Hurricane Energy Share Discussion Threads

[laserdisc] 01/10/2023 09:11

Janekane yes .309pps relates to 30/9/23 payment this cash element receipt has gone in my Isa which i am pleased with. This is as i see it now a deferred credit of capital from the DCU from when the shares were in the Isa ,so it seems correct that the cash coming off the Dcu should be credited to where the original Hur shares were held.

If Prax had paid the 6.48p in June then it would of all gone into Isa at that time. The DCU,s are just a vehicle for paying out capital which falls due to Hur shareholders in retrospect till possibly 2026.

The actual DCU cannot be held in an Isa because it does not trade on a exchange recognised by HMRC. So if you bought one today through Jenkins it could not be held in an Isa

The Capital related payments coming off from the Dcu's over the next 3 years relates to the original Capital for the takeover of Hur shares back in June 23, in effect its just like a delayed payment . These 6 monthly distributions of Capital should be paid into where you held the original Hur shares. Over on LSE thread this matter is being discussed so any input from others would be welcome. Presently i have not seen any correspondence from HMRC to confirm this is correct OR incorrect I presume your provider makes the decision at this time .

This link will take you to news release shows calculation of .309pps The Deferred Payment Calculation
Statement can be viewed in full here.


I reckon we now have 6 further payments possible if Lancaster keeps producing to 2026.
In the proposed 31st March/ April 24 payment we could have 4 offloads of oil in computing the amount due. ie ( offloads July 23 ,October 23, Dec 23 & March 24) in that calculation so the payment would be nearer to 1p in April 24. This Sept payment of .309pps has only included 1 offload of oil.

EDIT 2/10 /23 HAVING RE READ THIS PARA
The DCU payments will be paid biannually in arrears, approximately 90 days after
the end of each 6 month period (those periods ending on 30 June and 31 December each year). So it seems we may quite a tight window to get 3 offloads in next payment anyhow i will keep monitoring

April 2024
Oct 2024

April 2025
Oct 2025

April 2026
Oct 2026

So still possibilities here for DCU holders to receive over time the takeover promise if Lancaster continues to produce and further as Prax state
our goal is to participate in further deals in the UK North Sea in order to
continue to deliver value to the DCU holders.

[steve73] 01/10/2023 04:50

i-dealing credited me 0.309pps on Friday..

[ifaze] 30/9/2023 22:24

I have had payment into my ii ISA account (despite hearing that it can't be held in ISAs) 0.309 per share. Nothing yet in Barclays a/c

[janekane] 30/9/2023 19:22

So what’s the payment amount being made on todays date saying payment will be made
Sorry but is your post confirming one third of a penny per share previously held
Dates your quoting I don’t understand the correlation

[laserdisc] 30/9/2023 11:59

one third of a penny for every previous share held this relates to offloads only to 30/6/23. 1 cargo of oil 539244 barrels the Prax news link shows the full breakdown of how they calculate. Should be more on next payment the 11th July offload was not included and we have another offload possibly next week imminent, So if all goes well by end of this year there could be 3 offloads still to be included @31/12

[janekane] 30/9/2023 11:46

So we get one third of a penny for every previous share held

[laserdisc] 29/9/2023 18:11

should be an offload next week which i will update when we know further ,i note presently supply vessel GRAMPIAN SOVEREIGN
Departs: 29 Sep 2023 - 16:10
To
AOKA MIZU, Offshore Oilfields

Positive vibes coming through todays news release that Prax upstream are still looking to use those Hur tax losses in some form of acquisition

Interactive investor has notified DCU's holders this afternoon i expect cash will be in account come Monday

[fat frank] 29/9/2023 17:08

So, gotta love P1 - still putting out 7,000bopd.

What chance, in the current climate, a revisit of P8????

[wbodger] 29/9/2023 11:49

The only way is a qualifying investment to produce more profit. They need to pay 2 pence a year to even get close. That would have been hard even for Hurricane PLC to afford if oil prices dipped, but not impossible at $100 oil.

(7000 bopd is about 2.5 million barrels a year, so gross revenue of $250 million, around £200 million. To pay 2 pence on all shares costs £40 million. Prax was working to an assumption of 17%, one sixth of Gross Revenue, distributable to DCUs. One sixth of £200 million gets in the ballpark.)

The deal works if they do find an investment, because it would improve the chances of improved payout, even if is eventually less than 6.48.

I personally think Crystal Amber was looking to get out with nine pence a share including the 6.02, and anything else is gravy. (That's possible, depending what they can sell 590 million Loan Note DCUs for.)

[brinks_matt] 29/9/2023 10:05

If this is the current rate of return, then there appears to be an impossible to improbable chance to get the additional potential full return of up to 6.48p per DCU before end 2026 on Lancaster alone.

[laserdisc] 29/9/2023 10:01

NEWS ON PRAX website
Hurricane Energy Deferred Consideration Unit Payment
29 September 2023: Prax Exploration & Production Plc is pleased to provide its first update to Deferred
Consideration Unit (“DCU”) holders under the terms of the agreement dated 8 June 2023

says also current production at Lancaster is around 7,000 bopd.

[laserdisc] 28/9/2023 16:10

Thankyou for that info Porrohmahnn , understand will be a Prax news release over week -end and payment to be made by 30 September 2023. It will relate to period March to 30th JUNE. Poster Peter over on lse says he has received a postal chq today dated 29/9 @ 0.309 pence per DCU

[porrohmahnn] 28/9/2023 16:03

I didn't receive a reply from Prax corporate so I did some more research and sent this message to the DCU Representative
( [e-mail] )

"I am a Prax DCU holder. According to the Prax DCU website;

"The DCU Cash Amount for the initial period from 1 March 2023 to 30 June 2023 will be paid by 30 September 2023."

"The calculation of each deferred payment will be published on the Prax website www.prax.com/dcu/ for all interested parties to see."

Normally, amounts payable to investors are announced in advance. It's now 28th September and, as far as I know, DCU holders have not yet been informed (via the Prax DCU website or by other means) of the calculation, the DCU Cash Amount payable, the DCU equivalent of the ex-dividend date or the expected payment date.

Please can you update me regarding these matters.

Kind regards,"

This is the very prompt reply I received;

"That is correct a payment is due shortly and you can expect the press release and payment to be made by 30 September 2023.

Additionally, if you would like to receive a notification of releases from Prax you can register at the bottom of the page of this link: hxxps://www.prax.com/information-for-holders-of-dcus/#press-releases

Best wishes"

There are a lot of Q&As about DCUs here; hxxps://www.prax.com/dcu/

This guidance includes the following statement;

"DCU Holders are able to trade on JP Jenkins daily during London market hours, save for during certain specified periods to be announced by Prax in due course."

Although the reply from the DCU Representative does not address my question regarding the DCU equivalent of an ex-dividend date, maybe the delayed announcement is to ensure that any period between the calculation, announcement and payment of a DCU Cash Amount, during which DCUs potentially cannot be traded, is kept to a minimum?

[luckygit] 27/9/2023 11:26

Many thanks for your very informative reply. I'll pass on the info to him. He is with IDEALING.com so not sure how good they are with info etc. Cheers

[porrohmahnn] 26/9/2023 23:14

A DCU cash payment is supposed to be paid before 30th September and the calculation for this should be posted beforehand on the Prax website. I haven't seen the calculation yet so I wrote to Prax asking for an update. I haven't received a reply yet.

[laserdisc] 25/9/2023 19:20

Article here from Fidelity but says not for private investor, must be a thread on Advfn for CGT questions like this

[rahosi] 25/9/2023 18:45

Scenario. One had an ISA holding, and a loss was sustained on takeover. Then the holding was transferred out of the ISA. Now, when DCU payments are made outside one's ISA, and this is assumed to be capital, not a divi, what is the notional cost of acquisition for CGT purposes?Hope I've made my question clear.

[laserdisc] 25/9/2023 09:26

Luckygit, Shares no longer listed on AIM he should have received cash settlement for the shares in the ISA around 21st June . DCU's were also issued as part of deal, share provider will have now trf & credited DCU'S to a trading account well thats what happened to me
Lancaster is still producing & this morning a flight went out to AM via Prax upstream

I would expect an offload to a tanker in the next 14 days despite annual maintenance schedule, will update tanker offloading as and when. The dcu's could possibly pay up further to 6.48p max over the next 3 years depends on events at Lancaster and if Prax utilise the hur tax losses in a Prax north sea oil acquisition

the details were
Under the Scheme, UK Holders will be entitled to receive in respect of each Scheme Share held at the
Scheme Record Time:
• the Transaction Dividend of 3.32 pence per share in cash (£66.1 million); and
• the Cash Consideration of 0.83 pence per share in cash (£16.5 million).
In addition, each UK Holder will be entitled to receive:
• the Supplementary Dividend of up to 1.87 pence per share in cash (£37.2 million); and
• a Deferred Consideration Unit, which may deliver up to 6.48 pence per share in cash
(£129.1 million), plus an amount of cash from Prax equivalent to such amount of the
Supplementary Dividend Amount (if any) which is not resolved to be paid as a dividend prior


At this point in time we are awaiting for an update on the DCU payment i believe an update is due 6 monthly 1st on 30 th Sept, any payment received on the DCU relates to a capital element of the sale of Hurricane shares . CGT could arise on the amount , its not a dividend see page 81 of documentation that is concensus of opinion following discussion over on the LSE thread where there are some good posts on this matter

[luckygit] 23/9/2023 17:28

I have a friend who bought a few Hurricane shares about 4 or 5 years ago in an ISA. He has asked for advice on what he should do but I'm not at all sure. Any idea on what he should do? Seems a bit complicated to me.

[laserdisc] 19/9/2023 14:18

thanks JakNife for clarification of the tax treatment, I will have another read as it says its complex , i note this para Deferred Consideration Cash Amount
This amount will be known on the Effective Date but it will be contingent on the Trigger
Event. If the amount is paid as the Deferred Consideration Cash Amount, it will not be a
dividend for tax purposes. It will instead be additional contingent consideration for
Hurricane Shares.
A UK Holder will be treated as making a part disposal of Hurricane Shares on the Effective
Date and the consideration for the disposal is the known amount

i hold class 2 DCU so if we get a dcu payment end of this month will it be treated same it will not be a
dividend for tax purposes but it will affect only the CGT aspect on sale of hurricane shares

Section B on page 81 does say it will be treated as capital

[jaknife] 19/9/2023 12:52

laserdisc,

Those rules only apply to US investors:



I would have thought that most investors in HUR are UK tax resident?

Page 79 of the Scheme Document sets out the UK tax treatment of the DCUs and can be found here:



The taxation treatment of payments under the DCUs is not straightforward and depends on whether holders converted their DCUs into Loan Notes.

JakNife

[laserdisc] 19/9/2023 11:46

should be end of month see latest posts over on LSE .

I copy this from bocase as a reminder THANKS BOCASE
Further to my post 37704 above, I have been doing some research and fortunately if you have held the HUR shares for more than 60 days prior to the ex div date, the dividend we have received will be classed as 'qualified dividends' and are not taxed as income but as capital gains or losses. That is a big relief!!I did not fancy a tax bill on an additional £20k of taxable income.

see below:

Dividends are separated into two classes by the IRS, ordinary and qualified. A dividend is considered to be qualified if you have held a stock for more than 60 days in the 121-day period that began 60 days before the ex-dividend date.
2
It is an ordinary dividend if you purchase it after the ex-dividend date.

ANYONE KNOW could this rule now apply to interest payments from the DCU;s if we do receive any interest in this tax year. All the dcu's have been trf out of isa's into trading accounts in this tax year 23/24

[rahosi] 15/9/2023 13:56

Does anyone have an idea when the first DCU payment will be made (My guess is this Sep 30)? Will there be an announcement and an 'Ex date' like a regular dividend?

[laserdisc] 12/9/2023 08:54

We know DCU Holders will benefit from the exposure to Prax’s future UK North Sea growth aspirations.

Yesterday Prax announced a new $300M Facility which will be used to refinance the maturing five-year term loan tranche from 2018, as well as for strategic acquisitions.

Lets hope some of facility is for a North sea acquisition a so they can use up some of Hurricane's tax losses