Hurricane Energy Share Discussion Threads

[hiddendepths] 17/4/2018 10:57

Just catching up..... If I may revert to the convertible bonds. A quick read suggests that most people don't understand the delta hedging that was undertaken on, probably, most of them.

This happens where derivatives teams at brokers and large institutions want to have a secure income flow but do not want any equity risk. In order to achieve this, they buy the CBs and sell the underlying shares. However, they don't actually own the shares so they short them (using several different techniques) with the short positions covered by the shares that will come from the CBs eventually being converted.

The end result of this is substantial selling of shares shortly after the CBs are issued. And when they are converted, a few years down the line, the selling that many expect fails to materialise as the net result of the issue of new shares is balanced by the closing of the short positions. In other words, we've probably already seen most of the selling resulting from the CB issue. In my view, there is no potential overhang to speak of. A quick scan of the chart shows that there was heavy and sustained selling of HUR in the wake of the CB issue when there seemed to be no fundamental reason for it.

Years ago, I worked very closely with a derivatives team in a large broker and I know for a fact that they used this approach a great deal. As an oil analyst I sometimes found it vexing as when I had a strong buy on a stock clients would pile in only to discover that the shares actually fell on selling from within my own brokerage. If clients found out, and they occasionally did, not surprisingly they suspected my motives for issuing the buy recommendation. Although I had no idea that delta hedging was going on (Derivatives had to be secretive because of Chinese Walls) I was shouted at and cursed on more than one occasion.....

[bloodhound] 17/4/2018 10:53

"And no I am not relates to Gary38!"

Telbap - I didn't think you were for one minute (there's ony one Gary38), I was just having a little fun along the way....;-)

We just need a little something news wise to push us into the 40p range.

BH

[bloodhound] 17/4/2018 09:08

Ah Gary, you're back:-) and still sitting by your pool.....:-)))

BH

[chopsy] 17/4/2018 08:41

40 beckons! 40p has history...

[telbap] 17/4/2018 08:38

Lol lol Lol!!There needs to be some Cyrus sun spread around on this thread.Without any doubt this is the most level BB I have come across on an aim stock .Come on guys, face it with Malcy, he is a bit marmite, However, he started pumping up sound in 2016, it went stratospheric!I have listened to the many wiser posters here which helped me keep the faith through the 20s dark days, now we are, I hope, moving out of that period towards the end game for HUR as an explorer, towards HUR the producer.Few at times ahead, let's have a little fun along the way?And no I am not relates to Gary38!....(although my brother shares the same name )

[gary38] 17/4/2018 05:30

BHIf Telbap was related to me he would be sunning himselve by my pool in Cyprus.

[bloodhound] 16/4/2018 22:45

Telbap - Are you or are you related to gary38? ;-)

BH

[0rient] 16/4/2018 19:28

Telbap..Malcy has never had any impact on HUR share price .he’s been bleating on about having a share price target at over 100p for ages now but never shows how he gets to that figure!
It’s hard to take him serious when he doesn’t put his own hard earned money into the shares he recommends..just a paid promoter of certain stocks :-/

[telbap] 16/4/2018 18:32

Francis et al......once the liquid gold starts flowing then we will see complete shift change of sentiment. At present this is still a risk on stock, lots could go wrong.....harva, so far all appears to be ticking along nicely......i just love to throw in a curve ball every now and then to see who is lurking on the bb

[francis55] 16/4/2018 17:10

Telbap we should also add a few pence with rumour of bigger fish wanting a hold of W Shetland as a whole..

[telbap] 16/4/2018 15:20

I believe we will get e bounce with the malcy update effect....a lot of PIs follow him....should he post a glowing report then we could see 5 or 6p bounce from that......our real share price push is going to be fspo sailway/arrival......main market listing........foil. Will make for an interesting year.

[laserdisc] 16/4/2018 15:05

well whats proven I reckon presently valued at roughly 25cents a barrel , expecting 50p this year I think Invergorden is presently an area to concentrate on for shipwatchers, also watching suez canal area, perhaps hur will advise soon , I will wait and see what info is released in next ops update possibly next week, I do believe some action pretty soon here

[telbap] 16/4/2018 14:03

Zz......thanks....guys it was a bit of fun....

[0rient] 16/4/2018 14:03

haha..pension maker! I just want it to get back to 50p!!Its been a long slog since we hit the high of 68p roughly a year ago!

[zztop] 16/4/2018 13:40

Nothing like a good rampKeep em coming please

[steve73] 16/4/2018 13:16

Peter, I know, I was being a bit flippant... although that's also why the EPS is so critical.

[carcosa] 16/4/2018 13:11

Best to keep such fantasy valuation posts in the back pocket for a year or two when, perhaps, some of us are likely to be sellers. All ramping attempts will be welcome by then.

[greyingsurfer] 16/4/2018 12:56

stepone.. the exploration costs are already sunk... (we've found the oil)

No, telbap's fantasy valuation includes the full 2.6bn, which is not proved up - by a long way.

[steve73] 16/4/2018 12:47

stepone.. the exploration costs are already sunk... (we've found the oil)

It's "only" the development CAPEX and OPEX costs from here, but don't underestimate them...!

(and tax as you mention)..

telbap, when Scheihallion first came on stream oil was just $10/bbl (for a few weeks) but within a few years it had hit $147... Now, almost 20 years later the field is being redeveloped as Quad 204 with a brand new FPSO. And I think the GLA has more OIP than the Scheihallion had originally (although perhaps not as accessible - i.e. less recovery).

If HUR were able to retain 100% ownership, this would be a pension-maker for todays teenagers... perhaps even newborns!!

[bones] 16/4/2018 12:25

stepone68, that's not the salesman's job....

[stepone68] 16/4/2018 12:24

You might want to deduct something for exploration costs and tax before you get too excited.

[steve73] 16/4/2018 09:35

From what I recall seeing of the AM deck layout there's plenty of room to install more oil processing kit in addition to a gas export facility, but you really wouldn't want to try to do that level of activity offshore in the WoS area.. (even on a calm day!!) so I think this is one for the future.

I recall BP's original Scheihallion FPSO was upgraded on location from 150 to 180kbopd even before first oil in the late 90's... and it was a nightmare apparently!! And for those of you concerned about offloads, at it's max rate they were offloading a c. 600kb oil parcel every 3-4 days during the plateau period.

[greyingsurfer] 16/4/2018 08:59

If things work out well they will quite possibly need all 30k capacity to fully check out the two wells being linked initially. There are other existing Lancaster wells that could be linked in longer term - or as has been suggested elsewhere it's possible (though I'd regard it as a lower priority) that wells on other structures - Lincoln, other parts of Lancaster, even Warwick could potentially be connected for long term production testing. But short term the AM is there to fully assess Lancaster (and generate revenue), there will be no rush to link anything else up.

Peter