Serica Energy Share Discussion Threads

[bountyhunter] 14/6/2019 13:47

I think that as Spandy said then if there is another deal (in 2019) which is anything like the BKR deal then we can expect £2+ by the end of this year. As all we have to go on is the BKR deal (which had the Iranian risk/uncertainty) where the price went from 27.625 -> 40 from suspension to relisting then rose rapidly, applying the same maths/logic we would go to (130.6 * 40)/27.625 = £1.89 on relisting following a similar deal (scaled up to fit the current market cap) with this quickly rising to £2+ soon after. Of course this assumes a similar deal to BKR which is quite an assumption but not beyond the capabilities of this company to pull off imho. If no further deal then the first 12 points in my above post should lead to £2 in any case at some point in 2020 imo.

[nigelpm] 14/6/2019 13:36

End of year predictions for me - feedback on whether you think I'm optimistic / pessimistic welcome :D

2019 - £1.85
2020 - £2.25
2021 - £2.60
2022 - £3.98

Usual caveats apply - current oil & gas prices, exchange rate, no new deals etc

I think you are too bullish.

I had in mind a fair value of £1.80-£2 - don't see why it should go much beyond that without further news.

[messer2] 14/6/2019 13:04

Here are my detailed modelled projections (based on averaging good and bad cases) alongside almsivi's projections:

almsiv Messer2
2019 - £1.85 - £1.63
2020 - £2.25 - £1.92
2021 - £2.60 - £1.99
2022 - £3.98 - £2.87

A target P/E of 5.5 was used.

Bit lower but in same direction. FYI, my 'good case' projection for 2022 is £3.66.
I think/hope I've covered everything aside from any possible acquisitions.

[captainfatcat] 14/6/2019 12:31

almsivi fingers crossed we will hit a few of those targets just a matter of time.

[spandy83] 14/6/2019 12:04

I love how specific your 2022 target of £3.98 is :-) didn't want to leap into £4 territory?I think they seem pretty reasonable but I wouldn't dare to guess beyond 2020 personally as so much can happen. This management team seem to have a back of exponential growth pursuit. More than doubling the value of their investment allows to them double again.If they're actively seeking deals that double their size right now and deliver one of those, we could break £2 this year IMO.

[almsivi] 14/6/2019 11:39

On the subject of price targets - I'm keen to hear where everyone thinks SQZ will go in the next few years, when you consider all that bh has helpfully listed.

End of year predictions for me - feedback on whether you think I'm optimistic / pessimistic welcome :D

2019 - £1.85
2020 - £2.25
2021 - £2.60
2022 - £3.98

Usual caveats apply - current oil & gas prices, exchange rate, no new deals etc

[rivaldo] 14/6/2019 11:09

Peel Hunt today reiterate their Buy and 177p target:

[bountyhunter] 14/6/2019 07:31

While it's quiet here I've updated my list of positives...


1) BKR production increase planned from around 24k boepd to ~30k yearly average

2) Lower opex cost reducing from $18/b

3) 2018 results only included one month of production from BKR and less than three months from Erskine

4) Serica will pay contingent cash consideration to BP, Total E&P and BHP calculated as a percentage (60% in 2018, 50% in 2019 and 40% in each of 2020 and 2021, nothing after that) of net cash flows resulting from the respective field interests acquired

5) Columbus development 2020 production 2021

6) R3 intervention should increase Rhum production significantly

7) BKR hub has capacity to handle increased production including from any nearby fields which may be developed by other companies which could increase revenues - BP did not pursue this opportunity for political reasons

8) Looking to extend life of BKR fields and so push back decommissioning as SQZ has lower overheads and is more focused on BKR than BP

9) Decommissioning costs - SQZ will pay 15% after taking into account HMRC's 50% contribution to the initial 30% liability

10) Erskine production restored, 3.2m barrels of oil originally forecast to be produced but 3m produced to date with new CPR indicating another 3m barrels still to be produced

11) Erskine still producing ~3.5k bopd

12) Cash balance as cash rich / debt free

13) Further accretive deals

[fardels bear] 14/6/2019 06:42

Ware is in Hertfordshire I believe, yes... If you are talking about trousers in the next bit do you not mean flairs? All this talk of tankers being fired at, flares is kinda different beast...

[upomega] 13/6/2019 20:28

For the life of me let the man Ware his cords so long as they are not flares.omho so dyor

[bountyhunter] 13/6/2019 19:24

Pompeo has just been on live TV blaming Iran for today's tanker attacks. Seems quite likely especially after Iranian news claimed one had been sunk earlier!

[sawney] 13/6/2019 13:10

Both still afloat..

[captainfatcat] 13/6/2019 11:44

Surprised the oil price has not reacted more strongly the potential impact is massive if it kicks off properly.

[bountyhunter] 13/6/2019 10:58

I think you have hit on the problem, too much salt in the soil for geraniums in Bute :)

[farmscan] 13/6/2019 09:34

Clearly demonstrating a lack of horticultural knowledge! Any gardener worth his salt knows geraniums are migratory.

[bountyhunter] 13/6/2019 08:34

It's early yet, keep looking :)

[fardels bear] 13/6/2019 08:31

I cannae see any geraniums in Bute this morning.. Lovely sunny start to the day.. ;)

[bountyhunter] 13/6/2019 08:30

Lol, yes better to ask here ;-)

[spangle93] 12/6/2019 22:53

don't ask Montidon for gardening tips until he shows you any qualifications - he's just a failed jeweler with good connections and corduroy trousers

[fardels bear] 12/6/2019 22:51

It's a cracker..