Member Info for Tigar

Hi L3 & Pelle
I see L3 you don't think they have drawn on the $439m available and it will not appear in H1 you may be right? but that $439m is clearly stated as available on signing and the $600m limit steps in on GE completion and is available till 31st Dec and between then and 31st March it needs to be repaid to $500m and of course we have letters of credit to $150m I am not sure exactly how the cash sweep is supposed to work but presumably it would lead to any FCF in each period having to be used to repay Bonds keeping the $75m allowed, to use the facility to the agreed limits. Will we have enough to repay the Retail Bonds at next interest payment date 15th August? Just food for thought.

L3 I have taken it they have repaid outstanding RCF on signing new deal, lowering interest rate immediately as I have said before, it seems they are borrowing the full outstanding amount and keeping FCF available? presumably to cut the outstanding Bonds latter this year, They have new facility of $600m with no repayments till after 31st Dec So it could be that the $439m loan will appear in H1 accounts. But I will have to wait till Sept to find out but it fills in the time while sitting on hands.
PS I'm with Pelle 180m 120m seems a bit low with little capex

Hi L3
"
The amount capable of being drawn by the EnQuest Group under the RBL, which will initially be applied
to refinancing the existing indebtedness of the EnQuest Group as mentioned above, increases subject to the
satisfaction of certain conditions. The full total commitments are available from signing, but for drawings in
loans (not letters of credit), subject to an initial (amortising) utilisation limit of $439 million until
Completion and then an initial (amortising) utilisation limit of $600 million until the Bond Refinancing"
I read that to mean the first part will be activated immediately so the $439m will be shown in H1 accounts and the increased FCF will show up as an increase in cash in hand?

Hi Pelle that is the aim, Oct 2022 New Bonds $500m at ? rate.

hitman1a you make good points on small print giving further info, I found it impossible to find, over how long the $170m NPV was for. I didn't say or think it was annually I got feeling it was likely to be the loan period Oct 23? or the 4 years mentioned, and yes the small print gives an indication on 20% rise in oil, this being the $50m additional payment trigger, so the $150m extra NPV I take it as after that payment. The oil price is 40% higher at moment so NPV could be much higher than your $320m (if it continues?) But knowing how long the NPV assumption was made over is very important to outcome. Oil being high at the beginning is a great start!

Hi L3 yes I have spotted my fag packet error, point taken!
We are undervalued and 19p is unlikely

I doubt it but shouting about it will not make it happen, if it does what are you going to do? Buy shares or sell a short?
If you have a short, brave man!
This with GE is now bringing in over 1p a share per day in FCF, if loaded up sit on hands next stop is accounts and GE completion early Sept .
Prospectus had GE delivering $170m value with oil at $51 for 2021 same assumptions with oil at $71 gives a value of $480m even after the $50m uplift to the price. Sit on your hands and 60p party will be a cert. AIMHO

You have answered your own question, If it is a US platform or Swedish for that matter OO is not available to those shares. Shares must be held in UK Crest accounts. Hope you haven't lost out too much. AB will pick your OO shares up.

Banana Jo
So you think with the stopping of air travel and the abandoned streets we had during covid that meant oil storage was bursting at the seems. No action should be taken to stop the oil price from crashing to undermine your economy? They need $60-$80 to balance the books.
A Farmer will leave his crop in the ground to rot if it costs more to harvest than he gets.

The market would say every airline is bust, every pub shop and restraunts is be bust but action was taken to stop as much of that damage as possible, I can't blame the Arab countries protecting there income. America could print another trillion to finance more fracking but they have subsidised oil production by giving access to millions of acres for peanuts and righting off billions in failed businesses to allow those that are left to pick up their assets for pennies. But can they afford to do it again I hope sense will prevail, and USA accepts it has manipulated a low oil price for long enough.

OPEC have taken some action to restrict some of the oil because of covid demand drop, who blames them? the west has been taking massif actions to protect its interests $Trillions printed to pay workers keep businesses going without OPEC taking some action we may have had cheap oil for longer but you could argue without Gov printing money, 50% would be unemployed.
OPEC will remember Trump tricking them into relaxing the cuts too early last time and will take what Biden says with caution but I doubt they have that much production waiting in the wings anyway! If they havn't that is when we will see $150 oil if they have they will probably step it up till oil is $80-$90 just enough to meet demand but not temp shale boom this time around.
A little spat within releases Biden tensions but will not change policy.
I have signed up for my OO but had to sell some at 23p to fund some within wife's ISA, I feel we will have Bonds trading at par very soon, but their days are now numbered 1st Oct 2022 at latest in my view.

The brilliant new Finance deal has 60% hedges as a condition. It has 4.25% interest rate with the carrot of a reduction to 4% if Bonds refinanced by 1st Oct 2022 it also lent us enough to clear the RCF as outstanding in Feb 2021 and allows for Max $600m till 31st Dec and $500m by March 2022. So all FCF till then can be used to increase production and clear as many Bonds as possible before a new deal for rest. Hedging is part of the new plan and clearing the Bonds quickly is the aim.

oxygen fully agree, but note prospectus is only giving assumption for oil at $51 in 2021 plus modest increases going forward, NPV hindsight figures with oil at $70 for 2021 go off the scale. Oil could drop to $30 to mess things up but that's why we have to hedge 60% for Finance deal.
And I repeat my point from an earlier post that if Bonds are re-financed by 1st Oct 2022 Interest rate drops to 4% Enquest has the backing of its Banks.

Dumbly you have cracked it perfect time to short, go for it! and go big easy 8.9%

Hi L3 the bit that grabs my attention was
"Prior to the Bond Refinancing and following the RBL Effective Date and Completion (“Step two”),
the utilisation limit for drawings in loans (not letters of credit) is as follows:
From the Signing Date to 30 September 2021 USD600,000,000
From 1 October 2021 to 31 December 2021 USD600,000,000
From 1 January 2022 to 31 March 2022 USD500,000,000
From 1 April 2022 to 30 June 2022 USD400,000,000
From 1 July 2022 to 30 September 2022 USD300,000,000
From 1 October 2022 to 31 December 2022 USD200,000,000
From 1 January 2023 to 31 March 2023 USD100,000,000
From 1 April 2023 to 30 June 2023 USD50,000,000
From 1 July 2023 to 1 October 2023 0
And it is good to see also that interest rate after is 4% if Bonds are refinanced 1st October 2022 from my reading.

The high yield bonds are so without checking Retail will almost certainly be. But was a good point worth checking.

"On or after 15 April 2017, the Company may on any one or more occasions redeem all or a part of the Notes at the redemption prices
(expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest, if any, on the Notes redeemed, to the
applicable date of redemption, if redeemed during the 12-month period beginning on 15 April of the years indicated below, subject to
the rights of holders of Notes on the relevant record date to receive interest on the relevant interest payment date:
Year Redemption Price
2017 105.250 per cent
2018 103.500 per cent
2019 101.750 per cent
2020 and thereafter 100.000 per cent
All redemptions of the Notes will be made upon not less than 10 days' nor more than 60 days' prior notice, except that a redemption
notice may be made more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or
a satisfaction and discharge of the Indenture. Unless the Company defaults in the payment of the redemption price, interest will cease to
accrue on the Notes or portions thereof called for redemption on the applicable redemption date.
In addition, at any time and from time to time, the Company may redeem Notes in an aggregate principal amount equal to the total
amount of interest paid on the Notes up to the Redemption Date through the issuance of Additional Notes (less the principal amount of
all Notes redeemed prior to the Redemption Date pursuant to this paragraph at a Redemption Price equal to 100% of the principal
amount of Notes to be redeemed, and accrued and unpaid interest to the Redemption Date, subject to the rights of the Holders on the
relevant Record Date to receive interest due on the relevant Interest Payment Date."

Tiger estimated about 90mb and 5km from Magnus so could be a perfect tie-back to get most from facilities in place. Next years Magnus drilling seem time to test it.

Hi L3
Just another point in your FCF thoughts for H1 we have not paid interest on $1bn of debt that has been satisfied by PIK, in H2 that is most likely to be cash. Bonds are now expensive so I do think Enquest are motivated to sort out next year in plenty of time to extend the new loan facility to 7 years. Hence one of my thoughts that they may be building cash to halve the Bonds an already stated aim. Though I would love to see Tiger tested with the drilling campaign on Magnus.

Hi L3 Trader
I have inferred that they have not paid down anymore of the RCF as the presentation gave the outstanding loans to be used by the new facility as $57m BP $26m Sculptor and $352m RCF they had stated 31st Dec Sculptor loan was $66m not sure BP outstanding? but the $352m was the figure in the update that said they had repaid $25m in Jan. So it seems to me they continued paying down Sculptor and BP? from FCF but are repaying the full $352m from new facility that leaves them with most of the FCF generated in H1 on the cash in hand account, so what for is the question? could be to build buffer to repay half of Bonds on refinancing them next year ? could be Drilling campaign on Magnus and Tiger? Drilling Bressay? who knows but they seem to be taking the full $600m when with the good FCF we have, they shouldn't need all of it.

Hi Pelle
I was surprised at the Sculptor loan only having £26m outstanding but that is in presentation so Kraken is producing good FCF, not sure of the decommissioning costs weighting to H1 but if as presentation infers $40m for Sculptor and $147m for Enquest that means Kraken has done $187m on its own, so you should easily get your $180m even after decom costs.