< "> 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

a truism ..... good deals get done quickly, but i suppose some may take comfort that talks are still ongoing

I wouldn't like to speculate ,either way iv'e done some serious dosh here ,not happy.

Surely it depends on who the deal is good for. Since Seplat have the upper hand here there just might be a crumb of comfort for the people about to be screwed, that's me but..... where there's life there's hope!

What ever happens it'll be after hours and not be able to do anything till monday morning, which will be too late.,.

you know my views so i won't repeat

if i wanted to gamble, i'ld probably go long at this point as there's likely to be a turn
to be made between now and mid feb

Should be more news today concerning the debt repayment. If that is sorted then SEPLAT might be a little more interested?
["As previously announced, Afren has initiated negotiations with the lenders of the US$300m Ebok debt facility with a view to obtaining a deferral of the US$50m amortisation payment due on 31 January 2015"]

'Following the receipt of a request from Seplat, THE BOARD OF THE COMPANY HAS RECEIVED THE CONSENT OF the UK Takeover Panel (the "Panel") for an extension to the Deadline until 5.00 p.m. on 13 February 2015 to enable the parties to CONTINUE their ongoing discussions. By this time Seplat must either announce a firm intention to make an offer for Afren or announce that it does not intend to make an offer for Afren, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This new deadline can be extended with the consent of the Panel in accordance with Rule 2.6(c) of the Code.'

Already been posted cyril! Keep up!!! ;o)

1 all, lol

"Further to its previous announcements, Afren has obtained from the lenders of the US$300m Ebok debt facility a deferral of the US$50m amortisation payment due on 31 January 2015 until 27 February 2015.

In addition, the Board has decided to utilise a 30 day grace period under its 2016 bonds with respect to US$15m of interest due on 1 February 2015 while the review of the capital structure and funding alternatives is completed.

The Company is continuing discussions with the advisers to the ad hoc committee of its largest bond holders regarding the immediate liquidity and funding needs of the business. The Company is also having discussions with its existing stakeholders and new third party investors regarding recapitalising the Company."

I think a rise to 10p might be in order.......as I think they might pull a Gloria Gaynor here !...

that is why i mentioned that a turn might be made by the brave gamblers ..... buy; set a sensible target; sell

RF

I didn't know you was a cockney

I'm not...well...I admit I couldn't resist another portion this afternoon....might make a decent profit because somehow I think they are going to pull this debacle around or...just the rumour of them raising the necessaries can send the sp in % terms way higher....

don't disagree RF, though one needs quite a chunk of shares to make a worthwhile profit ...... could be plenty of fun to be had here next week, but stay awake

http://www.cnbc.com/id/102382559


Crude settles up 8% at $48.24, best day since June 2012

NEW YORK Fri Jan 30, 2015 4:28pm EST

http://www.reuters.com/article/2015/01/30/us-markets-oil-idUSKBN0L305Q20150130

(Reuters) - Oil prices roared back from six-year lows on Friday, rocketing more than 8 percent as a record weekly decline in U.S. oil drilling fueled a frenzy of short-covering.

In a rally that may spur speculation that a seven-month price collapse has ended, global benchmark Brent crude shot up to more than $53 per barrel, its highest in more than three weeks in its biggest one-day gain since 2009.

http://m.fool.com/investing/general/2015/01/31/opec-sees-oil-prices-exploding-to-200-a-barrel

Sunday Times article
mment (0)
Print

The drop in oil prices has burnt investors The drop in oil prices has burnt investors

Kevin Broger had quite a yarn to tell. The Canadian geologist was involved in Brazil’s oil boom in the early 2000s, when explorers discovered vast quantities of the black stuff trapped 20,000ft beneath the sea floor. Namibia, he reckoned, could be next.

Before the Pangea landmass broke apart 200m years ago, Brazil and the arid southern African nation were neighbours, and their present-day geology is strikingly similar.

Based on that logic, Chariot Oil & Gas, the company Broger ran, claimed its exploration blocks across the Atlantic also “may hold significant hydrocarbon accumulations”.

It was not an iron-clad investment proposition, but punters piled in regardless. When Chariot floated in May 2008, it raised £45m to drill some wells and find out. The company was worth £184m.

Chariot has been a disaster. Broger left a year after the listing. The company raised another £129m in three subsequent fundraisings, pulled off a couple of strategic pivots and went through two more chief executives. For all its efforts it has nothing to show but dry holes and hope.

On Friday its shares closed at 7½ p, or 94% below the offer price. Late last year it relinquished rights to a pair of its Namibian licences.

Chariot is not alone. The collapse of the oil price from $114 a barrel in the summer to nearer $47 last week has thrown it, and the rest of the UK’s 120 or so listed explorers, into a life-or-death crisis.

Since 2008 — the last time the price of crude plummeted — the explorers and producers below the big three of BP, Shell and BG have raised $24.8bn (£16.5bn) through 347 stock market floats and follow-on offerings, according to figures compiled by Dealogic.

That mountain of cash underlined the primacy of the City of London as the place to go for prospectors in need of funding, legal advice and everything else that goes into hunting for oil in the modern world. The money was used to fund campaigns from the North Sea to east Africa, in the iceberg-strewn waters of Greenland and on the pampas of Argentina.

The returns, with a few glaring exceptions, have been abysmal. The oil and gas index for AIM, the junior market where most explorers are traded, has dropped 60% over five years. The FTSE 350 oil index, comprised of the largest groups, has fallen 8% in the same period.

Dividends have been almost non-existent. Cairn Energy’s £2.2bn special dividend in 2012 after its blockbuster find in India is a notable exception. Only eight other listed explorers have made payouts since 2008: they were “vanishingly small”, totalling just £1.3bn, according to Justin Cooper of Capita Asset Services.

Nearly half the listed explorers (55) do not even have oil reserves on their books. In other words, they don’t produce oil, nor do they plan to. They simply exist on the hope that, at some point, they will be able to drill a well and find some. But that requires money.

In a new world of rock-bottom crude prices, investors have little interest in throwing good money after bad. A whole swathe of the sector, which makes up 13% of the entire London market, faces going bust or simply being starved to death over the longer term.

One City fund manager said he was pulling out of the sector entirely. “There has been an incredible run of bad drilling results. This is a complicated business. A lot more complicated than I thought,” he said.

The crunch will force fundamental and painful changes through every layer of the exploration industry, including in the City. Philip Lambert, head of Lambert Energy Advisory, said: “Oil courses through the veins of London, and will continue to do so. But given the amount of money raised, and the returns that have been generated, the UK [oil exploration] sector will now have to positively reinvent itself.”

The question is: which companies are going to be claimed by the chaos?

A GOOD WAY to hunt for the vulnerable is to analyse “liquidity”, or how much cash a company has to pay its bills.

Afren is an extreme case. Last summer the Nigerian producer was worth £1.4bn and generating boatloads of cash from its reservoirs in Africa’s biggest country. Then it all began to unravel. Its chief executive was fired over a pay scandal. The company wrote down to zero its biggest acquisition, a $588m field in Kurdistan. And the oil price cratered.

The biggest bombshell came this month when its stand-in chief executive warned that despite having $235m in cash, Afren may not able to make a $50m loan payment and may need to raise money “in excess of the current market capitalisation”. On Friday, shares in the company, which is in rescue takeover talks with rival Seplat, were priced at 5.3p, valuing it at £59m.

On the face of it, the crunch made no sense. Balance sheets, however, can be deceiving. To obtain government approval for developments, companies are usually required to commit to drilling a minimum number of wells or hitting project milestones by a certain time.

In an industry where costs have soared — one deep-water well can cost $100m or more — a single commitment can mean that most or all of a developer’s money is spoken for, even if it has not been spent yet.

Bonds and loans, meanwhile, are based on an assumed oil price, revisited on a half-yearly or annual basis. When the crude price falls far and fast, it does two things. It hollows out turnover and can also make companies breach their loan agreements.

That is how solvent companies can suddenly find themselves in crisis, not unlike homeowners forced to remortgage after a 50% cut in both their salary and the value of their house.

A rival executive said: “The Afren statement was when the penny dropped for a lot of investors. Liquidity crises can come on incredibly quickly.”

To make matters worse, few companies have built up goodwill with their investors. The industry is notorious for wildly overpaying their executives. So now, when they are most in need, investors have little inclination to bail them out.

Another company that traders have zeroed in on is Gulf Keystone, a former high-flyer whose shares have also dived.

The company generates a fair amount of cash, producing 40,000 barrels a day from its fields in Kurdistan, northern Iraq. But it is lumbered with a huge debt pile, dwindling cash and a $54m annual interest bill.

In April, Gulf Keystone must pay half of that — $27m. As of last year, its cash pile had fallen to $90m. It had committed to spending $159m this year to develop a new field, Akri-Bijeel, but is likely to slash that.

Its biggest customer, the Kurdish regional government, owes it more than $100m in payments but is struggling to fund a war against Isis (also known as Islamic State) and support 1.5m refugees who have flooded across its borders.

Without a cash infusion, Gulf Keystone may struggle to make its payments, which is why one of its bonds dropped to 60p in the pound. Creditors are braced for the worst.

BACKING explorers has always been about betting on a team believed to have the best chance of finding the proverbial needle in the haystack. A few have succeeded in recent years — Ophir Energy in east Africa, Tullow Oil in Ghana, Genel Energy in Kurdistan — and could yet be scooped by opportunistic buyers. But most fail.

That has always been the case. The problem is that in recent years succeeding has become far harder. Costs have rocketed. An offshore engineer makes $120,000 a year on average — twice what he did a decade ago. With much of the “easy oil” found, prospectors have been forced into more difficult — and costly — regions.

Yet Big Oil slammed on the spending brakes. Shell said last week it will cut $15bn from investment over the next three years. That will trickle through to the rest of the industry. Already salaries are being cut and workers are being laid off. Drilling-rig rates have halved. The correction has begun. “The sector doesn’t work at $50 a barrel, let alone $44,” said Barclays’ analysts. “Balance sheet strength remains the focus.”

The problem is that for most of London’s listed oil companies, their balance sheet is their weakness.

cyril - if you have ST on line, please can you do me a favour and c+p the article on Flybe on the relevant thread