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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Jadestone Energy Plc | LSE:JSE | London | Ordinary Share | GB00BLR71299 | ORD GBP0.001 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
1.25 | 4.95% | 26.50 | 26.00 | 27.00 | 27.25 | 24.90 | 25.00 | 2,264,247 | 14:31:17 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Crude Petroleum & Natural Gs | 323.28M | -91.27M | -0.1688 | -1.58 | 136.56M |
Date | Subject | Author | Discuss |
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16/3/2019 14:52 | 2018 Container Port Traffic(TEU) at the top 25 Nations: Ranked regionally: 218 million - China 170 million - SE Asia & Pacific Rim 84 million - Europe 53 million - USA and Canada 52 million - Rest of the world Against this backdrop, it does not take a Phd in Applied Mathematics to work out why the 4.8 billion population of the fast growing Chinese, SE Asian and Pacific rim markets has been responsible for the entire 34 million bopd increase in global oil consumption since 1980 and, where the overwhelming majority of the future growth in energy and commodity demand is forecast to come from over the next decade. China alone already consumes more than 50% of the entire global production of copper and the region is expected to consume over 75% of global nat gas production by 2030. Data Source - Lloyd's List | mount teide | |
16/3/2019 14:26 | As mentioned previously, the overwhelming majority of my equity investments are now in the Shipping, Oil & Gas and Industrial metal sectors. Almost without exception these sectors generate revenue in US$ and have their costs in either US$ or weak currencies, and being mostly London listed report in GBP. It is not an investment strategy designed with Brexit in mind - it long pre-dates it - it's MO is the long term shipping/commodity market cycle, which bottomed after a 7/8 year decline/recession stage in H1/2016 that was longer and deeper than any previous cycle in living memory. If previous market cycles going back 70 years are a reliable guide we should see the current recovery/boom stage of this new cycle peak around 2024/25. Following chart compares the Goldman Sachs Commodity Index(20 major commodities with a very high oil weighting) v S&P500 over nearly 50 years. The hugely cyclical nature of the GSCI Commodity chart closely mirrors the Baltic Dry Index Shipping Chart over a similar period. Objective assessment of the current market fundamentals (increasingly supported by the consensus view of market analysts after 18 months of most forecasting further armageddon for the sector), suggests that although the joined at the hip shipping/O&G/Ind After a decade of very low investment following the financial crisis many Western Nations such as the USA are now actively involved in implementing huge capital expenditure programs to rebuild their crumbling infrastructure, while high population Nations like India and much of SE Asia and most of the fast growing African and South American emerging Nation economies are implementing and accelerating infrastructure and industrialisation development programmes similar to China. While China's spectacular growth may have softened from 10% to 6.5% over the last decade: it should not be forgotten that China's 6.5% growth today of its now more than twice the size economy, will generate considerably more demand for commodities in tonnage terms than the 10% growth at the last commodity market peak in circa 2008-2010. The fast growing economies of China, SE Asia and India's continuing strong demand for oil and gas together with a rapidly increasing demand for industrial metals from the materially important renewable energy and global electric vehicle sectors is forecast to strongly underpin demand over the decade ahead, and long after this latest commodity cycle peaks. As a result of low barriers to entry, the commodity and shipping markets have historically charted a remarkably reliable 15-20 year boom and bust life cycle over the last 70 years - as a consequence, investors only get 2 or 3 small windows of opportunity in an average lifetime to time an investment in the sector perfectly. With the shipping, zinc, copper and oil markets bottoming in 2016 after more than half decade falls of 98%, 66%, 56% and 76% respectively, this current early stage cyclical recovery phase still has a long way to run for equities since, as in the early years of previous recovery stages it took 2-3 years of a recovery in the pricing of commodities and shipping before the associated equities caught a bid and took off. Trump's high oil prices are simply not supported by the facts: Brent averaged $95 between 2008 and 2016 and $82 between 2008 and 2018, so today's $65 is still well below the level oil averaged over most of the last decade! Brent's 2008 inflation adjusted all time high price is $179. Any who may fear a possible wider market slowdown/recession over the next few years negatively impacting the commodities sector, should check out the performance of oil and industrial metals during the last sector recovery stage of 2000-2008, which followed a 7 year commodity market recession during which the wider markets boomed. The FTSE 100 peaked in 2000 at circa 7,000 (nearly zero nominal growth in two decades) and by 2002 had halved in value, and was still in correction territory more than 20% down by 2006. The pricing performance of copper and oil during 2000-2006 was: +171% - Brent +498% - Copper So much for wider market recessions negatively impacting investment starved commodity markets in/close to deficit with Swiss watch reliable 40 year average 2.5% annual growth. AIMHO/DYOR | mount teide | |
16/3/2019 09:58 | Spangle - 'but often it's because they are frankly underestimated in the first place.' You would think with decades of experience at operating in the North Sea, the sector will have gained sufficient first hand knowledge to accurately budget development projects. Or is it more a case of some project teams trying to make proposed projects(in a high development and operating cost environment) look as attractive as possible with regard to total cost and build time to get them authorised? Was surprised when BW Offshore/ Ithaca elected to convert FPSO BW Athena in a middle east yard/Dubai - while Singapore, South Korea and Japan may be marginally more expensive(circa 10%), they have a well earned and enviable reputation for carrying out highly specialised FPSO conversions and LNG new builds on time and budget. I see the Qatar government is responding to Australia's effort to usurp them as the World's largest LNG export Nation by announcing a Plan to order 60 more liquefied natural gas carriers from mainly South Korean yards at circa $300m each, to bring their fleet up to 110 vessels. The vessels are expected to have main engines running on the cargo(LNG boil off), in order to get around the implementation of the global 2020 sulphur cap. Interesting to see the wind and sea state forecast for the next 14 days for the Timor Sea where Montara is located - Force 1 to 3, with an average wave height of 1 foot - and average daily temp of 30 centegrade. Sea state and weather conditions the North Sea oil service industry can only dream about. | mount teide | |
15/3/2019 23:59 | MT, ref Ithaca and "Most projects seem to come in late and over budget." To be honest, I emailed JT Cod when they put out the schedule for the FPSO conversion to tell him that this was brutally optimistic. So it proved to be. I did well out of IAE, but when you say that projects come in late and expensive, part of it might be that they have been mismanaged, but often it's because they are frankly underestimated in the first place. I don't think JSE are under the same pressure to overdeliver, but I noticed that Vietnam sanction has effectively slipped a quarter since IPO presentations | spangle93 | |
15/3/2019 22:22 | Yes, their reputation as mariners is hard earned and well deserved - that they managed to navigate their way across the Atlantic in open longboats without access to modern navigation equipment centuries before Columbus discovered America is remarkable. | mount teide | |
15/3/2019 21:48 | Well done the Vikings then. | fardels bear | |
15/3/2019 21:45 | Good photo someuwin - you could count on the fingers of one hand the number of days a year you would see the sea state like that 150 miles out into the Northern North Sea! When i managed a ro-ro freight ferry service between Finland and the UK, it often took between 3 and 7 days to do the North Sea crossing from south of Oslo, Norway to Dundee such were the atrocious sea and weather conditions commonly encountered between September and May - its a sea passage that in relatively calm weather should have been achievable in 24hrs. | mount teide | |
15/3/2019 21:27 | Thanks MT, RRE is well worth a look and is supposedly designed to prosper in a low oil price environment. I'd be interested to hear what you think about it. I agree with all the points you have made on JSE. It is very well positioned and I really like what the management have done to date. I have a decent sized position now but will look to add on any dips. I'm also involved with HUR and know how much they have spent on their FPSO in the last year which makes the JSE Montara deal seem all the more remarkable. | homebrewruss | |
15/3/2019 20:59 | That is a quite remarkable deal if the floater is included at that price. | fardels bear | |
15/3/2019 20:45 | FPSO Montara Venture... | someuwin | |
15/3/2019 20:19 | hbr - after watching the North Sea prove a graveyard for so many small cap O&G companies while invested in Ithaca Energy, i elected to end my investment relationship with North Sea oilers on Ithaca's take over. A number of factors including extremely challenging year round sea and weather conditions saw Ithaca's production development plans delayed by years - a problem that seems to affect most, if not all North Sea operators. Most projects seem to come in late and over budget. Having said that i did take a brief look at RRE this afternoon and it does at first glance look an interesting prospect worthy of selection for further research. In the shipping, O&G and Industrial metal sectors, I look for companies with exceptional assets, a management with a long track record of success in the sector, and focus mainly on the average 6-9 year recovery stage of these long, highly cyclical markets. The last commodity market cycle bottomed after a near 8 year decline/recession stage in H1/2016. The investment attraction of JSE for me is the quality of the management and long regional experience; re-investment potential of the assets; that they operate in a region where the competition for high quality mature assets is very thin, the number of very experienced second phase operators very low; demand for O&G is growing rapidly and attracts a premium price; operating costs are relatively low; and the mostly benign sea and weather conditions enable field production development and maintenance work to be carried out year round - combined this offers significant investment downside protection rarely found in the North Sea and especially West of Shetland. That the FPSO 'Montara Venture' was included in the $82m net Montara purchase price is nothing short of astonishing considering the previous owners paid $50m for the hull and another $58m to complete the two year conversion in a Singaporean shipyard. Such is the extremely low cost compared to a similar chartered in vessel(Premier Oil are paying an annual charter fee of $210m a year for the FPSO BW Catcher on their Catcher field) ; if the management were able to increase production from Montara and its satellite fields above 20,000 bopd, they may well see Montara's operating expenses per barrel drop into single $figures. AIMHO/DYOR | mount teide | |
15/3/2019 19:12 | Ok Fardels, perhaps better on the RRE board but this should give you the flavour: | homebrewruss | |
15/3/2019 18:49 | Don't you think you ought at least to express your concern with Andrew Austin since you're slandering his reputation?I was in igas for some years and I rather thought that it was debt and the last oil recession that kiboshed them. I'm not in igas now but that's Nimby related and I am in RRE where I think you and I will do very well by AA.. | fardels bear | |
15/3/2019 18:24 | Thanks Spangle, I appreciate this is the JSE board but they have a slightly similar approach in assets bought/developed. I own both having only bought RRE in September at around £5. With the latest RRE acquisition they will have over 20,000 boepd with another approx 10,000 coming on stream in 20/21 and probably more acquisitions along the way. Their current market cap is approx £100m but no doubt there will be a sharp rise post current suspension. Arguably RRE is much cheaper so I'm interested in possible valuation methodologies. On the other hand I think I prefer the JSE management and there is a slight red flag over the RRE ceo's history at iGas. | homebrewruss | |
15/3/2019 18:01 | o/t Russ - ref your question, TBH it listed when, for personal reasons, I wasn't following small O&G companies, and I've never looked at it since. So I don't know enough about it to have any views at all, let alone either way. | spangle93 | |
15/3/2019 15:32 | Zengas, Spangle and MT a quick question if I may - I'm trying to improve my knowledge in this space. Did any of you look at RRE at all? I can't see any of you posting on that board so just wondering if you looked but then looked away and if so why? Reserves? Decom costs? Management? - All 3? Thanks | homebrewruss | |
15/3/2019 15:10 | Dry your eyes Paul. | zengas | |
15/3/2019 15:06 | OOO time to let out a little gassss.... | purple11 | |
15/3/2019 15:03 | JSEs 2P reserves = 45 mmbo approx at Stag/Montara. From infill drilling, current reserves production is expected to be replaced. This years development deals with U-Minh and Nam Du where approx 33 mmboe will move to 2P this year. That will take JSE closer to 78 mmboe 2P. Tho Chu is expected to be developed once spare capacity becomes available which would mean further 2P reserves. Planned 640 mmcf/d 28" pipeline to meet south west gas demand including 2.9 gigawatt Mon power complex. Within the blocks that contain the Nam Du, U-Minh and Tho Chu discovered fields are over 15 further prospects so again likely able to find additional future reserves to replace production. We hope to be in the producing Ogan Komering (OK) PSC later in the year. This was previously giving Jadestone 60/40 gas/oil ratio and 1500 boepd net. There are 3 existing discoveries on OK - Jantung Baru, North Meraska and Bandar Agung with a gross 16.5 mmboe approx - and has further upside exploration of 20 mmbo oil and 15 mmboe gas upside. None of these are in JSEs valuation but would add production and reserves. They might farm down some of their Vietnam interest later in the year. On SC56 Philippines JSE has a further 25 mmboe 2C. In total and not counting any further acquisitions or entry into Ogan Komering, Jadestone has circa 45 mmbo 2P and 135 mmboe 2C ie some 180 mmboe 2P/2C. Through cash generation to help fund production/reserves acquisitions imo 200p+ should be achievable with patience as the pace of acquisitions/develop | zengas | |
15/3/2019 14:46 | Spangle - indeed - thought it a high quality document. The highly transparent and detailed information within the section covering the contingent liabilities of the Montara acquisition is well worth shareholders being familiar with. The financial benefit JSE will have received by the time they trigger any potential payment looks mostly likely to be many multiples of these payments. | mount teide | |
15/3/2019 14:04 | MT - the CPR in the AIM admission has great information about each field, as you'll be aware. ERCE noted that the very good reservoir properties assist with reservoir projections, and that even though there's a complexity issue caused by tilted of the field after oil charge, even the watered oil zones deliver some oil production. They mapped production from Montara to 2030 based on just one new well (there is only one free slot from which to drill on the platform). I'm sure that as JSE gains experience managing the field, they may see other opportunities (like he alluded to with MAST when Talisman took it over from BP), and hence push out the oil production period, but these would be infill drilling by sidetracking existing wells. Note that it also says the new well is expected to deliver 3000 bopd as the company reiterated, but ERCE stated that this would be at the expense of some production from other wells, so the field as a whole would not gain the full 3000 | spangle93 | |
15/3/2019 13:08 | Excellent explanation spangle...thanks for that. What I know technically about oil/gas production can be written on the back of a stamp....so good information... My investment here was based more on the experience of the board, growth areas of the world and energy requirements thereof, size of business and cash generation enabling ongoing investment to build and grow...nice mix of oil and gas going forward etc... | sja123 | |
15/3/2019 13:07 | Perhaps the field in a gas context will still be worth as much as we paid for it when the oil is finally depleted. | zengas | |
15/3/2019 12:34 | Spangle - thanks for the detailed technical explanation - the CEO in his Presentation/Q&A was not suggesting any near term value from the gas cap. He said with the recent announcement of the development of the Crux field by Shell, it would add value to Montara in the context of answering the question; What is the likely field life of Montara?(which he suggested with the proposed infill programme is circa 2035). | mount teide | |
15/3/2019 12:15 | MT, Croasdale, someuwin Ref Montara gas I'd lay odds that it won't be produced until 2030, so it's not immediate benefit. 1. Shell's Crux field is described as minimum facilities, i.e. to suit the size of the Crux field. So until that comes off plateau, it can't accept third party gas. Given that it's just in FEED according to the articles, it won't be approved until the end of 2019 at the earliest, and more likely mid-2020. Then it has to be designed, built, installed and commissioned. First gas from Crux, maybe 2024-25. 2. The Montara field is a thin (14m) oil rim, underlain by a regional aquifer, and overlain by the gas cap you mentioned. Balancing dynamic equilibrium in a thin oil rim is a real challenge. They currently inject gas above the oil leg to preserve reservoir pressure, and stop aquifer encroachment upwards if the pressure falls. Nonetheless, water cut in existing horizontal wells is over 50%. If you stop injecting gas, the pressure preventing aquifer rise will not be sufficient to stop the oil wells watering out [also, the oil-gas equilibrium will increasingly turn to gas] Most oil rim developments therefore have an oil production phase, in which everything is done to preserve the integrity of the oil leg and produce as much liquids as can be commercially managed. Then once this doesn't appear sustainable, the fields switches to gas blowdown, when the injectors are switched over to producers and maybe another well is drilled at the top of the structure. The oil profile show at least 1,500-2,000 bopd from Montara out until 2030. So I'd reckon for those two reasons that Montara gas will be a late life field entension, and not something that's going to concern us in the short- or medium-term Again, only conjecture | spangle93 |
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