Afentra Share Discussion Threads

[elsa7878] 18/6/2024 19:04

2 day roadshow in the City next week. FWIW.

[mount teide] 18/6/2024 17:02

D35 - thanks for your thoughts. Very familiar with TXP as an early stage value/growth investment - bought the first 1.0m of a 2.4m position in TXP at an average of 7.5p, immediately following the London IPO, when the company was so unloved it was possible for poster Zengas and myself to repeatedly buy in transaction sizes up to 250,000 shares without moving the shareprice.

At that time, there were only three posts on the Advfn thread during a two month period and two were mine. Some nine months later the company raised a relatively large sum of money compared to the market cap at a shareprice of 11p.....to organically grow production/P2 reserves. It proved an extremely effective use of the cash compared to paying out dividends or buying back shares, as the stock was changing hands some two years later for circa 23 times our initial buying price.

If CEO McDade were to significantly veer from following a strategy other than identifying and buying attractively priced, high quality second phase O&G assets with material reinvestment and efficiency improvement potential to maximise reserves recovery, I would look to sell down my holding.

However, McDade clearly believes Afentra has an opportunity to replicate the success of Tullow, Talisman and Apache in the North Sea 20 years ago, not least because fortuitously Afentra has the tail wind of the recovery stage of a new oil market cycle, a strong post pandemic recovery in demand, and a major programme of disinvestment of high quality assets that are no longer material to oil majors and NOC's in a number of mature O&G basins around the world.

The holy grail is to find a lowly valued second phase O&G company with low producing costs, strong cash flow generating assets and highly material organic and inorganic development potential, run by an experienced management in a high growth, high energy price mature market, thinly contested for high quality assets being vacated by oil majors and NOC's, due to owners and Governments willing only to consider companies with management capable of demonstrating a previous track record of managing O&G assets to the highest operational and safety standards.

Should the company also benefit from a regional Government offering industry leading fiscal terms, long license extensions to attract new investment to maximise recovery from large mature fields, and a drilling/oil service sector still largely beaten down by the ravages of a long recession, together with a location in a region with mostly benign sea and weather conditions enabling shallow water offshore field production development and maintenance work to be carried out year round, that would be the icing on the cake.

On the balance of probabilities, over a 2-3 year view, I consider the risk/reward of an investment in Afentra today as good as any O&G company in my portfolio.

AIMHO/DYOR

[briggs1209] 18/6/2024 16:54

Dragon could well be right here. It has taken a chunk of time to get the last big deal done and we could now drift with the price of oil awaiting another deal.

However, equally there could be a steady flow of news relating to workover of wells and generally cheap and effective well interventions. The expectation of such moves could easily keep the price marching upwards.

I suspect deals may well come more frequently over the next year or two. Looks very nicely positioned.

[onedayrodders] 18/6/2024 16:12

dragon3518 Jun '24 - 15:51 - 334 of 334 (Filtered)

[dragon35] 18/6/2024 15:51

I have been here nearly three years and whilst I am happy with the steps taken I am questioning whether to keep holding or not. I was hoping for more of an RRE round two so patience is sadly wearing thin hence looking for inspiration from others!

[holdandhope] 18/6/2024 15:21

Or just have a bit of patience Dragon and let the market get the share price to 80 and let AET spend the cashflow on growth capex and acquisitions?

[dragon35] 18/6/2024 14:59

Buy backs are usually high return RRE was a good example. Cash deployed effectively - as AA kept saying they were the best value oiler on the market so why not buy back your own shares. Surely this is worth 80p plus then buying back at 55p is good business?

[onedayrodders] 18/6/2024 14:34

some posters are sooooo transparent

[onedayrodders] 18/6/2024 14:33

dragon

feel free to move on, some of us didn't wait until June to buy

You can leave us to suffer, but do remember to pop back in 6 months to gloat (or not)

;o)

[mount teide] 18/6/2024 14:32

d35 - with the greatest respect you could be mistaken for a trader who sold out on the pullback from 60p and is now looking for a cheaper re-entry point.

Share buy backs? AET is a high growth company in the early stages of its development, with a laser like focus on investing its fast growing cash flow into high return organic and inorganic growth projects, NOT relatively low return dividends and buy backs.

[dragon35] 18/6/2024 12:57

Great info. But I do not see any share buybacks short term so the issue I have is that we are using capex to invest in growth and the growth is linked to oil price changes. The capex takes time to make a step change in production. Without a new acquisition then what excitement value is there here right now? You hold the shares for 12 months and hope production improves but if oil price goes south you are back where you started with no cash growth. I am merely trying to work out what the buy case is here apart from hoping for an acquisition. Basically what is going to propel the share price to 60p 70p etc. it's currently on a X multiple compared to industry average of Y etc etc?

[pnetol] 18/6/2024 10:59

Great post MT

[mount teide] 18/6/2024 10:58

d33 - 'Whilst the cashflow etc are great here the current issue is that all the cashflow is going back into work overs etc for the future'

Some food for thought:

2023 Capex was $3/bbl - and included 30 LWI's - with an average payback time of 8 weeks at $75 Brent, together with work that delivered a doubling of the field water injection rate.

Circa 6,500 bopd = 2.37m bbls/yr - suggesting the net 2023 Capex spend will have been around $7.1m - which is 14% of the $50m sustaining production cash flow forecast at asset level @ $75/bbl Brent.

However, Brent averaged $82.49/bbl in 2023 - so a potential further $17.25m of cash flow at the asset level will have been generated by the higher average oil price - this additional sum ALONE is 2.24 times the 2023 Capex cost.

[dragon35] 18/6/2024 10:10

Whilst the cashflow etc are great here the current issue is that all the cashflow is going back into work overs etc for the future and another deal may not happen for months so us investors are left holding the risk on oil price while waiting. I think this is why people are selling a few to balance risk. Nothing wrong with the company but you are now holding waiting for 2025 or the random event of a new acquisition before the next bit of excitement all the while checking the oil price regularly. If oil stays strong then next year will be massive here but I wonder if short term it's a bit dull.

[eringael] 17/6/2024 17:01

Rollover day tomorrow for June contracts for a lot of sbet companies, no surprise that a lot of bids get hammered and you can be sure the spreads at end of tomorrow will be wide!!

[mount teide] 17/6/2024 16:14

RSI is back to a level last seen when the shareprice was in the mid thirties back in January ....... it's been achieved on modest transaction volume.....driven mostly by AT trades. Suspect the 50 day moving average around 52p will likely mark the bottom.

[onedayrodders] 17/6/2024 15:26

AIM tends to lose 50% of most recent 'spike' (50-60p) so we are right about that point now

[fatfish] 17/6/2024 15:25

someuwin17 Jun '24 - 08:41 - 317 of 318
0 5 0
New Tennyson note out.

"We reiterate our BUY recommendation with a raised target price of 80p/shr (vs 75p)"

"We would add that our analysis excludes the potential for further acquisitions which are expected to be a key value driver going forward."


I take it that is about Afentra of course as my top up at just over 60p looking a bit sick, I did expect 55p to be a low, alas , it appears it is going lower.

[linz22] 17/6/2024 11:06

Yes, falling back into buy big territory these days..

[someuwin] 17/6/2024 08:41

New Tennyson note out.

"We reiterate our BUY recommendation with a raised target price of 80p/shr (vs 75p)"

"We would add that our analysis excludes the potential for further acquisitions which are expected to be a key value driver going forward."

[mount teide] 15/6/2024 11:21

Let the trend be your friend - in the last week we've had the following developments:

* New Zealand to reverse ban on oil / gas exploration

* New York indefinitely postpones congestion fee

* US raises fuel economy standards less than proposed

* Green parties heavily lose vote share in European elections

Against this backdrop: The clowns running the UK's Socialist Labour Party announce to the world they intend to light the after burners on the UK's ultra high cost transition to 'renewables'!


'Global oil demand is trending above every IEA "scenario". So much that achieving NZE 2030 numbers feels science fiction'.....Javier Blas - Bloomberg 12 June

'5-year oil forecast for 2030: ~105.4
STEPS scenario for 2030: ~104.5
APS scenario for 2030: ~97.5
NZE scenario for 2030: ~83.7

I do note there are definition and methodological differences between the numbers for the 2030 forecast and 2030 scenarios. But even so, the gap is so large (particularly with the APS and NZE) that those differences are meaningless to the broader point.'


Opec reopens rift with IEA on peak demand - Argus / 13/06/24

'Opec today reopened a rift with the IEA about the future need for oil, calling the Paris-based agency's forecast for peak demand this decade a "continuation of its anti-oil narrative."

Opec secretary-general Haitham Al Ghais said the IEA's projection, made earlier this week, is a "dangerous narrative" that "will only lead to energy volatility on a potentially unprecedented scale." He made his case in a commentary for consultancy Energy Aspects that Opec made publicly available.........

....Criticism of the IEA from the upstream industry has magnified since 2021, when the agency said that 2050 climate goals exclude the need for any new oil and gas fields. Saudi oil minister Prince Abdulaziz bin Salman described this as "la la land" analysis. This year the IEA has come under fire from Republicans in the US Congress who have said the agency is veering into climate advocacy. US industry body API chief executive Mike Sommers said earlier this year the IEA "has become, unfortunately, so politicized that it's just not a reliable source of data any more." ''




OPECSec Gen: Peak oil demand not on the horizon

[taurusthebear] 13/6/2024 18:06

Looks like a bigger consolidation this time. :0)

[hubs] 11/6/2024 21:25

And there was a gap at 57.70 ish? Now closed? Onwards and upwards...gla.