Serica Energy Share Discussion Threads

[farmscan] 13/2/2024 10:24

No don't bother, I'd forgotten to include the Tailwind debt.

[farmscan] 13/2/2024 10:22

Out of interest, could you show your workings on how you come up with the figure of $21.5/bbl? TIA

[oilinvestoral] 13/2/2024 09:57

With regards to my post # 5656 . While we on the subject of acquisition acumen by management teams. JSE has just been suspended as they are one of the final bidders for Woodside's assets. We don't know the final details but based on press speculation it looks like being priced at a $6.7 / bbl 2P reserves valuation Vs the master stroke of tailwind form PE ($21.5 / bbl)! Also comes with double Tailwinds 2022 production.

[oilinvestoral] 10/2/2024 16:33

MarioPeter isn't suggesting anything! Has hit the nail square on the head! His post 4283 from over a year ago demonstrates to anyone with a basic reading & comprehension level that Mercuria invested the square root of zilch into Tailwind from their own money, they loaded it with debt and harvested egregious amounts of dividends from any cash flow that was generated! The 60 odd million they received from Serica in cash was multiples of any cash they personally invested ! The accounts confirm this! As for the shares they received for free at at slightly below 280p, I certainly wouldn't refer to those as "bought a chunk"! They are known in the industry as "a free kicker"! They are literally laughing all the way to the bank !!!

[steelwatch] 10/2/2024 13:00

Bruce infill well:

[nigelpm] 09/2/2024 20:41

Hopefully Labour will continue to U-turn up to the Election -

[nigelpm] 09/2/2024 20:06

Yes Stemis - that was one of Mitch's real drivers for the Tailwind deal - diversification away from gas and indeed since then the gas price has tanked and oil is barely moved.

The real mistake of Serica mgmt was not hedging the gas price significantly more than they did at some of the loopy prices - clearly they wouldn't have got away with hedging at the very elevated levels but 125-150/therm would have been sensible - as ever though Hindsight is a wonderful thing.

[stemis] 09/2/2024 19:44

Oilinvestor

While I disagree with Mario in some aspects, on an EV per barrel basis nobody rational can deny that Tailwind is one of the most expensive acquisitions in North Sea history (objectively speaking).

But that's not what we were discussing. Mariopeter was trying to dress the KIST 'offer' for SQZ as a missed opportunity. The reality is that it would have been no better than the Tailwind acquisition (which he thinks was an awful deal, so ergo...).

KIST shareholders, of which I presume he is one, have seen the value of their shares crumble more than SQZ's since then.

The reason that KIST has relatively underperformed is because they had a more geared balance sheet when gas prices started to fall and didn’t have the cash protection. They were also heavily exposed to gas prices (sig more than SQZ).

Perhaps KIST should have been diversifying away from gas then...

[nigelpm] 09/2/2024 19:23

You seem to be suggesting mario that Mercuria are great at adding value for themselves - given they bought a chunk of SQZ effectively at £2.80 one might argue they have been pretty poor actually don't you think?

[mariopeter] 09/2/2024 19:01

Looks like you and I both know the private equity beast OilinvestorAl. Horrible greedy people and they bagged half a billion from no outlay and probably upset a large number of people along the way.

Good weekend to you and thanks for your note.

[oilinvestoral] 09/2/2024 17:59

Just read your 4283 post MarioPeterWell done on your foresight! You broke down (using facts figures & numbers) why no oil company should ever do a deal with private equity who mismanage and leverage to the gills! Best of all you analysed it when the pugnacious happy clapper was telling everyman and his dog that Tailwind was an amazing deal ! Credit where credit is due ! Well done ! Zero hindsight involved (clap)!Some people shouldn't do their own research! They should read research from people like your good self who clearly know what they are talking about! Have a nice weekend sir!

[mariopeter] 09/2/2024 17:37

Nothing retro about post 4283 on this board.

[nigelpm] 09/2/2024 16:12

Masters of hindsight and capable of telling future returns = your average ADVFN poster.

[ashkv] 09/2/2024 16:09

Mariopeter agreed!!!

Lets compare SQZ vs KIST in one year.

Mitch Flegg inflicted a Waterloo on himself with Tailwind!!!

Sad - comes across as a personable individual but something was amiss with him / advisors evaluation of Tailwind Deal.

And Tailwind is so unforgiveable given Windfall Tax 2 was already in place and Labour coming to power ever so likely given Cabbage's wrecking ball to the Tory party!!!1

[ashkv] 09/2/2024 16:06

Ceteris Paribus the below should compensate for increased Capex and allow for a juicy dividend ($80 plus Brent contingent).

An additional USD 70mn cash flow from Tailwind Assets in 2024

SQZ PR has been very active on this board.

H1 2023 Tailwind had hedged 11,000 bopd at $58

From Interim Results ->

Oil - fixed pricing under oil sales agreements (equivalent to oil price swaps): for the 2H 2023 period approximately 11,000 barrels per day at an average price of US$61 per barrel, for the 1H 2024 period approximately 5,000 barrels per day at an average price of US$70 per barrel, and for the 2H 2024 period approximately 2,700 barrels per day at an average price of US$80 per barrel.

[mariopeter] 09/2/2024 15:47

Stemis

If you want to compare both managements by a chart you should probably include Rockrose Energy on the chart before the KIST management sold that Company.

Bit irrelevant now as SQZ management changing but for me to invest here v KIST I would want to see a proactive Mercuria with some good deals cause they got hard earned SQZ stock for fairly dull E and P assets and a large deferred tax asset. So far it looks like Mercuria will not be the dynamic partner that Flegg thought they would be and in fact I would guess the reverse as I note SQZ is for now confined to organic growth.

Flegg would not listen and why he was so aggressive to Andrew Austin and KIST can only be put down to someone like a child who could potentially have his toy taken away. The pram was rocking very wildly anyway. Mercuria have sorted him out though which could in fact be a very good thing.

Watching.

[oilinvestoral] 09/2/2024 12:55

Pugnacious Mendacious: " It tells me most private investors are terrible with numbers."---------Me thinks someone is projecting much ! Lmao

[oilinvestoral] 09/2/2024 12:26

The point is Mario that you are lauding KIST as "good acquision business men" and the Tailwind deal as "very poor"----Stemis While I disagree with Mario in some aspects, on an EV per barrel basis nobody rational can deny that Tailwind is one of the most expensive acquisitions in North Sea history (objectively speaking).The reason that KIST has relatively underperformed is because they had a more geared balance sheet when gas prices started to fall and didn't have the cash protection. They were also heavily exposed to gas prices (sig more than SQZ).That is all going to change with their development assets in Norway !

[dcarn] 09/2/2024 12:02

Additionally, the Company has entered into a drilling contract with Serica Energy (UK) to utilize the Ocean Patriot for two plug and abandonment (P&A) wells in the U.K. North Sea. The program is estimated to commence in March 2024 and to continue for approx. 60 days. The contract represents over $10 million of additional backlog, excluding mobilization.

[stemis] 09/2/2024 11:38

The point is Mario that you are lauding KIST as "good acquision business men" and the Tailwind deal as "very poor" and yet SQZ shares have relatively outperformed those of KIST.

[nigelpm] 09/2/2024 11:33

No - you're missing the point Mario - things are totally different in the E&P world and particularly North Sea since 25.7.22.

[mariopeter] 09/2/2024 11:11

Cant do an overlay of combined KIST and SQZ cause that was the real deal. Think you are missing the point.

[stemis] 09/2/2024 11:04

Mariopeter,

Try doing an overlay of KIST's share price on that of SQZ's since 25.7.22