Harbour Energy Share Discussion Threads

[ny boy] 07/12/2016 20:28

Right down to test 62p support, should be a positive move up, markets booming but most cash is pouring into blue chip stocks, not much interest in these, why risk funds in a Santa rally when the big plays are moving up nicely, it's an area I have been busy buying selective blue chips over the last few days.

When that area tops out, you'll probably see investors turn their attention to more Risky stocks like PMO, that have not yet participated in the general market rally.

[oilandgas1] 07/12/2016 16:55

Updated - anybody got anything else to add

Likely Timetable
1. Dec16: Pmo production target to reach 73kboepd average to be confirmed with Solan production increase.
2. 2017 Q1: Refinance debt
3. 2017 q1: Pmo to sell their 40.1% working interest in the Bagpuss Joint Venture to Reach Halibut subject to approval from partners and the Oil and Gas Authority (OGA).
4. jun17: Catcher Fpso
5. sep17: Catcher 25kbopd
6. 2017 Mexico: explore block 7
7. 2017/ 2018 debt: deleverage from 2016 Q4
Capex 400m 2017 & 300m 2018
8. 2020: Tolmount gas 450bcf capex 600m

[oilandgas1] 07/12/2016 16:52

Likely Timetable
1. Pmo production target reached 73kboepd average to be confirmed, solan prod increase.
2. 2017 q1: Pmo to sell their 40.1% working interest in the Bagpuss Joint Venture to Reach Halibut subject to approval from partners and the Oil and Gas Authority (OGA).
3. jun17: Catcher Fpso
4. sep17: Catcher 25kbopd
5. 2017 Mexico: explore block 7
6. 2017/ 2018 debt: deleverage from 2016 Q4
Capex 400m 2017 & 300m 2018
7. 2020: Tolmount gas 450bcf capex 600m

Pmo to add 10kbopd every year incl dec16

[oilandgas1] 07/12/2016 16:36

Premier also said its forecast operating costs of $15.90 (£12.70) per barrel and estimated gross general and administrative costs of $196m are both significantly below budget.

Meanwhile, the group's forecast 2016 exploration and development capital expenditure is expected to be below previous guidance of $730m and 2017 capex is anticipated to be materially lower at $300m.

The group's net debt of $2.8bn at 31 October was "marginally down" from the third quarter.

[olieslim] 07/12/2016 15:54

Appears down on the fake EIA numbers. A nice excuse, but hardly relevant anymore. Will set it up nicely for Friday though. GL

[begorrah88] 07/12/2016 15:39

The likes of GLG are loving the chance to walk right through PMOThe more of 2016 that ticks away without any covenant resolution RNS the more the shorters can bully the share price We all know TD isn't a good judge of time frames, it'll be very disappointing but not a shock if it all gets bumped again

[gloucester rugby] 07/12/2016 13:29

Just watched an excellent taped exclusive Bloomberg interview with Pierre Auderaund (hope I spealt it correctly!) He called the bottom of the oil crash in January February , but more importantly was one of 4 Oil Analysts invited by the Saudi,s the day before the OPEC meeting to give their view of the potential cut, how much would be required for the market to take it seriously, compliance and the impact on Oil price if no deal or cut took place.

He is bullish on Oil price now. Says $60 end of December and $70-$75 mid 2017 when market rebalances and inventories start to come down. Two key points, He says the Banks analysts who identify high non OPEC production outside of Shale are using 2014 recovery and decline rates, They are not taking into account severe Capex cuts over last two years and reduction in infill drilling. The actual decline rates he believes for 2017 will be double 2014. Secondly he says that deal will hold because Saudi,s guaranteeing.

The really interesting point he made in the interview was that the Saudi,s biggest fear is not oversupply but a sharp defecit in 2018 unless Capex increases and that will only happen if Oil Prices stabilise around $75. If not the Saudi,s fear a huge spike in prices in 2018/19.

Can you imagine the share price of PMO if Oil at $70/$75 just before Catcher comes on stream?! GR

[hearts1] 07/12/2016 12:33

The Solan issue is not helping either - they have left it out of the latest presentation. Solan has been a dog of a project.

[steve73] 07/12/2016 12:04

This year PMO have reduced OPEX on a per barrel basis (largely due to the higher rates from Solan & the EON acquisition). G&A has also reduced significantly (even more on a /bbl basis).
Over the next few months our CAPEX is largely committed to bringing Catcher on stream next year, but the resultant higher production will further reduce OPEX/bbl, and G&A should remain similar to this year in absolute terms.

IMO, it's our commitment to Falkland Islands development that's the big drag. I'm not exactly sure what our CAPEX commitments are for this, but a sustained higher OP will make it much more attractive if we are required to divest this.

Keep an eye on RKH share price as it's the FI's that makes up the bulk of their valuation - currently at an all time low, so the market sees little value contribution from this.

[the house of brexit] 07/12/2016 11:56

They'll be saying that about PMO soon enough!

[steve73] 07/12/2016 11:50

dean - tullow also had a fairly recent refinancing where the got hammered but have since recovered and are now flying to new highs.

[the house of brexit] 07/12/2016 11:50

Old Uncle BP is up 2.2% today.

[paulbiya] 07/12/2016 11:41

The 45 us figure includes capex. We can all see in presentation that OPEXplus g and a is around 25 us on average but with some fields producing significantly higher There is a reason this was valued at 1.8billion 3 years ago with lower production. Breakeven is not 45 us......that is a temporary issue until capex commitments end

[deanroberthunt] 07/12/2016 11:23

Enquest flying......note, if you get a decent re-org away, here's hoping for PMOers

[gloucester rugby] 07/12/2016 11:10

Whiskey, My understanding from TD,s various presentations is that $25 for PMO is our OPEX which includes current debt interest, tax etc... Obviously this will change with the higher interest/coupons post debt renegotiation. The $45 figure you correctly quote is including Capex. Not sure of Ithaca,s Capex Commitments,for 2017 but post Stella start up won,t be considerable. PMO $300m. But the point I was making was comparing Ithaca and Tullow to PMO, Two companies with very different Production levels and production upsides and with debt, compared to PMO. The valuations are completely out of sinc, but post Finance should be more of a level playing field. GR

[ny boy] 07/12/2016 10:30

Pimps are back buying to have another crack at the bears. If any positive news, then 77p can break, as shorters will start closing.

[bakedbean57] 07/12/2016 10:01

c700k buys gone through in last half hour off the book a day to watch the trading...

[whiskeyinthejar] 07/12/2016 09:42

Ithaca break-even will be about $25 with Stella operating. Break even includes all costs including debt interest not just opex. I think break-even for PMO is about $45. Catcher needs $45 too I think?

Thats a huge difference. If Brent is $55, that'd mean PMO would make $10 per barrel of free cash whereas.IAE make $30 per barrel of free cash.

So if these break evens are correct, PMO would need to sell three times as much oil to generate the same amount of cash.

Im ignoring hedges, but Ithaca is actually well hedged through to end of 2017. So downside protected too.

Enterprise value is better way to look at Premiers discount I think as it takes account of debt and assets. PMO looks very cheap. Problem again is we've been told pmo needs $45. So getting value out of PMO is a problem at $55 poo. But if you see oil price rising to $60 plus, different matter I think, PMO would be generating large amounts of cash.

[ny boy] 07/12/2016 09:18

Probably because they are all cacking themselves, man up and start buying you bulls😜

[begorrah88] 07/12/2016 09:11

Meanwhile the shorting carries on as normal

They must employ someone to physically sit at a terminaland manually pick off the bid via DMA.

It is so clear that they task is to 'match' exactly what is sat on the bid and then sit back for a few minutes before repeating.

I'm always puzzled why there are no DMA buyers who could do exactly the same to drive the share price up?

[ny boy] 07/12/2016 09:06

All the big money pouring into blue chips like BP etc been buying banking sector and adding to core holdings in Barclays etc. These are just a small punt on eventual recovery, assuming the debt doesn't suffocate them.

[gloucester rugby] 07/12/2016 08:50

A Tale of three Companies. With PMO I regularly compare to peer group to see current and future reaction to share price Tullow and Ithaca are two such comparisons. Ithaca has or will have, production around 25% or so of 2017 PMO production ( ie 20 -25 k BoPD Compared to PMO 80-90 BoPD) (When Solan is at plateau capacity) and Tullow has, or will have 25% greater 2017 production ( 90 - 100K BoPD)

Debt wise Ithaca has circa $600m reducing , and Tullow $4.2bn , like PMO at $2.8bn looking to reduce from this quarter.

OPEX costs for Ithaca in the round are similar or slightly higher than PMO, Tullow at about $5 per barrel cheaper.

Taking into account reserves and future drilling campaigns etc... which currently have limited inherent value, why is PMO approximately 20% lower in share price than Ithaca and only 10% or so of the share price of Tullow?. It cannot be the respective debt to EBITDA as the difference is only marginal. It can in my opinion be only one thing and that is the lack of clarity over debt refinancing. Ithaca had significant delays with Stella and cost over runs, Tullow had significant issue with Ten. No I genuinely believe that PMO has been singled out because of fear over the refinancing.

It is a binary bet, if we believe the management that Financing is at last only weeks away and at pretty decent terms, then a significant re rating needs to happen for PMO to equalise risk/reward within its peer group.

For me the key is that the management will have to hand over exploration control to the creditors. That , with the managements history , is gold dust. Financial discipline and a plan is key.

So assuming end of year term sheet tie in. 2017 $50-$55 oil and 2018 $55-$60 . PMO should have net debt down to around $1.9bn and EBITDA of under 3 and a share price of around £3.00. This will equate to approximately 50% of current Tullow Share valuation and 3 x,s Ithaca.

So seeing both peer companies at different production levels Ithaca soon circa 20-25k BoPD and Tullow circa imminently 90K-100k BoPD with respective debt levels gives me huge comfort that if the market can value as they are, in the current climate, then PMO should, all things being equal, see a significant re rating post finance tie up. GR

[begorrah88] 07/12/2016 08:45

I see that Marshall Wace closed their short and left - must have been a straight punt on OPEC.

GLG is still building though - that ties in with the 2.30pm AT sell activity we've seen recently.