Jadestone Energy Share Discussion Threads

[croasdalelfc] 02/8/2021 18:07

They could buy all shares back on projected FCF over the next 2.5 years.

[11_percent] 02/8/2021 09:58

This is starting to make chips look expensive.

[croasdalelfc] 02/8/2021 08:27

From here it's a short hop to 20kboepd (97% oil) . Probably the end of Sept.At 20k barrels a day and $75 oil - revenue runrate will be higher than current Mcap ($550m vs $500m) .Op update due as soon as H6 well is complete and they have an idea of flowrates.

[dunderheed] 02/8/2021 08:18

Yes I think this was "in the price" already*?
However personally expect it to strengthen anyway towards end of year.








*got asset right this time gnome!

[fardels bear] 02/8/2021 08:14

Not even worth a penny..

[thommie] 02/8/2021 07:31

Rns out. Jse finished malaysia aquisition and gets paid 9,2mio for taking over 6000 boepd. thx very much OMV!

[fardels bear] 01/8/2021 15:15

OK but being pedantic for a moment, Serica isn't an oil company...

[mount teide] 01/8/2021 15:09

FB - JSE's London IPO date was also the date of the highest Brent price in 7 years!

So, while the date may have been 'meaningful' to JSE, you should bear in mind it proved the worst date in 7 years for JSE to list relative to the oil price.

Consequently, the date is a very useful industry benchmark to analyse how JSE performed relative to the rest of the O&G sector in a rapidly falling oil price market, that bottomed at an all time low some 90% down just 18 months later.

The results speak for themselves - the overwhelming majority of the market is still 30-60% down, very much in line with the average fall in the price of Brent since Jadestone's IPO date.

Ps - like many, I tend to use performance comparison dates when I bought the overwhelming majority of my holdings; which was at the IPO date/price for Jadestone in 2018 and summer 2017 for Touchstone( which peaked earlier this year 24 times up from its IPO price - so is also very hard done by using JSE's IPO date).

[fardels bear] 01/8/2021 13:55

OK so try comparing Serica from before BKR announcement until now. You unlevel your playing field a bit but choosing a date that's meaningful for JSE but none of the others isn't going to achieve much..

[mount teide] 31/7/2021 18:47

Share-price performance since Jadestone Energy listed in London on 28th September 2018.

+423% - Touchstone Energy
+124% - Jadestone Energy
+79% - Serica Energy
+29% - Petrotal

-9% - Brent Price Today
-24% - Savannah Energy
-31% - Enquest
-33% - Exxon
-36% - Brent Ave Price
-45% - Shell
-51% - BP
-54% - Cairn Energy
-60% - US Oil Fund ETF(USO)
-83% - Tullow Energy
-86% - I3 Energy
-89% - Premier Oil

Brent
$82.72 - 28th Sept 2018
$75.50 - Today
$53.00 - Average since Sept 2018


By any objective analysis, since its September 2018 London IPO listing, the share price performance of Jadestone Energy relative to the wider O&G market and Brent has been outstanding.

From a 'fundamentals' viewpoint the company is positioned extremely well to continue that outperformance in H2/2021 and beyond, particularly if Brent were to average around today's $75bbl

AIMHO/DYOR

[mount teide] 31/7/2021 17:55

Southwest Vietnam Nat Gas Assets - Nam Du (Block 46/07) and U Minh (Block 51) gas fields

* 171bcf of 2C resources with a further circa 31bcf in Nam Du South fault block and resource upside

* Provides domestic gas to existing Ca Mau industrial complex, supporting economic growth in Southern Vietnam as existing gas supply declines

* Steady predictable cash flow tied to a fixed gas price, free from oil price volatility

* Provides a hub to potentially develop other nearby discoveries

With LNG spot prices back to over $14 mmcf - some 56% above the $9 mmcf long term average price for the supply of LNG into SE Asia - the timing is looking attractive to finalise a gas supply contract with the Vietnam Energy Ministry .......one that will very comfortably support an FID to progress these two gas fields into production.

I understand Vietnam Nat Gas Supply Contracts are similar to SE Asian LNG supply contracts - a fixed price for the life of the contract with annual inflation adjustments.

At current $75 Brent - the 5 year Nam Du (Block 46/07) and U Minh plateau production of 80,000 mmcf per day at a sales price of $9 mmcf would generate the same gross revenue as 9,714 bopd of Brent.

At an estimated OPEX of less than $3.0 mmcf($15/bbl), it could potentially generate operating cash flow of circa $200m a year, for the duration of the 5-6 years of forecast plateaux production.

With a Vietnam Office now up and running, I'm expecting some news on the Southwest Vietnam gas field assets during H2/2021.

AIMHO/DYOR

[mount teide] 30/7/2021 20:13

Maari Oil Field Acquisition - Jadestone (69%) - Completion date target: End Aug 2021

Maari Field FPSO: Roroa - Commercial History

2006 - Conversion to FPSO carried out at Jurong Shipyard - Singapore (cost of hull and conversion similar to sister ship Montara Venture at circa $107m).

2009 - Went into commercial operation on the Maari Field under a 10 year fixed price charter rate contract (with annual uplifts), containing an option to buy after 4 years.

2012/3 - Maari Field Consortium bought FPSO from the owner (price not disclosed - would estimate $85m-$100m)

2013 - FPSO underwent a US$40m upgrade programme of work in Nelson Shipyard NZ - this included the upgrade of the processing equipment and the installation of a new heavy duty mooring swivel.

During this time construction activities at the Maari field continued in preparation for the tie-in of new wells. This included the upgrade of the wellhead platform and the replacement of several of Roroa's anchor mooring lines.

2016 - Carried out a further US$30 million upgrade on Roroa - including the upgrade of all eight mooring lines to a higher strength specification, and chain attachments and mooring line components, to 'future-proof' the in-field operation of the FPSO. "The replacement will mean that no major mooring works will be required for the next 10 years."

Considering the likely price paid by the Maari Consortium for FPSO Roroa and the cost of improvements since carried out to the vessel - two fellow shipping industry professionals and myself believe OMV's 69% ownership of the FPSO Roroa currently has a market value in excess of the $50m being paid by Jadestone Energy to purchase the Maari Field INCLUSIVE of the FPSO Roroa.

Additionally, by the expected deal completion date - Jadestone expects, as a result of being in receipt of the cash flow generated since the effective deal date of 1/1/2019, to be in a position where they will have no payment to make to OMV for the asset, and will very likely get a meaty cheque on top for OMV's 69% shareholding of the Maari Field.....which includes ownership of the significantly upgraded and highly valuable FPSO Roroa.

AIOHO/DYOR

[fardels bear] 30/7/2021 14:21

I might have to buy some more on Monday..Watch it fly now..

[croasdalelfc] 29/7/2021 08:55

https://www.investorschronicle.co.uk/news/2021/07/28/new-zealand-oilfield-sale-shows-net-zero-push-dilemma/

[fanshaw] 28/7/2021 20:57

Mount Teide and Croasdalelfc

Many thanks for detailed explanations.

Fanshaw

[croasdalelfc] 28/7/2021 17:28

Fanshaw - their is no obstacle to NZ govt approval - and no disagreement between the parties . The govt regulator could sign it off before the Act goes through if they wanted to. Paul Blakeley has even met the Minister Megan Woods and offered a way forward .It seems to be ministerial intransigence or possibly 'fear' of negative publicity from the NZ green lobby if operatorship is transferred before the Act going through Parliament. The Taranaki debacle was just really bad luck for JSE happening one month after signing the PSA.

[mount teide] 28/7/2021 17:13

Fanshaw - it is simply a view based on the expected timetable for the progression of the Crown Minerals (Decommissioning and Other Matters) Amendment Bill currently going through the NZ Parliament.

Of course, OMV and Jadestone when recently notifying the market of an end of August 2021 completion date, could well be of the view, that by agreeing to Decommissioning Terms at least equal to those contained in the Bill, may enable them to secure Government approval for the deal to complete earlier.

AIMHO/DYOR

[fanshaw] 28/7/2021 16:24

Mount Teide

You made the comment on post 5966 that the Maari acquisition could be completed by
year end have you any further information on this subject as Company has extended
only to the end of August.

[croasdalelfc] 28/7/2021 14:04

Put another way Stag accrued barrels was 500k @ $43 Brent and high Opex (~$22m gross ) .PM assets 1.27m barrels @ $66 Brent and very low Opex ( ~$84m gross) . Nearly 4 times as much. I'm expecting a net $15m cheque to JSE minimum.

[croasdalelfc] 28/7/2021 13:01

I don't know all the ins and outs regarding the Stag purchase but interesting if there was a working capital adjustment of $4m from completion 11/11/16 back to the acquisition date 1/7/16 . That is 134 days . Production was 3750 barrels of oil and oil prices very low around $45-50 . Stag oil traded at a discount to Brent.Fast forward to PM asset . It will be 213 days of accrued barrels. 6000 bopd and oil averaging $66 plus small premium..Not long to see what the working capital adjustment will be

[mount teide] 28/7/2021 09:59

The impact of Jadestone's management on the OPEX of the Montara and Stag fields post acquisition, and the market timing of the deals is well worth some research.

The scale of the OPEX reductions achieved by Jadestone following completion of the deals is outstanding ........as both Montara and Stag had OPEX well above $50/bbl in the period preceding completion of each deal.

The OPEX results to date suggest either the Jadestone management are without peers or the previous owners completely inept - I suspect its more a case of horses for courses - larger companies specialise in bringing into production new fields while companies like Jadestone are second phase experts.

Presumably the primary reason why a bombed out Santos Oil(who were haemorrhaging cash at the time) dropped their price for the Stag field from the $50m asking price to Blakeley's exquisitely timed $10m offer($6m Net), was its $50+ OPEX and the fact that at the time of the negotiations Brent was in free fall at circa $30/bbl and heavy sweet crude at that time attracting a $5-8/bbl discount to dated Brent.

The OPEX reductions achieved to date when combined with IMO 2020 oil sales premiums to dated Brent are currently delivering incredible operating cash flow results at $75 Brent.

Jadestone has delivered an average circa $27/bbl reduction in OPEX since acquiring the Stag asset and $32/bbl at Montara.

These OPEX reductions when combined with the exceptional market timing and price of the acquisitions, have subsequently delivered astonishing improvements in operating cash flow at $75 Brent of circa $92/bbl and $65/bbl respectively from the effective acquisition dates.

Broken down as:
STAG - $10m ($6m Net) Acquisition Price
+$45/bbl - Improvement in Brent Price
+$27/bbl - OPEX Reduction under Jadestone management.
+$20/bbl - IMO 2020 Oil Sales Pricing (from $6 discount to $14 premium to Brent)

MONTARA - $195m ($82m Net) Acquisition Price
+$12/bbl - Improvement in Brent Price
+$32/bbl - OPEX Reduction under Jadestone management.
+$3/bbl - IMO 2020 Oil Sales Pricing (from Brent to estimated $3 premium)

It's a testament to the skill of the Jadestone team that even after the huge reduction in OPEX at both fields achieved to date, they have identified measures and re-investment opportunities to deliver still further reductions - management expects the H2/2021 Infill and Well Work-Over Programme to reduce the combined OPEX of the fields to below $20/bbl by the end of 2021 - which when combined with the current $18/bbl OPEX of the Malaysian Peninsula Assets should see Jadestone enter 2022, with production in the 20,000 to 22,000 bopd range at an average OPEX of circa $19/bbl.

(Were the Maari acquisition to close by year end, this could potentially lift production into the 23,500 to 25,500 bopd range, with an average overall OPEX still below $20/bbl)


AIMHO/DYOR

Ps: it's worth noting that the Brent price has risen by $25/bbl since the effective acquisition date of the Malaysian Peninsula asset deal (some $7/bbl more than the current average OPEX of the assets!)

[mount teide] 27/7/2021 15:14

With the forecast near doubling of production over the next five months reducing projected OPEX to high $teens/bbl, I suspect the Jadestone management might describe the company at present as being on the 5th floor of a 38 storey office block under construction, just as they're about to introduce low cost arrangements to rapidly accelerate the pace of construction.

Having already successfully completed the construction of two 38 storey office blocks(the multi $Billion valued Talisman North Sea and Talisman SE Asia businesses), they clearly have the expertise, talent and know how, as specialist second phase operators in maturing O&G basins being vacated by the majors to do it a third time ....... particularly when on this occasion they have the tail wind of the covid pandemic economic rebound layered on top of the recovery stage of the oil market cycle, layered on top of the largest sale of priced to sell international oil company assets in the sector's long history.

This time around, its difficult not to get the impression that Paul Blakeley views his current shareholding and stock options as a low cost off-plan 38th floor penthouse suite retirement home.

AIMHO/DYOR

[11_percent] 27/7/2021 15:01

Croasdlelfc, cheers.

[croasdalelfc] 27/7/2021 13:52

To further my point: Average Brent since Jan 2019 : $55.1Maari averaged realised price over the same period $63.8/barrel

[mount teide] 27/7/2021 13:11

For the heavy sweet crude oil market, the IMO 2020 low sulphur fuel regs completely flipped the market on its head, turning the former ugly duckling into a swan.

And as with the property business, price is determined by Location, Location, Location.

With the covert introduction of slow steaming by the global shipping fleet post the introduction of the IMO 2020 fuel regs to materially offset much of the increased fuel cost(while cynically getting the shippers/consumers to pay the full increase via the BAF/Bunker Adjustment Factor surcharge - never underestimate the shipping industry's propensity for using a major operational change to profiteer!), Jadestone is able to sell and load a Stag cargo into a shuttle tanker nearly a month AFTER a West African heavy sweet cargo was bought, loaded into a VLCC and sailed for Singapore, and still have the Jadestone cargo arrive and unloaded into storage BEFORE the ship carrying the West African cargo had even arrived at the Singapore anchorage.

In the years leading up to the introduction of the IMO Jan 2020 Shipping Fuel Regs, Jadestone's Stag production was sold at an average of a $5-8/bbl discount to Brent. Over the last 18 months it has averaged more than a $10/bbl premium, with the last lift attracting a $13.8 premium.

Since Jan 2021, Jadestone's Stag production has generated over $30m more revenue than it would have likely achieved prior to the introduction of the IMO 2020 Shipping Fuel Regs.

The Stag field was bought by Jadestone in 2017 for a net $6m from Santos in a distressed sale, after a $50m offer for the field by a SE Asian O&G company fell through due to the Brent price falling more than $25/bbl BELOW the then estimated $57/bbl OPEX of the field.

AIMHO/DYOR