Enq 23 �pik Tog Discussion Threads

[pimsim] 13/10/2016 08:05

ENQ1 - capital reorganisation proposals - No further distributions on retail notes while oil price is below $65/b

[steve73] 15/8/2016 08:36

Just a reminder that from today, for the next 6 months these bonds will be paying a 7% coupon.

At the present offer price of 54p this represents around 13%.

...although the ordinary share may well be a better buy at this time...

DYOR.

[hpcg] 19/7/2016 08:06

I'm relatively bearish oil for the first half of 2017 where they are unhedged in comparison with where I thought prices would go. Also there are marginal lost dollars this year. I thought the year would close out at 60-65 and I'd say 50 is more likely now with a drop into the 30s in between.

[my retirement fund] 19/7/2016 00:01

From the company I mean. Well its certainly a good deal for Dalek if all goes to plan pound notes for pennies! It does brings home what a desperate hole Enquest are in. 30 pence is quite a bearish view hpcg. Are you expecting oil to fall a lot further are are you simply expecting more negative news flow from them?

[hpcg] 18/7/2016 16:29

I think the rational is that they can't afford the whole project. Cairn who have cash have not come running. I'll reconsider the situation when these are back to 30p!

[my retirement fund] 18/7/2016 15:17

Some sensible rational behind it would not go a miss !

[hpcg] 18/7/2016 14:56

I can't work out the farm out implication here. On the one hand it may de-risk, on the other I don't think it will be a good deal.

[my retirement fund] 06/7/2016 15:20

Ive followed too learnt my lesson here before.

[hpcg] 05/7/2016 16:26

I sold my entire holding this morning. Supply demand dynamics are going to make for another oil dip I think. Whilst I suspect Enquest can make it through it, and low pound helps with costs, its grace period with the hedging is running out.

[hpcg] 08/6/2016 17:30

5.5%. The 7% period is Aug-Feb. They have to say in advance otherwise if you bought after Feb, but before the announcement, which I did quite a lot, one would have underpaid the accrued. I can't 100% vouch for this, very much my understanding based on the word of the RNS and what I just outlined as the consequences if that were not the case, so I can't see how I'm wrong.


... the Rate of Interest for the immediate next following Interest Period commencing on (and including) 15 August 2016 ending on (but excluding) 15 February 2017 increases to 7.00 per cent. per annum.

[my retirement fund] 08/6/2016 16:14

Can anyone confirm if i buy now do I have to pay an accrued of 7% or 5.5% please?

[steve73] 26/5/2016 03:41

Does anyone understand what the 3:1 leverage ratio refers to, and is this "bonus" likely to continue to be applied beyond the initial 6 month period?

[spittingbarrel] 25/5/2016 19:28

So an extra .75% for the 6 months to 15 Feb 2017, that's a nice little bonus. Thanks for pointing it out.

[hpcg] 25/5/2016 15:07

kching - good call to those expecting this news. For the change to 7% I make it 3.5p for the 6 months August 16 to Feb 17. This wasn't the reason I have built up a substantial holding, but it is nice bonus.

Edit - the stronger oil price is the more important factor. But not too strong, it is still not enough to encourage new sanctions.

[sogoesit] 19/5/2016 14:14

Thanks for that hp.
I will check-out Kraken and, probably, it is comparable to Catcher (also an upcoming FPSO development of PMO's).

On a purely financial basis, at a 10% discount rate, I make ENQ1 worth 86p/£1 and PMO1 worth 90p/£1.
That, and what I thought ENQ to be more risky, I went with PMO1.

Given your comments, the issue is whether we will see another low in the oil price (demand from China) but, since bondholders and banks have shown willingness to redraw covenants, maybe they take the view that the business is a long term cyclical one and "mark-to-market" on a short term view doesn't make sense. A view I would agree with.

[hpcg] 19/5/2016 10:05

Sogoesit - the oil price is already high enough to see that the payback window for ENQ1 is comfortable. I have not studied Premier so I don't know about them, though they are closer to par. The challenge was to survive the downturn and that looks like being the case for both.

The risk to both is from a global recession and drop in demand. Enquest has a lot riding on Kraken. The protection comes from two years with few project sanctions, an even longer hiatus for Petrobras, PDVSA in dire straits, and Libya and Nigeria being unattractive places to operate. In addition a staggering amount of debt has and is being wiped out by the energy sector. This isn't coming back for two reasons: once bitten twice shy; and the money no longer exists. This will hold back future supply.

[sogoesit] 19/5/2016 07:44

Any views on ENQ1 vs PMO1?
I now hold PMO1 and will digest today's report & take a view on whether ENQ is a survivor out to 2022.
I think PMO's Opex variable costs are more robust, at about $16/bbl, versus ENQ's at $26/bbl.

[badtime] 03/5/2016 12:06

Ta for reply

[hpcg] 30/4/2016 18:41

Yes, more bonds. Those last two were well above my basis but I think there is a very good chance that this summer the forward strip for 2017 will get high enough that some production can sensibly be hedged. Tactically it makes sense to hedge more of Nov and Dec 2016. There is still a lot of risk if there is any slow down in the world economy whilst stocks are so large and over production is still rampant.

[badtime] 30/4/2016 17:46

HP ..re post 232 I take u bought more bonds and not the ords?

[hpcg] 29/4/2016 14:20

MRF - not any that can be trusted. I'm kicking myself for not going heavily long immediately it held up after Doha. Seasonality suggests a tale off in September but what the level will be then I don't know. I'm looking for a pull back to buy in the short term, but I will be more circumspect when we get to June. There are too many moving parts for me to have any certainty.

[my retirement fund] 29/4/2016 11:06

Hpcg have you any predictions for oil from here and over the summer?

[hpcg] 29/4/2016 11:04

Of course what they should really do is an equity raise into the strengthening share price. I added some more today as Brent price has risen higher and faster than I was expecting. Revenue to August should be pretty good unless Libya comes back on stream.

[lonrho] 29/4/2016 10:37

hpcg

Thanks for your reply, yes I am also thinking that now might be a good time to start 2017 hedging , perhaps starting at around 10 to 15 thousand barrels a day.