Member Info for Tarmak

Hi!

Romaron,

The hammer hits the nail on the head and you hit me exactly right.

I can add that the "free electricity" forecast takes almost 10 years to pay for itself, but you are "insured" against increased electricity rates, since even sold electricity gives more when it increases.

Companies do not make investments that do not pay for themselves in 5 years or less unless there are special agreements with guarantees.

Just avoiding irritation when prices increase (I think Sweden will approach Europe in prices, then I will be a winner) is an advantage and another is the value of the facility.

When sold, the value is slightly higher than the cost, so you get the investment back then.

It is also the case that the entire investment is tax deductible when sold and gives an extra 30%.

Not having to worry about the price being expensive in the morning and evening is convenient, almost a bit luxurious.

When will the change and the penalty tax on this too good facility (which only takes 1/3 of its lifetime to be paid off) come?

Is there trust?

Regard

Kamrat

Hi!

Stevo12,

I think we mean roughly the same things but write it differently.

In short, at just over 40k at the start of the year, 15% decline, 15 days of maintenance and six new wells, production should be almost flat.

Vietnam increases production by c. 2.6k for the year (H2) while c. 2.6k (H1) production is only counted as money and lowers the purchase cost.

Production in the range of 40-45k for -25.

The production file is really good while the part with fcf/barrel is quite untested and I have tried not to be too high (hence the reference year -20) with deductions for EPL etc.

On my 43k -25 (including Vietnam, J/80) there is upside as estimated production in Vietnam is c. 5.3k, pro forma, (5.3 * 365) while I have it entered with maintenance stop and decline in H2 (4.7k, M/66) which will counteract some extra downtime.

Do we understand each other?

...ok one more... the model ignores the price, makes it easy to change but is also a weakness.

I think you should take my production into your calculations to see what you want (and probably end up closer to the real thing).

Cheers

Kamrat

Hi!

There is a shortcut to understanding in this context.

All that is needed is to count the production in Vietnam and thereby use the middle of the 40-45k guidance from the company.

cheers

Hi!

BTFATH1,

you're going on the swing, I suppose, but in anyway you will be a winner IF the deal is going thru.

It is much more to lose for both companies as deductions from taxes will go faster.

Regards

Kamrat

Hi!

Stevo12,

I don't want people to think it's right without knowing it, unfortunately I'm no better than that at showing (the examples are in the production file for those who want to see them).

We had about the same numbers for -25 before this production thing appeared and many appreciated seeing them.

They would probably show closer to the real result with my production figures.

The production is in Example 3. at the bottom of the file with a decline of 15% (including some downtime) with 15 days deduction for maintenance and 800 boe/new well.

Vietnam is not included in these figures but if you want to include them you have to add just over 2.5k boepd.

The figures that have been performed so far are reasonable to assume, showing c. 41k in March, and make the example more fair as the January and February numbers will be included in the annual figures.

Example 1, with a decline of 15% (without maintenance and new wells) gives a year-end (Production in December) of c. 36.8k and an annual average of 39.6k.

Example 2. with decline and maintenance (without new wells) gives the same year-end (Production in December) of 36.8 while the annual average is c. 38k

Example 3. with decline, maintenance and newly added wells (corresponding to the current situation) gives a year-end (production in December) of c. 41.4k and an annual average of c. 39.8k.

The last example shows how production should be excluding Vietnam with some downside for unexpected stops.

If you set a decline of 50%, the year-end (production in December) ends up at c. 31.3k and the average production for the year at c. 35.2, which must be seen as completely unreasonable (Example 4.).

Even if all fields do 14 days of extra maintenance, the average will not end up below 38k for the year.

The company has guided 40-45k and 35-40k is calculated retrospectively due to the word pro forma but falls due to the unreasonableness perspective.

Some production outages are "swallowed" by the decline rate (15%) as the declines of the large fields are in the high single digits while the remaining ones have higher numbers but with less impact.

In the examples, new wells are calculated with 800 boepd while in the upper file there is 200 boepd more for UK fields, and GE wells will be ignored (will be included in production during company updates).

https://docs.google.com/spreadsheets/d/1f5HeabHGD6X3LByuOcebN1Cru64VaNu5BLsfJzJsgZ8/edit?usp=sharing

Regards

Kamrat

Hi Romaron,

It is the expensive hours that make a plant profitable!

You are absolutely right that Swedish electricity comes from stable sources where nuclear power also makes production predictable.

Sweden is divided into 4 zones where the two northern ones benefit most from hydropower and the two southern ones lack their decommissioned nuclear power plants.

From the two southern zones, electricity is taken for export to Denmark and Germany, which also have less or no predictable electricity, which drives up prices there.

It is the price differences between the hours of the day and the possibility of being able to store during cheap hours and being able to use expensive hours that make up the calculation in these southern zones.

The northern ones are more doubtful about whether it is worthwhile.

Regardless of which country you live in, it is the circumstances that determine whether it is good or not.

Expensive electricity and high consumption mean that it may be worth looking into.

For us, it is also cheaper to run an air source heat pump as it is free during daylight hours (summer time) and also provides cooling during the summer.

Some countries (e.g. Thailand) charge if you overproduce.

In addition to the costs of the system itself, there is a cost to ensure that the roof lasts during the life of the system and this is probably not something most people do, but those who do it reduce the cost of others in the long run by not using electricity during daylight hours.

Regards

Kamrat

Hi!

Modestus,

Just write some (not complete) about solar.

There are many details that determine whether solar energy is economical.

All solar energy that I use myself (in Sweden) becomes a direct free detail (except for the interest cost on the investment) as it is not burdened with network fees and taxes.

This means that electricity consumption should be high enough to be able to save enough.

What you do not use can be stored and used later but requires investment in batteries and, for the calculation to be reasonable, the possibility of having an hourly price for imported electricity and the possibility of selling excess production.

There, the battery cost becomes purchase / charging cycles / number of kWh which is quite high but is good for removing high-cost hours.

Tax and network fee are added.

In winter, you can charge c. for free + tax + network fee at night and use it during expensive hours but here an 8kwh battery is not long enough.

You can also charge during the day, more expensive, to remove the even higher dinner price.

In the summer there is a profit and in the winter there is a greatly reduced cost with our annual consumption of c. 15,000 kwh.

The conditions are what give the answer to profitability.

Here it is.

One thing to tought about is that the panels have to be installed to get best effect at time you use most electric, nothing els, and for us was it mornings an afternoons (east and west).

As it is lightpannels, not need to have directly sunlight is daytime, produce it the most in the middle of the day anyway.

Regards

Kamrat

Hi!

Divi was c. 30% of fcf and thats also my number in the file.

It says that, in this earning year with less lease, it will be c. $40m next year and that this year can contain bb to.

A deal will make the weel spin faster and that consern to both companies and are in their interest.

Regards

Kamrat

Hi!

Technical things determine which direction a merger goes while the valuations are the same in both directions.

Mergers are consensual.

The assets together make no sense without more deals and I believe in a production of over 120k boepd with a great cash flow and secured dividends for a long time.

If the boards agree on the valuation, it is something to follow as there should be reasonableness in it.

I do not rule out that money will go for shares in some direction and how the deal is intended we will know more in detail when an offer is made (which should be reasonably anchored by both parties).

The webinar was great.

Regards

Kamrat

Hi!

Stevo12,

I had wrong number for February (the average was in that place) so it is closer now.

It was Malu, on the Swedish discord, who seen it.

It just cosmetics and it still have to be over 50% decline to reach 35k over the year.

I maintain that this is a misconception and that what I said earlier is correct.

You are welcome to take another look.

Regards

Kamrat

Hi!

Steve12,

I am cautious and take away both decline and maintenance from Vietnam who´s not in the guide.

I would have been very vrong last year if i had put in +50% decline, I was not.

i suggest you to think again, and the numbers from -24 is still there.

Of course can it be some day off each half year and I will consider scheduling it.

Regards

Kamrat

Stevo12,

To drop production to 35k (excluding Vietnam) it is not enough to have 50% of the decline for the remaining 10 months of the year.

You can see the calculation at the bottom of the production file more clearly.

The base is actual production (Jan - Feb) - decline - maintenance + new wells (6pcs * 800/well).

Drilling

2 wells at Magnus and four on Seligi

800boe /Well

15 Maintenance, Days

15% Decline

98.75% Monthly Left

j 44,200 Company numberrs

f 43,037 Company numberrs

m 42,499

a 41,968

m 43,044 2 Wells

j 42,506

42,880 H1

j 41,974

a 43,050 2 Wells

s 21,256 Maintenance

o 41,980

n 43,055 2 Wells

d 42,517

38,868 H2

Y 40,858

You will end up equally wrong if you take these numbers and then add 5.3k for Vietnam as it is half (half the year).

I´ll hope that you understand.

Regards

Kamrat

Hi!

all,

I wrote about a fair deal from the beginning and that it will be presented after valuation (due diligence) if it is even presented and that it was not decisive with MC.

Also presented the advantages of a deal but everything went wrong when it was said that - everything except that S gets xxx much will not be fair.

There dd determines where it eventually ends up.

Even the company value is wrong to use since it is the owned content (equity + hidden assets) that determines.

We will find out if there is a bid and then it is important that both parties are equally happy or unhappy.

In this case, it should mean that both parties are happy as there are synergies for both to benefit from.

dickupham, I didn't think the question of the value of a share applied to me, but rather to those with the Dunning-Kruger effect, so I was expecting answers from others.

However, I say that the value varies over time as it is where buyers and sellers meet and the need for money for a seller can temporarily lower the price.

It can be overvalued and undervalued sometimes.

I describe the momentary price that is most important at that time for both parties.

However, this is not a purchase with a premium bid but a merger and if you agree it will be a deal.

Regards

Kamrat

Hi!

Several,

Some here believe it would be a 70/30 split in favor of Serica plus a $250m-$350m dividend to your shareholders.

Before Triton's latest (probably not the last) outage, I would say 52/48 and possibly change.

We'll see who has the Dunning-Kruger effect soon.

Over an out

Kamrat

Hi!

dickupham,

EV IS the value.

The debt just tells you what is in the company and that it is worth enough to have interest and a discount on the value in relation to risk.

Equal EV is equally worth in a deal but due intelligence is done between companies to catch mispricings from the market.

Another mistake in here is that they is saying that the difference is xx and they want the whole piece of it.

If I have 4 pieces and someone else has 3, you need to share a piece to get the same number.

EnQuest is the bigger and better part!

Put filter on me now.

Regards

Kamrat

Hi!

Seekforde, Megla, dickupham, Dennis The Pennies,

Nothing desperate but trying to get you to do the math and think right and most of it is said in this and previous messages.

Serica was previously valued by the market at mc ($661m) + netdebt ($71m) = EV ($732m).

EnQuest was previously valued by the market at mc ($277m) + netdebt ($386m) = EV ($663m).

The difference between the valuations was c. $69m with a combined distribution of c. 52.5% / 47.5%.

If you assume anything else when you start calculating what a merger will look like, you will be disappointed and feel like you have been thrown under the bus.

The discussed merger has probably been spiced up with some extra money to get Serica's board to agree to leave their positions (they were probably also gratified in your deal with Tailwind at your expense).

I myself suggested to the EnQuest board that such extra money should be distributed to all shareholders after a merger together with regular dividends.

In EnQuest's case, we have a CEO who has over 10% of the shares so he has a lot to gain from a fair deal

Of course, FPSO will play a role at the moment and we will see if there is any bid at all.

If there is a deal, synergies will of course mean that there will be more room for dividends than if it does not happen.

Now I also see Rhum as a risk as it only has an exemption for two years (Iranian shareholders).

Lets see what the boards say!

Regards

Kamrat

Hi!

Megla,

took you seriously at first but it mostly looks like you're trying to tease.

What I've been talking about all this time is a fair deal for all shareholders in both deals (we don't know the details yet).

Synergies make it 1+1=3.

Ok, you're having fun joking around but you can mislead others into thinking it's serious.

Without a deal, EnQuest stands at 1+0=1

while the calculation for Serica will be lower and how much lower remains to be seen.

To hedge your loss in the event of a failed deal, I recommend a purchase in EnQuest.

Regards

Kamrat

Hi!

zebbo,

I think it sounds really silly, like believing in elves and trolls or virgin conception.

I'm not going to criticize your beliefs, but it could be misleading for others who might follow you.

If you have followers, you have to take responsibility for it too.

Regards

Kamrat

Hi!

Stevo12,

You are still wrong.

The numbers from the guide are exactly what they are, including Vietnam (c 2.5k).

In January, production was 44.2k (company figures without Vietnam) and from that to reach your numbers it must be a decline like hell...that's where you can see where you are thinking wrong.

I appreciate that you try and try again and there are not many who do so breathe and think again.

It is easier to be in your situation if you do not have your own forecast for production and if you had one you would not have been there.

I am proud of my production forecast because it speaks for years to come and there is a big difference whether it decreases or not and we are not in recession.

However, my fcf /bo is more uncertain and I try to stay with low numbers so as not to exaggerate.

If you use my production figures with your calculation, you will be more right than me and the result would be nice to see.

In short, give yourself a pat on the back from me for all you do and good luck.

Regards

Kamrat

Hi!

walk99,

You are partly right!

To succeed, all the parts are required and EnQuest has it.

In addition, they extend each other's field life and thereby profitability enormously.

Kraken has been opened and the decision has been made to draw a tieback from Bressay, for the gas operation of the Kraken FPSO in a first step, at a cost of c. $60m and an annual saving of c. $30m.

EnQuest Producer (FPSO) is intended to be placed there when the time is right.

For Bentley, the situation is different and a development would cost c. $730m with a jackup rig according to a previous investigation.

It is also being investigated to only go with a tieback to Kraken and possibly EOR from the start to increase the recovery rate.

Why hasn't it opened yet?

It's about muscle, purchasing power, and EnQuest only got to the right point last year, when they could start focusing on maximizing money (tax planning) and shareholder returns.

In parallel, they still need to pay off loans precisely because they are not big enough, but a deal can make the difference that is needed.

However, they have, from this year, an improvement in lease ratio of c. $49m and another $15m /year after that.

For those who have read previous posts regarding CDP, EnQuest is not looking for partners for CCS, but it is quite low costs with high returns thanks to a lot of infrastructure already in place.

Estimated to start before -30.

Regards

Kamrat