Jadestone Energy Share Discussion Threads

[mount teide] 11/12/2022 18:50

O/T - Viktor Katona, crude analyst at Kpler, a commodity analytics firm, said: “At a time when world markets brace for the impacts of a 2023 recession, shipping stocks might be one of the most resilient means of investment into the market.”


Payday for shipping lines as Russian oil cap comes into force - Times today

'New sanctions will further enrich firms with tankers for hire.

In 1926, the Martinos family of Athens opened an inconspicuous antique shop beneath the Acropolis, about a minute’s walk from Hadrian’s Library. The family name still stands above the shop — which today bursts with Middle Eastern rugs, Persian cushions and neoclassical art — but the grandsons in the dynasty have moved on spectacularly.

Thanasis and Andreas have each managed their own oil tanker companies, making the family one of the wealthiest in Greece. This year has been especially good for the brothers, who have made significant sums shipping Russian oil that others have refused to touch since the invasion of Ukraine. And the fresh round of sanctions last week could make next year still more profitable for them.

Since 5 December, tankers ferrying Russian crude have only been allowed access to western maritime insurance if the oil is sold under $60. The price cap, which Russia said it would not observe, was intended to keep oil flowing without allowing the Kremlin to profit from it. But for those, like the Martinos brothers, who are still willing to ship Russian oil, the sanctions will be a boon.

Prices of freight on most routes have shot up by at least 25 per cent in the past month in anticipation of the new regime, with some doubling, according to European shipping brokers. Viktor Katona, crude analyst at Kpler, a commodity analytics firm, said: “At a time when world markets brace for the impacts of a 2023 recession, shipping stocks might be one of the most resilient means of investment into the market.”

There are many reasons. First, the added red tape and complexity inherent in the new sanctions mean shipping firms face higher costs, which they are passing on with an extra premium on top. Second, they are charging more for the higher risk of their reputations being damaged for carrying sanctioned oil.

Third, compliance is hard, with the risk of high fines — at least £1 million in the UK — if mistakes are made. “These risks are translated into shipping companies asking for more to ferry their cargoes,” said Katona.

The sanctions are also having a big impact on the number of tankers available to be chartered. This is because, as another element in the new rules, it is illegal to import Russian oil into European ports. Instead, ships must take the crude from Russia to Asia. This 5,000-mile trip takes ships out of circulation for 40 days each way.

Data from Refinitiv shows that a record 12.86 million metric tonnes of Russian crude went to India and China in November. The two countries accounted for 94 per cent of all Russian crude exports.

Michelle Wiese Bockmann, an analyst at the shipping journal Lloyd’s List, said: “Because they are shipping more volumes over longer distances, that cuts down the number of tankers that can be chartered at any one time. That reduction in supply will increase freight rates.” Wiese Bockmann added that the recalibration of global shipping routes has pushed freight prices to more than $100,000 a day.

Traders, who buy and sell the oil and charter the ships from the likes of the Martinos family, are also set to cash in from the new sanctions. They will be buying Russian oil at $60 per barrel, but can sell it for however much they want. Currently, the market price for benchmark brent crude is about $77 a barrel.

“Russian crude will still get into European ports,” said one Greek shipping insider. “The only thing that will change is how it gets to those ports. It will not be directly imported; instead, it will go through several different transfers between ships, be blended with a whole variety of other oils to change the documentation, and then be imported as another blend entirely.”

The shipper said the only way to enforce the sanctions so that no Russian oil could make its way to European ports would be the use of electronic documentation that could trace cargo back to its origin. “Until then, it will have no effect,” he said.

Thanasis Martinos, managing director of Eastern Mediterranean Maritime, said the company was eager to fill the gaps created from the shortage of Russian oil and that increasing uncertainty and instability was harmful to all businesses. The company also said: “EMM is fully respecting and complies with EU and USA regulations and sanctions. EMM wishes that the hostilities and the terrible consequences to human lives come to an end.'

In anticipation of the EU ban on the Russian tanker imports triggering a major increase in the demand for shipping to service much longer voyage lengths, posted 2 months ago that I'd increased my shipping sector investment level and weightings to 50%/50% - Dry Bulk/Product. Last week increased it further resulting in a 45%/55% weighting.

While most Russian crude oil that can be has been rerouted, most refined products (estimated at 750,000 bbls/day) is still to be rerouted prior to the Feb 3rd 2022 deadline.

What a difference a month makes.....the re-routing of oil product tankers from the political fall out of the Russia/Ukraine War is now having a major impact on charter rates, due to the huge increase in shipping capacity required to service the re-routing of Russian oil, on a sector that was already operating with a very tight supply/demand dynamic.

If Clarkson's estimate of a 9.5% increase in product tanker shipping demand for 2023 from the rerouting of Russian oil products and its knock on effect to existing trade routes is correct, that is equivalent to a shipping capacity shortfall of over 550 ships.

Long Range (LR2) Product Tanker Rates - (750,000 bbl capacity)
Middle East to Far East

$13,500/day - Jan Average
$27,500/day - Nov Average
$71,500/day - 1st Dec
$73,500/day - 8th Dec

Medium Range (MR) Product Tanker Rates - (500,000 bbl capacity)
US Gulf Coast to UK/Europe

$12,500/day - Jan Average
$33,500/day - Nov Average
$52,750/day - 1st Dec
$55,250/day - 8th Dec

[mount teide] 11/12/2022 10:45

O/T - With Product tanker charter rates up 53% since November 1st and now three times the average of the sector's oversupplied recessionary years between 2008 and 2021......Q4 has the potential to be the highest earning quarter(in nominal terms) in 15 years.

Q4/2022 - "You're going to need a bigger chart!"



Ps Bloomberg got the left axis of the chart wrong - it should read $Billions! Scorpio earned $490m in Q3/22

[thegreatgeraldo] 10/12/2022 13:55

unt Teide9 Dec '22 - 17:54 - 11799 of 11799
0 1 0
US Shale Oil Industry's costs have have rocketed over the last 18 months to the extent that many are barely turning a profit.

Eagle Ford, one of the biggest shale plays in the country has seen its breakeven surge 33% from $45.62/bbl to $60.54 in 18 months. While the Bakkan's break-even increased by 38% from $46.85/bbl to $64.48

....A large number of the shale plays are quite gassy... I've heard the gas price over there has ticked up a tad this year

[mount teide] 09/12/2022 17:54

US Shale Oil Industry's costs have have rocketed over the last 18 months to the extent that many are barely turning a profit.

Eagle Ford, one of the biggest shale plays in the country has seen its breakeven surge 33% from $45.62/bbl to $60.54 in 18 months. While the Bakkan's break-even increased by 38% from $46.85/bbl to $64.48

Biden wanted to refill th Strategic Reserve at under $70/bbl - with US produced crude - good luck with that !



Source: Enverus & J P Morgan

[the_gold_mine] 08/12/2022 20:15

Almost 4 months since Montara was shutdown to effect tank repairs, surely must be getting close to re-start time?

12th August: Montara shutdown for repairs after an additional internal defect is found in water ballast tank 4S, on top of the original defect in tank 2C.

12th September : NOPSEMA issue directive to Jadestone to provide weekly updates and require an independent reviewer to undertake a gap recognition review, with the report to be considered by NOPSEMA prior to the restart of production.

October: DNV nominated as independent reviewer to undertake gap recognition review

17th November : Defects in tank 2C and water ballast tank 4S reported as repaired. Baseline survey on the FPSO’s remaining tanks on-going.

I'm wondering if Santa has a present in store for Jadestone investors this Christmas or if we're going to be put on the naughty list...

[amaretto1] 08/12/2022 09:17

Apart from GS and gang who are predicting 100 plus oil ...But selling at the same time.

[amaretto1] 08/12/2022 09:16

Oil stocks all preparing for 50 /60 2023 OP estimate.

[amaretto1] 08/12/2022 09:14

U got Container utility data ? Drop in containers.... drop in useage of oil to produce goods ...Global slow down. Oil useage figures ? Just a side note ... with your constant ramping of oil tanker fleet utilisation.

[amaretto1] 08/12/2022 06:47

You are listening to the media too much ....Europe is still getting Russian oil and gas ...

[jacks13] 07/12/2022 17:01

There's a lot of discussion and obsession even around the spot price of crude, in particular the quoted Brent benchmark. But spot prices are not the whole story as this article from Energy Intelligence (link below) explains.

1. Refiners need meaningful price signals to quickly assess the value of a crude. Those signals come from the oil spot market where around 40 million barrels move around the world every day. To distil price clarity from the large variety of oils on offer and the large group of players, the market created benchmarks.

2. Benchmarks are critical in defining the spot value of crude, help determine the price for crude oil sold under term contracts, are the basis for hedging and risk management and attract lots of managed money to oil markets.

3. Over time, Brent in the North Sea evolved as the global benchmark — the oil price for all to see. Brent is “the price of oil.” It is the Brent price that allows other grades in various regions to determine their own value quickly, based on price relationships that different grades have established over time. In North America, West Texas Intermediate (WTI) is a benchmark. In the Middle East, Dubai and Oman are benchmarks. They all essentially trade at a differential to Brent.

4. The oil market is relatively young and still evolving; its spot pricing mechanism is even younger. The spot market for oil, which is at the basis of all price discovery, has only developed since the early 1980s. Supporting the development of the spot market was the rise of benchmark grades. As they provided the quick reference price level for similar crude oils, benchmarks helped a rise in market liquidity.

5. The spot market, which captures 40% of internationally traded crude oil, is essentially trading oil cargoes for immediate delivery. That way, the spot market allocates scarce or abundant supplies in an economically efficient manner. A key characteristic of the spot market is that it is pricing the marginal barrel of oil available. The last trade sets the price of oil. That way, the market reflects demand and supply.

6. The benchmark status of Brent and WTI is supported by their highly liquid electronic futures exchanges. Brent advanced as the global benchmark from 2010 after WTI price dislocations, due mainly to pipeline constraints.

7. It is the relationship between the physical and paper markets where price discovery takes place. In the interaction between the ICE Brent Futures contracts and the physical market in the North Sea, the world settles on “the price of oil.” In the end, oil prices are the result of supply and demand. To get there, all the players in the market have their say: producers, consumers, refiners, physical traders, banks, funds, and other types of investors that see oil as a tool to express their market expectations. Because of its strategic importance, crude oil has always had political overtones beyond its economic value.

It is the value of the refined products that ultimately determines the value of the crude oil that makes them. If a crude oil is good at making gasoline, and gasoline has a strong value that will make this crude oil attractive to buy and refine.

The basic concept is straightforward, but the actual process to assess the value of crude oil involves an intricate maze of steps and decisions. The consumer sends signals to refineries about what products are needed. A refinery then shops around and buys, at the best available price, the crude oil that can make the product. Sometimes that crude oil is at the other side of the world.

Refiners need meaningful price signals to quickly assess the value of a crude. Those signals come from the oil spot market where around 40 million barrels move around every day. To distil price clarity from the large variety of oils on offer and the large group of players, the market created benchmarks. They represent a reference level for crudes of roughly the same quality in the same location.

Over time, Brent in the North Sea evolved as the global benchmark - the oil price for all to see. Brent is “the price of oil.” It is the Brent price that allows other grades in various regions to determine their own value quickly, based on price relationships that different grades have established over time. In North America, West Texas Intermediate (WTI) is a benchmark and it still has a wide appeal beyond its region for the liquid futures contract market. In the Middle East, Dubai and Oman are benchmarks. They all essentially trade at a differential to Brent.

[the_gold_mine] 07/12/2022 16:31

Jeff: whilst psychologically I like to see oil over $100 in reality it will be easier for Jadestone to do cheap acquisitions at $80 oil - especially with all the recession bed-wetting going on.I only wished I had some dry powder available so I could invest more here and in my other O&G stocks which have been taking a beating recently.

[jeff114] 07/12/2022 15:41

They can easily return those 100 mio even with 13k production...as long as they don't do a extremely cheap acquisition the best they can do is buy shares back as fast as possible,.. I would sign for A 5 year 70-80 oil price with 10% a year buyback... would mean 5 to10 x shareprice... that's what the market doesn't get, we don't need $100 oil

[pughman] 07/12/2022 15:12

So Jeff, on that basis, you'd expect JSE to carry out the proposed $100m return to shareholders. I don't.

[jeff114] 07/12/2022 14:54

Even an end of the war won't make Europe buying back from Russia again... in the recent past only one attack on an oil installation or oil producing country would require a risk premium. Here we have the second largest oil producer at war and sanctioned and no effect on oil price ... it will in a couple of weeks or months... and even at current prices Jadestone is printing cash

[mount teide] 07/12/2022 14:19

So much for LNG being the cheap 'Green' future of ship propulsion!

Looks like its 2.5 to 4.5 fold higher cost than fuel oil in 2022 is taking its toll with just 8 new LNG powered ships ordered this month, and all of them were 'duel fuel', enabling a switch to fuel oil should the LNG cost becomes too prohibitive......which is likely to be most, if not all of the time over its 20-25 years commercial life!


$375/tonne - HSFO (peaked at $780/tonne in May )

$650/tonne - VLSFO (peaked at $1,149/tonne in June)

$1,595/tonne - LNG (peaked at $3,600/tonne in Aug)


The respective energy contents are assumed to be 40 MJ/kg for HSFO, 43 MJ/kg for VLSFO, and 45 MJ/kg for LNG

[fanshaw] 07/12/2022 13:49

iT's about time we had a update nearly 4 months down.

[amaretto1] 07/12/2022 11:57

i won't add in a global recession and less need for oil !

[amaretto1] 07/12/2022 11:56

And if Russia ceasefire or with draw .... Oil price ??Oil price will be a tool to reduce inflasion and combat interest rate rises .....Oil stocks ? All ready in retreat for this occasion. Oil price target 2023 remains 50 - 60

[mount teide] 06/12/2022 18:10

Back to the drawing board for Santos and NOPSEMA after Australia's Federal Court rejected on Friday an appeal by Santos, to resume drilling on its $3.6 billion Barossa gas project off northern Australia.

Suggesting investment risk securing the approvals and consents to develop new O&G offshore projects in Australia(and elsewhere across the West) continues to get ever more demanding, time consuming and costly.


Australia court rejects Santos bid to resume Barossa gas drilling - Dec 2022

Australia's Federal Court rejected on Friday an appeal by Santos Ltd STO.AX to resume drilling on its $3.6 billion Barossa gas project off northern Australia, dealing another setback to the company's biggest project.

Justice Debra Mortimer said the court ordered that the appeal be dismissed, following an expedited two-day hearing in November stemming from a challenge against the drilling approval brought by some traditional owners from the Tiwi Islands.

Santos had to suspend drilling on the project in the Timor Sea in September after a judge found that the environmental approval for its permit was invalid on the grounds the company had not properly consulted with some traditional owners about the project.

The court backed a challenge led by Tiwi Islander Dennis Tipakalippa, overturning approval by the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) for drilling on the Barossa project.'

NOPSEMA said its considering the implications of the federal court appeal decision in Santos NA Barossa Pty Ltd v Tipakalippa [2022] and how we can best advise industry with guidance on the relevant person consultation requirements in the Environment Regulations.

We are aware that the decision has implications for all environment plans either yet to be submitted, or under assessment, and Minister King has requested NOPSEMA provide clarification to industry on the requirements as outlined in the judgement. We will be engaging directly with industry and other stakeholders in the short term to provide interim guidance while formal guidance is being developed.

[sea7] 06/12/2022 11:04

at least we know that nopsema expect regular updates...



To submit a written report by close of business every Wednesday to NOPSEMA describing the progress of the Project, until the Project is complete.

all notices...

[croasdalelfc] 05/12/2022 09:31

Maersk Tacoma set off from Stag ~27/28 th Nov - now in Singapore .Probably $104-$110/b for 190k barrels ~$20/21m