Member Info for simonalexsmith

I do hope you are right Mirasol that the recent activity is sparking the idea they are due a return to normal trading. Interesting to hear thoughts on where the stock will be priced. I guess that’s a tough one if there is a deal. Sky’s the limit I suppose? More interested in where the position sits in the market without an RTO and a period of significantly changing playing fields. Firstly a removed cost of RH. Secondly increased / stabilised production and a successful and superbly priced hedge ( still can’t fathom how that was managed but praise where it is due!) I suppose even without a deal its price has to be higher. Albeit some explaining to be done? GLA

Https://www.bbc.co.uk/news/articles/c74172wlezwo?fbclid=IwZnRzaAMZDWxleHRuA2FlbQIxMQABHhykSlNKXw-y0Yyr3qtmuA7QSYj0wtL_e-Iw4hlRjW2s7vrQQjElZv54XYHx_aem_2QI9dMHH3YiQULsOnubw2A

Mirasol, think you would be best heading over to X.com and having a word with Lady of Aim bearing in mind that was the source of the leak that suspended this whole thing. Surprised more of your focus is not applied there?

They plan on drilling new wells, starting Q1 26, seems whilst they can offer sticky plaster improvements with coiled tubing / VS etc the real answer is new wells without royalties. Let’s hope the next week or two shows a return to market with an RTO success! GLA

Anyone with any news or insight other than more shares for board who have managed to drive this to the bottom and keep it there?

Mirasol, I respect much of what you say but all the can't pay statements are not what the company states. In fact they say that they are working with Trafigura on a new plan. Therefore, all just guesswork. It would be my guesswork that Trafigura are leading this RTO and will support Angus throughout as the MOU on Saltfleetby storage long term with a US partner business in the fold is an extremely valuable concept. With US LNG and storage with connection to Theddlethorpe and the demise of Rough is significant for the future. As you know the numbers dwarf that of the current market cap and yes it needs investment put if Angus get their act together they can potentially be on the cusp of greatness? GLA

Implications for SaltfleetbyThe limited UK storage capacity enhances the potential value of converting Angus Energy’s Saltfleetby gas field into a storage facility, as discussed in your previous query. With Rough’s future uncertain and total capacity strained, a new facility like Saltfleetby (potentially 2.3-3.4 BCM working capacity) could significantly bolster UK energy security, supporting its estimated £350-£500 million valuation.

The Rough gas storage facility is currently operational but facing significant challenges. It was reopened in October 2022 after being closed in 2017, with its capacity increased to 54 billion cubic feet (BCF) by June 2023, providing about half of the UK’s total gas storage capacity. However, Centrica, the operator, halted gas injections in April 2025 due to financial losses, citing insufficient price spreads between summer and winter gas prices to make storage viable. Reports indicate Rough is not closed but is at risk of decommissioning unless the UK government provides regulatory support, such as a cap-and-floor mechanism to fund a £2 billion redevelopment for natural gas and hydrogen storage. Without this support, Centrica has warned that Rough could close, reducing UK gas storage capacity from 12 days to 6 days of average demand. As of August 2025, Rough remains in use, with a record fill level achieved in November 2024, but its future depends on government backing

This is sequential on the thread starting with the first post. Interesting to understand Saltfleetby's true value from a storage perspective.

NPV of Storage: Assuming a 20-year storage operation, a 10% discount rate, and £150 million annual revenue, the NPV could be £1.2-£1.5 billion. However, this assumes full utilization and stable market conditions, which is optimistic.

3. Development Costs and RisksConversion Costs: Converting a depleted field to storage requires drilling injection/withdrawal wells, upgrading compression facilities, and ensuring pipeline connectivity. Costain’s 2010 study suggested costs in the range of £100-£200 million for similar projects.

Regulatory and Timing Risks: The 2010 storage authorization order indicates regulatory feasibility, but new approvals could take 2-3 years. Environmental concerns (e.g., CO2 storage considerations) and public opposition could delay or increase costs.

Market Risks: LNG oversupply or new UK storage facilities could depress storage margins. Conversely, persistent storage scarcity could enhance value.

4. Total Asset ValueProduction Phase: £190-£270 million (NPV of remaining gas production).

Storage Phase: Assuming conversion in 5-10 years (post-depletion), the discounted value of storage revenue is reduced. Using a 10% discount rate over 10 years, the £1.2-£1.5 billion NPV drops to £450-£560 million today.

Combined Value: Adding production and storage values, and subtracting estimated conversion costs (£150 million midpoint), the total asset value is:£490-£680 million (£190-£270 million production + £450-£560 million storage - £150 million costs).

Adjustment for Risks: Given uncertainties (regulatory delays, market volatility, Trafigura MOU not binding), a conservative discount of 20-30% is applied, yielding a realistic range of £350-£500 million.

Critical ConsiderationsThe £44 million sale to WINGAS in 2010 was for the entire field when storage was speculative, suggesting the market then undervalued its potential. Today’s energy crisis and storage scarcity increase its strategic value.

The Trafigura MOU signals commercial interest but lacks firm commitments. If Trafigura funds conversion, Angus Energy’s costs could decrease, boosting the asset’s value.

UK energy policy prioritizes security, but public and environmental pushback against onshore gas projects could complicate development.

The valuation assumes stable gas prices and demand. A drop to 80p/therm or an LNG glut could lower the production value to £150-£200 million, while storage value depends on sustained price volatility.

Due to ongoing reliance on LNG imports, limited domestic storage, and global supply constraints. While exact 2025 prices are unavailable, I’ll assume a range of 100-120p/therm (£3.40-£4.10/MMBtu) based on 2024 data and market trends, adjusted for inflation and demand pressures.

The UK’s energy mix remains heavily dependent on gas for heating (80% of homes) and power generation (30-40% of electricity), with LNG imports covering about 20-30% of supply. Limited storage capacity amplifies price volatility during winter demand peaks or supply disruptions.

The MOU with Trafigura reflects growing commercial interest in gas storage to capitalize on price arbitrage (buying gas when prices are low and storing it for sale during high-demand periods).

Saltfleetby as a Storage Facility:A 2010 study by Costain and WINGAS evaluated converting Saltfleetby into an underground gas storage facility at the end of its production life. The proposed design involved injecting gas from the National Transmission System (NTS) during low-demand periods and withdrawing it during high demand.

In 2010, the field was sold to WINGAS for £44 million, partly due to its storage potential, though the project was not pursued at the time.

The field’s depleted reservoir, with a gross sandstone sequence of 60 meters and a structural closure over 10 km², is geologically suitable for storage. Its proximity to the NTS and existing infrastructure (e.g., pipelines to the Theddlethorpe Gas Terminal) reduces development costs.

The MOU with Trafigura suggests renewed interest, but no firm plans or timelines have been confirmed, and conversion costs (e.g., additional wells, compression facilities, and regulatory approvals) remain a key uncertainty.

Valuation ApproachTo estimate Saltfleetby’s value as a storage asset, we need to consider:Current Production Value: The value of remaining gas reserves as a producing asset.

Storage Potential Value: The incremental value from converting the field into a storage facility, based on UK storage demand and price arbitrage opportunities.

Development Costs and Risks: Costs of conversion, regulatory hurdles, and market uncertainties.

1. Current Production ValueRemaining Reserves: Approximately 46 BCF of gas remain (114 BCF GIIP minus 68 BCF produced). Assuming 70% of this is recoverable (a typical recovery factor for depleted fields), about 32 BCF (or 3.2 billion cubic meters) could be produced.

Gas Price: Using 2024 prices of 110p/therm (adjusted to 100-120p/therm for 2025), and noting 1 BCF ≈ 10 million therms, the revenue potential is:At 100p/therm: 32 BCF × 10 million therms/BCF × £1.00/therm = £320 million.

At 120p/therm: 32 BCF × 10 million therms/BCF × £1.20/therm = £384 million.

Net Present Value (NPV): Accounting for production costs (e.g., £1.25 million decommissioning costs, operating costs of ~£0.20/therm), a discount rate of 10%, and a 5-10 year production timeline, the NPV of remaining reserves

As I said, I wouldn't know what the tax implications would be if it was owned on a non-uk market and how that would relate to operating costs? interesting hearing different views on it.

Valuing the Saltfleetby gas field as a potential gas storage asset in 2025 requires considering multiple factors, including its current production value, the state of UK gas storage (notably Rough), market conditions, and the feasibility of converting Saltfleetby into a storage facility. Below, I’ll break down the analysis based on available information and provide a realistic estimate, while critically examining assumptions and gaps.

### Key Context

1. **Saltfleetby Gas Field Overview**:

- Saltfleetby is the UK’s largest onshore gas field, with an initial Gas Initially In Place (GIIP) of 114 billion cubic feet (BCF). By 2018, it had produced 68 BCF of gas and 1.1 million barrels of condensate, leaving approximately 40% of the original gas in place (roughly 46 BCF).[](https://www.angusenergy.co.uk/operations/saltfleetby-gas-field/)

- In 2024, at gas prices of 110p/therm, the remaining gas reserves were valued at approximately £267 million.[](https://www.angusenergy.co.uk/operations/saltfleetby-gas-field/)

- Angus Energy, the operator, recommissioned the field in 2022, installing gas compressors and a condensate stabilization unit, and plans to add a booster compressor in Q1 2025 to sustain production as reservoir pressure declines.[](https://www.angusenergy.co.uk/operations/saltfleetby-gas-field/)

- A Memorandum of Understanding (MOU) with Trafigura explores the potential for converting Saltfleetby into a gas storage facility post-production, alongside evaluating CO2 storage.[](https://www.angusenergy.co.uk/operations/saltfleetby-gas-field/)

2. **UK Gas Storage and Rough**:

- The Rough gas storage facility, located offshore in the North Sea, is the UK’s primary gas storage site, with a capacity of around 50 TWh (approximately 4.5 BCF working gas capacity). It was temporarily closed in 2017 but reopened in 2022 due to energy security concerns following Russia’s invasion of Ukraine. However, its capacity is limited compared to European storage facilities, and the UK relies heavily on LNG imports and pipeline gas from Norway.

- The UK’s total gas storage capacity is equivalent to about 4-6% of annual demand, significantly lower than countries like Germany (20-25%). This scarcity enhances the strategic value of new storage facilities, especially given volatile LNG markets and geopolitical risks affecting gas supply.[](https://www.costain.com/solutions/case-studies/saltfleetby-underground-gas-storage-facility)

- Rough’s storage capacity is critical but insufficient to buffer seasonal demand spikes or supply disruptions, increasing interest in alternative storage sites like Saltfleetby.

3. **Current Energy Market Conditions (2025)**:

- Gas prices in 2024 were reported at 110p/therm, equivalent to about £3.75/MMBtu (assuming 1 therm ≈ 100,000 Btu).[](https://www.angusenergy.co.uk/operations/saltfleetby-gas-field/)

- In 2025, UK gas prices have been volatile due to ongoing reliance on LNG impo

AI generated business assessment - I will add the reasoning on the next post for information.

Question

Given the current state of Rough storage in the UK and the current energy situation with limited LNG storage, Angus Energy who own Saltfleetby have an MOU in place with Trafigura for the storage on that field following its end of use as a gas field. What is today's realistic value of that asset given the current market conditions ?

Final Answer

Given current market conditions in 2025, the realistic value of the Saltfleetby gas field as an asset, combining its remaining production potential and its prospective use as a gas storage facility, is approximately £350-£500 million. This accounts for £190-£270 million from gas production and £450-£560 million (discounted) from future storage, less conversion costs and risks. For comparison, the 2024 production-only valuation was £267 million, and storage potential adds significant upside given the UK’s limited storage capacity.

If somehow they managed to get this RTO over the line and manage to transfer onto a different market (out of the UK) it would be interesting not having to pay the ludicrous tax rates in the UK. Don't know if that is a possibility or pie in the sky but until an update happens we will never know. Lots of things can play out from here and Trafigura for sure are supporting this possibility. The key thing is we know very little other than the storage is more valuable by the day, Saltfleetby production is back on track to acceptable levels, the old hedge is finished and a new higher value one is now being delivered. Let's hope something positive comes out in the coming weeks. One thing is for sure, the pro-Angus holders know the same as the doom-mongers and that is very little of the future! GLA

Appears some kind of work-over is ongoing, hopefully see some kind of positive upturn shortly.

OofyP, that is the point I do pay attention and it's clear, you and all the rest of the people you name, are quite knowledgeable. However, and quite frank as it is they are all serial de-rampers with an axe to grind and a clear agenda. I am sure there are plenty of buyers of the assets.. The key one being Trafigura whom have entered an MOU for its end value once they have a concrete plan and revised CPR that forms the basis of that. As of now, with granted low volumes the revenue is significant. Reduced considerably with RH salary off the books and RTO on the table.

I can only agree with you on that front BP regard the company - however, the fundamentals are just that and they ensure this company regardless of its BOD holds a significant value owned by the shareholders, listed on AIM or not.

WG818 - sorry you never said, what is your agenda here actually? You'd know about fantasy, maybe given your take on the asset and license value of Angus, what in number form do you value those fundamentals at? Interest in your ballpark?

HITS, Should this not be on the UKOG thread? Oh sorry, I forgot, your agenda is to de-value the asset value of Angus and muddy the waters of asset valuation and credibility of any links of people in Angus too. Very clever - to the untrained eye! WE SEE YOU!