< "> edit this post http://www.investegate.co.uk/afren-plc-%28afr%29/rns/trading-statement-and-operations-update/201301210700069619
http://www.investegate.co.uk/afren-plc--afr-/rns/2012-full-year-results/201303250700107200A/

In an attempt to cut down the header page,i've transferred some of the older news to Page1 post No.3.

http://www.oil-price.net/index.php?lang=en
http://www.ft.com/home/uk

http://www.investegate.co.uk/Article.aspx?id=201111020700081674R
http://www.investegate.co.uk/Article.aspx?id=201111150700250723S
http://www.investegate.co.uk/Article.aspx?id=201112010705051251T
http://www.investegate.co.uk/Article.aspx?id=201201170700146472V
http://www.investegate.co.uk/Article.aspx?id=201201230701479690V
http://www.moneyam.com/action/news/showArticle?id=4323758
http://www.investegate.co.uk/Article.aspx?id=201204170700164488B
http://www.investegate.co.uk/Article.aspx?id=201205140700212304D
http://www.investegate.co.uk/Article.aspx?id=201205210700407032D
http://www.moneyam.com/action/news/showArticle?id=4430164
http://www.investegate.co.uk/afren-plc-%28afr%29/rns/significant-new-seychelles-3d-seismic-programme/201212120700052973T/
http://www.investegate.co.uk/afren-plc--afr-/rns/2013-half-yearly-results/201308230700063334M/
http://www.investegate.co.uk/afren-plc--afr-/rns/ogo-drilling-and-resources-update/201311190700083404T/
http://www.investegate.co.uk/afren-plc--afr-/rns/trading-statement-and-operations-update/201401280700096280Y/
http://www.investegate.co.uk/afren-plc--afr-/rns/interim-management-statement/201405200700135209H/
http://www.investegate.co.uk/afren-plc--afr-/rns/interim-management-statement/201410300700116483V/
http://www.moneyam.com/action/news/showArticle?id=4942625
http://www.moneyam.com/action/news/showArticle?id=4943375

Looks a buy at 14p Cyril.gl.

I bought it many years ago around that price (on a Spread bet) ,but i think it most unlikely.I would consider a spread bet if it reached such levels,but it's a long time since i traded in this way.They altered the rules,something to do with the risk,so i've never bothered since.
Any input on S/B would be more than welcome,as i'm a little wary of such transactions nowadays.

http://www.aljazeera.com/programmes/insidestory/2014/12/what-driving-oil-prices-down-20141212191627605113.html

Some of the points which i found interesting,

Some of hedge funds are closing their positions.
The 7.2% of growth (if true)means that in less than 10 years demand will Double.
A figure of 70/7.2= 9.72 years or 10% would be, 70/10 = 7.

The point of supply against demand being the issue seems be the most criticle and will
decide the future?

Mention of AFREN in the Sunday Times

Sunday Times -

hxxp://www.thesundaytimes.co.uk/sto/business/Industry/article1495615.ece

THE plunging oil price has unleashed chaos on the London market, with some listed oil explorers trading for less than their cash reserves and others eyeing takeovers at levels that were unthinkable just a few months ago.

Since hitting nearly $115 a barrel this summer, the price of oil has plummeted 45%. Brent crude closed on Friday at $61.5.

The fall is likely to lead to a flurry of collapses and long-coveted deals amid predictions that the swoon will continue into 2016 and could see the oil price dip to $50 or even lower.

Spain’s Repsol, for example, is closing in on a bid for Talisman, which is listed in Canada and has operations in the North Sea.

The companies held talks in July but called them off because they couldn’t agree on price. After that, Talisman’s share price collapsed by two-thirds before jumping this week on hopes of a new deal. It is thought that Repsol is looking to take out the company for as little as C$6 (£3.30) a share, or C$6bn — less than half its value a year ago.

Anthony Lobo, head of oil and gas at KPMG, predicted that many of the industry’s small and medium-sized players could be gobbled up, especially in all-share deals.

The share prices of industry heavyweights such as BP and Shell have fallen far less dramatically than those of their small rivals.

Lobo said: “Their shares now hold much greater value as takeover currency. We are going to see a lot of corporate activity. The majors are geared up for it.”

The pain for some is extreme. Shares in Ophir Energy, the London-listed explorer, have plunged by two-thirds this year. On Friday the company’s market value was £700m, which is less than the $1.5bn in cash it had on its balance sheet in June.

The plunge has thrown into doubt its takeover of rival Salamander Energy because the companies’ share prices have begun to diverge widely from the intended swap ratio.

Tullow Oil is also seen as one of the most vulnerable to an opportunistic offer. Its portfolio of big fields in Africa has long been coveted by larger rivals but its share price was seen as prohibitively high. From a high of £15.66 three years ago, it closed on Friday at £3.67.

Another big faller has been Afren. Its share price has dropped 80% this year to 35p. The Nigerian producer’s stock was first laid low after it uncovered a big unauthorised payments scheme engineered by its chief executive and other directors.

Its problems have been exacerbated by concerns over its $1.2bn debt pile. It is thought that at least two suitors are circling the company at present.

Providence Resources, meanwhile, is close to signing a deal with Sequa Petroleum to fund the development of its Barryroe reservoir in the Celtic Sea.

Providence, 15% owned by beleaguered tycoon Sir Anthony O’Reilly, is running out of time. It took out $24m in loans from Melody Business Finance, a New York hedge fund, and it must repay the money in June

From the Telegraph regards
Oil price crash means £55bn of projects face axe
32 developments and 5bn barrels affected with North Sea oil plans in doubt


By Andrew Critchlow

8:40PM GMT 13 Dec 2014

Dozens of new oil projects in the North Sea and Europe could be shelved as falling prices force international oil companies to tear up their investment plans.

Global energy consultancy Wood Mackenzie has said that 32 potential European oil field developments containing 4.9bn barrels of oil equivalent are waiting for approval on more than $87bn (£55bn) of funding. These could be at risk should oil prices fall below $60 per barrel.

“Major projects and investment in the UK and across Continental and Mediterranean Europe could be at risk if prices stay below $80 per barrel, as over 70pc of the pre-FID [final investment decision] reserves in each region have a break-even [price] in excess of $60 per barrel,” James Webb, lead analyst for Continental and Mediterranean Europe upstream research at Wood Mackenzie, told The Sunday Telegraph.

“Whereas in Norway almost 80pc of reserves require an oil price of less than $60 per barrel to break even,” he said.

Norway’s output is expected to increase by 50,000 barrels per day (bpd) to average almost 1.9m bpd in 2014, despite the recent slump in prices.
Related Articles

Major international oil companies such as BP, Chevron and ConocoPhillips are already reviewing capital expenditure levels in the wake of a rout in global crude markets, which has wiped 45pc off the price of a barrel of Brent since June.

The benchmark closed out the week at just above $62 per barrel, close to a new five-and-a-half-year low, after the International Energy Agency slashed its forecast for demand growth next year by 230,000 barrels to 93.3m bpd.

A sharp cutback in spending on new projects by oil majors could also threaten thousands of jobs in the UK’s oil and gas sector offshore and hit hubs such as Aberdeen and Montrose, which serve the North Sea, hard.

BP warned of thousands of potential redundancies last week, as it informed investors of $1bn of cuts it plans to make to adjust its business to the new lower price environment.

“The downward trend in oil prices is a growing source of concern for operators across Europe,” said Mr Webb.

A sharp pull-back in investment is a concern for the North Sea, where the challenging offshore operating environment, high levels of taxation and dwindling reserves have made Britain’s hydrocarbons heartland increasingly uncompetitive when compared with regions opening up elsewhere in the world.

A recent study by industry body Oil & Gas UK suggested that £1 trillion of investment may be required in order to extract all of the remaining 30bn of oil reserves left in the UK Continental Shelf. Oil & Gas UK has also said it was aware of 150 projects offshore in British waters that are seeking investment and final sanction by operators.

These schemes could now be seriously threatened if oil prices continue to trade at the current levels, or fall even further, which some analysts predict.

Pressure is also expected to build on George Osborne to provide more tax relief for drillers in addition to the measure introduced in the Autumn Statement, when it was announced that the charge on profits for oil companies working in the UK Continental Shelf would fall 2pc to 30pc.

North Sea output was expected to recover in the fourth quarter after the start-up of Nexen’s Golden Eagle Area Development, which will pump 70,000 bpd of crude. However, total full-year output for the entire North Sea is expected to decline to 840,000 bpd, its lowest since 1977.

However, some analysts argue that a slowdown in global supply and spending on developing new oil reserves is what is required to rebalance the market. Abdullah bin Hamad al-Attiyah, a former president of the Organisation of Petroleum Exporting Countries (Opec), told The Telegraph last week that 2m bpd of crude need to be removed from circulation in order to restore an equilibrium between supply and demand.

Mr al-Attiyah said the cartel, which controls about a third of world supply, should sit down with other producers outside the group such as Russia, Mexico and Norway to share the burden of trimming output.

The 1.2 billion of debt is a huge worry / problem

worth reading ST Biz section today ......
long articles on both QPP and vulnerability of small and med sized E+P companies, witrh particular mention of both TLW and AFR

From Mr Poshman on another board.

Afren
The breakeven points I've calculated below. Shows cash breakeven and income statement breakeven.

Price of oil 60.00 70.00 80.00 90.00 100.00
Operating costs 14.00 14.00 14.00 14.00 14.00
Royalty 10.80 12.60 14.40 16.20 18.00
Financing 5.81 5.81 5.81 5.81 5.81
Other direct cost 3.00 3.00 3.00 3.00 3.00
Admin 3.32 3.32 3.32 3.32 3.32
PPT 1.13 2.62 4.11 5.60 7.09
Total cash costs 38.06 41.35 44.64 47.93 51.22
DD&A 26.00 26.00 26.00 26.00 26.00
I/S breakeven 64.06 67.35 70.64 73.93 77.22
Cash profit / bbl 21.94 28.65 35.36 42.07 48.78
Profit / bbl (4.06) 2.65 9.36 16.07 22.78

Costs calculated on production of 33k bopd, admin costs of $40m / year, financing costs of $70m / year, royalty at 18%. PPT I calculated on Okoro and OML26 production but spread across all production to get a cost / bbl for 2015. The netbacks at $100 are similar to those shown in the HY presentation so I'm happy enough that I'm fairly close on these numbers.

So at $60 / bbl Afren will be losing money on their net production, but on a cash basis will still be generating significant cashflow after financing costs are paid for.

I'm expecting a revised capex budget for 2015 to be somewhere in the region of $300m (which will be paid for from production once hedging is taken into account). It may be a bit higher than that if they plan to take on more debt (and already signalled that with the Okwok facility, or they could use the facility and stockpile the rest in cash). Should be looking to defer any payments on the Ebok facility also.

A revised capex budget of $300m will still cover most of the Ebok development increases you would expect.

cp1 good point would make me think twice about investing.

NAV of $1.981bn and making a profit.

hTtp://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11292837/Opec-willing-to-push-oil-price-to-40-says-Gulf-oil-minister.html

Nice pull back this am,+8%.

NEW YORK (MarketWatch)—The Libyan National Oil Company said on Sunday that the oil ports of As Sidra and Ras Lanuf have stopped operating because of fighting, according to media reports.

Militias from the city of Misurata attempted to seize control of oil facilities in the country’s east, and the ensuing conflict involved airstrikes by Libyan Air Force.

Libya declared force majeure on both ports, which protects them against claims from oil buyers for losses from the disruption. The latest skirmishes and closure of the oil terminals, which account for about 300,000 barrels of oil exports daily, are likely to add to further volatility in oil prices.

Nigerian oil workers go on strike
fuel being sold on the black market during a previous strike Fuel was sold on the black market during a previous strike

Nigeria's two main oil workers' unions have begun a nationwide strike, threatening to hurt the output of Africa's largest oil producer.

The unions, Pengassan and Nupeng, said the strike would continue until the government addressed its concerns.

These include the adoption of the delayed Petroleum Industry Bill, aimed at overhauling the sector and maintenance work on oil refineries.

The unions frequently go on strike or threaten to strike.

"We've commenced the strike. It will affect oil production, since all operations are on strike," Pengassan chief Babatunde Oke told Reuters.

However, an oil executive said the strike was not expected to affect output, because it would require the co-operation of large numbers of workers at production sites who would be unwilling to go that far.

"It's very difficult to shut them down, and once they do, it would take them a week to get them back up. They never do it. That's the last thing anyone wants," an oil executive told Reuters.

The BBC's Will Ross in Lagos said most of the unions' demands seemed "unrealistic, especially with an election looming".

"The refineries are not suddenly going to be fixed because of this strike. Some oil industry watchers suggest the unions are simply trying to force the government to pay them off and get a hefty Christmas present," he added.

A strike in September had little impact on oil production.

However, our correspondent says that if the strike continues for more than two days, it will mean people having to spend hours queuing at fuel stations and buying fuel for an inflated price on the black market.
http://www.bbc.co.uk/news/business-30479898

Standard Life increase their holding to over 8%.
Now holding over 90m shares.

Yes i noticed that,8.127% in total,getting very te,pting now.

Yes i noticed that,8.127% in total,getting very tempting now.

Dropping like a stone at present?

15:05:20 33.77 6,293 AT 33.77 33.86 Sell 3,624,783 3,190,01

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I expect 30p this week.