acquired become available to offset against Enquest taxable profits after 5 years." Conditional I imagine on Bentley being developed?

Your posts confirm that it is a double attack on the future of the NS. You are taxed to a level that prohibits investment and in case that doesn't work the emission demands require extra expense (probably electricity replacing diesel) that adds to the (already) unviability of new developments. We are trying to shoehorn Bressay into production using a combination of Kraken emission reduction. I'd say that is a non-starter because you should have an administration helping manufacturing and future growth. The government is openly hostile to any assistance and seemingly bent of testing diving off the cliff-edge approach.

I found the letter in full on Energy Voice. No signatories attached.

I would like to read the letter and especially who signed it? To attract Union support they should put the number of jobs and affiliated jobs that they estimate would be lost if the companies cease trading. The companies could help by also estimating the number of jobs they think they could create with renewable job creation + costs + subsidies. Oil & Gas does not receive subsidies whatever activists say. Tax allowances are normal across most industries. https://www.equinor.com/energy/rosebank#faqs

I think I could have done a better job than David Whitehouse at OEUK. It isn't an open letter if I can't read it. How is he [David Whitehouse] still in a job? He must have failed all his performance targets.

He spoke on R4 today at 6:17 and I think he missed several open goals. Is the industry going fast enough was one. That is not the industry's responsibility. Those about to be despatched do not usually enthusiastically build scaffolds or arrange firing squads. That is the government's responsibility and they have formed a circular firing squad.

Then there is the timing of this letter. It will be in the bin when parliament returns.

If anybody can access the letter and signatories I would be grateful.

From Our Ed on twitter 2 hours ago

"Britain is leading global efforts to tackle the climate crisis 🇬🇧

That’s why I’m in Brazil – an important partner in the fight against climate change, to see how we can work together on this shared challenge"

Clueless or is it some kind of pilgrimage?

Like watching paint dry. And you should know.

"Unfortunately, the planter in question includes materials that are not environmentally friendly, such as plastic and concrete, which conflicts with our sustainability efforts."

What are his turbines made of and how do they stand upright without concrete?

With the ESIM price threshold I have complained in the past that conflating gas with oil over complicates the mechanism and can work against our interest. Electricity relates more closely to gas power. Maybe in this case it comes to our assistance. If they soften on the investment allowance (quite simple to do as few understand it) then it has to apply to both O&G.

The timing is pretty good too. Parliament returns in 2 weeks. This is one where we can sit on the side-lines and enjoy. I'm looking forward to September.

i belatedly started reading today's sunday times. an article by dominic lawson titled "the drax tax is an affront to reason and nature" made pleasurable reading. he went through stuff rehe****d on here but his final two paragraphs were reason to celebrate:

"in the meantime, miliband is soon to encounter resistance to this whole business from the labour benches. the mother of the house, diane abbott, is circulating a letter to all mps, who are busily signing up to its complaint that "british families pay more for their electricity than any of the 27 members of the eu. this drives fuel poverty and makes it much harder for pensioners to keep warm... a key reason that our electricity costs so much is the huge subsidies paid to the drax power company for burning tens of millions of trees every year."

how long can the drax shareholders continue to reap such lavish rewards? in a more rational world it would be their profits, not the trees, going up in smoke."

all this whilst the uk mothballs the cheapest energy in the eu and taxes it to extinction. miliband has made a major misstep here. he has awoken the other kraken. i mean the one made up of millions of pensioners who have plenty of time on their hands and do not take kindly to being dismissed so lightly. whatever you think of diane abbot she is loved by the hard-core left and unions. miliband is viscerally hated by them. he is being attacked on several fronts now and his incompetence is no defence. this has made my day!

This list is a mess. It has just dawned on me that even the UK registered companies have little UK shareholder interest. Ithaca is Delek (Israel) and Harbour have EIG (US) as major shareholders.

This complicates it even further imo. You have Rosebank with Norwegian/Israeli ultimate owners and Cambo with Shell and Israeli owners. Shell doesn't appear to be totally enraptured with the British government either. What a mess.

M's posting 12:35 made me realise Serica wasn't in the list. More info on the list and how it was created:

"There are 258 companies with production and exploration licenses in the UK Continental Shelf (UKCS), many of which are subsidiaries of larger groups. The NSTA consolidates these license holders into 118 parent companies licensed to produce oil and gas in the UKCS. 65 66 However, in reality just 20 parent companies – operating through 82 licenseholding subsidiaries – control the bulk of all currently productive oil fields. We used NSTA production data from October 2021 to October 2022 to identify the most productive fields. We then linked this data to the equity holders to come up with a list of the 20 major parent companies responsible for 81.3% of production in the last year. "

From a report from Unite the Union titled:

"Unite Investigates: Renationalising energy - costs and savings" February 2023

Hi Dumbly - the list is not up to date and has a reasonable source (Unite Union) who want to save jobs in O&G but also Nationalise the industry. It does help us see the bigger picture. This is the "silly season" regarding news and with slow news you get commentators printing any old rubbish. This is a time to consolidate and prepare for action post budget and for when politicians return from their holidays [the O&G producers grind on]. It is pretty pointless wasting energy on attacks when there is nobody in or listening.

I think events are gradually working in our favour and if Ed is true to his religion he will stop burning wood pellets at Drax. If he does not (because his whole NZ would collapse) then it opens the door to developments in the UKCS with the "level playing field" Act coming into play. He has managed to get himself into a self created corner without any help from the O&G industry.

He [Ed] should have a lot of margin for error. If renewables are 9X cheaper then even if that was hyperbole and exaggeration they must be at least 3X cheaper, eh?

As regards Waldorf I think it is nailed on that we take over their interest in Kraken as we did with First Oil and Kraken back in 2016 and don't forget we have their ex CEO on board, Steve Bowyer. Alternatively they could be part of a larger deal and those take time. Whatever happens we have a senior interest.

I am overall more confident because both the Tories and labour have used the industry as the fall guy and forced it to pay for budget gaps. We have been given fixed penalties only because they 'changed the rules'. The result is that the industry won't deliver new fields because it is not economic to do so. We are in the privileged position of having old tax losses to fall back on. Others are not so lucky and will consider legacy wells a drag on progress and increase their desire to get out. You can't just do a moonlight flit so unless Labour want chaos to ensue they'd better have a plan B.

Harbour 13.62%

Total 10.72

BP 9.71

Shell 7.03

Neo 6.36

Ithaca 5.57

Spirit 3.81

CNOOC 3.31

ENQUEST 2.99

Apache 2.98

Taqa 2.95

Perenco 2.11

Repsol Sinopec 1.86

EQUINOR 1.84

Korean NOC 1.78

Neptune 1.1

CNR 1.05

Ineos 1.02

Centrica 0.77

Hurricane 0.7

From this list of Top 20 Producers (Oct 2022) those with UK PLC owners are Harbour, BP, Shell, EnQuest, Centrica, Hurricane - Neptune and Ineos are UK Private companies, Spirit is mixed – Hurricane is now Prax and I’m unsure if it is private or PLC – could be an interesting model? From this 81.28% the UK O&G is c.40.7%

It does help with the perspective. So you could argue that more than half existing producers are foreign. They each have different drivers and can potentially retaliate if draconian measures are seen to be overstepping International agreements. Could also scupper aims to Nationalise the industry that some have put forward. I’m not even convinced that Harbour will remain UK based with question marks against Shell and possibly BP.

"There are no subsidies for the UK offshore energy industry. Companies can offset the expenses of running their business against their profits. This applies not just to those involved in the exploration and production of oil and gas in UK waters but also shops, sole traders, and many other industries. These costs are known as Allowable Expenses. If business operating and capital costs increase, then profits and the tax due on them will decrease.

Governments also deploy investment allowances in a range of industries to target investment in key policy areas and this is also not a subsidy, with the investment funded in full by the company." Source https://www.equinor.com/energy/rosebank#faqs

Can the renewable industry say the same regarding subsidies and investment allowances?

Over to Ed now to defend the indefensible. He has made a lot of promises. Rising energy bills suggest someone has been telling 'porkies' or even worse - doesn't understand the real world of energy and economics.

Hi Dumbly,

I think your 1-5 are all ‘unlikely’. The reason I say that is because Labour have plenty of other issues to keep them occupied and O&G + EPL are conveniently ‘parked’ for now and few people are paying it much attention. There is the added problem that the UK O&G Industry is now in the hands of various smaller companies. The Majors have the real leverage and they have moved assets out of the UKCS. They [BP, Shell] scare the Government; we don’t. Simply put the Government can bully us and treat us with contempt.

I think Labour will do what they’ve threatened (actually said). I’m being realistic but all is far from lost imo and these are some of my reasons:

I’m looking at some figures for top 20 UK O&G producers as at October 2022. The biggies are:

Harbour 13.62%, Total 10.72%, BP 9.71%, Shell 7.03%, Neo 6.36% - Harbour & Neo bought assets from the Majors and now appear to be heading away whilst Shell & BP continue to divest from the basin. Who will now buy these assets? Willing sellers but few buyers with fiscal uncertainty and climate zealotry rife in the UK. I think that the Majors will be very creative and helpful with financing as they have been in the past. Believe it or not but we hold a strong hand. We can survive on our own and aren’t legally required to help the Majors exit a basin that doesn’t work for them any longer. We should not be in a hurry to make life easier for either the Government or the Majors. Deals will be structured with claw-backs if the Government ever treats the industry with fairness again. We will almost be paid to take responsibility for these unwanted sunset fields and infrastructures.

GB Energy will have it all to do. They are banking on O&G workers moving into renewables. That doesn’t actually happen (look at coal). The removal of the winter fuel allowance now means that Ed has to deliver on his cheap bills from renewables. The main threat though is Drax imo. It provides 6% of our electricity and subsidies match dividends. Drax admits that without tree burning, net zero electricity “is not possible”. Acceptance that the CO2 claim is false should logically mean cessation of subsidies up for renewal 2027. Drax has threatened to close the plant if the tap to £billions is turned off. There is a judicial review ready to go questioning the net zero emissions related permissions of Drax that appear not to have been rigorously applied as required by law (they can also bite us in the bum).

We can afford to sit and watch.

Between 1980-1984, more than 200,000 miners lost their jobs with the accelerated closures of pits. A 90% reduction. It produced limited use of migration or changes in occupation following the job losses. Instead, many miners retired earlier or declared sick or permanently disabled, a phenomenon called "hidden unemployment".

They'll say that closing down O&G is less damaging because it supports around 30,000 direct and 100,000 indirect jobs. It won't worry Westminster as most of those jobs are in Scotland and Doncaster isn't on the coast.

This will end in tears. You can't cut out the winter-fuel allowance and increase energy bills at the same time.

https://ifs.org.uk/sites/default/files/2022-09/Job%20displacement%20costs%20of%20phasing%20out%20coal.pdf

I wouldn't get too excited. 'Reclaim the Power' is just another crackpot evangelistic offshoot of the environmental religion. I think that the Labour party deserve them and it is nice to see them demonstrating a short drive from Ed's constituency. They use lazy tropes that have run their course and undermine any point they have to make. Here's a perfect example from the Ecologist article - whingeing about them not being treated as 'special' and beyond the law they write “It is utterly ridiculous that multiple police forces have wasted so much resource on this massive operation to stop an entirely peaceful protest, when they could have focused on preventing the violence fascist attacks happening nationwide."

"The word FASCISM has now no meaning except in so far as it signifies 'something not desirable'". published in 1945 from an essay by George Orwell - 'Politics and the English Language'.

Now he actually fought Fascism and knew the true meaning. How can dilettante poseurs expect to be taken seriously?

Updated on the EnQuest site. Pretty unchanged. BlackRock moved below 3% but above 2%. Helikon in at 4.66% but were previously below the 3%. We're not the only long term holders here. Cobas + 1.06%.

Obfuscation as normal. Until I get clarity I read it as "f*ck you O&G. If you want tax relief join in the move to decarbonisation and invest in renewables."