Member Info for Tyler19

Aucuba, you are right that the acquisitions were a while back. However, companies tend to allow projects to come to a practical end before completing any consolidation, partly due to contractual commitments with ongoing long term clients. Below is an extract from their last update which states that the strategic review has been on-going for a year:

“We are now one year into our strategic growth journey and our results

continue to show clear progress. We have delivered strong revenue and EBITDA

growth, improved our underlying cash generation, grown our order book, and

continue to see an acceleration in the proportion of sustainable solutions

within our pipeline.”

It also states:

“We are confident that our actions, business model and strategy are delivering

and look forward to giving a further update in March.”

As you’ve said, these are overhead/support positions. This makes sense as senior managers often partly book to overheads and have separate department budgets. They need to be consolidated. Also, I’m glad that they’re only looking at overhead positions and not technical roles. The latter would a bearish sign.

Combining the Sky news story with earlier company update, in my opinion only, it’s bullish for the share price. Hopefully, this will be confirmed next week. Good luck!

The company consists of a number of legacy acquisitions which need to be consolidated into efficient units. This probably requires a number of senior roles and offices to be merged and hence, a small number of job cuts and potential consolidation of buildings. This news alone may even be a positive when looking at profitability metrics.

SW, it’s falling on thin volumes and most likely investors are looking to book profits before the end of the tax year. Any falls make it a compelling buy with a forward dividend yield of ~10%. Further falls? Yes, please!!!

The share price movement is most likely down to the macroeconomic picture rather than anything company specific. In particular, the outlook for interest rates and investors becoming nervous. As the old saying goes “markets climb a wall of worry”.

Analyst forecasts should always be taken with a pinch of salt. In 1998/9, when the oil price was around $8/bbl, analysts were forecasting an oil price of $4/bbl for the long term, only to see the oil price reach $140, and interestingly the rise started in 1998/9!!!

Results are expected around 26th Feb, three weeks to go! It should be very interesting reading. As a minimum, I would expect a confirmation that the acquisition is almost formalized/locally approved with minor formalities remaining.

There are also other catalysts here which should bode well, such as a stable currency as SeaTank mentioned below, ANOH plant and third party pipeline start-ups. One thing that I think will add a lot of hidden value here will be the Exxon staff that will get transferred over as part of the acquisition. Exxon has a history of recruiting the very best. Fingers crossed!

Looks like we're almost there, only days away!

"The $1.3 billion sale divestment of ExxonMobil asset to Seplat is also 98 per cent completed, and would be finalised in the coming days, the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has said."

guardian.ng/news/1-3b-exxonmobil-seplat-divestment-98-completed/

The main technology for CCS is absorption of CO2 using a solvent such as an amine. BASF have licensed amine processes which they licence to many industries around the world and I doubt that these licences would have been part of the original deal. The costs of these licences is negligible in the overall scheme of things but makes interesting headlines in the press.

There are a number of catalysts which will eventually bode well for the company. These include:

• Receipt of delayed payments from the Egyptian government.

• The company has been using water injection in Egypt to enhance recovery and should increase production within a year or so, if done correctly. Any increase will have a material impact due to the low current production rate.

• The big catalyst is any drilling in block 125 in Vietnam. This is a deep water field where drilling is expensive. That’s why Pharos is looking for a major partner to share the burden as well as potentially using a well slot on third party facilities (low cost option). If the latter results in large flows it will make it easier to attract a farm in partner and should be very positive for the share price. This may happen this year, at least the agreement.

• One thing that gets overlooked here is that Pharos is listed on the main market which may be attractive to a major producer looking to sell mature assets, in line with current industry trends.

• Bradley Radoff, an American investor, has been building a large stake in the company and will likely start taking an active role soon, most likely once third party discussions on block 125 have concluded.

The shares offer good potential if you’re looking to hold for more than 2 years. The shares are good value based on the balance sheet but not necessarily production, which is likely to fall in the short term. Hope this helps and good luck!

I believe it's mainly payments from Egypt that are being delayed. It may persist for another year or so. Egypt is undergoing financial difficulties which are are probably being made worse by the current mid east crisis. Pharos should get paid eventually and should add another 30% or so to market cap. The big downside is that it's money that Pharos could use to explore block 125 in Vietnam which is believed to hold very large reserves and could transform the company.

When dealing with developing countries it's fairly common for payments to be delayed but do eventually get paid, sometimes through the courts. It's part and parcel of the risks within the industry.

Nitro, I think the market volatility will continue for the next year or two, with economic uncertainties, timing of rate cuts, mid east conflict and a potential energy crunch in 2025 being forecast by some banks. HBR has a high operating leverage and FCF will change very rapidly if any of the external factors become slightly more favorable. I think the share price will drift upwards with some volatility till the merger is completed. Good luck!

May be I'm missing something here? HBR has a clear declared strategy of growing production overseas due to their dissatisfaction with the EPL. It makes sense to perform shutdown operations whilst the tax level remains high. The EPL tax looks increasingly unsustainable, particularly if other companies are also deferring production in the north sea to force the governments hand. This may have been an indicated in yesterdays update "..deferred partner-operated wells at Beryl and Elgin Franklin in the UK.." I believe there's more to this guidance than just a simple production drop. Companies can chose to maximize production even when shutdowns are required. To perform an unusually high level of planned shutdowns implies its a choice that the company (or may be even the industry) is making for other reasons.

Had yesterdays update included a downgrade of reserves I would have been worried, in the absence of any such announcement I will continue to hold theses share. Good luck all.

This deal is huge! On what appears to be on excellent terms and conditions. Nice little Christmas present for all shareholders. Harbour will now end up in a similar category to the big players such as Shell and BP. Great financial nouse on part of the management. Well done!

A fall in price Brent may increase acquisition potential for HBR with a $1B in FCF per year, there are already lots of great opportunities in the industry. HBR have stated that they’re pursuing multiple opportunities. I believe the bottom is now in and after a long time we can now look forward to some SP growth. GLA!

I assume cost of any finance will be offset against profits/tax in the UK, subject to arrangements. In which case the new assets should pay for themselves fairly quickly. Should be positive for the share price. Although, the potential consideration has been in the news previously.

I would also add that as the deal will be back dated, the amount of debt required will now be much lower. Although, may be at a higher cost. On balance, financing should be less painful.

I also agree with you Brokestocker. However, unless there's a reasonable risk/reward ratio, investment in the North Sea will stop very quickly. I'm sure you'll agree, that's probably where we're heading unless common sense prevails, starting with the autumn statement. Fingers crossed!

The longer this madness prevails the more likely we will also lose the capability to increase production, which worries me even more.

Positive statement from the Nigerian regulator on potential acquisition of Exxon assets.

https://www.reuters.com/markets/deals/nigerian-oil-regulator-optimistic-exxon-asset-sale-seplat-2023-10-11/