Member Info for theoryman

Most obvious reason but not necessarily the correct one is it’s the last Thursday in the month and the last day of the month.

The first being the standard rollover day for Futures and Options.

The second being related to some pseudo products for those who like that sort of thing.

The shorters will have access to analysis of what happens in general to pressure on the Bid resulting from a distribution.. if they hadn’t built it into their modelling with GKP they probably are now.

IMO max pressure comes from a buyback where no shareholder sells onto it or a dividend where every shareholder reinvests the cash - fat chance of getting that then.

Just listened to GKP’s input at the annual Nordic get together, Presentation and Webcast are now on the website.

Are my ears and brain deceiving me again:-

#1 I think he said there’s chance of a distribution before pipeline opens? (Calm down Armas, calm down 🙄)

#2 offering Shaikan at $25 a barrel was a deliberate ploy to drive up sales volumes because the reservoir economics opens up that strategy during difficult times?

Word got lost in posting.

As for the people who Recced it, guess who several months prior to the 2016 Reconstruction posted a detailed analysis that showed the long term unstainability of the company finances at the time?

Encouraged by buchephalus’s DYOR, I did some and found this from August ‘23

“Agreed Itsaponzi.. 

All that you write is now more possible then ever. The legality is the King... The horse trading is going on and on and that is very frustrating, but once we're through that and the pipes opened, we'll see the real potential and value here. Unless We're snaffled before that occurs.”

So agreement gets the correct use of your username but posting something he doesn’t like gets a puerile adaptation instead.

As for the people who Recced it, guess who several months prior to the 2016 posted a detailed analysis that showed the long term unstainability of the company finances at the time?

It was BB and it didn’t go down really well with the happy clappers and holders of golden tickets but…

@PUTUP, you missed the opportunity to be accused of being a pedant 🙄

From the comma after GKP until the next one is an adjectival clause. The first comma signals a break where there should be a slight pause to emphasise it is not to be read continuously.

On the other hand you could get accused of being a “bean counter” by pointing out what multiplying 38400 29 25 and 36% gives.

The personalised attacks on you seem to have subsided a bit, maybe you need to up your game?

@ValueS, I have just had another a look at #2 and #3 I put forward earlier.

The increase in local demand generated by the new processing facilities opening make those two less than good outcomes get better, which means the value offered by all outcomes must have increased.

Pipeline closed, demand increases,local price realised should increase.

Pipeline open but Shaikan not in the blend then a lot of the current local supply will then be in the blend. Local supply drops, local demand rising, should drive the realised local price up even more.

@ValueS, I think it is 61.5% before adjusted 20% CBC.

Correct figure is on slide 23 of the 23/03/23 Presentation FYR. ( Amazing how 23 keeps cropping up more than it used to after Beckham used it as his number - must be conspiracy based 🙄

I’m on my phone with poorish signal so can’t access the GKP site.

Values, was the fast rate of production you referred to all down to oil being lifted or was is topped up by volume from storage?

Given all the wells are different I would Exocet them to fire up the easy ones first and bring the more complex ones on later and more slowly.

On the booster side weren’t there two new wells which were drilled tested and ready for hooking up just before the pipeline shut? If so, I’d hope they would be a welcome fast addition to production.

With GKP when it comes to timing positive outcomes I have found that assessing what’s reasonable and then adding slippage leads to less disappointment.

ValueS, I think he was using 80% at the contractor level I.e. gross and not nett to GKP.

“ The R Factor is still likely around 1.19 now. So that's a 27.2% share in Profit Oil of which the contractor has 80% i.e. 21.8% now and falling.”

@gavsgear, I hope you referred yourself to Admin using the same criteria after your FCF post last year 🙄

https://twitter.com/john78846295/status/1707701694107164698/photo/1

Apart from being founded on baseless assumptions re production and a total lack of understanding of how PSCs work, it was yet another example of how spreadsheets in the hands of the clueless can produce uplifting positive outcomes with zero validity.

I think any calculation done at this time could well be a total waste of time for several reasons.

The rest of the world uses ‘production costs’ but the FGI introduced ‘cost of production’ when they came up with the original $6 figure.

The former term is well defined, the method for calculating the FGI one has never been disclosed. If they are identical then why introduce a new term? If they are different then disclose how they are different. What’s included and what isn’t?

Sometimes it’s $12 and sometimes it’s $20 depending on who has caught the ear of a journalist but is that a flat rate per barrel for each IOC irrespective of actual costs?

We do not know what sort of replacement contract is being offered. Lots of references to ‘sharing’ but sharing of what?

Some articles have even implied that Iraq has been using production sharing ones since the 2018 round. However when you delve deeper it turns out they were effectively revenue sharing ones - there was no way that the producer could take their share of production and sell it themselves as in a real PSC.

Conclusion, until we know what this $ per barrel actually represents, how it is going to be distributed, what is going to be shared and what %s will be used in the sharing process, probably a good idea not to go multiplying numbers together.

I don’t see it so much as a vision more like Soap Opera approaching Xmas ( in this case the $ per barrel that goes into the Budget). They have recorded three versions of the final program to keep everyone on edge…

(In each case I have outlined what IMO the most likely response would be from the company.)

What matters of course is how the market reacts and how each investor reacts to that.

#1 Export ban lifted, pipeline opens, Shaikan in the SOMO Blend.

(Take what SOMO gets minus discounts.)

#2 Export ban lifted, pipeline opens, Shaikan NOT in the SOMO Blend. (Doesn’t fit the target quality of the NEW improved blend.)

(Truck as standalone product to export point, sell own share and/or sell own share locally taking cash up front in both cases.)

#3 Export ban not lifted, pipeline remains closed,

(Continue to sell own share locally taking cash up front.)

Previous experience shows that cases #2 and #3 are survivable and opens up the chance that #3 reverts to #1 or #2 at some later time, or even #3 to #2 and then #1 over a longer timeframe.

#1 should produce a healthy rise in price from these levels.

Is there value on offer at this price level?

IMO Yes, with the usual value investing based caveat, only as part of a well balanced portfolio.

@kheldar wrt #4

Aren’t the new contracts long term initiates in terms of potential production but the reopening of the APIKUR wells would have a measurable effect on production with a month or two?

IMO the firmer is about replacement and future OPEC+ quotas, the latter is about known current ones.

@balgrano, you wrote, “… and its certainly not true that they are with holding Kurdish crude due to quotas.”

Can you supply the figures to prove that assertion or is it just a strongly held belief based on previous experience?

How binding are OPEC+ production quotas? What sort of % surplus gets through without comment or any repercussions?

Does Iraq have some extra wriggle room anyway because of previously underproducing compared to their quota?

What area of land does the current OPEC+ production quota relate to? ( The whole of geographical Iraq or a smaller area after Kurdistan and/or the disputed territories are removed?)

Al-Sudani, on Tuesday 20/02/24.

"The three-year budget included the cost of oil production according to the national benchmark," al-Sudani responded to a question from a correspondent of Shafaq News Agency during a press conference earlier today.

"The cost of extracting oil in the Kurdistan region alone is above this benchmark," he added. "Oil companies operating in the region have halted production."

So they allocated funds in the budget to cover the cost of oil production for the WHOLE of Iraq but then found out it didn’t even cover the cost of production for just Kurdistan.

Even with the lower incorrect figure in place they are already running a deficit budget one year into the three year cycle, that figure needs increasing and will make the deficit even worse.

In addition there are other amendments that are being proposed to direct extra funds to identified areas of urgent need, which if approved will make the deficit even worse.

I wonder when someone will suggest, paying the IOCs what they want, get the export oil flowing, then have a look at what that does to the PoO, how close TOTAL production gets to the OPEC+ quota, see if anyone is actually bothered and look at the effect on the Budget deficit…

At the moment I don’t think we are anywhere near a serious financial scenario, the company is stable, debt free, in a self sufficient state and trundling along awaiting developments.

The next key piece of data IMO is the figure for the “$ per barrel” which the FGI have to go public on as part of its journey through the Finance Committee and Parliament.

At the start of its journey and at the end, will it be at a level acceptable to APIKUR or be below it?

That is a clear binary outcome, which for those who didn’t listen in Maths does not necessarily mean it’s 50:50 🙄

Are the FGI willing to recalibrate how they view contracts with IOCs or are they unable to and are willing to live with the consequences - whatever they might be?

On a previous thread I wrote, “ There is also a journalist’s summary of it but that contains no quotes and language that we would not normally associate with Caggins given his previous outputs.”

In the video on this thread, towards the end, the previously reported language is there coming from his own mouth - unless it has been doctored in some way 🙄

“strangled” “hands around the throat”

IMO looks like a deliberate change in strategy, driven by lack of progress resulting from use of more diplomatic language.

There is a video of Caggins speaking yesterday but superimposed on it it someone translating for the local audience.

There is also a journalist’s summary of it but that contains no quotes and language that we would not normally associate with Caggins given his previous outputs.

The only thing that matters is whether what’s said at these meetings shift the “$ per barrel” figure high enough to get APIKUR approval, plus that figure survives the Financial Committee and Parliament haggling over the totality of amendments within a deficit Budget.

If the 10 day guy was correct, only 7 days left until we find out. Is that working days…?

Looked at the GKP site this morning and he was on the Senior Management list but not the Directors’ one.

Just checked again and that is still the same.