Jadestone Energy Share Discussion Threads

[jacks13] 02/10/2022 10:48

Adam Rozencwajg, (Managing Partner at Goehring & Rozencwajg),talks to Top Traders Unplugged on the global energy crisis and how the world (the West) arrived at this situation.

[mount teide] 02/10/2022 09:59

Opec+ ups the anti on the oil paper price manipulation of the US - Bloomberg reports this morning that OPEC+ is now considering a production output cut of more than 1.0 million bopd to get ahead of the market.

[the_gold_mine] 02/10/2022 09:33

David Neuhauser of Livermore Partners gives a pump to Jadestone about half way through this short interview (<3 minutes),

[mount teide] 02/10/2022 09:31

IEA Warns of LNG Tightening in 2023. The head of the International Energy Agency (IEA) Fatih Birol warned that LNG markets in 2023 might be even tighter than this year amidst higher demand from China, India, and other parts of Asia, as stronger Asian growth ramps up the need for more gas. (India is currently growing at 13.5% and urban and industrial China is now opening up after spending most of the year in lockdown).

OPEC+ Seems to Be Serious About Cuts. According to OPEC+ sources, members of the oil group have started talks about potential oil production cuts in November 2022 as Russia has already suggested a 1 million b/d target reduction for the October 5th meeting. With production cuts being discussed as a means of maintaining palatable prices, an upward run towards $100 per barrel might be on the cards for ICE Brent. (Soundings from OPEC participants suggest there is a growing consensus for at least a 500,000 bopd cut).

Warren Buffett Really Likes Occidental. Warren Buffett’s Berkshire Hathaway bought another 5.99 million shares of Occidental worth 352 million this week, boosting its stake to 20.9% after the US energy regulator gave Berkshire the permission to buy up to 50% of the firm’s common stock.

US Slaps Further Sanctions on Iran Oil Trade. The Biden Administration targeted 6 companies in India, Hong Kong, China, and the UAE for allegedly enabling the sale of Iranian crude and products into South and East Asia, as most Iranian exports still sail towards Chinese buyers.

Europe’s Industry Shut-Ins Now Move to Industrial Metals. Commodity giant Glencore is considering shutting its lead operations at its Portovesme plant in Italy after high electricity prices made production commercially unsustainable, potentially putting at risk development of an EV battery recycling plant there.

Source: Oilprice.com

Germany's manufacturing industry 'miracle' was a mirage built on ultra low priced nat gas imports from Russia, who with impeccable timing, sprung their energy supply trap in February with its invasion of Ukraine, after being buoyed by their success of a decade ago, when, after annexing Crimea, they found all the egocentric Germans wanted to do as soon as the smoke had cleared and dust settled over Crimea, was to negotiate a further large increase in their imports of cheap Russian Nat Gas!

Putin, the ever scheming shyster's shyster could not believe his luck, playing the reckless, self serving Germans and their EU glove puppet like a finely tuned grand piano until their reliance was total and the trap set, allowing him to make his move.

Played out on the public stage the script was so predictable, that even a largely disinterested Trump could see it and lectured them accordingly, to nothing but contempt and ridicule. Never has the phrase "none are so blind as those who will not see" been more apt!

With energy security now firmly back at the top of the global economic agenda, the days of cheap energy, not just for the Germans and EU but, everyone, are now well and truly in the rear view mirror and likely to stay there for decades.

The sabotage/destruction of the underwater sections of the Nordstream Nat Gas pipelines where the Baltic Sea is the deepest with the most difficult seabed terrain, was a final slap in the face to the Germans. It was basically an unwritten message telling them to stop wasting their time postering behind the scenes in the hope of a negotiated settlement in Ukraine, as only a total Russian withdrawal would be acceptable to Ukraine and most of the West and, there is simply no possibility of that and so, no way back for Germany to continue receiving cheap Russian energy.

[sea7] 30/9/2022 08:43

The facility is designed for continuous service with a design life of 20 years. The FPSO vessel, turret and mooring systems have been designed to allow all essential maintenance and mandatory inspections to be performed in the field whilst in continuous operation without dry-docking, with in-water survey in lieu of dry docking.

[mount teide] 29/9/2022 21:14

'After Norwegian company warned of sighting of drones near its offshore oil and gas fields in the North Sea last week, now Total of France is warning about the same.

The later reported a drone near its Halfdan B platform, >200 km offshore. No chance that's a civilian drone!' ....Javier Blas

[mount teide] 29/9/2022 14:25

f22 - it should have been a relatively low risk possibility considering that the FPSO has only been out of drydock 13 years and, used to handle production for eight years, under an ongoing Hull and Tank, Inspection, Testing and Maintenance regime in lieu of dry docking. The only real unknown was how much faith could we put in the work the Thai's claimed to have carried out in that respect before Jadestone acquired the assets.

The fact that the production platform was taken out of service very shortly after handover to carry out a wide range of major repairs and inspections and, that the Thai's gave us $22m to cover work that actually cost $2-3m was something that we perhaps dismissed too lightly. As, taken together with the fact that the FPSO had had its Class partially suspended for a period of 8 months prior to completion of the deal should have legitimately raised the question as to how much of their FPSO Inspection, Testing and Maintenance work we could rely upon.

AIOHO/DYOR

[fireplace22] 29/9/2022 13:38

The fact that they've allowed the craft to remain on station whilst carrying out cleaning, inspection, and repairs over seven weeks suggests that they see the need to drydock only as a remote possibility now.

[mount teide] 29/9/2022 13:28

p45 - the buyback is a known quality - would expect it to continue doing its job of supporting the share price until the cash allocated has been fully spent, regardless as to when the FPSO comes back into operation.

[poacher45] 29/9/2022 13:23

Mount Teide The reverse of your statement would then be true that when good news comes because of the buyback there will be less shares available on the market.

[mount teide] 29/9/2022 13:03

p45 - 'The really interesting point is that over the last three weeks not one of the top 25 holders has sold a share as far as I can tell. This says to me they are confident that Montara will come back on line shortly.'

Although glass half full men by nature, as shipping industry professionals, when it comes to hull(below waterline), ship cargo and ballast tank inspections, long experience has taught us that they carry only downside risk. ie that's why shipowners, managers and operators only ever put a ship into dry dock when they are forced to under the regulations(At Special Survey once every 5 years).

With respect to our FPSO Montara, which has not been dry docked for 13 years, the most significant downside risk is not the issues already identified but, that some ballast tanks yet to be inspected during this latest inspection and testing period in lieu of dry docking, are to be opened and inspected.

Ballast tanks can often have a higher corrosion rate than cargo tanks because they're periodically filled or part filled in the case of trimming tanks with highly corrosive salt water, and so oxidation/corrosion of the steel at the top/deck level of side/wing tanks is usually a permanent ongoing feature. And usually accelerates/is more pronounced in the upper section of the tanks where they're above sea level, as the tank temperature there is greatly elevated when operating in the tropics by a combination of the high general ambient temp and direct affect of the sun on the deck during the day.

AIOHO/DYOR

[poacher45] 29/9/2022 12:01

Mount Teide I fully agree with you that if it had not been for the buy back the share price would be a lot lower. However Simply wall street have put out a new up to date shareholders list. This shows that because of the buyback the top two shareholders now own 34.23% of the shares instead of 33.77% in your header. The really interesting point is that over the last three weeks not one of the top 25 holders has sold a share as far as I can tell. This says to me they are confident that Montara will come back on line shortly. The rev

[sga64] 29/9/2022 11:50

And by 2035 another 1 billion added!

[bountyhunter] 29/9/2022 11:38

I'm out, there's too much uncertainty here now for me; hoping to recoup my losses on iog which stands a greater chance of a strong recovery in my view.
Good luck to those that remain.

[mount teide] 29/9/2022 11:34

Since the 2007/8 GFC - the global population has increased by 1.1 billion(1.3 times the population of the West), nearly all in the emerging Nations.

2007/8 - GDP (PPP) - US$
$28.9 Trillion - US and EU combined
$17.8 Trillion - China, India and SE Asia

2022 - Est GDP (PPP) - US$
$61.4 Trillion - China, India and SE Asia - up 245%
$46.9 Trillion - US and EU combined - up 62%

Since 2007/8, global oil consumption has increased by 14m bopd - an average of 1m bopd per year.
Yet the average consumption per capita in China, SE Asia and India, which is one twelfth of the West has barely moved, largely because of size of the growth in population. That region needs close to a 1m bopd increase in oil consumption just to meet its current population growth and development needs(which are on a rapidly accelerating trend).

As China comes out of lockdown, post cessation of the SPR releases, the global oil supply and demand dynamic simply does not add up - only higher prices to trigger higher levels of investment combined with some demand destruction has a hope of making a dent in the scale of the rapidly growing supply/demand problem.


Data Source: World Bank

[mount teide] 29/9/2022 10:34

Further to the last post, the well researched will be aware that every year a net circa 80 million new people join the 7.9 billion already here, all needing, but not always having, energy to power their lives.

In six years from 2014 to 2021 spending on new upstream sources fell by an average of 55%, while the world’s population rose by 8%. You don't need a PhD in Applied Mathematics to work out that the maths doesn’t work, particularly when 7.0 billion currently live in emerging/developing nations reliant on a rapid growth in energy demand to meet their economic development plans.



The oil market is undersupplied as the EIA graph below shows. Since March when the US announced the SPR releases, US stocks have risen about 15 million barrels. If you back out the 172 million barrels withdrawn from the SPR over this time, inventories would have shrunk to 248 million bbls...... a drop to barely half of the 5 year average; a waterfall drop off the bottom of the chart.




Not only are oil inventories being artificially inflated by SPR releases, the productivity of new wells as reported in the EIA-Drilling Productivity Report is now declining. Across the major US shale oil basins there is a pronounced decline in spite of the steady growth in the rig count this year.

With the European geopolitical situation in a state of extreme flux no one can predict what the oil market will do over the next few months. However, over the medium to longer term the oil market fundamentals point very strongly to higher prices, probably for most of this decade. The best guess is it will likely commence when massive weekly inventory draws start to show up in the data after the SPR releases stop as we enter the high demand Northern hemisphere winter season.

Data Source : S&P Global Platts


In Europe, sales and pricing of Merino base and mid layer clothing are going through the roof. Many of the top manufactures like Aclima, Woolpower, Devold and Icebreaker have seen demand surge and increased pricing accordingly, since the annual production of superfine merino wool used in their products is strictly limited. Never thought I'd see the day when even lightweight superfine merino t shirts retailed at 75-100 Euros, and were leaving the shelves as fast as they were being manufactured.

[mount teide] 28/9/2022 16:40

2020's - the Decade of high energy prices? A nailed in certainty according to the CEO of Aramco who blames the collapse in O&G investment across the industry coming home to roost.

Previous energy crises were supply side shocks with geopolitical origins. Today, supply constraints around gas and oil are evident once more but, crucially, and as some here predicted, these constraints are occurring at a time when energy markets are struggling to absorb the:

* Massive and still accelerating 20-year Asian energy demand shock - average growth of 1.0m b/d per year

* The impact of the naive rush by the green, woke West's 'transition' into expensive and poorly performing renewables

* Russia - Ukraine War

Per capita energy consumption in China is 750% higher today than in 1973, yet, despite importing more oil than the entire annual production of Saudi Arabia, Norway and the UK combined, and recently usurping Japan as the world's largest LNG importer, Chinese energy consumption per capita is still only one eighth of the USA.

There has been no historical equivalent to the decision of the Chinese government last winter of demanding that energy companies procure supply of all energy sources at any cost. Europe is now doing the same in preparation for this winter.

The scale of the global energy demand problem is given perspective by the fact that the consumption per capita of the 3.4 billion emerging nation populations of SE Asia and India (excluding China - population 1.4 billion) is one fourteenth of the West, yet is now accelerating faster than China.

Data Source: mostly from Lloyd's list and BP's Annual World Energy Review

[mount teide] 28/9/2022 15:45

Nig' 'Buyback really valuable here to existing holders. Without it as someone else commented there is little doubt price would be much lower.'

Support has been so good - Sold 20% of my JSE holding over the last week to add to positions in four O&G holdings not benefitting from the support of a large buyback operation during this general market pullback - Petrotal, Afentra, Arrow and SOUC.

The value currently available across the O&G sector is astonishing at $87 Brent, when considering the industry reported an all time record of FCF generation in Q4 2021 when Brent averaged $76/bbl.

[fozzie] 28/9/2022 12:31

Agree it has been a terrible last few months. Bought more AXL this morning but funds are very low. I am considering selling a lot of non oil and gas positions in order to provide some firepower.

[otemple3] 28/9/2022 12:24

18% this month!! Stop showing off fozzie. This month has been beyond brutal & the fact JSE (despite being only one to issue as news) is one of my best performers this month says it all.....

[fozzie] 28/9/2022 12:20

Questioning my own sanity at the moment. I have weathered such storms before but this is irrational and week after week really gets you down. Portfolio is down 35% from Jan 21 high. Did not expect to see my oil and gas investments behave like this in this particular environment.