Member Info for Slift

Best option forward for Bentley would ideally be..
Have a standalone operation/field development for Bressay with an FPSO and infrastructure..

Then have ENQ tieback wells from Bentley to both Kraken and Bressay considering they will be operators of all 3.

But significant amount of investment required... And would need oil price stability and future security.

I think his response was along the lines of..

"I cannot really comment on their observations.. but what I can say is that we have infrastructure and FPSO already in place that we can tie the field back to, so we will be coming up with a potential development plan for the field.

However we haven't yet completed the acquisition, but we will look into it further when we complete the acquisition and provide any details of any further development or plans"

Obv along the lines.. not word for word lol

mrc,

"Your costs to develop are too high IMHO and would never be developed if that was the plan. I don’t think it will need significant modification to accept fluids from bressay."

Do provide your costs for development. Otherwise, you're coming across as an idiot (again).

"! have drafted Written Reps for the Judge"

Hope it contains a viable alternative that is more attractive than the proposed restructure to keep the company as a going concern..

Otherwise, in the bin it goes.

"I think it's more to do with booking some reserves to shore up the balance sheet for the debt negotiations."

Maybe so for Bentley (although I think Bentley probably added $20-40m to balance sheet, so not significant).

But I wouldn't say that was the reason behind Bressay. Enquest are currently exploring options for development of this field, including using Kraken to tie back. Luckily, this field already has JV partners to fund the development so as for development costs, it'll only be 40.8% to ENQ.

The Bressay field should be viable at $60-70+ oil price, even if it's a standalone development with new infrastructure.
Also, there are several benefits to developing this field, including reducing CO2 emissions by using Bressay produced gas to power FPSO - contributing to ENQ long term Scope 1 and Scope 2 emissions goals.
So no doubt ENQ will seek OGA approval for this field in the next few years, assuming Brent is $60-70+/barrel.

If sanctioned, it will significantly add value here - more than the production asset acquisitions.
However, it may also mean taking on more debt, if cannot be developed via cashflow alone.

For Enquest, the Armada Kraken can be used as the FPSO and infrastructure for Bentley.

However, it will require modifications.
The two wells (7 and 7Z) have now been plugged and abandoned too. So Enquest will have to drill new wells.

I think overall, it cost Enquest approx. $100m to modify FPSO, drill and tieback each well.

Assuming that two wells are drilled (to produce approx 4k bopd), it will cost around $200m.
The wells will produce at around 2-4k bopd average, over around 3 years before optimisation and reservoir management CAPEX has to be spent due to natural decline - so taking this as the stop point..
The cost to develop would be approx. $61/barrel.

And then subsequently after, should production fall significantly, new wells can be drilled cheaper (as no requirement for modifications).. or EOR techniques such as water injection can be used to further reduce this development cost.

So all in all, definitely viable for Enquest.. but only at high oil prices.
Bressay is similar, but would produce higher flow rates and faster payback period. I think Bressay wells can be tied back to Armada Kraken FPSO at development costs of $40-50/barrel, if not lower.

Romaron,

I heard the question you had asked AB during AGM regarding Bentley and Breakeven development. It got me thinking what can ENQ really do to develop the field.

Pros of Bentley:
- Already discovered huge STOIIP
- Long life field

Cons of Bentley:
- Heavy oil
- Low productivity
- High development costs
- Long payback periods

No doubt that previous FDP by Xcite and Whalsay was unattractive due to the above.

But to answer your question on whether who was right regarding the development costs for the above FDPs ($80/brent or $35/brent)..
I think both are. It just depends on how you look at it.

Both the previous FDPs required c. $700-750m investment for FIRST OIL.. then subsequent investment (whether through cashflow from first oil or further investment from investors) was required to further develop the field to have 20 successful wells all developed to produce (at peak) up to 45k bopd. However, the FDP was a 35 year plan.
Over 35 years, the development costs would be $35/barrel for the field.
However, the development costs over the first 5 years or so would have been over $80-90+/barrel (due to sequential drilling).

"FIRST OIL" would have involved pre-drilled wells tieing back to infrastructure. So all in all, it would have cost Whalsay and Xcite c. $700-750m to have two wells (7 and 7Z) tied back to the production platform occupying one of the 20 slots. The production rate (using ESPs) would have been c. 4k bopd.

"Suggestion is not proof."

Well, I think the BoD, and the auditors know more about you or me regarding the financial situation of the company.
So sure, keep pretending the company is a mansion full of diamonds when it's really a shack on fire.

adoubleuk,

It seems like you really do lack knowledge around corporate, finance and law.

https://www.hurricaneenergy.com/investors/results-and-reports

Turn to page 24.
And no, it wouldn't be an assumption, it'll be a "scenarios" tested for going concern.
Similar to the stress test that the banks complete to ensure they can survive and overcome any financial difficulties.

Typing to you has been like typing to PlantedBHA today lol.

adoubleuk,

"The court hearing is on the 21st this month. It remains to be seen what that judgement will be. If the 'restructuring plan' is ratified by the court (which as a private shareholder I very much hope it will not be) there will be a bondholders' meeting in early June ."

Please tell us why the court won't ratify this restructure?
"Because company can currently pay the bills" is not the answer when the accounts suggest there is negative equity and will not provide enough FCF to service and pay off debt.

adoubleuk,

I think you're the one that's being slow lol.

Yes, if you actually know how the restructuring plan works, then you'd understand..

The 21st May hearing is a convening hearing.
There will be a second hearing known as the sanction hearing.

The convening hearing is approval by bondholders.

When the company received 75% support by bondholders, they released an RNS on notice for annual results.

The annual results will assume that the plan goes ahead, and will also state the impact should it not be sanctioned. As the going concern statement.
https://www.lse.co.uk/rns/HUR/operational-update-and-notice-of-results-3y45qx0vw1emz56.html

"Meanwhile, shareholders are being kept out of the loop and hung out to dry. This sounds to me (as a shareholder) as being fundamentally and substantially WRONG and reeks of connivenc, conspiracy, and corruption regarding the current BoD and their creditors (including bondholders), possibly of a criminal nature, and should be investigated asap, through whatever means genuine shareholders may be able to muster."

No. This is all within rules of corporate law under the Restructuring Plan and Companies Act 2006.
Unless ofcourse you think both The Restructuring Plan and Companies Act 2006 is criminal, corrupt, or whatever... then i'd suggest you take that up with the government :)

"if we ignore the BoD who are after all perpetrating the “scam”...
Deloittes the Auditor and their lawyers."

JUST 11 MONTHS ago.. significant number of shareholders voted FOR several resolutions:

Re-appoint Deloitte LLP as the Company's auditors
870,877,964 votes
99.92 %

Elect Beverley Smith
875,176,257 votes
99.85 %

Re-elect Dr David Jenkins
874,634,091 votes
99.79 %

"There is now a sign of desperation, but just because someone's 'on the ropes' it's no reason for not to continue hitting 'em."

Am I the one that's blind...? or is it everyone else..?

Only desperation I see here are shareholders' actions..
"to continue bombarding the media, financial services, members of parliament or whoever about this horrible scam."

adoubleuk,

"Why ? It isn't drowning yet."

No, there wouldn't be a "drowning" moment.
It would be an instant sink as the company delists from the market.

The company produces cashflow for all costs including operations, interest payments, salaries etc, sure.
But that doesn't satisfy FCA, FRC and AIM Market rules.

If the proposal isn't accepted by the bondholders, the company is technically insolvent, and therefore the annual report will not be published by the company. The company will be suspended and delisted from the market.

But hey, you seem to have time to be gambling, so suggest reading up on insolvency and AIM Listing rules.

adoubleuk,
"Balls. That's just what you and Mcadder are just paid to tell us."

Laughable.. paid to tell you? Because our opinions don't align with yours that it is a "scam"?

Rather than making gambling analogies...
Provide or suggest a viable alternative to save this company then?

"The latest RNS is an all-out 'declaration of war' between the BoD and the shareholders"

I feel that it's more like the BoD pleading with bondholders to show mercy on shareholders by accepting the proposal and giving shareholders 5%.

adoubleuk,

There isn't a win scenario here.
It's 5% or 0%.

But if you want to be naive and think there is an alternative, state it. Because as it stands, it's insolvent.

And to go with the analogy, there is no matches left in the shareholders' matchbox.

I doubt it tbh, unless ofcourse the Bondholders/BOD(or new BOD) come up with a more attractive FWP to recover the the oil that's left.

Also note that the current BOD even suggest that NFA is best course of action for maximum bondholder returns.

I suppose the only other thing I can think of is maybe acquiring other nearby licenses and using the existing infrastructure (AM) to produce.
But here's he limits to that.. marked in black:
https://gyazo.com/3d2e93ac7070c6965383e946835aec3b

That's okay.

46% of production for the rest of year hedged at average $63/barrel floor.

"As at the end of April, c.6.2 MMbbls of production has been hedged with an average floor price of c.$63/bbl and an average ceiling price of c.$72/bbl. "

CaptainSwag,

There is no arguing that in the targetted FB reservoir (7z and 6), there isn't much oil left. The OWC is shallower and is proof of this. The only oil left in the FB is between well 6 toe and the attic.

Well P8 will be targetting the remainder of FB oil which well 6 cannot produce and victory sand, which when combined with a water injector (which will be drilled in the victory sand), could produce help produce all the oil within the victory sands too.

So basically.. in FB there isn't much oil left, and majority of the oil that's left is within the victory sandstones.
Unless you have evidence of there being more commercial oil in FB.. but production data doesn't give it.