Soco Share Discussion Threads

[jotoha2] 31/7/2018 18:46

Should bounce of 82p for a wee short term profit , ready steady ............

[emptyend] 31/7/2018 18:39

Hi tournesol,Fair points. The issue for me is whether any of these elements of "luck" are genuinely controllable. If you put the (linked) FPSO contract extension negotiations and compressor issues to one side, delays come with the territory. I'm not sure about the delay re the completion string, though.Operationally, the FPSO news is likely to be pivotal.

[robs12] 31/7/2018 17:32

LOL!! That sums it up nicely!

I still have a few SIA..and some AEX..to hold on in the vain hope something will happen after all these years.....or not??

Hindsight is a wonderful thing. If nothing else, I hope I have learned to now cut my losses and run much sooner than I used to.

[tournesol] 31/7/2018 16:53

Napoleon was once asked what qualities he looked for in his generals.

He famously replied that "he preferred generals who were lucky."

I find myself wondering how just unlucky Soco seems to be. Today's update reads like a series of unfortunate events that would daunt even the young heroes of Lemony Snicket's eponymous story.

Personally I do not like to be invested in companies which are unlucky. I am glad that I sold most of my small Soco holding a while back and annoyed with myself for keeping hold of a small slice. Question is should I finish the job and save my intellectual and financial resources for luckier subjects?

[emptyend] 31/7/2018 10:20

Completely agree there, YASRUB. Management will be held accountable for any lack of deals - which they were last year when they got very little of their largest bonus line item (and even that element was probably predicated on having got Kuwait Energy to the cusp of getting done).On that topic, by the way, I suspect there are still deals to be done for some of the KE assets.....but we'll see.

[yasrub] 31/7/2018 09:58

Not jumping for joy but the rig delays are not really controllable - it happens in this sector. Assuming oil price stays around this price range revenue will still be thrown off at a healthy rate. Management are not shying away from highlighting they are looking for deals and this is where I particularly have them accountable. Whilst I certainly do not want some half way house deal they have now had personnel in place for sometime to complete a compelling deal for stakeholders, back to my armchair always so much easier from there !

[robs12] 31/7/2018 09:42

I guess we could be positive and thankful that this year's production decrease is smaller relative to previous years, assuming that it remains within the new guidance at say the midpoint 7,800 boepd for the year.

That's only a 6% reduction in production - compared with:

2013-14 = 19% reduction
2014-15 = 12%
2015-16 = 17%
2016-17 = 16%
2017-2018 = 6%? (TBC!!).

And if they keep the dividend payments at the current level (assuming they produce enough to make the revenue) then the yield is quite nice to have.

[emptyend] 31/7/2018 09:32

I suspect that the delayed start-up of drilling from H1 might have a "double whammy" impact on production forecasts for the year. I'd imagine that the production set-up would have anticipated some maintenance opportunities at the time of the planned drilling, so perhaps they not only have a delay to the production increase but they also will be running sub-optimally for a longer period.I repeat that the key piece of news pending is the FPSO outcome. There may well be some quite significant changes to commercial terms, given the oil price fall since the original agreement but also the lower production - and the size of the carve-out for Talisman/Repsol (and the commercial terms thereof). Perhaps Repsol will be squeezed out entirely?

[robs12] 31/7/2018 09:08

"Revenue of $93mn in first 6 months - compared to $156mn for the whole of 2017."

Yes, pretty disappointing really given the average Brent oil price in 2017 was $54, vs $70 in 2018 so far.
All averaging of course, but effectively a 19% increase in annual revenue vs a 30% increase in the oil price.

Thankfully, the market didn't take the news as badly as I feared. Everyone's on hols!

[emptyend] 31/7/2018 08:56

Revenue of $93mn in first 6 months - compared to $156mn for the whole of 2017. $3 premium to Brent (which is also a helpful increase). Revenue for the second half should probably be a bit higher, given the production forecasts.The remediation work on the compressors and the extension terms for the FPSO are interdependent factors, as I established at the AGM. Also relevant is whether Repsol and partners will continue to take any capacity and on what basis. Plainly there will be material news on the FPSO (and these linked issues) within the next month - hopefully that will pave the way for increased production capacity............at which point they will need to do more development drilling in 2019 if they are to take advantage of it. Meantime, the delays to the 2018 aren't helpful - but at least having two rigs available may give more options to reorganise the programme.The FPSO news may be the most important news in H2 - unless they get a deal done (and of course there are no clues on that).

[impvesta] 31/7/2018 08:07

Unfortunately the yield is getting better and better at the moment!

[robs12] 31/7/2018 07:33

Oh dear....looks like all three trends are continuing..

reduced production
falling shareprice (bets on what it will get to today?)
continued lack of and delays in deal making.
Still thinking about what to do about the compressors...how long has this been being thought about now?

Not the best of news all in all....

[richalert] 28/7/2018 18:31

Thanks for stating the obvious Jotoha2. Any useful contribution?

[jotoha2] 28/7/2018 17:14

Sia has been a trading stock for the last two years , 20% here and there and it's quite nice , if you play with big lumps of say £30k , otherwise stay well clear . Long term holders have been rogered well and true!

[robs12] 26/7/2018 23:32

Indeed an interesting comparison. TLW clearly didn't impress today (based on share price reaction).

Comparing the two over the last year..or 2..or 3..:



Not sure if the link will work but it's the chart of TLW vs SIA from ADVFN. Just plug in whatever timescale etc you wish.

Soco need to pull a rabbit out of the hat and quickly...

[emptyend] 25/7/2018 08:08

Tullow results today make an interesting contrast with SOCO. They also have substantial and rapidly rising free cash flow - but are paying down debt instead of paying dividends ......and their derivative hedges are now a conspicuous drag on profits. The only attraction (other than having two projects nearing FIDs) relative to SOCO for now seems to be their plan to drill 3-4 frontier wells per year.....but that is only a positive IF they come up trumps (and even then they need to find the cash from somewhere to develop any finds).

[emptyend] 23/7/2018 12:40

FWIW, I think Vietnamese interests will build a stake. Reorganising the ownership of blocks held by directors may be a precursor to some activity of that sort?

[dunderheed] 23/7/2018 11:26

Yes or a merger of sorts? (To be subsumed within another entity and close sia HO?)

[eggbaconandbubble] 23/7/2018 11:23

Best they just put the whole show up for sale and everyone can move on.

[haideralifool] 23/7/2018 08:30

rich, that's not wholly true is it?

[richalert] 23/7/2018 08:30

Jumped the gun there. Not actually a disposal but some sort of manipulation in share ownership.

[richalert] 23/7/2018 08:26

Wow. Even de Souza disposing of shares.

[dunderheed] 23/7/2018 08:00

I agree totally.
I was of course joking about the 'dream team', Lol.