Enquest Share Discussion Threads

[heialex1] 12/4/2022 16:06

And market cap still less than £700m. This has at least 50% more upside as money returns to the sector

[patience a virtue] 12/4/2022 16:01

Nice to see further interest from institutions which can only be a good sign for the oil sector and stocks like Enquest. Oil price is to stay high due to the structural deficit caused by underinvestment in the last few years. March was a full month of oil trading above $100 and Enquest’s debt should be reduced to $1 billion by the end of March. Look forward to the trading update on 19 May.

[chrisa1] 11/4/2022 18:18

RNS : Schroders takes a 4.96% stake!

[heialex1] 11/4/2022 17:27

https://www.google.co.uk/amp/s/www.proactiveinvestors.co.uk/companies/amp/news/979171

[chrisa1] 11/4/2022 16:57

heialex1, where did you see Jeffries revised price target?

[johneee] 11/4/2022 12:03

Oil in UK waters has to be Positive and a sure BUY in these crazy times.

Keeping the UK independent of the Global Energy Oil madness

[heialex1] 07/4/2022 18:28

Jeffries raises price target to 50p

[onedb1] 06/4/2022 12:34

Am sure the post below offers insights into Enquest . Views that are very technical and insightful research with links and smart commentary . Custom of such poster on this bb. I bet it has nothing against me or his obsession about me...... Follow the chap below as his insights into Enquest are unique . I think I read once that Citadel reads these bbs only because his posts are so amazing ;-) How blessed are we ?

[stansmith3] 06/4/2022 08:58

it must be a blue day, onedb1 is out from under his mums bed and posting...oh how we missed you fantasy portfolio updates during covid when you were underwater...

[onedb1] 06/4/2022 07:24

Barclays raised Enquest to 40p broker forecast just out .

[steelwatch] 05/4/2022 22:36

Confirmed: ATD: 2022-04-05 14:38

[onedb1] 05/4/2022 17:01

RB,

Remember that the hedging levels are there to also satisfy the bond rating agencies without which Enq would not have a chance of raising capital. Just like any other firm.
So in order to guarantee a certain profitability and reduce volatility the hedges are placed . What you may want to look at is the forward Brent curve ie the 2 , 3 and 5s and that is where Enquest finance director will be able to use for hedging puroposes , They don't hedge at 6months. Again the rating agencies are allowing Enq to issue bonds for many years not just 12 months
Notice the 5 yr forward that has just broken out at 77ish . That is what we want to see.
Anyways...

[american idiot] 05/4/2022 15:19

Newts,

You are chatting with the wrong person as I don't care at all. You are a nobody to me and likewise me to you.

38p, 48p or 1000008p I just do not care.

[onedb1] 05/4/2022 13:35

Idiot the book is my trading book . You are like a nobody and don't even know the basic terminology . Am still waiting for the promised punch lol . You'd be shocked. Keep on making things up though . You are the laughing stock here as a few know me personally. Enq target 38 I gave now a while back . You on the other give nothing of value hence why you don't even know what a trading book is . Hugely embarrassing lol

[american idiot] 05/4/2022 13:18

The tax losses might be tempting for a bigger player but most of their assets are old unfortunately.

That is the problem going forward...picking up bolt ons for an acceptable price to enable continued reduction in net debt. Golden Eagle cost $325m for 10k boepd.


2018 FY Results - Group production averaged 55,447 Boepd in 2018 with net debt of
$1,774.5 million


2019 FY Results - Group production averaged 68,606 Boepd in 2019 with net debt of
$1,413.0 million


2020 FY Results - Group production averaged 59,116 Boepd in 2020 with net debt of $1,279.7 million


2021 FY Results - Group net production averaged 44,415 Boepd with net debt of $1,222.0 million

[patience a virtue] 05/4/2022 12:48

AI, I was very pleased to see Enquest buying up some producing bolt ons and took up all my entitlements. I wished AB could have found some more such buying opportunities in the last few years when oil price was so low.
In a year or two Enquest might itself become a target for the larger players.

[american idiot] 05/4/2022 12:31

Patience a virtue...I fully sold out at 26.9p. Thats good for me.

I shall be purchasing some of the bonds. 9% yearly is a fantastic return on investment.

The problem with Enquest is the need to keep buying bolt ons every year or two to offset natural declines (Magnus then Golden Eagle)

Each time they do this it costs them around $300m which eats into a large slice of their free cash flow.

They have been going around in circles for years doing this. No dividends throughout (Only 2 dilutive open offers to raise £)

I do agree that providing oil stays high then this time might just be different for Enquest.

[patience a virtue] 05/4/2022 11:36

AI, as long as oil stays high for a long period which imv is more likely due to the underinvestment in the last few years and the increasing demand post pandemic Enquest should reduce its debt to a more comfortable level. Remember $78 for 8.6m is still very profitable for Enquest and the other 50-60% production at say $100 will contribute greatly to the balance sheet. Once debt is down re rate will happen and it is possible that Enquest might be debt free in 2024 which should find itself easy to pay 9% on the bonds.
Shame that you sold out too early and this share is likely to go up more in the medium term.

[richardbroughton] 05/4/2022 10:22

Hi AI, I'm no expert but surely the smart play is to delay the hedges as much as possible and take advantage of high current POO to reduce debt? Regards Richard
PS Thanks for your tip re bond will try and get some.

[american idiot] 04/4/2022 20:57

Enquests recent 2022 outlook was clearly front loaded (If that is what it is called )


2022 performance and outlook

Year to date February production averaged 50,408 Boepd, in line with full year guidance

Net debt amounted to $1,090.0 million at 28 February

Hedges in place for c.8.6 MMbbls of oil with an average floor price of c.$63/bbl and an average ceiling price of c.$78/bbl

Full year average net Group production expected to be between 44,000 and 51,000 Boepd

Full year operating costs of c.$430 million

Cash capital expenditure of c.$165 million, with cash abandonment expenditure of c.$75 million


In the little section above (Taken from Dec 31 2021 FY results)

Lots of emphasis on year to date February production average of 50,408 bopd because the ENQ board know its all down hill from here for the rest of the year....hence FY guidance of 44k - 51k boepd unchanged.

Whilst net debt is down how many of the 8.6m hedges have been unwound so far this year ?

A) Probably none which means ENQ still have to unwind a massive 8.6m of hedges at far lower prices than current Brent.

So, H2 is going to have average production of around 40,000-45000 boepd (allowing for shutdowns and natural declines) and a bucket load of that pricewise is going to be at an average ceiling price of $78 bbl.

That probably explains why Enquest are offering a ridiculously high 9% on the retail notes to ensure the bond offer gets away safely. (Otherwise the RCF can be called in)

With Brent riding high and Enquest pumping up their February production figures the obvious trade is a 'short' on the assumption that this is as good as it gets for 2022.

Whilst the equity is toppy, the bonds are an excellent buy. 9% is an excellent yield.