Member Info for senseman

Please could those who already sent Fat Frank's email to Sec of State Rees Mogg (& cc'd to 4 others) COPY their email to:-
correspondence@nstauthority.co.uk - ie: email address of NSTA (NORTH SEA TRANSITION AUTHORITY)
Because this may flush out whether HUR explanation is correct & fault does lies with NSTA

Fat Frank's email is in 3 parts ie: posted here yesterday Tues (i) 18.39 (ii) 18.46 (iii) 18.48
Email address to send to is: secretary.state@beis.gov.uk
cc to: correspondence@nstauthority.co.uk
philip.wolfe:@hurricaneenergy.com
antony.maris@hurricaneenergy.co
comms@hurricane energy.com
rb@crystalamber.com
We have so far 7 + ADVFN senders (LSE forum much bigger). We need 20 before relaxing. Please can posters spend 10 mins emailing - whereas it is tedious we need try put cat amongst pigeons (it has worked before).
Please could peeps include (add) correspondence@nstauthority.co.uk (NSTA email address) to text at bottom of their email where cc's are listed, before sending

CEJ - have emailed
7 so far from LSE - we are up and running

Automatic reply: HURR ICANE ENERGY - STRATEGIC RESOURCE - UNHELPFUL NSTA (North Sea Transition Authority)
"If you are writing to me as Secretary of State for Business, Energy and Industrial Strategy please email:"
secretary.state@beis.gov.uk

NOTE - JRM email as Secretary of State is secretary.state@beis.gov.uk

jacob.reesmogg.mp@parliament.uk
jacob.reesmogg.mp@parliament.uk
jacob.reesmogg.mp@parliament.uk

We need 20-30 emails to JRM by Monday - 50 in dream world. If we manage 20-30, together with ADVFN's, there is fair chance JRM will have a junior investigate & report back
all email addresses given are correct
on page 3 - there are 2-3 typos - all where NTSA is incorrectly written rather than the correct NSTA. Please correct prior to sending.
Fat Frank on ADVFN was the writer - I just tidied up
The email can be VARIED as people consider appropriate, or sent AS IS. Essentially it is a template for peeps to feed off.
If you email - please INFORM forum - so we know how many we have

Please can comments be posted on THIS thread. So that people can easily identify the 3 posts (1 long email) containing the email text in straightforward order. To avoid confusion and assist easy copy and pasting for those wishing to email JRM. I have already emailed and copied to the other 4 recipients

(cont - PART 3 to end) text as follows.
new para
As a Hurricane shareholder I find it deeply disappointing that, at this time of extreme turmoil in the energy supply chain, a successful UK company is walking away from proven oil reserves, in a location with existing infrastructure and a comprehensive plan for extraction, because it is unable to secure the support of a Government Agency. Surely maximum assistance and encouragement should be given by the NTSA to UK operators to ensure they extract everything possible, before field abandonment, in order to maximise ever diminishing UK oil reserves?

This becomes even more vital considering a 4th September Energy Voice article citing a recent report by OEUK market intelligence manager Ross Dornan which stated;

'without new investment, forecasts suggest the UK would be reliant on imports for 80% of its gas and 70% of its oil needs by 2030 – up from 62% and 25% last year, respectively.'

I respectfully ask that, should you consider it appropriate, you consider intervening in this matter. Possibly by requesting that both the NTSA and Hurricane revisit the issue with eyes afresh, and reconsider the decision(s)

Yours sincerely,

Name (Shareholder)
cc. philip.wolfe@hurricaneenergy.com (Philip Wolfe, Chairman, Hurricane Energy)
cc. antony.maris@hurricaneenergy.com (Anthony Maris, CEO, Hurricane Energy)
cc. comms@hurricaneenergy.com (Hurricane Energy Communications)
cc. rb@crystalamber.com (Richard Bernstein, CEO & Chief Investment Officer, The Crystal Amber Fund - 29% major Shareholder)

(cont - PART 2). text as follows
new para
It will also have to navigate the implications of the government’s windfall tax, though this was described as “manageable”.'

Last week Hurricane Energy issued its Half Yearly Results containing the following update on Lancaster field development, with Anthony Maris CEO commenting:

‘Repaying our Convertible Bonds and becoming debt-free has enabled us to consider multiple trajectories for Hurricane's future. At the same time as ensuring continuing production from Lancaster, we have been working diligently on many workstreams, all with the aim of creating additional value for our shareholders. In terms of Lancaster, continuing our close collaboration with our FPSO operator, we have been able to deliver superb uptime performance, leading to the production of more oil in the period. Our team can be justifiably proud of the fact that we bettered our targets set for the shutdown and unplanned downtime without at any time compromising the safety of our operations.
Looking to Lancaster's future, we have expended considerable effort and some funds into maintaining the ability to deliver a new well in the Lancaster Field, termed P8, in order to meet our "maximum economic recovery" obligations to the UK Government. Given our emissions challenges, we have worked closely with the UK's offshore regulator, the North Sea Transition Authority ("NSTA"), to plot a way forward for Lancaster. It is disappointing that despite the enormous efforts of our team, and extensive interactions over many months, the NSTA is unable to provide comfort to the Company with regard to the likelihood of it being granted the necessary consents related to flaring for Hurricane to make further commitments to investment in Lancaster.’

He further commented:

'The project and the level of financial commitments are of major significance to the Company. Therefore, to seek clarity this issue was raised with the most senior levels within the NSTA. Having now considered this, the NSTA finally confirmed on 29 September 2022 that, in response to our requests, it does not give such comfort.

Whilst the Company believes the proposed P8 project would be within the regulatory guidance, the Board has concluded that in the face of regulatory opposition, the additional financial commitments to offshore equipment suppliers and the associated financial risk of proceeding with P8 is too great.

Therefore, with great reluctance and regret, the Board has decided that no further investment is possible in relation to an additional well on the Lancaster Field.'

(to cont with final part 3)

to be sent to jacob.reesmogg.mp@parliament
in email subject box: HURRICANE ENERGY - STRATEGIC RESOURCE - UNHELPFUL NSTA (North Sea Transition Authority)
cc to 4 email addresses at email end. text as follows:

HURRICANE ENERGY - STRATEGIC RESOURCE - UNHELPFUL NSTA
Mr Rees-Mogg MP - Secretary of State for Business, Energy and Industrial Strategy,

Dear Secretary of State

I would be grateful if you would consider the below situation regarding an independent British oil producer operating in the UK sector.

In June 2019 Hurricane Energy produced first oil from the Lancaster Field located West of Shetland. It currently produces c8,000 bopd although this is now from it’s P6 well alone. Declining production is forecast to likely become economically unviable during 2024 at the current rate of natural decline.

Hurricane reappraised it’s resources following the initial performance of the field and the original figure of estimated recoverable reserves was substantially reduced but, by analysing data acquired during production, they commenced planning an additional well, P8, to maximise extraction from this valuable asset. In July 2022 the following article appeared in the industry newsletter Energy Voice:

‘Hurricane Energy is weighing up an M&A deal or a potential $250m boost to its existing Lancaster asset in the West of Shetland.
The firm is newly debt-free after repaying more than $78m to bondholders, leaving the revitalised operator with options.
With a strong balance sheet, the challenge is to “identify how best to optimise capital allocation”, the board told investors at its AGM last month.
A potential new Lancaster producer – the P8 well – would add incremental reserves of 3-5 million barrels, with capital expenditure of $80-90m subject to the rig market, Hurricane told the AGM.
In return, the board estimates the NPV10 (net present value, discounted 10%) of the project to be around $250 million if the oil price stays at $100/ barrel, with “rapid payback” making the move “economically attractive”. Adding another producer to the existing P6 well also “diversifies production away from a single well and loss of remaining field value”.

‘Dealing with the regulators’

London-listed Hurricane Energy said it anticipates a final decision being made “later this summer” with first oil in Q3 or Q4 2024 and the team is “looking at what it would take to do that in 2023”.
Such a move would not be without problems, however. The firm laid out a series of potential barriers, including “dealing with the regulators as we navigate the issues around the below bubble point risks and the net zero targets they are focusing on”. Hurricane had previously mooted a side-track well to P6, but had been in discussions with the then-named OGA regulator on producing below the “bubble point” – when reservoir pressure declines to the point at which gas is liberated from oil, and may therefore need to be flared.
(to continue)

IMPORTANT
Fat Frank on ADVFN today emailed Secretary of State for Business, Energy & Industrial Strategy, Jacob Rees-Mogg, Asking the Secretary to intervene, in light of declared government policy, and request both the NSTA & HUR to revisit the P8 issue. The email is erudite and is being by other ADVFN guys. I have said I will repost it here and encourage our forum to email. it is necessarily lengthy because it includes various quotes. I will see if it loads on LSE in one hit. Otherwise it will arrive as 2 separate posts. With this in mind might I ask that no one posts for the next 20 mins or so, to give me chance to post it as cleanly as I can manage? Thanks
The email for obvious reasons takes at face value (HUR RNS) that the fault lies with the NSTA. It does NOT mean we cannot email HUR in later days requesting specifics for NSTA refusal (my intention)

HUR said P8 satisfies NSTA concerns. But NTSA still won't 'give comfort'. Both can't be right. Don't naively accept accept anything written by chief execs with previous for truth-bending. Ask them to specifically explain the clear contradiction - explanation which the RNS should have included

glouc - similar thoughts here. will CA be peed off enough to change chief exec(s) & revisit NSTA with P8 plan? do they have enough time/space? malcy's blog precies CA & PI long held views in short form

methinks email(s) should focus on ascertaining specific reasons(s) why NSTA would refuse P8 application. because P8 crucial. fatal to move to other things before that. it's what chief execs want. remember - ask first question the one you know t'other party will hate most

schlemmy - means 'unexpected' - no one expected HUR to no-go P8 for inability to secure NSTA permission

Well done Malcy (whatever one thinks, of his blog, it is widely read by trade & corporate).
I confess considerable surprise on Fri/Sat at how sanguinely SHs accepted P8 news (& buried in 6 monthly report).
There is already visceral comment on ADVD post Malcy blog issue, worth a read

I don't accept CA automatically want no P8. My lay view being that a fast-track scheduled P8 makes HUR more attractive & easily sellable. Imagine P6 & P8 producing in tandem 18K down to 15K for 2 years, with P8 likely to outperform in similar fashion to P6. A successful P8 producing Q3 203 immediately puts SP back into 30p-40p territory with today's (ie next 2-3 years min) high oil. CA's SH's relaxing of Dec 23 as wind up final date extends CA timespan if needed.

My Sat 'RNS COMMENT' posts at 11.49, 12.50, 14.20 may be worth a revisit. Lack of specificity & substance shrieked out of RNS to me. That is what Malcy has picked up on. If one has to deliver a left-field bombshell, is giving solid, specific reasons (especially if the blame lies elsewhere) not the first thing one does?

look at it this way.
at current 8300 bpd we fill tanker 530,000 barrels every 64 days, that's almost exact 250,000 barrels a month
costs 12 mill a month divided by 250,000 barrels = OPEX $48 a barrel
our OPEX is NOT $48 a barrel, our costs are NOT 12 mill a month

golden - i get it. whatever metric used, we will have a whole chunk more than Maris's $110 mill cash by end Dec. How the eff can we have 89 mill cash end july 22 and only 20 mill more 5 months later....grand theft?)
by the way - at 250K barrels a month at $57pb profit (90 oil) the profit is 14.25mill a month. so monthly costs almost equate to monthly profit with oil at 90? even though OPEX is only either $27 or $35(no one knows which). apply common sense. errr. they don't!. our month by month costs are NOT 12 mill. u and glouc are double accounting something
kooba on ADVFN make fair point HUR's EPL seems to be largely offset by capital expenditure of some nature. in which case there is significance diff between spending say 90 mill of own HUR money on P8 compared to spending 90mill of money payable to taxman
but generally - i share your general mega angst
we'll figure stuff out next couple of weeks, always this angst after fairy tale RNS

many posts - none of which answer my 14.20 pm lead question

the 12K a month cost metric is too variable and crude

From RNS 'Cashflow' section - does this mean our genious CFO wasted $4.2 million hedging HUR cash?

'Included within the terms of the extension to the Bareboat Charter is the requirement to set aside a certain amount of cash to cover the FPSO day rate during the six month notice period, along with amounts to cover the estimated decommissioning costs associated with the vessel's departure from the Lancaster Field. These funds replace the previous escrowed amounts that were in place under the original charter terms to cover early termination costs. At 30 June 2022, this amount was $19.4 million (31 December 2021: $7.9 million), resulting in an increase of $11.5 million into restricted funds during the period. An additional $7.7million was placed into trust in relation to Lancaster EPS decommissioning arrangements (as outlined above), resulting in a net decrease of $15.1 million to net free cash in relation to restricted cash movements once FOREIGN EXCHANGE LOSSES OF $4.2 MILLION ARE TAKEN INTO ACCOUNT.' (my capitals)

gloucs
i always work things out a different way: ie: POO at lower of 1st 5 days or last 5 days of offload month, minus 8% for BW, minus $35 pb production costs = profit per barrel x circa 530,000 barrels. hence no need work out monthly running costs. always served me well, save for profit usually couple mill higher than my sums. hence my question - does $35 pb costs already include BW 8%? (RNS paragraph cited both a $27 figure and $35 dollar figure, difference of which would equate roughly to BW 8%