Member Info for theoryman

PUTUP, in doing my calculations I have assumed that there is no CBC deducted.

I don’t think even the MNR could justify withholding it AGAIN when it has already been deducted in the original missed payments.

So 36 plus 16.2 gives 52.2% of the field production gives the working barrels for the contractors.

GKP gets 80% of that.

The other plans are 50c in (Brent-50)

So crunching all those together gives

Monthly repayment= 0.5*(Brent-50)*0.8*0.52*monthly production

I’ve set up a two way table, production versus Brent and it reveals just how long it might take to repay the $73 million and how weighted the time is towards (Brent-50) as opposed to production.

Hi, first thing that hits me is the focus on positive price drivers, where do you also see the threats coming from?

I think the repayment plan will be neutral if it matches the others since they are known and built in to the price - a potential positive is getting the 50c in the Dollar raised to say 75c.

Beware getting correlation e.g. new CEO and a price rise and assuming causation in this case ;)

The company is functioning very nicely at the moment whilst in this cash cow mode, how about linking the repayment plan and the buyback/dividend plan?

Put the monthly revenues from the repayment plan into a pot, let them build up and then redistribute them. $73 million over however many years it takes creates a good long term feel IMO.

s2, IMO as far as your analysis goes there is both good and bad news.

The monthly production from the field has recently been much higher than 1 million barrels.

Unfortunately GKP can only profit from its share of the production.

Quick calc gets your estimate down to around $140 million IMO, still cash cow scenario provided the production is maintained, PoO stays high and payments continue.

Two further points to keep in mind:-

1 Most of that profit is not from the Profit Oil - previously covered.

2 If revenue rises more much rapidly than the agreed costs, then the R-factor could become >1.0 and affect the workings of the PSC - previously covered.

PUTUP, thanks for the “yes”, clears up a long standing either or.

As for your other point, I realise that is shorting, I was trying to establish that the other example could be considered as shorting as well.

IWrt to price action, 138p is proving a tough nut to crack, everything time it has got close recently the buying pressure has evaporated - this morning the UT was followed by a substantial trade and then....

Anyone got a reddit account?

M11, why do you think it is a ridiculous comparison?

On the surface they start off in an identical pattern IMO - borrow, ged rid, receive something else in return

Borrow shares, sell them, get cash in return.

Borrow money, spend it, get goods in return.

Where am I going wrong so far?

If you use boards where people trade Indices, Commodities, Currencies etc., shorting is just seen as the inverse of hoping to profit from buying low and selling high.

In my experience it only raises people’s hackles when it is used with a share, then the comments can get very unpleasant.

Personally I do not understand why this should happen because using a Short, through a SB or CFD account, can be used as part of an LTH’s active management of their risk profile.

The other thing which doesn’t make sense to me is how people thought Voleon’s 1.5% Short position was holding the price down, whilst an II’s 15% one wasn’t holding it up.

From basnews https://www.basnews.com/en/babat/665520

My upper case to emphasise the areas that I presumed had been sorted out when they announced the budget had been agreed or I thought they did.

“ERBIL - The Iraqi Council of Representatives is expected to vote on the budget bill next week while Erbil is YET to agree with Baghdad on its share from the federal budget, a lawmaker said on Thursday.

Kurdish MP Diyar Tayib told BasNews that part of the Iraqi factions demand that the Kurdistan Region should hand over MORE than 400,000 barrels of oil per day to the state oil marketer SOMO, some others say the WHOLE dossier of oil has to be under the control of Baghdad in retun for Erbil's share from the federal budget.

There is also the THIRD argument which believes the Kurdistan Region and Iraq could negotiate between the first two options and reach "a moderate understanding" between them, Tayib noted.
Experts argue that Baghdad cannot ask for the whole dossier of Kurdistan Region's oil in the framework of the constitution.”

BB, here is a link to a June 2018 presentation.

https://www.gulfkeystone.com/wp-content/uploads/2019/12/corporate-presentation-june-2018.pdf

Slide 19 contains reference to both 40% and 30%.

I assumed that reading from left to right, it was a case of 40% was the active value with the change to 30% being (subject to future agreement).

As far as I am aware, there has been no agreed change to the PSC being made public.

The left hand box also refers to 80% which has since been included in all the subsequent presentations.

Which is why I have been using the 40% in my spreadsheet until I changed it to the 30% last week.

Now done the obvious and running both, the 40% does give a slightly better historical fit but given the bigger picture not worth agonising over IMO.

PUTUP, am I right in thinking that you have got that beck from the company?

Just to remove all doubt, the Capacity Building Charge is 40%?

As previously posted, they have a DNR on my email questions, as in Do Not Respond - I was never rude, they simply refused to explain their conduct.

ss, I think the three articles, components, clauses referred to are Articles 110,112 and 114 of the Constitution - the O &G Law is the “How” part of implementing them.

Given the previous complete standoff between the two parties, there must have been significant shifts on both sides.

How about?

The KRG accept that the Oil is owned by all the people of Iraq - it is not Kurdish oil.

The Iraqi Gov accept that the KRG be allowed to develop those resources as they see fit, including the use of PSCs if they want to.

In order to maximise the return and increase the transparency, all the Oil goes through SOMO.

Nice combination of working independently but working together towards a common aim of extracting themselves out of their present financial situation.

vimconfused, it will be a potential game changer if implemented but just now a matter of seeing how this pans out.

Let’s hope it’s been drafted without any reference to any other clause in the Constitution.

If it has then it will almost certainly include one that different factions interpret in different ways.

Hi CCC, don’t know if you’ve come across this but it did surprise me. In the US if a trading system gives a Buy signal, they are allowed to use the exit price as being the highest reached before it drops below the entry! There is no requirement for them to give a system based Sell signal.

If only we could do that, life would be so much easier...

On reflection I could have extracted another two or three pence WAV on say just 33% and kept 67% running. I have a trading “critical friend” who just outlined where I ignored my system and went with my instinct - it’s not hindsight, it’s brutally factual.

Anyway, decisions made, future outcome unknown - good luck with your new strategy.

CCC, chart and added explanation added on II GKP board.

I’ve done it quickly, so any questions from anyone and I’ll deal with them over there. I can edit the text later, I’ve already thought of at least one thing I should have included.

CCC, usually I’d ignore a request like that but since it’s you I’ll do it.

I have dumped 40% WAV 144p based on two levels being breached, one on the SAR and one an internal support level.

The rest will go if it gets to below 123p - until then the dream is still alive.

If you still have an iii account I will post a very scruffy chart screenshot I took before all this happened.

For those who remember me from the old UKX site on there, it shows a potential high probability falling Mm on RSI dropping through 70.

Wither it was a warning of a small correction or end of the dream only time will tell.

sr2004a, the payment due this month for last month’s oil is already known. Any cash generated from this month’s repayment plan, if agreed by now, for the debt will only come when final production figures are audited, so IMO that will start next month.

I don’t do reasons for why rises and drops happen, I just chart them and take action.

Someone once explained to me the sheer fultily of trying to explain why markets behave as they do - there are theoretical models and reality!

So I trade what I see is happening, not what I think should be happening - that doesn’t mean I don’t have a picture of what I would like to happen :)

opulentia, your reference to the 10 working days is from many years ago and it only lasted two months anyway. When the payments restarted last year they were supposed to be within 15 working days and that lasted, wait for it ........ two months!

They have recently kept to within the next month, sometimes the payment is received on the very last day and doesn’t get cleared and RNS issued until the next month.

I’m afraid all the IOC’s have let the drift from the mid month to the end go without comment other than to say the MNR are sticking to the end of the month!

Given that GKP under SZ used to refer to regular payments when the gaps between them had a range between 22 and 43 days, what can you expect?

I was serious when I asked to see your figures for the repayment timescale under the deals the other companies have, I think people will be very disappointed by the numbers.

Ignore my not ignoring your request to ignore.

Free will always be delayed but why not go to the horse’s mouth?

Search for London Stock Exchange GKP and ignore the lse paid for link.

You will see a snapshot of the trades with an option to download the rest, button somewhere on the RHS.

The list is in the form of a spreadsheet which can be copied into a standard spreadsheet and then be sorted by trade size, trade code etc. Great for getting rid of those annoying 1,2,3 SINT trades :). You can then also set up a trade size minimum filter and see what that does to the OHLC data for the day.

PUTUP, hope this helps because it’s the best I can do.

https://www.gulfkeystone.com/wp-content/uploads/2020/02/gkp-corporate-presentation-22-jan-2020-vfinal..pdf

Slide 26/26 last grey box on bottom left.

As BB has previously pointed out, it has previously had other names. It depended on what stage they were at, in not coming to any final decisions about changes to the PSC.

I despair that a PSC flowchart shows revenue, it’s a production sharing contract, not revenue sharing!

The key points are that only GKP pays it and it only comes off their share of the PO. Whether someone believes it is a 40% or 30% reduction depends on how you interpret a previous slide, presented sometime well before the stated deadline to sort everything out of end 2018 :)

I used to think it was 40% but BB has persuaded me it’s 30%, notice how the slide fails to give the value being used.

There has to be somewhere you go to in order to perfect that level of poor communication but how does anyone know where it is?

When Shaikan was discovered it was in a landlocked region in what was one of the most corrupt countries in the world - the region being marginally less corrupt.

LTH were hopefully aware of that combination, it was then and still is now a very high risk investment IMO.

The lack of leverage amongst the individual IOCS, apart from DANA, is exemplified by the lack of referrals to International Arbitration despite many breaches of contract by the KRG.

I do not support the actions of the KRG wrt how they have dealt with the IOCs. Their behaviour merely reflects what I would expect from them, given the way they have been allowed to operate for years.

If the IOCs feel that there is mileage in challenging that behaviour at this late stage then they need to get their act together now - start a class action even without DANA on board.

Maybe DANA. could “adopt” GKP and put the pressure on for us, even if the others do not want to go down that route.