Serica Energy Share Discussion Threads

[smokieuk] 29/6/2019 11:06

The BBC only reported it, they didn't write it!

I posted the link as a sensible response to an earlier post, not to start a BREXIT or anti-BBC discussion, which are tediously appearing with too much regularity on many forums.

Anyway my apologies that it seems to have triggered one.

[bountyhunter] 29/6/2019 10:52

The BBC should be neutral given they are funded by the licence fee. The fact that they are clearly not is one reason why I resent being forced to pay their excessive licence fee just to watch any TV at all even non-BBC channels!
I wouldn't mind paying a small fee for radio and a public politically neutral news channel but that's all.

[robo175] 29/6/2019 10:51

Conservatives and Labour are corrupt through and through especially the Cons, time for a shift in UK politics.

[smokieuk] 29/6/2019 01:17

@14143 "Kind of funny that on one of the hottest days of the year the gas prise has gone up lol."

Could this have had an effect? "Brexit 'could leave UK short of energy'"

[fardels bear] 29/6/2019 00:15

That makes a change.

[captainfatcat] 28/6/2019 23:05

Some interesting posts over on the LSE SQZ chat bb

[captainfatcat] 28/6/2019 19:15

Kind of funny that on one of the hottest days of the year the gas prise has gone up lol.

[rivaldo] 28/6/2019 09:17

For the record, the Times says Hold:



"Serica Energy

Serica Energy appears to be reaping the benefit of its growing presence in the North Sea (Greig Cameron writes).

The London company was formed in 2004 and announced its plans to float on the junior Aim market in 2005. It bought a stake in the Erskine field from BP in 2014 when crude was trading at more than $100 a barrel. The additional field gave the company extra cashflow but the decline in the oil price caused its shares to drop sharply: they were changing hands for less than 3p by March 2015.

Serica continued to look for opportunities. An agreement in November 2017 to buy stakes in the Bruce, Keith and Rhum fields from BP was hailed as transformational because it would take production from 2,000 barrels of oil per day to 25,000. Serica paid little upfront in exchange for handing BP back some cash generated from the fields depending on how they perform. By the end of that month Serica shares were worth close to 67p. Regulatory hold-ups, complicated by part of the Rhum field being owned by the Iranian Oil Company and United States sanctions against Iran, meant it took until last November for the deal to be formally ratified. Results for 2018 showed a pre-tax profit of $59.2 million, compared with $10.8 million previously. Serica’s reserves, effectively how much it can extract from its current assets, rose from 3.1 million barrels to 69 million.

Serica gathered an experienced group of 140 BP staff who know how to run North Sea assets and has been adding people to a new operations base in Aberdeen. It is keen on further acquisitions with Mitch Flegg, chief executive, hopeful it can continue to structure transactions so it doesn’t have to tap shareholders for cash or take on debt. Serica’s Columbus gas field development has been approved by regulators and is due to start operating in 2021. A brief trading update before its annual meeting yesterday showed production in the first five months of 2019 was equivalent to 30,500 barrels of oil per day. That was up from 25,800 in 2018. With summer maintenance programmes to come, it forecasts an average for this year of between 26,000 and 30,700 barrels per day. The shares rose ¾p to 129¾p.

ADVICE Hold
WHY Early days for Serica in running a larger portfolio"

[farmscan] 27/6/2019 16:45

From the same re OFAC :"But we have to keep our eye on the ball and make sure that the structures put in place are
resilient in a complex world. We have a licence from the US Office of Foreign Assets Control,
known as OFAC, that enables us to maintain Rhum operations. As part of the process to
obtain the licence a robust and secure legal structure, which has removed any Iranian interest,
financial or decision making, from the Rhum field for the duration of US imposed sanctions on
Iran, has been put in place. The licence was granted for one year which expires at the end
of October so we are now in the process of submitting an application to renew. We do so at
a time when US/Iranian relations have deteriorated even further but, due to the ownership
structure which has been put in place, ensuring no Iranian involvement, either financially or
operationally in the Rhum field whilst US sanctions prevail, we believe that we continue to
meet OFAC requirements. Clearly there is always the unknown to contend with and sudden
changes in sentiment but we will be embarking on our application in the next couple of weeks
and are hopeful that we will obtain a licence renewal to enable these important UK assets to
continue producing for the ongoing benefit of the UK economy.

[farmscan] 27/6/2019 16:41

Paragraph from the chairman's statement: "Finally, I would like to thank our shareholders. We do read the bulletin boards and, whilst we
smile at some of the comments and are sometimes frustrated that we cannot respond, we do
see the level of support that comes through and it gives us a fillip when we get the occasional
dark day. Whilst we, the Board, focus on the assets and strategy, it does help if we know
that we have general shareholder support."

[farmscan] 27/6/2019 14:38

I think chestnuts said he was going, so we can look forward to his report.

[steelwatch] 27/6/2019 14:08

More opportunity:

"Looking at potential buyers for ExxonMobil’s Norwegian upstream portfolio, Neivan Boroujerdi, a principal analyst for Europe upstream at Wood Mackenzie, said the new wave of North Sea independents were likely to be the front runners"

[farmscan] 27/6/2019 12:59

Thanks Almsivi, I felt that was probably the case.

[rivaldo] 27/6/2019 12:58

Loving that cash generation. Happy to hold...and hold....

[almsivi] 27/6/2019 12:45

OFAC license largely a formality given that Serica has already demonstrated that the asset it seeks relief from sanctions enforcement falls within all of the relevant executive orders remit for excluded business. So long as nothing changes with regards to Serica / NIOC ownership & operatorship - it will be a copy and paste submission.

I did a massive amount of reading which gave me the confidence to double down on the OFAC outcome last year, more than happy to do the same and keep my money where my mouth is.

[overeager] 27/6/2019 11:40

Thanks Spandy,
I'm more than happy holding a stock generating $100m cash net pa that has a market cap of £350m (of which c£90m is cash) - i.e. a p/e of 2.5. I guess the market cap is just too small for most of the City to be interested..

[bountyhunter] 27/6/2019 11:34

Malcy's summary:

Serica Energy
An AGM statement from Serica today which is merely to inform that net production ytd is 30,500 boe/d and that guidance for the year is 26-30,700 boe/d. Cash of $112.3m and whilst realisations have inevitably fallen so have opex costs and the outlook for Serica is one of the best in the sector.

[bountyhunter] 27/6/2019 11:33

Malcy..

Serica Energy
An AGM statement from Serica today which is merely to inform that net production ytd is 30,500 boe/d and that guidance for the year is 26-30,700 boe/d. Cash of $112.3m and whilst realisations have inevitably fallen so have opex costs and the outlook for Serica is one of the best in the sector.

[farmscan] 27/6/2019 11:26

Well I suppose the OFAC licence (due for renewal in Oct)may cause some uncertainty again. Not sure whether the renewal is purely a formality.