Member Info for WaffenBurret

You can include 2P reserves if you wish but it’s only 50% valid according to the rules.
So you have to multiply 2P by 0.5, which gives one an additional 850,000 barrels.

According to ERCE’s CPR , it could therefore possibly provide an additional £35M = 1.8p per share.
The tax credits are only good for the future oil produced. They are future earnings which would be dependent on future earnings which are good for four more lifts. (I haven’t deducted tax in my assessment whereas ERCE probably have - including the additional 25% levy. Possibly this is why their predicted revenues are so much lower.
I was attempting to get to today’s value in order to understand why the share price remains where it is today.
If you start to include forward potential you should also include other prospective events such as Crystal Amber selling up, potential shifts in Government policy. These are all unknowns at present.
As we currently have no active Government, it is impossible to predict what may happen to energy policy, levy concessions (eg:91% offset).
I think your valuation is a wee bit generous.
Though you may turn out to be right, and I truly hope you are, I personally am not working on that premise.

Thought I’d try and re- value this share as things currently stand:

£72.74M (fx@1.2234 09.15 ) Cash in Bank = 3.7p a share

Potential:

- 1P Oil remaining at Lancaster EPS = 2MMbbs approx (4 lifts by April 2023 @ eg: $110 per barrel) = $220,000 ) minus opex ($17M x4 = $68M) = $152M x 0.9 (1P@90%) = $136M = £112M =
5.82p

ERCE's estimates of P1 Reserves for the Lancaster field as of 31 December 2021:
(RNS # 3441I - 14/04/22) is worth apparently only $40M net = £33M (fx 1.2234) = 1.7p per share.

However the ERCE calculation is based on $70/barrel during 2023/24 (Could happen, one supposes) and inflation per annum of only 2%(!) which seems a little off, even for December but governments were then jokingly assuring us that it was a temporary blip.

Based on the above we get two valuations:

3.7p + 5.82p = 9.52p (My conjecture) or:
3.7p + 1.7p = 5.4p (HUR BOD / ERCE conjecture)

If we split the difference we get (9.52p + 5.4p) / 2 = 7.46p as a mid valuation.

We can also take a look at Contingent resources (useful shop window for enticing a buyer or JV partner) to rouse our spirits:

from RNS # 3441l:
“Contingent Resources, Development Unclarified, assume additional development wells and / or water injection is implemented as part of any further development; and contingent on regulatory consents, funding and execution during the lifetime of the existing Lancaster wells.”

These resources amount to a further 1C - 3C anywhere between 11MMbbs and 86MMbbs

Development Unclarified, meaning:

“• Project is currently under active evaluation*
• Significant further appraisal may be required
• Contingencies have not been clearly defined
• Progress is expected in a reasonable time period
• Chance of development difficult to assess and
could be a big range (20% to 80%)”
*(GLJ Petroleum Consultants 2015)

Considerably revised from 2017 assessment:

CRP Lancaster RNS # 3962E - 08/05/17 :
” The remaining 484 million barrels are classified as 2C Contingent Resources as 'Development Unclarified or On Hold' whilst the EPS assesses full field development potential”

The unclarified resources, as with the Halifax Field, have gone through considerable reassesment compared to original view in 2017 of 1C - 3C of 129.1MMbbs to 1,116MMbbs (!) under CEO Dr. Thrice’ s tenure.

In conclusion, my (sober) valuation now puts HUR at 7.46p.

Anything higher depends upon hope. All we have at present is:

RNS # 8869S - 19/07/22

“We believe that there are good investment opportunities ahead and the Company is well placed to deliver significant shareholder value."

Probably very tricky for BOD to take a clear decision at this moment as there are so many global uncertainties regarding future demand - currently reflected in the highly volatile and twitchy oil price.

Would this be a fairer HUR outlook:

- Single well P6: 1P (90%) proven reserves at beginning of 2022: 4.1 MMbbs.
2.2MMbbs extracted so far (4 uplifts; Jan,March, May, July) 4 uplifts remaining (approx) before relying on remaining 2P reserves (50% chance) of possible 1.8MMbbs
- Nothing at Halifax (currently worthless)?
- £85M cash in bank.
- Undetermined tax relief (from levy) on further exploration, pending new UK Prime Minister, new policy, in September.
- No Warwick or Lincoln - ‘non commercial’ well at Lincoln plugged and abandoned. GWA licence relinquished.
- large shareholder CA fund manager obliged to sell 29+% ( avg 6.7p (?)) stake by 12/23 latest.
- BOD stuck, awaiting world events before deciding what to do with the money (deflating@ c.10+%/annum)
- current value £85M/1.9B shares = 4.27p. + whatever’s left and commercially viable from P6 (-BOD salaries, Opex, etc).

Apologies for the last para - out of order and should be before CA RNS quote.

To finish: I think it highly unlikely that such a set of recorded facts regarding the Halifax field and test drill could be interpreted without any basis at all. There was a test drill, teams involved.
Of course the interpretation could be askew but to hoodwink so many seems unlikely in my view.

To get past the conjecture, I foresee, given the changing nature of energy security, that there will be oiler’s itching to re-visit the, ‘there yet not there’ Halifax field.

According to FT April 2020, Pierre Andurand (famously shorting oil) claimed it was only absolutely clear to him in February 2020 that Oil would drop dramatically due to covid19 and regretted not staying for the negative price dip of -$40/barrel.

Another possibility is that 50/50 assets are being stripped away in preparation for a sale.
I would like to hear more about that plan as would we all. That Halifax field is still there and needs further exploration. Crystal amber have ‘targets’ for “dividends” not necessarily set in stone(?):

22/12/21

The Fund has a track record of returning cash to shareholders via share buybacks and dividends: since the change to the Articles in 2013, £60 million has been returned to shareholders. The Fund intends to return all net proceeds from its holdings in Hurricane Energy plc, […] after providing for ongoing operational costs as necessary. The Fund previously announced, based on the Investment Manager's assessment of the status and timing of anticipated corporate transactions, that it is targeting additional shareholder returns of at least £40 million or 50p a share before 30 June 2022. Whilst the Fund is confident that this as achievable, after consulting with a number of shareholders, it is no longer considered to be in the interests of the Fund to impose a fixed deadline but will be keeping it as a target.

However, the general consensus at the time was generally that the game was up for oil and it would be all about ‘renewables’ , with oil at around $65 avg 1st half 2020.

Well, I still haven’t had a reply directly from HUR so while still waiting to here from Maris &Co, I’ve been mulling over Some RNS history - highly relevant in my view. (Happy to be corrected).

It was stated 11/12/17
“Halifax 2C Contingent Resources of 1,235 million barrels of oil equivalent
· Lincoln 2C Contingent Resources of 604 million barrels of oil equivalent
· The undrilled Warwick prospect is assigned Best Case (P50) Prospective Resources of 935 million stock tank barrels of oil, with a 77% chance of being a discovery”

Lincoln, part of GWA, was 50% owned by HUR due to farm-out to Spirit Energy prior to recent relinquishment, (Still listed on Spirit Energy’s asset list) in order to obtain funding for early production.

01/06/22
“Hurricane has determined that further appraisal and development costs to reach an economic development on the Warwick discovery within the remaining licence term is not feasible for the Company. Further to discussions with the Company's JV partner, Spirit Energy, the GWA JV has decided to relinquish the P2294 licence area. This is in addition to the previously announced decision to relinquish the Lincoln P1368(S) licence sub area. “

HALIFAX licence is still owned 100%. It needs to be repeated that in 2017 that there were probable reserves of some 1 Billion+ barrels of oil within a 1.8km column (to 200m deeper than Lancaster).
Furthermore DR Thrice CEO until 08/06/21 stated : “The principal purpose of the Halifax [exploration] Well was to support the Company's view that the Lancaster Field and the Halifax prospect are one large connected structure. Well results support the Company's opinion. The Halifax Well has successfully identified an extensive oil column, significantly below local structural closure. The reservoir interval encountered is pervasively fractured with porosities similar to those at Lancaster. The Company believes that the deeper oil down to ("ODT") at 1,846m true vertical depth subsea ("TVDSS") identified in the Halifax Well, compared with an oil water contact ("OWC") at Lancaster at 1,678m TVDSS, is most likely caused by a tilted OWC.”

Then, sometime later:
Halifax: ERCE (Emergy Resource Consultants).

07/04/21
“No Contingent Resources are attributed by ERCE to the Halifax well drilled in 2017. At 31 December 2020, c.$35 million of the Company's balance sheet intangible exploration and evaluation assets represented the historical cost incurred at Halifax to date. The Company now expects that the Halifax carrying value will be fully written off in its audited accounts for the year ended 31 December 2020”.

Dr Robert Thrice, of the above statement has resigned after Crystal Amber went to court over the bond repayment scheme. His-linked in account is dormant.

I wonder where all that oil has gone?

Perhaps the negative oil price of April 2020 gave the BOD cold feet (although the timing doesn’t seem to match this theory very well. Cont….

I’m curious Mabesyes, which retrospective court case would that be?
Is there one in progress?

We all know that there is a high probability of this going north eventually.
Attempting to time it is is really a case of gambling by the greedy and some losers are clearly disgruntled by today’s movements.

And on a day when price destruction is prevalent in the oil market and we are seeing the lowest prices for six months. How annoying eh!?
It all seems so counter-intuitive. But remember, if it’s in the news, it’s probably already in the price. LTHs should be reassured by this rather than worrying about volatility. Most of the shares are in sticky hands and relatively few are being traded.

Despite these unexplained movements, we all know that something good has to happen that will take this much higher (not withstanding black swans). The core value of this company is not going anywhere fast to satisfy a few twit(ter)s unless it’s a ‘meme’ share such as AMDT:

https://www.bbc.co.uk/news/business-62417010

Value investing is the purpose of my investment here. The gamble remains the BOD, though perhaps less so than last year.

*be paid.

So in conclusion, it might fall, it might rise. It’s hard, nigh impossible, to predict.
Best to stay in for the longer term and hopefully, etc.

Useful advice. Subscribe now and give away £100 that are not worth two pennies.
Sometimes I feel one should paid to read these posts let alone waste 10mins watching kids’ software games.

Nigwitty, your post yesterday (Wednesday 17.48). “The answer will be a polite refusal.”

I wonder if anyone has actually received an acknowledgement, let alone a polite refusal.
If not, I normally follow up after 48 hours, politely asking:

“Re: my previous email, I would be grateful for a response. If that is too much trouble, an RNS covering my points might be a suitable alternative.
I look forward to hearing from you shortly.

Yours truly,

Nigwitty, ( ibid ) “You're just wasting everyone's time and irritating the directors and long term shareholders”

If you feel your time is being wasted here then please feel free to do something more useful.

I think your comment exposes either an ulterior motive or a complete lack of understanding when it comes to valuing time and assets management.

Respectfully.

Plus, should Hurricane Energy end up in further court proceedings (God forbid) shareholder actions and requests such as these become a matter of record - Always useful.

Senseman: Sent mine yesterday, in case you hadn’t included in your total.

I will drink to that Dunkirk (later!)

I have been put in my place Dunkirk. Thank you for that.

I just cannot see the purpose of continued miserable commentary unless there is an agenda. Surely better to apply that same energy to the kind of positive action being suggested in this particular thread. I apologise for my own gripe and am not in the habit of quibbling, or posting this frequently.

Lth sitting with losses surely would be more interested in the possibility of retrieving said losses. One way of doing that I suppose would be to add at a lower price if you can talk the share down. Is that the plan?

“ We are swamped on this BB with day traders.”

Why would a LTH post every day with vacuous and sniping comments of little value? The truth is that the market generally has become more short-term and volatile in the face of extreme uncertainty about our future. Recession v tight supply, reflected in the POO.

All that is being requested in this thread, given the circumstances, Is that HUR maintains the status quo until the single well issue is underpinned by a PLAN beyond P6 exhaustion. You yourself have made that very point Daltry.

Why are you invested in such a high-risk/reward share of you don’t like day traders?

When you least expect it.

Withering comments are hardly helpful to the cause for LTH.

An excellent suggestion Sensemen.
I congratulate you for your continued watchful perseverence.

I shall be writing my own wording to the BOD shortly given the (still single well) precarious nature of the current situation facing HUR.

It does seem ridiculous that after the highly conspicuous behaviour of the last two years that the company would wish to arouse further suspicions amongst investors.

I’m not for a moment suggesting that the object of the exercise is to cause uncertainty and suppress the share price prior to orchestrating a deal which could be worth multiples of current value, or to enable an increase in shareholding for certain large holders at weakened prices, although the decision to reduce information flow could so easily lead one to such conclusions.

Yes, when precisely was one able to buy HUR shares for 0.32p?

They were at their lowest - 0.65p - on 04/05/21 according to the script I’m reading.

Unless the chart and records are wrong, in which case we really should report this to the correct authority, get things straightened out as it could affect TA predictions and whatnot.