Deltic Energy Share Discussion Threads

[barnes4] 31/8/2023 18:08

Snouts in the trough again

[apotheki] 24/8/2023 13:46

From my experience in corporate finance share options should never exceed 10% of the outstanding share capital so at 10.8% that better be it plus the BODs should now finally fully deliver for all shareholders not just themselves!

My gut feeling is that they have front end loaded this as they believe that a TAKE OVER could potentially be on the cards in the not too distant future?!?!?

[apotheki] 24/8/2023 13:43

In total, 10,066,560 options over Ordinary Shares in the Company are now outstanding, representing approximately 10.8% of the Company's current issued share capital.

The total number of Ordinary Shares currently in issue is 93,096,600.

[peterlowen] 24/8/2023 10:27

Well they certainly have monetised their options....

[taxi1] 24/8/2023 09:38

They must have faith in this going the distance or they wouldn’t bother giving share options.

[nigelpm] 24/8/2023 07:14

If they deliver everything or even only 50% of what they say they can I doubt anyone cares less about 2% dilution. I've seen a lot worse.

[source] 24/8/2023 07:05

More blooming options for the boys at hardly any premium diluting us all by 2%. Nice for them. Worth a nag at the AGM I would guess as the share price hasn't really rewarded anyone for a long while.

[barnes4] 22/8/2023 18:25

In the airline we trust

[taxi1] 22/8/2023 15:35

I’m glad there wasn’t any bad news

[trop] 22/8/2023 15:11

You've got to laugh ..... otherwise

[anley] 22/8/2023 10:47

SELENE..........

Because of inflation Deltic is planning for gross well costs in the order of US$30-40m for the Selene drill by September 2024.

Given the increase in these drilling costs and estimates since the farm-out to Shell in 2019, Deltic is also planning to reduce its working interest position in Licence P2437, and therefore capital exposure to the Selene well, and has launched a farm-out process to attract interest from industry in the Selene opportunity.

You can now see what has been happening behind the board room doors and how management is trying to reshape the Balance Sheet by the year end 2023.

We should expect more interesting news that will drive the share price forward.

[anley] 22/8/2023 09:51

For me there are 2 important comments from the report.

"In line with the Company's stated strategy, Deltic has also commenced a formal process to pursue the value crystallisation options that exist for the Pensacola discovery which may involve monetisation and/or farm down of an element of its equity interest in it."

I know what I would do with Pensacola and who knows who is sitting and waiting and watching the Deltic share price.

Just Pensacola is worth 100p per share and that is a discount on one of the brokers estimates.

See below for No 2 comment..........

[taxi1] 22/8/2023 09:32

All news sounds great
Nobody else willing to take a punt on this share,apart from the ones already holding
Don’t think we see a rise until we drill the appraisal well or we monetise our assets.

[apotheki] 22/8/2023 07:47

CEO Statement

The first half of 2023 has been transformational for Deltic, having drilled our first exploration well at Pensacola and resulting in a major discovery. At the same time, the Company has continued to progress its other key licence with Shell over the Selene gas prospect while also maintaining the potential to further enhance the Company's portfolio of assets through the current UK licensing round.

Having commenced drilling towards the end of last year, we were delighted to announce details of a very significant discovery of gas at Pensacola in February which was very much in line with pre-drill estimates. The well also discovered relatively light oil, although at that point it was too early to provide a meaningful indication of the scale of the oil opportunity.

Following the discovery, the JV has carried out the necessary post-well analysis which has allowed us to quantify the potential volume of the oil and associated gas, and we were delighted to report in July that the contribution of the oil and associated gas has led to a near doubling in our original expectations of P50 Estimated Ultimate Recovery from approximately 50 mmboe to 99 mmboe.

The positive results of the post-well analysis mean that Pensacola is now at the upper end of our expectations. At current estimated volumes, Pensacola is the largest discovery in the SNS in a decade and arguably one of the most significant discoveries in the North Sea in many years, particularly bearing in mind Pensacola's play opening potential.

The JV will now move forward its appraisal and development plans while assessing development concepts and is working towards an appraisal well being drilled in Q4 2024.

This well has been a fantastic result for Deltic. This first discovery reinforces the quality of our technical team and the Deltic model of taking licences from award through to successful drilling. Critically for Deltic, this well moves Pensacola from an exploration opportunity to being a highly valuable appraisal and development asset and the Company is now undertaking a process to seek to farm down an element of its interest in Pensacola while retaining exposure to its successful development and ensuing cash flow.

We look forward to working with our partners, Shell and ONE-Dyas to continue moving this exciting asset through the appraisal phase and onward towards development.

Having achieved success at our first well at Pensacola, we are increasingly excited about the prospect of drilling our next exploration well at Selene, again with Shell as our JV partner. Selene is another similarly-sized prospect with gross P50 Prospective Resources of 318 BCF, in excess of 50 mmboe. Unlike the play-opening Pensacola discovery, Selene is an established play, with a high (70%) geological chance of success and in close proximity to existing infrastructure.

The planning process for Selene is already well underway with the focus on detailed well design, planning, rig procurement and other key preparations to support drilling operations. Long lead items are in the process of being ordered and the geophysical site survey over the proposed well location has already commenced. We also anticipate the rig contract for Selene to be put in place in the coming months which will represent another significant milestone as we move further down the runway towards the drilling of this high impact prospect. Depending on the exact timing of the Pensacola appraisal well, Selene and Pensacola may also have the added benefit of forming part of the same drilling programme.

Having found gas and oil at our first well at Pensacola, we are excited about drilling this prospect and having the potential to add another discovery to Deltic's asset base. Accordingly, we look forward to providing regular updates as we progress through the planning phase towards the commencement of operations.


Having only brought Capricorn Energy PLC ("Capricorn") into our five contiguous licences in an underexplored area of the SNS in 2021, changes in ownership, management and strategy have prevented Capricorn from being able to continue to invest in assets outside of Egypt, resulting in their withdrawal from these licences. Despite this, as a result of promising technical work already undertaken, Deltic has decided to focus on the two most prospective licences in this acreage, being P2567 (Cadence) and P2428 (Cupertino) and retain 100% equity in each of these licences. An extensive work programme has been progressed by Capricorn over these licences which has identified multiple prospects and leads in the Carboniferous, with a total estimated P50 gas-initially-in-place of more than 2.6 TCF.

As the current phase of licences P2567 and P2428 ends on 30 November 2023 and 31 March 2024 respectively, Deltic is applying to the North Sea Transition Authority ("NSTA") to seek an extension to both of the licences to allow time to attract another partner with the ultimate aim of drilling one or more of these prospects.

This year has also presented Deltic with the opportunity to further enhance its portfolio of licences. Applications over various blocks and licences were made in the UK's 33rd Licensing Round in January. The Company had its interviews with the NSTA in June and awards are expected to be made before the end of Q3 2023.

Over the first half of the year our sector has, as ever, been impacted by certain challenges. Gas prices have inevitably continued to soften from the record levels seen in the course of 2022, but nonetheless remain above long term historic averages. In any event, our projects do not rely on elevated gas prices and remain economically robust at very low gas prices.

The Windfall Tax and political risk have also been factors which have created uncertainty, albeit the investment allowance associated with the Energy Profits Levy continues to make the economics associated with investing in Deltic projects very attractive. Despite these factors, Deltic has continued to deliver on its business plan of taking licences from award through to drilling and now has its all-important first major discovery. The success at Pensacola also now means that we expect to be drilling wells at both Selene and Pensacola next year such that Deltic and our shareholders have much to look forward to as we progress towards these key catalysts.

I would like to take this opportunity to thank the entire Deltic team for their continued hard work which has been instrumental in a successful first half of the year.

[apotheki] 22/8/2023 07:45

Chairman's Statement

While a Chairman's statement rightly covers the broader outlook, leaving the CEO and COO to focus on the results and plans, it wouldn't make sense to open this statement without highlighting the recent success of our well at Pensacola in the North Sea off the coast of Teesside.

This prospect was acquired 100% by Deltic in an exploration licence round. Following the thorough technical assessment which we consider a hallmark of our operations, we were able to demonstrate the potential to Shell and bring them on-board to work with us as an experienced operator. We drilled the well together with a common understanding that it had a roughly 50/50 chance of success. Not only did it discover hydrocarbons, but subsequent evaluation of data from the well by ourselves and the operator show it to be at the high end of our expectations and approximately twice the volumes of recoverable resource of our 'most likely' case prior to drilling.

Doing this and doing it again and again is, quite simply, our business model. I'll leave it to Graham and Andrew to go into detail on this and our wider portfolio of exploration opportunities.

Many have commented upon some tough external factors in recent months and years, but we remain focused on the fundamental aspects which support our business model.

Our portfolio is in the UK North Sea where we have a lot of experience in a small team, primarily on gas in the Southern North Sea ("SNS").

Over the years we have built a conveyor belt which begins with high quality, low cost technical screening of available licences; acquiring attractive licences; working acquired licences to the level that attracts an operator with the technical, commercial and financial resources to take a Joint Venture ("JV") through exploration and to migrate theoretical in-place volumes to discovered recoverable resources which can be developed.

We now have assets at all stages along this conveyor belt; a portfolio of opportunities which are moving through the process from a successful Pensacola discovery, far along the conveyor belt, to Selene drilling plans, through to opportunities that are under assessment, and back to licences expected to be added via the current licensing round.

Alongside this, on the demand side, we have a society highly dependent upon these resources, spending more on the import of these resources than on national defence or education, based on the Government's own figures for 2022. Imports are bad for jobs, bad for Treasury receipts, bad for energy security and bad for emissions compared with the domestic supply within our portfolio.

With an election looming, once again our sector is a political football, but we should have confidence that the demand is there and we have the supply. The external environment may seem hostile at times, but the political environment isn't picking on Deltic specifically. With or without future licensing, the Deltic portfolio remains robust.

[apotheki] 22/8/2023 07:44

Interim Results

Deltic Energy Plc, the AIM-quoted natural resources investing company with a high impact exploration and appraisal portfolio focused on the Southern and Central North Sea, is pleased to announce its interim results for the six months ended 30 June 2023.

Highlights

· Significantly increased estimate of oil and gas resources for the transformational Pensacola discovery on Licence P2252 (Deltic interest 30%) in the Southern North Sea ("SNS").
o Discovery contains total gross P50 Estimated Ultimate Recovery ("EUR") of c.99 mmboe, nearly double initial expectations
o Pensacola now estimated to contain material volumes of oil, representing c. 30% of the combined recoverable hydrocarbons
o Work is progressing with partners to develop the appraisal and development programme for Pensacola, with an appraisal well targeted for Q4 2024

· The well planning process for drilling the Selene prospect (Deltic interest 50%) in the SNS is progressing well.
o The geophysical site survey currently underway with the geotechnical survey planned for later in the year
o Selene still expected to be drilled in Q3 2024

· Deltic is withdrawing from three Licences (P2560, P2561 and P2562) it held with Capricorn Energy ("Capricorn"), and the partnership will move to relinquish these licences as soon as practicable.

· Deltic intends to continue with Licences P2567 (Cadence) and P2428 (Cupertino), the two most prospective licences in this acreage, and apply for extensions to both licences as it seeks to attract another partner.

· Deltic has submitted multiple applications for blocks and part blocks in the Southern and Central North Sea during the UK's 33rd Offshore Licensing Round in FY 2022, with awards expected to be announced before the end of Q3 2023.

· Cash position of £9.1 million at 30 June 2023 (31 December 2022: £20.4 million), with a net cash outflow for the period of £11.3 million (H1 2022: £2.5 million). The first half of 2023 saw significant planned investment and use of capital to complete the drilling of the Pensacola discovery.

Graham Swindells, CEO, commented:

"It is no exaggeration to say that the first half of 2023 has been transformational for Deltic, following the discovery of material quantities of hydrocarbons at Pensacola in the Southern North Sea. With an estimated 100 million barrels of oil equivalent, the majority of which is natural gas, this represents one of the biggest UK discoveries in over a decade, and is particularly significant considering the enormous energy security issues that the country currently faces. I am very proud of the entire Deltic team which has delivered this success, and I am confident that we will continue to build upon this going forward."

[steelwatch] 21/8/2023 11:14

Just as a matter of interest, the survey vessel not named in this morning's RNS is Fugro Meridian:

[grannyboy] 21/8/2023 10:01

You should have included the caveat in your "when the share price was 1.75 (35p today)" with after a share price consolidation!

[anley] 21/8/2023 09:05

When you stop and think about all that has gone on with Deltic since 2019 when the share price was 1.75p (35p today) you have to agree with SOLIDERBOY that there has to be a final floor in the share price after news this morning.

I am beginning to think that even a Labour government will be relaxed about taxing the North Sea out of existence and on any any hint then all the North Sea E&P shares could fly really well in 2024.

Let's see what happens......on the political front.

[soilderboy] 21/8/2023 07:54

Now is the time to really start loading up here. Good positive news. All is about to commence.

[anley] 12/8/2023 08:26

and........what about a BUY back plan with some of the cash to underpin the market price?

Just a thought....

[anley] 09/8/2023 15:07

TAXI1....if I was Shell who also hold other licences in the Pensacola area and Deltic approached me then I would say: "Please come in and sit down" - "how can Shell help Mr Deltic?

We need cash and we also wish to keep a stake in the licence area which will not cost us when you (Shell and ONE-Dyas) develop the licence in to a full production area by 2028.

We all have what is there 99m barrel's of oil @$5 = $495m so how will that be finally carved up after up to date costs have been taken in to account?

Anyone else for an answer please!!

24 August we might have a clue.

[taxi1] 09/8/2023 12:00

Just read their update on the last well report again.
They say they will look to monetise or a farm out would shell do any of these options
I don’t know.

[fhmktg] 09/8/2023 11:38

Bring it on!
Updates on committment from Shell for Pensecola and Selene, clarity on other licences and progress on monetisation would go down nicely.
...man was born to dream...