Member Info for senseman

From ADVFN's Marmar (also respected)
marmar80 19 Mar '23 - 12:44 - 37017 of 37017
Senseman, I would not be able to summarise it any better. Lack of common sense when it comes to return it with cash. Is it Prax or Hurricane who pays for this takeover.

Have posted the stream to show (i) ADVFN basically same as here (ii) respected kooba's reasoned position (iii) my 1-10 main reasons for disliking deal. Hope not too tedious but as well as wanting to harness my own thoughts, it's important to hear knowledgeable counter-argument to common feeling on both here and ADVFN.
Note - only I can usefully add is that kooba and i never fall out (we ADVFN message) but have always held differing costs/profit/P6 risks viewpoints. On the costs/profits issues, to date mine have so far been remarkably accurate. That is not to say of course my view of the future will be

senseman19 Mar '23 - 12:11 - 37014 of 37017
I would add:-
8. It can't be argued that because CA & Ker recommend the bid, it is good for HUR. For Kerogen the quantum is peanuts, they covered costs by selling tranche earlier & likely want out just to clear irritant HUR from desk. CA are under 'seller's exit pressure so it is judgement call. Telling BoD price they wanted one way or t'other in my view error (should have cited higher) as allowed BoD to work backwards to BoD's personal advantage & tie CA up like kipper. I believe CA will in time view decision as bad judgement call. Deal suiting HUR & Ker does NOT automatically mean good for HUR or remaining 55% SHs.
9. At 12.5p straight cash I would have voted against deal for personal reasons but understood CA's acceptance and bore no grudge as understandable friends' parting of ways. I believe in supporting this bid/deal CA fall below 'natural duty of care' long term friend owes not to leave friend (us) which helped saved CA investment in 2021 in circumstances which diminish us when not necessary. In my view, bad judgement call.
10. I view horrific Irrevocable Undertakings as proof of Prax, HUR BoD, CA & Ker knowing the deal is not good for company HUR or any other SH. Other wise why their need for existence, particularly in draconian format? And why the need for such language, fact & figure skewed presentation/deal documents?

koob - re costs & profit is again where we must agree to differ without rancour. I don't accept HUR running costs are currently so high and will increase so dramatically, not do I accept citing $73 oil appropriate when a higher 'balance of probability figure' should be applied. My figures don't rely on $90 or $100 oil. Comment re FSP costs is valid but these will be excessive as a stitch-up job usually doubles costs. I don't cite AM rental escrow money as free spendable cash but as a cost-saving gift to Prax which needs taken into account when considering a deal good or bad. Put it this way - if you left a rented flat would be happy to leave your 2 months security deposit for the incoming tenant to benefit from, or would you want it back? In applying common sense in the past to HUR's future cost & profit projections I have been remarkably accurate, much more so that the BoD

kooba19 Mar '23 - 10:51 - 37013 of 37017
The free cash at the end of this month will likely be $130m maybe less with the fees on FSP. The funds in escrow are not free funds and with cost pressures everywhere it is unclear if the decommissioning is now fully provisioned . If Bluewater decide to leave then we can bring that escrow money back to free…but thats the end of production when they leave , so not exactly a positive.
We are now moving towards a 10 week offload cycle whilst the fixed costs are still there..and likely increasing in some operational costs,..labour costs are going up.
So if you work on 10 week cycle fixed costs $25m for one offload of 525000 boo ( not allowed for any down time there 69 days at 7600) giving 525000 at $73 current brent $38.3m..take off bluewater share $3m..leaves $35.3m.
So over 10 weeks the company might net $10m.
And there will be production declines from there…unfortunately many numbers given are not taking into account production and price declines and inflation in costs. Happy for those numbers to be challenged as back of a *** pack.
Yes the oil price could go back up…but the DCU will pay out the revenue benefit from that..so there is upside either way on the calculation.
But in 10 weeks it effectively adds 0.4p to shareholders.
If you take the DCU revenue share we get 17.5% of the offload we get 0.28p.
But we have already taken all the cash out of the company and stand to further benefit from any other production assets acquired by Hurricane.

kooba19 Mar '23 - 08:37 - 37007 of 37017
You (Jacqui) are not explaining why you think it is worth any more than the offer..senseman is at least trying to put some numbers to this ..which i think where we are with costs and the oil price and declining production are rather optimistic. If i have time i might put an example of where we are with both alternatives..take this or crack on alone with same management.
You say i am the only shareholder who takes a view that this is as good as it gets…apart from the 2 most important ones who are totally behind the deal who have probably done their own research. Crystal Amber having been invested here since before they listed and wants to maximise returns to its shareholders and kerogen a large specialist energy investor involved in multiple M&A deals in North Sea oil and gas.
The views on a BB are not necessarily reflective of all shareholder views it seems.
But hell i am allowed an opinion and do back my posts with facts rather then ..couldn’t make it up comments with no justification…folks need to understand anyone who might have been interested has kicked the tyres and didn’t even match the deal being offered..yet most think that there is plain as day far more value..maybe all th experts missed it??

senseman19 Mar '23 - 10:37 - 37012 of 37017 Edit
My objections in main are as follows:-
1. The 'bid' likely only one leaving BoD in situ, + bonuses. Given history, I have zero faith it is best for HUR, or beats 'no deal' + new BoD. This reason is HUGE,
2. At BoD's request, ERCE updated CPR now magically shows economic production till Feb 2026 + uprated reserves (I always said would be 2026 - or longer)
3. Well 6 catastrophic failure risk hugely overstated - 2022 AGM Maris stated backup pump 'no reason why should not work;, and changeover timescale 2-3 weeks.
4. Market experts say bank squalls soon end. Most oilies downgrade 2023 average by only $10 & most retain $100 oil prediction end 2023 or sooner.
5. Unarguable by end May signing date HUR will have 7p p.sh cash, net of AM escrow funds held which make 7.8p p.sh.
6. Hard to argue, even net of AM escrow funds, HUR will not have 9p cash Xmas 23 & 11p cash end Q2 2024.
7. Decomm costs already held paid & secure in escrow

senseman18 Mar '23 - 21:58 - 37002 of 37017 Edit
Jacqui's question is simply fair. Have always taken ESPECIAL CARE to make clear HUGE RESPECT for kooba's opines. Devils's advocate ALWAYS merited. Kooba & I always differ re risk profile & cash realisable. But it is UNARGUABLE that by end May signing off day, HUR will have straight 7p p.sh banked cash, 7.8p if 6mths AM rent escrow funds taken into account. All decomm costs already held in escrow. Use any LOWER metric one wants, HUR will have +9p free cash (likely +10p) by end 2023,and +11p by end Q2 2024 (likely 12p). Only black swan variable is well 6 catastrophic failure (-10% probability). Kooba - huge respect, but you need explain with figures why HUR won't have cited free cash I opine by cited dates

kooba18 Mar '23 - 22:08 - 37003 of 37017
My expectation was not high of achieving anything over the 7.7p ..I have in the past been lambasted for pointing out the risks of a single declining asset..add now cost inflation pressures on production and a declining oil price and even without any early cessation of production the amount available to distribute on a wind up was going to be limited to below 9-10p in my opinion. So my initial thoughts on the deal were not great as the up front was not appealing and the earn out was without much detail. I’ve looked at it closer and still need more detail on the DCUs but from the presentation I think they rank for equivalent of just about gross revenues on everything produced..which could be 2.5-3p out of W6 and I strongly believe now looking at the tax position that Hurricanes new owners will indeed inject production assets to keep the tax credits alive in case W6 encounters problems. So I think the DCU earn out to 2026 could indeed pay out the full 6.48p in haly yearly payments which I believe would payout more than a wind up over next 2 years or so. Could do with more convincing from Prax on their plans and confirming the revenue share is as I believe..so hopefully more info on those points and on governance and comms on DCUs and whether they are transferable or likely tradable before having to make up one’s mind.
CRS and Kerogen are no idiots and i believe they would have had detailed meeting with Prax to get the irrevocable acceptance. By doing that they also must think there is no better offer to be had i guess and prefer this outcome to a wind down for their own investors.

Peeps may wish to know ADVFN (somewhat to my surprise) erupted in similar nigh on total disbelief & derision of Thursday's news. Only poster considering the deal fair & decent being kooba. Since respected kooba thinks before posting his view cannot be easily dismissed. Still trying to harness my thoughts I posted there (intention was for here) as it seemed apposite to their discussion. Below is a sample 3-4 ADVFN posts (in posted order) peeps may find helpful:

Jacquibic18 Mar '23 - 18:49 - 37000 of 37017
Kooba, are you invested in hurricane (cannot remember as read so many posts)if so out of curiosity which way are you voting?
Having read on here and LSE virtually every post in the last 2 days it seems you are the only poster who believes they (BOD)are painting a true picture and have got a fair market deal….what do you think is the probability out of all the investors who have posted that they are all delusional or have a blind spot to the reality when it comes to Hurricane?
Having read your posts you are very knowledgeable and respected by fellow long standing hurricane investors but can you see my dilemma why only you?

RG27 - from experience, I always found best to phone where poss and check email address is THE correct one or there is a more specific one direct to one's target. Tedious but works. Nothing more soul destroying putting one's heart into an email then later finding it's sitting in some generic email and didn't hit it's target. I wait 2 days for reply then pick up phone to person if haven't gotten one. We aren't in a position to be shrinking violets - better to be told to eff off than be waiting ad finitum for email reply that never comes
All helps and is grist to the mill as outliers sometimes produce great results
But again, let's not lose sight that main target has to be HUR main inst SHs

It's important to pin this down early - let's not just guess or think
Someone take it upon themselves to email info@lse.co.uk with the question. When an answer is obtained and posted, someone can then email same to get confirmation
Am dusting down my box of Special Gold Stars, for anyone who hits a home run on anything valuable

Noel has opined (see below)
"RE: AlternativeToday 09:49
With the record of voting at past GMs (approx 60% of total ) we probably only need 15% OF TOTAL shares to reject - only 300m!"

All that is required is for HUR BoD to phone & chat up the other main inst invs (who will have seen HUR's Conclusion Of FSP powerpoint presentation + Prax & HUR fairy tale documents) and secure their votes, to see near near 80% of ALL shares cast in favour. We cannot be lulled into complacency. We need whole 20% (we won't get it) of PI shares being cast against, PLUS some inst invest support

Euston - thanks. I will contribute as and when I can.
My main message was to make clear that others must learn how to do, and be prepared to do, donkey work - CA are no longer doing donkey work in our favour.
To illustrate what I mean by donkey work - someone needs to PIN DOWN top 10 inst invs & find name & contact email + phone of head honcho - not speculative but PIN DOWN. This can easily be a half day or full day's inet trawl and phone blitz - pure donkey work. Unpaid, no giving up, needs be thorough & 100% accurate, little thanks. Keep notes so can compare and consolidate results. A few hard started - I urge them to double down and keep at it.
I return to my main thought - only way to prevent 75% being achieved is to obtain a degree of inst inv support.

In case of interest - I have found it better to print off all core documents (some 20-30 pages but there aren't many). One can then read them lying on the sofa or in bed etc, and have them to hand when need to check or reference. Yellow marker highlight pen the crucial paragraphs or sections. Much better than scrolling through company websites again and again and getting more confused. Having and reading physical copy also helps the mind retain the basics better

Gazelle - your Sat 09.59 post (am playing catch-up)
I never put my name on spreadsheet, and so have not amended whatever it was beside my name.
I have 3 friends/acquaintances holding large numbers who will vote no with vengeance, Add my depleted smaller number (remember had to sell some earlier) to theirs and round figure is 2 million. So for spreadsheet accounting purposes you can put 2 mill by my name (have never used/worked a spreadsheet)

Forget FCA
Forget EGM to out HUR BoD
The ONLY avenue is stopping 75% vote at HUR AGM to vote deal through
All else is C RAP. Unless all GET REAL, we are DEAD!!!!!
Suck it up, deal with it, decide what you want to do. And how you intend to effect that which is required.
I will not be repeating this essential message. Lock this into your braincells!

rodney - emailed back, thanks, we speak tomorrow
404x - awaiting reply, we need speak, nothing lost if non-productive
senseman

404x
email me peter0255@yahoo.co.uk
for phone number exchange so we may speak

Rodney
Any chance 10 min chat by phone? If it is poss, message me as below. give a phone number or I will email you back mine
my reserve email peter0255@yahoo.co.uk

Sorry - my downloaded link won't open on here. And when I open 4x4's link Saba link again to see where it came from, it's not popping up again. it was titled:-
Powerpoint Presentation
Hurricane
Conclusion Of Formal Sale Process
Recommended Offer AT An Up To 84% Premium
March 2023

i clicked on link 4x4 posted and soon after that link opened another link popped up - HUR powerpoint presentation
don't know if it's on HUR site (can't find it) or Prax. It opened my eyes
Is it PP presentation HUR sent to all inst SHs?
Open & read - talk about loading the dice - makes other docs look innocent?
file:///C:/Users/Peter/Downloads/Investor_Relations_Presentation_16_March_2023.pdf

How many bothered phone broker & posted to help all, eh? Grunt work gentlemen, grunt!
My Hargreaves understanding - DCU's are IOUs to pay remaining value of shares currently held under ISA wrapper , so stay within ISA umbrella (see below 16 March post)

Addition to point 4 of .'Thoughts' post - 'At AGM Maris/Chaffe stated downtime for backup pump switchover 2 weeks, add 1 week for always readily available ROV hire. total time 3 weeks'. Non apocalyptic.

"senseman
LISTEN UP - ISAs 16 Mar 2023 16:13
Needs 9 other people to check with their broker
Hargreaves say if shares in private company issued, then cannot stay in ISA
BUT
We will be given 'a deferred cash payment line' which will be marked in the ISA and remains there. It's a promise to pay additional sums. Ergo, he says he is 99.9% certain of his facts and cites 'NAPSTER' as a company which recently did the same thing and SHs deferred cash payment line stayed, and currently remains, within their ISAs.
If correct will save a few heart attacks. Needs checking of course - push to speak with someone with expert ISA knowledge"

Not sold, having little sleep. Limited use posting whilst all legitimately indulge in angst, & find their way round HUR RNS, Prax document, Irrevocable Undertakings, Maris video. Those who haven't yet, do so pronto. Grunt work - get hands dirty. Don't expect others to educate you on detail, it's unfair. My take:-
1. Docs structure, language, style, skewed narrative & fact redolent of 2021 court $17mill pile of toilet tissue.
2. Constructed to hoodwink other Inst Invs whose vote needed to get to 75%. 'Bury with complex paper' works.
3. Flawed rational for sale/deal employed/exagerated - risk of catastrophic well 6 (pump) failure.
4. 2022 AGM - Maris 'no reason for backup pump not to work if switched on - devil's advocate % 75% - 100%.
5. Free cash by end May court deal signing-off day $170mill = 7p (today £1 - $1.22)
6. Calculated end Feb $140.1mill + April 20(ish) offload say $19mill + AM half full say $10 mill
7. Add $20 (circa) AM 6 mths escrow security held, Prax cost benefit saving = 0.8p. Cash end May = $190mill = 7.8p
8. AM escrowed decommissioning sums split 50-50 as upon sale both HUR & Prax will have utilised Well 6 & AM
9. Don't know decomm costs held, say $40mill - half Prax benefit = $20 mill owed to HUR

My disappointments:-
10. BoD (expected). Deal unjust, unnecessary, no clear SH advantage, all Prax benefit, HUR BoD enriched & in-post.
11. CA - both deal & manner. No clear advantage. Manner poor, unnecessary, inexplicable.
12. Irrevocable Undertakings. Disgraceful docs meant to render SH vote Russian election. Collective collusion.
13. Were I CA BoD member, would have voted against deal as no clear advantage, indeed clear disadvantage.
14. Were I CA BoD member, would resign CA BoD re 12. & isolating of collective PIs who protected CA's investment.
15. Caveat to 12-14 above - based on current knowledge, I await CA comment to market etc.

What Can Be Done?
16. 75% of votes CAST needed to pass. BoD already have 45% of ALL shares as block. PIs held 21% of ALL shares
17. Put simply, would take 100% of PIs 21% shares. Plus +4% from elsewhere, to reach +25% votes cast to defeat BoD.
18. PIs likely now -21% (sickened sales). And not all 21% would vote (situational unawareness, tax reasons, coma)
19. Most institutional shareholders vote with BoD recommendation. Ignorance, laziness, 'BoD know best' etc.
20. FACT - to reach +25% votes cast, PIs need institutional investor support.
21. FACT - unless some PIs prepared to do grunt work, barring unknown wise inst inves or two, 20. won't happen.
22. FACT - yesterday I suggested someone find/list top half dozen inst invests + main man's contacts. Silence!
23. FACT - I can't do it. Am fighting to save my home after cost/time consequence of time inputted in 2021 & since.
24. I can write emails & contact inst invests. But I can't think, donkey work, write & cheerlead. Not fair. So sorry.