Harbour Energy Share Discussion Threads

[steve73] 21/3/2017 08:14

thanks user47... I thought that was the right date but a post yesterday got me thinking...

Rogk - yes - but only from the 23rd onwards....

[user47] 21/3/2017 07:38

Hi Steve, thanks for the VWAP updates. As regards to the dates, my understanding is it includes the 22nd, so we have 2 days left, then we will see what happens , hopefully they will let it go a little after wednesday, but you never know with PMO.

Enclosed is the sentence from the 1st March RNS that confirms it includes the 22nd.
"from today to 22 March 2017 (inclusive) or 62 pence"

Good luck over next few days everyone.

[steve73] 21/3/2017 02:55

Yesterday's VWAP was 63.79 on 5.2 MM share, giving the average to date of 62.14.

So, just a little over the target, and with just one or two days trading left (depending on how the announcement is interpreted) will there be a push to depress the average a little bit more.

To get to 62.0 with just one days trading will require volume of around 27 MM with a daily VWAP of 61, or 14 MM if the VWAP can be reduced to 60.

This might be the last chance for anyone wanting to buy, so the CBH's (or their helpers) could be busy today.

[timothyjones2010] 20/3/2017 16:49

All day and especially at close I thought the shorters may of closed the share price close to 62p

[emilio] 20/3/2017 12:49

DUDU ? on FILTER

[datait] 20/3/2017 12:13

60p next entry point for me

[sirmark] 20/3/2017 11:30

Conversion price to be reset at a premium of 20% to the higher of the volume weighted average price of Premier's shares over the period from today to 22 March 2017 I presume just today and tomorrow left? As the wording says to the 22nd Thoughts ?

[datait] 20/3/2017 09:32

come on my order is set for 60p lol

[gilesgraves] 20/3/2017 08:15

Brent forecast is a bounce to $55 and that is as far as it can go for now. When does the VWAP period on PMO end?

[ua36] 19/3/2017 16:48

Outside the oil price (obviously...) I think the biggest near term risk (in my eyes anyway) is the apparent (if you read across on LSE anyway!) consensus that the share price is 100% certain to fly up after the end of the VWAP period finishing.

If the stock market was as simple as that then we'd all be out cleaning the 458 Italia instead of on the internet. The market has had ample opportunity to buy at 59-62p and I'm not 100% clear that the conclusion of the VWAP period is going to be some biblical catalyst for a whole new set of buyers who want to buy in higher.

From my reading of CB delta hedging (which I agree has been part (major?) of the recent shorting - especially when you consider the volume of shares the CBs correspond to vs. what they did when the exchange price was $4) when the share price goes up, they short more?! And when the share price falls, they reduce their short. The dive to 52p would correspond to some of the shorts decreasing recently I think so I'll be watching the reported shorts to see if any have went back up after the share price went back to 65p area.

Going to be an interesting week (well, it is Premier..!). No crude builds though please else Brent will be taking a trip south of the river and taking the sector with it.

[leoneobull] 19/3/2017 13:16

Steve. Webcast full year results said they will shed a bit from their eon assets

[steve73] 19/3/2017 03:41

Leon, not sure how much cash we could generate by selling EON non-core stuff. I recall PMO indicating that it had virtually already paid for itself. Once you consider much of it is either long-term future potential for PMO, or additional %-age of existing PMO assets, there's not much of any value (to others) left.

ua - I see you're a very new poster here... Excellent contributions - keep it up! Where were you previously when we needed some sensible analysis?
re. the CB's, if the share price exceeds 40% above the CP, ie, 104 (assuming they get the desired 62 VWAP target) then PMO could force it before the end of '18. This could well put a cap on the share price even if the oil price plays ball..

btw.. the Debt:EBITDA ratio is 5x for 2018, dropping to 3x for 2019....(not sure if you just made a typo on this...?)

[ua36] 18/3/2017 11:02

Hi Leono - I figured, based on 5% natural decline from existing fields and 25k bbls/d from Catcher (so 96k barrels per day 2017), that in order to achieve the target EBITDA they'll need to reduce debt debt by a minimum of $700million in 2017 & 2018 (to bring it down to $2.1billion from the current $2.8billion drawn debt) with EBITDA increasing to $700million to fulfil the ratio (up in 2018 by 33% compared to 2016).

Assuming total oil production for 2017 is 27.4million barrels & 2018 is 35million barrels I estimate per barrel costs as (please chime in if wrong!):

G&A $300million p/a (assume flat post Catcher) - $11p/b 2017 and $8.6p/b 2018
Capex $390million (2017, unknown 2018) - $14p/b 2017. Lower 2018? Some Tolmount and Solan?
Opex (Catcher will increase slightly on 2017) - $16p/b 2017, $18p/b 2018
Interest, trickier to fully calculate but (£150million retail bonds at 6.5%, $245million convertible bonds at 2.5%, and the remaining $2.36billion at 4.5%) I calculate that as $122million p/a interest (obviously reduces when it starts to get paid off!!) - 2017 production would have that at $4.4p/b, decreasing to $3.5p/b with Catcher.

I think that totals to: 2017 $45.4, and 2018 likely lower but hard to assess as forecast Capex not known (well not known to me at least!). However I'm sure I may have missed some costs or made a mistake somewhere so please look at all the numbers yourselves!

By my reckoning Premier would need to set aside around $11p/b, averaged across all of 2017 and 2018, to pay down debt to get the EBITDA to 3x. Which would require a realised price p/b of $55 in 2017 and something a bit lower (again assuming Capex costs align) in 2018. $55 realised should also convert the earnings to drive the EBITDA. The calculations should however be skewed to take into account that some of Premier's gas receives a lower per barrel equivalent compared to Brent so the oil component would need to contribute more so somewhere north of $55 required. Also need to consider the 2017 hedges that sells some at a fixed price of around $50 and some with a similar floor but upside exposure. Of course, this is averaged over 2017 and 2018 so the longer the oil price stays lower at it's current price, the more pressure it places on the future prices to be higher to compensate for any periods where the oil price is too low to drive down the debt.

Having written it down, in my mind I think it's probably unlikely that Premier will get the 3x by end of 2018 (barring an oil crisis that drives prices) but if you are of the mind that prices will continue North to $55-$60 this year and higher beyond then they should be able to give it a good go. With this in mind the Tullow situation yesterday does play on my mind a little bit but I don't believe it would be viable for them to do a RI/equity raise before the completion of the refinance legalities so I'm not too anxious at the moment anyway.

Just my ramblings - please tear apart as you wish as I'm sure I've got lots wrongs!

[leoneobull] 18/3/2017 03:37

https://www.energyvoice.com/oilandgas/north-sea/133746/durrant-insists-premier-track-healthy-balance-sheet/Three x ebitda by end of 2018 thanks to catcher and enhanced production portfolio. Tlw too dependent on Ghana and ten and Fpso problems have been disappointing

[steve73] 18/3/2017 01:00

Friday's VWAP of 64.5 on 8 MM shares give the average to date of 62.1, on 182MM shares since 1st Mar.

Might be some opportunities next week to get in a little lower if they try to keep the average around or below 62.

Have good weekend all... especially those of you who follow the 6-Nations.