Andes Energia Share Discussion Threads

[simon gordon] 17/4/2012 12:24

LEX in the FT:

Readers can decide for themselves whether Argentina is run by a populist seemingly determined that her people do not participate in an economic golden age for Latin America. What is certain is that the renationalisation of YPF by the government of President Cristina Fernández will guarantee that it is not only the share prices of YPF and 57 per cent-owner Repsol that are heading south. Argentina simply cannot afford the $25bn a year needed to develop new fields containing up to 22bn barrels of shale oil and gas. Which oil company will now lend its expertise?

It is already embarrassing that long-suffering but energy-rich Argentina has to spend 7 per cent of its annual budget on energy imports. It is wrong, however, for Ms Fernández to blame Repsol. Last year YPF accounted for a quarter of the Spanish company's operating income but a third of its total investment. On the face of it, therefore, the 20 per cent fall in Repsol's share price since the start of the year looks about right. But it will fall more on Tuesday because YPF was expected to double its production over the next decade. Repsol can kiss that goodbye. And Argentina can kiss goodbye being treated seriously again by investors for another generation.

[shuell] 17/4/2012 12:10

From the FT. DYOR - "However, investors should not be fooled: Repsol's chances of getting much for the nationalised YPF stake are very limited. The risks that it could face additional claims from YPF creditors are not negligible. Investec says sell. Its analysts have done their sums and written down the value of Repsol's 57.4 per cent controlling interest in YPF to zero. That takes €9.63 off the share price and Investec's fair value price down to €15.63. "Our hopes that Argentina was sabre rattling on YPF now look misplaced."

Argentine president Cristina Fernández's announced the decision to expropriate 51 per cent of Repsol's holding came without saying anything about compensation. In the escalating war of words between Repsol and Buenos Aires, the Spanish company's stock has fallen 32 per cent since the beginning of 2012, reflecting what Investec estimates to be a 50 per cent drop in the value of the YPF stake to $2bn."

This matters to Repsol – YPF accounted for 21 per cent of group profits and 34 percent of investment in 2011.

Meanwhile, Macquarie warned that shareholders' problems may not be limited to the loss of the YPF equity.

It warned that Repsol could face pressure from YPF creditors with debts of €2.2bn at the end of 2011 – for example, via cross-default provisions and/or guarantees from the parent company.

[stluke] 17/4/2012 11:44

Starting to turn and in for some myself, seems Sinopec want to buy out YPF stake could prove well for Andes in the long run this.

[mypension] 17/4/2012 11:16

Does anyone know how the demerger will work. If I remember correctly the compnay said it wantd TWO listed companies. Does that mean if the oil and gas bit is demerged into another list company we get shares in it?

[jonno1] 17/4/2012 10:55

worth mentioning I thought...as you probably know you can spreadbet this with IGindex, but more importantly they will let you have a guaranteed stoploss, unlike nearly every other AIM oiler. With the uncertainty with what is happening in Argentina this is far safer than buying the shares at the moment IMHO

[stluke] 17/4/2012 10:38

Hopefully an update from the company will be forthcoming as a fall of this level can not go unmentioned I would have thought.

[simonparker5] 17/4/2012 10:24

stluke - yes it is although not by much.

[stluke] 17/4/2012 09:53

simonparker5 - Is the electricity generation business currently profitable, the hydro part maybe?

[stuart14] 17/4/2012 09:05

YPF are beingt punished because they focus too much effort /investment on international projects and not enough on domestic production / exploration.

Argentina has the worlds 3rd largest Shale Reserves, and they are totally unexploited.

Ironically I see this as positive for us.

1: YPF have been forced to give up some very nice domestic licences- are we after them?

2: YPF are being forced to invest a lot more on developing existing domestic projects. That should help us out.

[simonparker5] 17/4/2012 08:31

Pugugly this not just an oil and gas play. They have a large interest in power generation which is profitable. Shuell's post reports a 51% figure and even then compensation would have to paid as per international law. Don't get me wrong I not saying that this shouldn't have a negative effect on the price.
I suppose what I shoul dhave said is that being a typical AIM stock this will be punished beyond the true reflection of the news.
I would expect a good buying op in the low 30's.

[pugugly] 17/4/2012 08:22

Why unjustified - The Argies will probably nationalise (expropriate) our holdings so what value then - They have no money to pay realistic compensation. (imo & dyor)

[simonparker5] 17/4/2012 08:03

shuell it will mean a big unjustified fall in the share price as has been seen this morning.

[shuell] 16/4/2012 17:53

"YPF shares plummet in New York and Buenos Aires

Shares of Argentina's biggest energy company YPF fell by 18% percent in Wall Street and was edging down by 2.5% percent at the Merval Buenos Aires stock when the market suspended the company's shares quotation.
Stocks plunged after president Cristina Fernández de Kirchner announced today the Government House was sending the Congress a Bill allowing the administration to expropiate 51% of YPF's actions."

What will this mean for shareholders?

[stluke] 03/4/2012 08:18

Back in for a few this morning after recent reverse should get an update soon hopefully.

[shuell] 02/4/2012 11:00

Until the uncertainty around YPF is settled, we might hover around this level for a while.

[simonparker5] 02/4/2012 06:20

Hopefully this is the bottom and we will make our way north again. Further news should be due soon.

[pigeon1] 29/3/2012 18:18

Thinking of having a go here can anyone tell me if this harassment of YPF is behind the decline here? Could they potentially lose their ground in Argie or is that scaremongering?

Also what is the next operational news?

When is this demerger expected?

Much appreciate any help!

[eddington1972] 13/3/2012 15:00

Its in auction now so don't think it is... I had topped up today as well

[jpuff] 13/3/2012 12:08

I have held on through this extreme volatility and agree the reaction appears well over done.

[simonparker5] 13/3/2012 11:17

Surprised to see these trading near where we were before the oil discoveries.
Todays news IMHO does not warrant an 8% drop. We were trading at near 100p only two weeks ago and nothing has changed.
We should get an update on the drilling results soon.

[stuart14] 06/3/2012 15:53

The rise was down to lack of liquidity. MMs making the most of the drying up of buying pressure. Longer-term this all looks very good still