Diversified Gas & Oil Share Discussion Threads

[nimbo1] 08/10/2018 17:02

I personally think IHT will be refined if not revised at some point. Its moved quite far past what the original intention was I believe.

I think its more to do with the fact there are no bids out there - the market is so so thin. There is a buyers strike due to brexit / trade worries whatever and asset prices have generally increased. (Fevertree / Blue Prism etc)....liquidity works both ways!

I am not quite sure why DGOC did so badly when gas prices are zooming up but there is always contagion. About 2 months ago due to a house purchase I sold almost all of my growth portfolio and stuck the remainder it into global high yield - american reits, uk reits, dgoc etc...it is not doing brilliantly....but better than growth would have faired.

[basem1] 08/10/2018 16:59

Julys average was 60,000 boepd.Has anyone anything further to add ref guidance and what we think the current production figures are ? A massive massive cash cow if we can maintain 60.000 particularly with the gas prices firmly on the rise. Added a further 10000 last thing today.

[podgyted] 08/10/2018 16:48

Very strange - this down 4% - NG up 4%.

Nimbo - as you say AIM crashed today - IHT revision fear?

[nimbo1] 08/10/2018 15:24

very light volume

some large moves on aim today!

[lab305] 08/10/2018 15:16

Meanwhile.......

NATURAL GAS 10 mins
3.285 +0.142 +4.52%

[lab305] 05/10/2018 11:05

Yes gas and oil soaring especially gas but the share is dropping, but apparently I have no patience ! Where is the long awaited announcement on decommissioning ? On August 13 they were "very close" . Now October 5th. How much patience do I need?

[basem1] 05/10/2018 10:52

Jeepers, disappointing price action today. The divi yield is increasing at this price.

[nimbo1] 04/10/2018 20:58

Im a happy holder - if dgoc can pay decent divi's at a 2.8 gas price im assuming 3-4 is helpful : )

[basem1] 04/10/2018 16:52

Frustrating price action but 122 is a nice backtest of previous resistance. It's setting itself up nicely for a break to the upside. Patience is key.

[podgyted] 02/10/2018 17:01

Still rising - tomorrow's opening will be interesting if this continues.

[podgyted] 02/10/2018 16:49

Going crazy - now 2.5%

[podgyted] 02/10/2018 13:31

Gas pricing looking strong today (Henry Hub) +1.6% at present.

[lab305] 01/10/2018 22:20

Today
NATURAL GAS 15 mins
3.113 +0.105 +3.49%

[nimbo1] 01/10/2018 15:23

Yes some big buys being worked. Hopefully price can move up once they are processed as sell side seems to be drying up.

[lord gnome] 01/10/2018 14:56

It would seem that Edison has some big hitters amongst its readers. Somebody just took 500,000 at 125p.

[podgyted] 01/10/2018 13:28

Edison Investment Research - Initiation

"Diversified Gas & Oil (DGO) has grown exponentially since listing on AIM
in February 2017. The company’s acquisition-led strategy has enabled it to
amass over 6.5m net acres in the US Appalachian Basin, taking net
production to 32.5kboed in FY18, underpinned by a 1P PDP 393mmboe net
reserve base. We see potential for further inorganic growth, diligent
management of existing well stock and infill drilling in the event of a gas
price recovery to provide a platform for further growth. DGO trades below
our base case valuation of 138.1p per share, which excludes asset
consolidation and the infill drilling option value. A 2019 6.7% dividend yield
supports the current share price and investment risk/reward is skewed to
the upside given the potential for further value accretive M&A. Key
sensitivities include gas price realisations and cash operating costs."

23 pages - not read yet - free if registered. Yield figures below the above discussion.

[nimbo1] 28/9/2018 14:30

seems very solid around here. my largest income holding now with the added advantage it could double : )

[reptile3] 27/9/2018 17:28

Lord gnome..... agreed. That's my understanding too and Interactive Investor seem happy with it as well.

[lord gnome] 27/9/2018 17:11

As I understand it, US withholding tax is set at 30%. The dual tax agreement that they have with the UK means that anyone with a W-8BEN form is taxed at just 15%. There is no reclaim from this, it's just tough. The US Treasury takes its slice. I had 15% deducted from my latest dividend and it was paid net. You need to take this into account when calculating yield, but if the forecast yield is around 10% so that it yields 8.5% net of US withholding tax, I can live with that. My shares are held in an ISA, so no UK tax to pay.

[lab305] 27/9/2018 17:11

This was the best and clearest article that I could find .

If you hold your foreign stocks in an Individual Savings Acount (ISA) or Self-Invested Personal Pension (SIPP), you’re sheltering them from UK tax as much as possible. But you may still be paying more tax on them than is absolutely necessary.

That’s because many foreign governments impose withholding tax (WHT) on dividends before they even reach you. And in many cases, they are charging WHT at a higher rate than they are supposed to under their double taxation agreements (DTAs) with the UK.

Many investors don’t read the rules on this and just accept what they get. But if you understand how it works, you may be able to reclaim a sizeable amount of tax from abroad.

You could even get an extra 15% tax break on American dividends in your SIPP that most investors don’t know about. To find out how, read on.


Foreign dividends in ISAs and SIPPs
ISAs do not have any special status for foreign tax. Just because they are a UK tax shelter doesn’t mean that foreign governments are going to cut them any extra tax breaks.

So when it comes to WHT, foreign stocks in an ISA get treated exactly the same as foreign stocks outside an ISA. Obviously, you may save on additional UK income tax and capital gains tax by using an ISA, but you don’t get an increased refund on the WHT over and above what you’d get anyway.

SIPPs are different. Under some tax treaties, there are special clauses for WHT on dividends paid into a pension scheme. One very important case is the UK-US DTA. Under this, dividend payments by US companies into a UK pension scheme should be taxed at a zero rate (see the HMRC manual and the treaty text [PDF]).

The standard WHT on US dividends is 30%. This is reduced to 15% under the UK-US DTA, which is the rate that will apply whether you hold US stocks outside or inside an ISA. But if you hold them in a SIPP and your SIPP adminstrator is thorough enough, you can get them paid gross of all tax.

So far so good. So do many investors lose out on foreign WHT in their ISAs and SIPPs? And what can you do about it?

The two reasons why you pay too much WHT
There are two reasons why dealing with WHT is complicated. The first is that many countries don’t allow you to get the reduction you’re due under the relevant DTA up front. Instead, you have to file for a refund.

That can be costly and time-consuming. Understandably, many stock brokers and wrap providers don’t think it’s worth all the paperwork.

The second is that when you hold foreign stocks through a domestic stock broker, they are usually held in a nominee account. This means that the account is in the name of the stock broker (or another intermediary) who is holding them on behalf of you, the beneficiary.

You have rights over the shares and your ultimate ownership is clear. But within the nominee account, they are often held alongside lots of other investors’ shares. These pooled nominee accounts are used instead of individual accounts for each investor because it makes trading and settlement easier and cheaper.

Some brokers have all their clients’ holdings of foreign stocks in the same pooled nominee account, whether the client is holding them in a regular account, an ISA or a SIPP. That means that you can’t apply any special tax treatment due to SIPPs to the whole group of shares, which makes handling WHT exemptions and reclaims even more complicated.

Overall, brokers tend to handle WHT on US stocks best. That’s because investors can file a W-8BEN form which entitles them to receive the dividends with WHT deducted at the lower treaty rate initially, rather than having to reclaim the additional WHT afterwards. In addition, US stocks are the most widely held by UK investors and so having the arrangements in place to handle US dividend WHT is cost effective.

Getting reduced WHT on US dividends usually works smoothly if your stock broker is a qualified intermediary. This means that they have an agreement with the IRS that allows them to receive dividends gross of tax, sort out what’s due and make the necessary payments. Most will ask you to complete the W-8BEN form when you initially open a general dealing account or ISA, and then pay US dividends to you net of only 15% WHT rather than 30%.

However, depending on the way their nominee accounts are set up, not all brokers are able to pay SIPP dividends with zero WHT. So if you intend to hold US stocks in your SIPP and your US dividend income is large enough that the extra 15% could be handy, it’s worth checking whether your broker does. Brokers that can get US dividends paid gross into their SIPPs include AJ Bell Youinvest and Hargreaves Lansdown.

You should also be aware that not all brokers will handle W-8BEN forms for dealing accounts and ISAs – some firms consider the cost and admininstration involved not worthwhile (examples include Halifax/iWeb/Motley Fool and iDealing). If you use one of these, your dividends will be paid net of 30% WHT, so you should take this tax cost into account when deciding which broker is most cost-effective for you.

How to reclaim excess withholding tax
For countries other than the US, things are unlikely to go so smoothly. A few firms will handle reclaims for one or more other countries, but generally most do not consider it cost-effective to try to get WHT reductions for anything other than US stocks.

In this situation, you may want to consider reclaiming the WHT yourself. Unfortunately, this is only possible for ISAs and standard dealing account – a SIPP is legally a different entity to you and the reclaim must be done by the SIPP administrator. Since administrators don’t generally consider this worthwhile for anything other than US shares, this tax break – which potentially applies to a dividends from a number of countries – is unfortunately lost.

The process of reclaiming WHT varies between countries – you can find details and forms for WHT reclaims here for several countries including the US, France, Germany, Spain, Switzerland and Ireland. Briefly, you will need to get paperwork from your tax office confirming that you are entitled to the payment at the reduced treaty rate. You also need to have evidence that you received the dividend after the higher rate of WHT had been deducted.

This is typically a dividend tax voucher – but if your foreign stocks are if held in a nominee account, you won’t always have this.

[sogoesit] 27/9/2018 16:50

Good point basem1; when I responded with the W-8BEN form issue previously I was wondering whether the listing place affects the US Witholding Tax Status.
My assumption was that the US was more likely to withold tax because the distribution of profits is from a US activity.
But reptile's experience suggests either the paying agent is not doing a proper job or they are not executing dividend payments properly (in the case a UK listing does not need to withold tax).

What causes me doubt is the case of DCC plc which is an Irish company listed on the London Stock Exchange.
Its dividends are paid less 20% Irish Witholding Tax. And this witholding amount is applied irrespective of the holding being in a SIPP, ISA or non-ring-fenced holding!

I am still awaiting my payment but will post when I know what my (2) brokers do.

[thegreatgeraldo] 27/9/2018 16:17

Guess you guys have a peek now & again at US gas stocks..... they've probably got plenty stashed away to get thru a normal Winter, but if the US has a tough Winter... (current stocks 18% below the 5 year average)

[basem1] 27/9/2018 15:28

iii have just messaged me and said the US tax form is irrelevant as DCOG is a UK listed stock.

[nimbo1] 27/9/2018 11:56

lab305 why is SIPP taxed at 0% as opposed to 15% in the ISA. Is that because USA recognise pensions but not ISA's type thing?