United Oil & Gas Share Discussion Threads

[swanvesta] 29/9/2020 10:17

Here's a comparison to the Merlon (El Fayum) acquisition that Pharos touted as 'transformational'. It was settled only a very few months before UOG's deal:

~6000 bopd
$10-11 opex
28.5MMbbl 2P reserves
Acquisition cost: $200m+

UOG got more than a third of that for $16m, at what looks like 4-5x the value.

[soulsauce] 29/9/2020 10:02

Cheers cpap ;-)

[the chairman elect] 29/9/2020 10:00

United Oil & Gas (UOG:LSE) Interim results comment – target price increased to 20.5p



Please find attached Optiva’s latest update note on United Oil & Gas, commenting on the Company’s interim results.



The first half of 2020 has been transformational for United. In spite of the twin headwinds of the current Covid-19 pandemic and a slump in global oil prices, the company is now a full-cycle oil and gas company with a diverse portfolio of production, near-term development projects and appraisal opportunities in Egypt, Italy and the UK. These assets are complemented by potentially high impact exploration plays in the UK and particularly Jamaica which could provide significant longer term growth opportunities.



The next twelve months promise further activity including the recommencement of development drilling operations and an upgrade to gas infrastructure on the ASH field in Egypt in addition to a potential exploration well on the same asset in 2021. United also expects to commission a new CPR on the Walton Morant licence in Jamaica covering at least 10 targets additional to the Colibri prospect in H2 2020. This has the potential to enhance considerably the prospectivity of the licence ahead of a drill decision and a parallel farm-out process. With events remaining on track and the provisional award of two exciting UK North Sea assets containing confirmed discoveries, we are increasing our valuation of United from 17.7p to 20.5p per share.

[swanvesta] 29/9/2020 09:31

Nothing is going to look transformational at average $26 oil. But if those per barrel cash costs are real, and capex is not too high, this is considerably more 'transformational' than the 'transformational deal' Pharos achieved. [Edit: Pharos's deal was indeed transformational, but in a wholly negative sense.]

[swanvesta] 29/9/2020 09:26

The revenue fits with 57% government take (net 43% to UOG), same as Pharos, after allowing for some production still in inventory:

1975 * 122 * $25.94 * 43% = $2.69m

The BP derivative will have given them a bit of a lift - $15 or so pb but it's only on 6609 bpm or about 220 bpd. Still it means they will be in profit on the BP deal going forward, which has been recognised on the balance sheet to the tune of $2.8m. Hence the significant paper profit.

Looking forward, at current (say $40, allowing for gas component) oil prices and projected 2300boepd production, we can expect annualised figures of:

Before hedging: 2300 * 365 * $40 * 43% = $14.4m
Hedge contribution: 220 * 365 * ($60-$40) * 43% = $0.7m
Cash opex: 2300 * 365 * $4.36 = $3.7m
Operating cashflow: approx $11m

Opex could be lower with increased production. G&A doesn't seem too wild, but there will be some capex to pay for. I'll leave you to plug in the DD&A, but notice they did replace 190% of barrels produced.

[soulsauce] 29/9/2020 09:22

No, nothing about what I have read is a transformational deal that we were promised. If the operator had not decided to reign in Capex we would have been on the wrong end of another deeply discounted placing.

[snickerdog] 29/9/2020 09:09

Surely you can give some credit for that and realise all on four months production and oil prices lower than $30? H2 going to be much better obviously. The derivative is an accounting element where it's annual face value is applied, that will move up or down with the oil price but as oil moves up that portion will be reflected on the balance sheet and less on the fair value of the derivative

[swanvesta] 29/9/2020 08:39

Re cash, they did pay $16m for Egypt?!

Looking at other Egyptian operations, govt take is more than 50% of revenue and you're expected to pay all costs. This is why Pharos have been hammered at low oil prices, though their opex is considerably higher and they have declining fields.

I believe the fiscal regime may have changed for newer operations though, as Egypt wanted to attract new investment.

[9tintin] 29/9/2020 08:38

Spangles

My point exactly.

Though you have put some more numbers to the equation.

It does look like operating is marginal at best, maybe the average price realised is low because of the crude spot price shenanigans earlier in the year.

Maybe that question will get asked at the Q & A

tintin

[9tintin] 29/9/2020 08:33

Soul

You beat me to it,,,,,,,,,,,"transformational" you're havin a laff.

It's just as well the opex is so low bearing in mind the net back on the product!!
UOG need economies of scale on production to make this work, need to drill a couple more successful wells.

Like a lot of companies in this part of the world (ME) it aint easy to make it work, SDX is another struggling and Circle Oil before that.

Still a profit is better than losing money!

A lot is riding on finding a JV partner for Jamaica - not sure how long the market will give Larkin to produce the rabbit out of the hat.

Meanwhile it's back to waiting and stagnating at 3p

tintin

[soulsauce] 29/9/2020 08:22

Cheers someuwin I put £ didn't I.

[spangle93] 29/9/2020 08:21

I'll wait for accountant gurus to comb through this, but as far as I can see, we actually made a small profit of £0.3MM on operations, which was far exceeded by £605k Admin, and we've only made a net profit because of the derivatives associated with the BP loan, which we certainly can't bank on next time.

The government take must be impressive.
Average price realised per BOE = 25.94 - 4.36 = $21.58
Average net production = 1975 boepd
4 months period = 122 days

Revenue should be $25.94 * 122 * 1975 = $6.25MM = £5MM
Net to UOG, Net of opex, revenue should be $5.2MM = £4.15MM

Revenue quoted = £2.4MM, i.e. less than half the amount based on their figures
Opex = £1.05MM
DD&A + inventories = £1.1MM
Net net is therefore £0.3MM in reality, not £4.1MM

Maybe someone can explain how we only made $0.3MM gain on operations when each Boe is net $21.58. It looks like the DD&A is as high as the opex.

If we make $0.3MM in 4 months, how many months does it take before we break even after the $16MM "transformational deal"

[someuwin] 29/9/2020 08:19

...Group Cash balance of $1.2m. (Which equates to GBP0.93m)

[soulsauce] 29/9/2020 08:12

And yet after a year of Rkh production, the 4m or so we raised and 4months production of our own we only had $1.2m left in cash. Transformational indeed 😏

[parob] 29/9/2020 08:12

Cenkos have increased their target price by 2p from 17.1p to 19.1p.hTTps://twitter.com/croasdale01/status/1310831058972291073?s=21

[bountyhunter] 29/9/2020 08:05

operating costs of just $4.36/b !

[dubjon] 29/9/2020 07:31

Interim financial statement rns out.
We are in profit!

[soulsauce] 28/9/2020 17:08

Cheers cpap.

[the chairman elect] 28/9/2020 16:25

Further to the below, the 9:30 call is for Analysts only, to be registered with Camarco ahead of time.



The company will be holding a call specifically for shareholders at 12:00 on Tuesday 29th September 2020. Please use the link below to pre-register.



Shareholder call pre-registration:

hxxps://event.loopup.com/SelfRegistration/registration.aspx?booking=nY5kU8ZvOmJbhDksRyRC5Y2ri2g1jVIYApW96HLHXyc=&b=2389e96d-457b-46a8-bebb-fec356d5b031

[soulsauce] 28/9/2020 15:16

How ya doing cpap? Why the change of name? You suddenly disappeared late August and like Dr.Who was reborn as The Chairman Elect. Nothing to do with the Rkh sale was it 🤔😄

[the chairman elect] 28/9/2020 15:15

Invitation to United Oil & Gas Interim Results Announcement



The management team of United Oil & Gas plc, the full cycle oil and gas company with assets across Egypt, UK, Italy and a high impact exploration licence in Jamaica, is pleased to invite you to its Interim Results presentation and Q&A for the six months ended 30 June 2020, on Tuesday 29th September 2020.



Details:



Date: Tuesday 29th September 2020

Time: 09:30 – 10:30 am



Dial in number(s)



UK Toll Free: 0808 109 0701

Ireland Local Dublin: [phone]
Ireland Toll Free: 1 800 932 993
Standard International Access: [phone]

Conference PIN

3110934#





If you would like to attend or for more information, please contact Emily Hall, [e-mail].

[the chairman elect] 28/9/2020 15:10

Now that is what I call a proper MUMMY!

[soulsauce] 25/9/2020 11:43

They're all on LSE 9tintin, all hoping we are going to have blockbusting interims :-/

[9tintin] 25/9/2020 09:46

Bearing in mind that the interims are just around the corner (last year late September) - it seems very quiet on here and trading seems under 'lockdown' - LOL

Where have all the rampers gone ?

tintin