|fh....thanks for that. Modest commitments are always good if you have 70% of them. Doesn't preclude a faster pace.|
|Re 125/6 the expected pace is a bit pedestrian (from 2016 interim results):
• Seismic acquisition, processing and interpretation 2016-
• One exploration well 2020-2021|
|Upgraded to 155p by someone today apparently! Needs to be a damn sight higher than that to attract any serious attention!|
|Have I missed something or are we still waiting on the fdp ??
back in the summer it seemed the main thing would be the number of wells drilled next year, 6-8 or some range like that, (might have been 8-10).
Would be nice if we could get back to moaning about the oil processing bottleneck as opposed to the lack of oil production.
|I suspect the March comment relates primarily to blocks 125/6, which have been progressed subsequently and where a 70% PSC stake is expected .....err....imminently (this month, according to the update of two weeks ago).In keeping with past practice, we will then find out what the company thinks about the potential of the blocks.....and I would be unsurprised if a chunk of the Mongolia receipts were to be very promptly invested in some extensive 3D work there.|
|If that is the case EE SIA's window of opportunity is now closing with a renewed interest in oil, so they had better make their "secure synergistic, longer term opportunities" pretty damn quick or it will all be "just words". At this rate we may even reach 150p again! Still a LONG way to go to make me anywhere near happy though! I suppose increased oil prices will ultimately be reflected in increased dividends too?
FWIW - Http://economictimes.indiatimes.com/markets/stocks/news/now-brace-for-some-crude-shocks-jim-rogers-sees-oil-price-at-60/bbl/articleshow/55720706.cms|
|.....ps....worth revisiting the "Outlook" section from the March results:We remain committed to evaluating alternatives to optimise our exposure to upside without jeopardising our focus on sustainable cash flow generation. We expect to secure synergistic, longer term opportunities that offer exploration drilling optionality in a more robust environment without putting our dividend policy in jeopardy. We are refocusing our business in South East Asia as past merger and acquisition activity has substantially reduced the number of competitors in the region. We understand the region, particularly Vietnam, and have had considerable success there in the past, which we aim to repeat in the future.|
|FH.....PMO and TLW are plainly more leveraged to the oil price....and they are also more liquid. So if the oil price is rising they are an obvious first buy for any institutions (or traders) looking for a quick return.The other factor is that many people seem to have assumed that upside potential no longer exists at SOCO and (whilst there has been little evidence to the contrary whilst oil prices have been under pressure) I don't believe that management has forgotten how to create upside.|
|Is it just liquidity or do these "investors" just prefer the look of other oil stocks?
We repeatedly say we are leveraged to oil price ,yet when we dont move up with oil price like others we say its because we dont have the same liquidity as other oil stocks. We certainly had the same miss fortune on the way down through to low prices,but not it seem on the way up. What does that tell us.
|Wake up seems to have done the trick ;-)|
|As ever on an oil price move, people pile into trades where the liquidity and quick results are to be had.....hence the big moves in PMO and TLW.
Fair enough but there's a point where this starts to look a bit silly.
SIA behaving as if there hasn't been an agreed OPEC cut - POO up $6 now.|
|As ever on an oil price move, people pile into trades where the liquidity and quick results are to be had.....hence the big moves in PMO and TLW.|
|I would imagine a lot of producers who hedge are looking at $52.80 on Brent - May and thinking I'll take some of that.|
|With Trump getting into the white house, and I suspect allowing even more drilling, shale and other wise than Obama, we have to factor in that there might be a bigger than expected jump in production there, especially if the price jumps, Shale has surprised everyone with how well production has held up since the crash in the price of oil.|
|Biggest rise in crude in over 9 months - 8.5% - Soco up 2%.|
|The anticorruption NGO Global Witness wrote in its report Heads in the Sand that "Global Witness' analysis demonstrates that the International Energy Agency continues to retain an overly-optimistic, and therefore misleading, view about potential future oil production." According to Global Witness, "the Agency's over-confidence, despite credible data, external analysis and underlying fundamentals all strongly suggesting a more precautionary approach, has had a disastrous global impact."|
|Oil Supply Crunch to Hit in 2019 as Investment in New Projects Dries Up
Here is this topical article by Emily Gosden for The Telegraph:
An oil supply crunch could hit as soon as 2019 as investment in new projects dries up following the price crash, leading analysts have warned.
Delays and cancellations of projects by cash-strapped energy giants mean the volumes of new crude production coming onstream will not be enough to make up for the decline from existing fields and meet growing demand, Barclays analysts said in a research note.
They forecast that 2019 would see the "the lowest year for new capacity" on their records, which stretch back to the Nineties, with just 1.2m barrels per day (bpd) of new supply.
By contrast, decline from existing fields and growing demand would together equal 4m bpd, resulting in a gap of almost 3m bpd.
"2019 marks a juncture where supply becomes a concern. With current volatility and oil price uncertainty, project sanction approval continues to be difficult," they wrote.
The analysis comes after the International Energy Agency last week warned that the world was headed for another boom and bust cycle in the oil market, with supply shortages likely to cause rapid price increases by the early 2020s.
The IEA said that if project approvals remained at current lows through 2017, it was "increasingly unlikely that supply will be able to meet the rising demand without rapid price increases".
The Barclays analysis is even starker, suggesting that a supply crunch in 2019 may already be unavoidable.
Given long lead times for many projects that it is monitoring "no decision now makes 2019-20 start-up an impossibility", the analysts warned.
"Inventories could help fill the gap, as will the phased ramp-up of onshore developments and shorter development brownfield, but by then we feel it is not a question of the US shale ramping back up, but how much it can produce to fill the gap and how high an oil price is needed," they said.
Oil prices have rallied to near to $50 a barrel for Brent crude in recent days on rising optimism that Opec will agree new production curbs at a meeting in Vienna next week, helping to rebalance the market from the current supply glut.
But the Barclays analysis suggests that regardless of whether Opec decides to cut next week the fundamentals are tightening and that an increase in production by the cartel may actually be needed within the next couple of years to fill a looming gap.
Ole Hansen, head of commodity strategy at Saxo Bank, said: "Crude oil has rallied strongly, despite headwinds from a rising dollar, in response to increased speculation that Opec will finally succeed in reaching a deal to cut production on November 30. The latest move once again highlights the cartel's role as a major driver of oil market volatility.
"On the assumption a deal to cut production by a minimum of 800,000 barrels can be struck we could see Brent crude oil once again challenge the ceiling around $54 per barrel."
However, he warned: "The initial move would be driven by short-covering and once that is done the market may pause and retrace in the realisation that Opec's ability to comply with its own production targets have been very poor in recent years."
David Fuller's view
I do not agree with this forecast. No disrespect to the International Energy Agency but I cannot think of any commodity agency which does not predict higher prices in most of their forecasts. If prices are low, they use that as a determinant of higher prices at a future date. This has sometimes worked given previous inflation and global GDP growth. What the agency is not factoring in, is the increasing wish to reduce consumption of crude oil because of CO2 emissions.
Even more importantly, oil has gone from supply tightness to abundance, thanks to technology. Today, oil is much easier to find and most importantly, onshore oil can be produced far more cheaply thanks to the vast quantities available in shale formations.|
|... but won't bother.
That's a relief, then!
What use is a weighing machine when the operator wears a blindfold?|
|.....Fidelity does - and will have been buyers up to 160p-odd.
The point is SIA isn't and rarely has been a trading stock. If the price of oil changes, people go in and out of Tullow - as it gives greater exposure and is more liquid.
I could go on about weighing machines etc...but won't bother.|
|Dismal display the last few days when POO has been stable if not slightly up - market just doesn't see this like some of us do - back to hibernation for the winter.|
|More worry over Nuclear in Japan won't help matters either with latest Quake and Tsunami.|
|With volumes now falling, institutions who wish to follow Fidelity's lead will struggle for stock. A 5% stake is tough to build when insiders have so much.For a day or two in February Tullow and Soco were both at 120p, so one might suppose there is plenty of room to pay up a bit before the OPEC meeting?|
|Quite true Lauders....and I'm not happy either. But that is down to the oil price, not much to do with the company.....|
|Quite true emptyend! I did not factor in the "dividends" over the years so nearer 45%. Still, my bold text still applies just to a lesser degree ;-) Now if it were +45% rather than -45% it would be a completely different story and then I would agree with the bold text. Fact is there isn't much to be happy about!|