Member Info for spike501

"There's a lot more to this story than just some people having 'a punt on an AIM share'."

You are of course free to believe whatever you want - maybe there is a massive conspiracy here where for some reason the board are taking a huge risk and committing fraud by lying about the OWC and ERCE have either not discovered it or are in it. At the same time. not only are the BOD lying about the OWC, but they are also unnecessarily deciding the company is heading to bankruptcy and again all their advisors such as PWC are also blind to it or in on it. So maybe you are right and there are two independent and separate conspiracies going on here.

It doesn't really matter though from an equity perspective - unless you or someone else can provide evidence in the next 12 days to the court, this restructure is going through.

More likely than these conspiracies is simply that the original analysis was indeed wrong and the new analysis is more likely to be correct based upon the data being assessed by a number of different parties and at this stage no one is interested in risking tens of millions more just to try and discover if there is some opportunity here.

The restructure will go through, production will run off and the Hurricane dream and licences will die.

So by all means carry on, but whichever way you look at it, you're howling at the moon.

"No it’s not right and I noticed no one responded to my message regarding those claiming to be experts on bonds."

Your message was drivel - we know the terms of the bonds, quarterly interest payments and bullet repayment in mid-2022. Its the bullet payment in 2022 that is the causing the issue as based upon all the information the BOD have they have no ability to repay the debts as the field will not produce sufficient cashflow.

"No. Not right. Time they grew up."

You're completely out of your depth if your view is that bondholders need to "grow up". They benefit from contracts and legal protections and the BOD owe a duty to them.

Aduk,

"It is you yourself who is making a huge assumption. Saying 'OWC has substantially increased'. This is purely an unproved hypothesis"

You are correct to highlight this and its true, the new OWC is assumption based upon the available data, just as the previous assumption was based upon the available data at the time. However this CPR is based upon substantially more data from full production and is consistent with the increased watercut.

Aduk

“ But this is what oil companies do ! Plus Hurricane HAS THE CASH ! Only declare insolvency if there's no cash left”

You’re simply out of your depth here with corporate governance and directors responsibilities.

I’m not sure what’s difficult to understand about Halifax - the 2017 CPR assumed a much lower OWC. As Halifax is connected to Lancaster and the OWC has substantially increased, there isn’t sufficient data available to make any proper assumptions on the reservoir size and potential volumes.

"However Hur wanted a CPR and prob wanted it to back up their evaluation"

Why would the board want a massive downgrade? You're still insinuating there is some sort of conspiracy and ERCE are part of this, just not particularly knowingly.

Yes there is certainly a general case that companies producing CPRs might not want to rock the boat - logic would then suggest the most likely consequence would be that the first CPR was the one that didn't have enough independent scrutiny.

"The more I think about this, the more I feel the Serious Fraud Office"

Have a day off - you really are scraping at the bottom of the barrel in what I can only assume is still part of the denial phase.

You will get a straight answer - the identity of the bondholders is confidential

"10,600 barrels of oil per day isn't coming out of the sky."

Who said it was? I'm not claiming there is no oil and neither is ERCE.

"Did ERCE independently verify the data, or did they produce a revised CPR on data offered from HUR BoD?"

The produced it primarily based upon data from Hurricane of course. Unless anyone has evidence that HUR falsified the data and can present that to the court in the next 12 days its not particularly relevant.

Of course this could be some elaborate scam, requiring the involvement of dozens of people, but Occams razor suggests the original assumptions were wrong and investors who have over committed are clutching at straws.

"I can think of a 'credible alternative' immediately. Hire whatever suitable rig available, and go drill P8, with a DSV who insists it's horizontal (unlike 7z) at about the same depth as P6, just about forget about wireline logging, and tie it back asap to the FPSO.

Is that good enough ?"

No as there aren't the funds to do it without severely further jeopardising the bondholders in the event it fails - have you not been paying attention?

The discrepancy is clear - the original pre-production model has been shown to be wrong by production that has demonstrated the OWC is not where initially assumed.

The judge is not going to question a CPR produced by a reputable firm, unless someone provides solid evidence it is wrong and given no one can do that, there will be no question. You're in fantasyland if you think otherwise.

I've no idea why you seem to think ERCE would risk their entire business to produce a 'fake' CPR for one single client

"Spike...were you even paying attention and do you know how the law works? The Plan is unravelling."

Shareholders will vote against the plan, but then the sanction hearing will push the plan through unless a credible alternative is put on the table.

AdoubleUK - the only thing the judge specified is that a shareholder vote most be held. That has now been scheduled. There is no further requirement for the judge for anything else to be called, so despite what Latino says the board have fulfilled their obligation.

The fact you don't believe the CPR makes not a jot of difference at this stage - everybody else relevant to the process will accept the CPR as a valid assessment of the resources and the only hope here is that there is someone else external with deep pockets who also doesn't believe the CPR and decides to make tens of millions of pounds available to the company to stave off bankruptcy.

The judge is certainly not going to question the validity of the CPR:

"Where is the EGM...can see the Judge coming down hard on the BoD on this"

The Shareholder meeting to vote on the plan was announced yesterday and is all that is needed. The judge even specifies an EGM is not required for other matters.

"In particular, I do not think that the desire of certain shareholders to requisition a general meeting before the Plan is progressed any further is a reason to delay the convening of meetings"

"I think this means that the Court may sanction the restructuring the plan should the bondholders vote come in at 51% (rather than the required 75%) or the shareholders vote come in at 51% (rather than the required 75%)."

It means if the bondholders come in above the 75% and the shareholders don't, the court may well still go ahead and sanction the plan.

"How on earth can the company suddenly come out with a financial report reporting a loss of 650 million or so ? What expenditures have been made over the year to explain this ? Where has the money gone, and on what has it been spent ? This is scandalous."

If you don't understand basic differences between P&L and cashflow, you really shouldn't be anywhere near stuff like this.

To recap - Hurricane over a number of years spent hundreds of millions discovering and developing the assets, most of which was capitalised to the balance sheet as an asset. Now there have been massive reserve downgrades, those assets not longer justifiably have the valuation and have been impaired.

It does, the only quite surprising thing are the production targets for the next three years, which barely move from current production - 26koz this year, 28koz 2022, 29k0z 2023 - only in 2024 does production jump to 45koz.

Is this management sandbagging or should production be considered to be only stable for the next 3 years.