Hurricane Energy Share Discussion Threads

[hiddendepths] 08/5/2017 10:24

adam - the CPR did, the company used 25%.

[adam] 08/5/2017 10:20

Hiddendepths have you taken your aspirin?


They stated 22.5% here not 25%

[leeson31] 08/5/2017 10:16

...just keep thinking end game: ie total assets OIP ~9billion barrels +++ and ~25pc RF.

[mrwaite] 08/5/2017 10:14

Bloodhound....I suspect my thoughts are near yours. The market where the biggest demand surprises will occur is India. They are adding motor vehicles of all types in huge numbers every year now , yes adding millions per annum. Much attention is paid to the supply side but demand is going to accelerate in petrol and diesel vehicles in areas of the world who are not much interested in clean air...for better or worse.

[tournesol] 08/5/2017 10:14

Hidden Depths

hear hear

I wholeheartedly endorse your comments

T

[bloodhound] 08/5/2017 10:05

"I would say those oil price forecasts are a tad generous" - Robbiekeane post 20419.

Made me smile that as I thought the oil price forecasts in the CPR were on the conservative side based on an interesting article I read the other day which quotes the 2020 oil price as $79/b v's the CPR's 2020 price of $71.80.....

"By 2020, the average price of a barrel of Brent crude oil will rise to $79/b (in 2015 dollars, which removes the effect of inflation). Shale oil production will slow after 2021. This will contribute to a decline in total U.S. oil production through 2040."

www.thebalance.com/oil-price-forecast-3306219

BH

[hiddendepths] 08/5/2017 09:59

Not wishing to ramp, just my assessment! All figures conservative in my opinion.

The area around the Lancaster wells has 2.5 billion barrels in place. This does not include the full areal extent of this part of the field. The area around the Halifax well, some 35 km away, is likely to contain more because it's got a deeper oil column and we have no idea how much deeper. Let's say 3 billion barrels for this bit, probably an underestimate because we don't know the areal extent because we don't know the thickness of the oil column. How much oil is in between the two sections, which are almost certainly connected? Surely there's at least 1 billion barrrels, possibly much more. This adds up to 6.5 billion barrels.

Then there's there Greater Warwick Area, which we're told is about the same size as Lancaster, presumably the bit that the CPR has just assessed. This is a further 2.5 billion barrels then.

Forgetting all about the now derisked prospects in the immediate vicinity which are still undrilled and Whirlwind, a large discovery in its own right, this lot adds up to 9 billion barrels in place and it's easy enough to envisage substantially more.

As for the recovery factor,, OK, it's prudent to keep it low at this stage and I would suggest that the company's 25% is quite cautious enough. This would suggest a recoverable reserve base of 2.25 billion barrels. Given that many larger North Sea fields eventually recover 70-80% of the oil in place, one could realistically hope that 5 billion barrels will be recovered in due course without breathing hard.

My considered assessment of what we have here is a set of oilfields which are world-class and will eventually be regarded as among the biggest thirty fields or so in the world. The UK is back as a major oil province!

This is all very positive but I'm not so naive as to believe that we as Hurricane shareholders are going to fully reap the benefits of these discoveries. However, it gives me a massive amount of confidence that we are in a substantially undervalued share and in due course will make a goodly return on our investments. My biggest concern is that we'll be taken out on the cheap before the long, long revaluation process has got far along the road. It happens!

[tournesol] 08/5/2017 09:49

IMHO the key point about the CPR is that it supports management's previous statements - in other words they know what they are talking about and they are not over-egging the pudding. IE we can be confident in their assessments.

Secondly the CPR shows that there is a clear underlying upwards trend in the resources/reserves figures. The total is getting bigger over time.

Put those two facts together and you have a pretty good indication of the future outcome at Hurricane.

I'm holding. If I was not already over my exposure limit, I'd be buying more.

[altom] 08/5/2017 09:27

Tournesol.
Thank you very much. Most helpful.
Altom.

[robbiekeane] 08/5/2017 09:21

I would say those oil price forecasts are a tad generous - but a good CPR.

[tournesol] 08/5/2017 09:16

boe Barrels of oil equivalent bopd Barrels of oil per day
CPR Competent Persons Report DST Drill-stem Test
EPC Engineering, Procurement and Construction
EPCI Engineering, Procurement, Construction and Installation
EPS Early Production System (phase 1 of Lancaster/GLA development)
ESP Electrical Submersible Pump
FEED Front End Engineering and Design
FPSO Floating Production Storage and Offloading vessel
FFD Full Field Development (phase 2 of the Lancaster/GLA development)
GLA Greater Lancaster Area (Lancaster and Halifax)
GWA Greater Warwick Area (Warwick and Lincoln)
LLI Long Lead Items
NMR Nuclear Magnetic Resonance
ODT Oil Down To
OWC Oil Water Contact
OGA Oil and Gas Authority (An executive agency of the UK Government’s Department for Business, Energy and Industrial Strategy) PI Productivity Index
SPS Subsea Production System
STB Stock Tank Barrel
SURF Subsea Umbilicals Risers and Flowlines
TMS Turret Mooring System
TVDSS True Vertical Depth Subsea
UKCS United Kingdom Continental Shelf

[jacks13] 08/5/2017 09:11

www.hurricaneenergy.com/communications/glossary

[tournesol] 08/5/2017 09:03

Altom

best source is to look at the document that accompanies an E&P IPO - any IPO. There will be a glossary of terms.

to get you started

1P = proven reserves - probability of commercial production >90%

2P = probable reserves - probability of commercial production >50%

3P = possible reserves - probability of commercial production >10%

reserves = oil that is present (subject to above), that is extractable and that is
commercially/economically viable

resources = oil that is present, that is extractable but where there is uncertainty as to whether it is/will be commercially/economically viable - ie

If oil prices rise then resources will tend to be promoted into reserves ie the economics improve past the tipping point of viability

If oil prices fall then reserves will tend to be demoted into resources - ie the economics deteriorate past the tipping point of viability.

Industry practice in E&P is to consider 2P as the primary metric for valuation. It represents the best guess or most likely outcome = the balance of probability.

1P is the low case beyond any reasonable doubt.

3P is the best case = least likely outcome.

HTH

[nicebut] 08/5/2017 08:59

Nice set of figs...

Right, after profit taking, we now we need the ii that was buying last week to continue his buying and a farm in partner to be signed up. Not too much to ask is it?

[laserdisc] 08/5/2017 08:57

Only a small decrease in CA holdings last month moving to 11.2%, prev 11.7% of their fund

happy with the Recoverable figures, price has consolidated & once we get the volume it will move up in my opinion ,we will find out more in run up & at AGM

[jimarilo] 08/5/2017 08:53

Next step must be the funding of the EPS ?

[terry hardacre] 08/5/2017 08:50

Perfectly happy with the price action this morning - topped up core holding to a nice round pile and opened a trading position for good measure.I expect volume buying to lift this in due course - a great opportunity in my opinion.

[idleduck] 08/5/2017 08:43

Meanwhile, EOG is up 10% or so on its CPR based entirely on a premise; not the actual and thoroughly verified presence of a large commercial oil find, which is what Lancaster is

and they say the Market likes certainty?

NUTS!!!!

[gary38] 08/5/2017 08:41

TPIFiltered

[qazwsxedc69] 08/5/2017 08:35

altom - Wikipedia has a good jargon buster....

[qazwsxedc69] 08/5/2017 08:34

Congrats Patient investor on the most stupid comment made on any BB ever.

[lfdkmp] 08/5/2017 08:32

A minor top up at 62p.

Thanks, folks.

[altom] 08/5/2017 08:32

Would someone please suggest a primer which will explain the terms and abbreviations used used in the oil business ? P1 P2 all that sort of stuff !
I would like to understand better this morning's CPR (I know that one) as I am an optimistic shareholder in HUR which is one of my largest holdings.

[odvod] 08/5/2017 08:23

CPR gives the institutions the necessary formal assurance to invest in. So from PIs and early investors into strategic hands. I expect vol increase