What a chart, further to go, or not
Comments please

http://www.malcysblog.com/

Oil price
Not much to add, the EIA stats were better than expected, a draw of 4.9m barrels v 3.4 guesses but not quite as impressive as the API numbers. Nevertheless crude is slightly better again this morning with $70 Brent within reach…
Premier Oil


A trading and operations update from Premier this morning which continues in the vein of operational excellence which has characterised the company for the last two months. The feature today is Catcher which came onstream on Dec 23rd on time and under budget and is already doing very well. Starting at 10/- b/d it is now up to 20/- b/d and speaking to TD first thing I get the impression that the first two wells are being tested at very good rates indeed. This month means testing of the facilities and of course with flaring restrictions production is held back, but by the end of January expect a significant increase, at $69.20 things are very pleasing.
Elsewhere very much as expected, Zama will be appraised this year and next and Tolmount development sanction is expected this year as well. At Sea Lion progress with contractors is gathering pace and debt is being processed, sanction here is planned by the end of this year. (See RKH below)
Financially things are of course looking up, opex this year will be $17-18, capex of $300m and with the healthy oil price and positive free cash flow, debt repayments are accelerating and the total is now , only, $2.7bn. The shares have had a great run having doubled since the summer and the slight dip this morning appears somewhat churlish by the market but I’m still very happy to keep them tucked up in the bucket list.


Rockhopper Exploration
Rockhopper has announced a corporate update, timed clearly to be in tandem with Prems as the subject is primarily Sea Lion. Phase 1 continues to move towards sanction later this year with work in the last few months concentrating on the commercial, fiscal and financing elements required to secure the $1.5bn capex ahead of first oil. LOI’s are being signed with contractors for provision of well services, logistics and vendor financing which must be good news . For both PMO and RKH the finance needs to be arranged and I understand things are progressing well on that front. Although debt providers are unsurprisingly cautious after the last few years, the project economics of Sea Lion at around $70 must provide plenty of comfort and it should get away.
Finally at Abu Sennan news on production is good and a ‘full review of its prospectivity’ indicates that there is decent upside and enough to consider further drilling this year.
Finally at Abu Sennan news on production is good and a ‘full review of its prospectivity’ indicates that there is decent upside and enough to consider further drilling this year.

More good news in my eyes

The convertible bonds are capable of being exchanged at any time and are currently trading "in-the-money". With this invitation, the Company is seeking to accelerate the exchange of the Bonds into ordinary shares, which has several advantages for the Company, its shareholders and bondholders:
· The primary purpose is to reduce the Company's indebtedness: the early exchange of the Bonds along with the recent non-core disposals of Wytch Farm, Pakistan, and its interest in the ETS pipeline and the start of production at Catcher, will assist the Company to reduce debt and to impact positively the Company's forward financial covenants;

· It will rebalance the Company's capital structure and should reduce hedging activity in the Company's ordinary shares: the Company's capital structure currently comprises shareholders' ordinary equity plus long term borrowings which include UK retail bonds, senior loan notes, bank debt and the Bonds. Accelerating the exchange of the Bonds will increase the equity base of the business whist reducing outstanding debt and associated hedging activity (short selling) by certain holders of the Bonds;

· The early exchange of any Bonds will lead to a smaller total number of ordinary shares being issued in respect of the Bonds than would be issued if all coupons were paid in ordinary shares and the Bond were held to and exchanged at maturity;

PREMIER OIL PLC
("Premier")
Catcher operational update
24 January 2018

Premier is pleased to provide the following update on its operated Catcher Area development, which was successfully brought on-stream on 23 December 2017.

The first export cargo of Catcher oil of approximately 500,000 barrels was lifted yesterday, earlier than anticipated, and has been sold at a premium to Brent. The second cargo, which is scheduled for the third week of February, has also been sold at a similar premium to Brent.

To date, four production wells - two from the Catcher field and two from the Varadero field - have been brought online. Initial rates from these four producers totalled in excess of 60 kbopd and, as planned, these wells are being deliberately constrained at an average of 20 kbopd whilst final commissioning of the gas processing modules on the FPSO is completed.

Performance of the BW Catcher FPSO has been excellent with high operational uptime. Commissioning of the water injection system has been completed. Gas commissioning is progressing well with the gas import/export pipeline now fully open to the SEGAL pipeline and booster compression test runs successfully concluded. The next stages of gas treatment and export compression commissioning will now follow with the switch to fuel gas for the main power generation and ancillary boilers set to commence this week. Once the gas systems, including gas export, are fully available, production will be brought on-stream from the Burgman field and full production from the Catcher Area is planned to increase to 60 kbopd. This remains on schedule for Q2 2018.

StockMarketWire.com
Premier Oil said the company and partners had been awarded an exploration licence off the coast of Indonesia.

The Andaman II licence is located in the under-explored but proven North Sumatra basin offshore Aceh.

Premier said it had identified numerous prospects and leads and planned to acquire 3D seismic in an initial three-year term.

'This award is in line with Premier's strategy of targeting low commitment high impact exploration in proven hydrocarbon provinces and has the potential to deliver significant organic growth opportunities for our existing Indonesian business in the longer term,' chief executive Tony Durrant said.

StockMarketWire.com
Premier Oil reported production of 75 kboepd (2016: 71.4 kboepd) in the year to 31 December.

OPERATIONAL HIGHLIGHTS
- Catcher first oil achieved in December, on schedule and under budget

- Tolmount funding secured

- World class discovery offshore Mexico, estimated 600mmbbls (gross)

- $300m of non-core asset disposals

- Reserves and resources of 902mmboe (2016: 835mmboe)

FINANCIAL HIGHLIGHTS
- Comprehensive refinancing completed; cash and undrawn facilities at year-end of $541.2m

- Cash flows from operations of $496m up 15% (2016: $431.4m)

- Opex of $16.4/boe, maintaining low cost base

- Development and exploration capex of $275.6m, down 58%

- Positive free cash flow of $71.2m, net debt reduced to $2.7bn

- EBITDAX increased to $589.7m (2016: $494.1m)

- $253.8 million post-tax loss after previously disclosed impairments and refinancing costs

2018 OUTLOOK
- Production guidance of 80-85 kboepd

- Opex and capex guidance of $17-18/boe and $300m, respectively

- Catcher expected to reach 60 kbopd (gross) in April ahead of plan

- Tolmount project sanction anticipated

- Material progress on Sea Lion towards final investment decision

- Zama: rig contracting in progress for 2H appraisal

- Significant covenant headroom forecast by year-end

- Rising free cash flow, driving debt reduction through 2018 and 2019

StockMarketWire.com
Premier Oil said it had been awarded three exploration blocks in a Mexican allocation round, two for which it held 100% stake and another in which it had 30% ownership.

The company was awarded 100% of Blocks 11 and 13 in the 'highly prospective' Burgos Basin and 30% of Block 30 in the Sureste Basin, which it would explore with operator and joint venture partner DEA and second partner Sapura Energy.

'The outcome of this highly competitive licensing round is a fantastic success for Premier and its partners,' chief executive Tony Durrant said.

'We are delighted to have been awarded Block 30, the most contested block in the round.'

'This award increases our footprint in the prolific, shallow water part of the Sureste Basin.'

'The award of Blocks 11 and 13 provides us with a low cost entry into the Burgos basin, where we will look to repeat the first mover advantage we enjoyed in the Sureste Basin with the Zama discovery'

'The awards significantly enhance our existing acreage position in Mexico and have the potential to deliver significant organic growth for our business in the longer term.'

Heads up!

Looks like a breakout

StockMarketWire.com
Premier Oil said its was on track to meet its full-year production guidance despite output slipping in the first quarter.

In the three months through March, the company produced 74,000 barrels of oil equivalent per day, down from 81,200 on-year.

It pinned the fall on the sale of Wytch Farm, a planned shutdown at the Huntington field and natural decline across the portfolio.

The decline was partly offset by the commencement of Catcher field in the North Sea and the company kept its full-year guidance of 80,000-to-85,000 boepd.

since heads up we are nearly 60% up

No reason why rise will not carry on unless oil price falls

At AGM they said they had tested catcher at 80,000 barrels a day and all was fine so more testing and a few tweaks.

www.proactiveinvestors.co.uk/companies/news/197185/barclays-upgrades-premier-oil-as-stronger-crude-price-eases-debt-concerns-197185.html

Barclays upgrades Premier Oil as stronger crude price eases debt concerns
Share
10:28 17 May 2018

Premier Oil shares advanced on Thursday after yesterday's trading update and an upgrade from Barclays

Barclays has a 145p price target, suggesting some 22% upside to the current price – Premier shares, meanwhile, advanced about 5% to 118p.

READ: Premier Oil’s Catcher field ramp-up continues
It comes as Barclays analyst James Howie revised a number of exploration and production companies, in the wake of the strengthening crude price.
Howie, in a note, highlighted that as better prices boost cash flow, it will be the debt-levered oil producers that should benefit most. Barclays’ new Brent base case is now fixed on US$65 per barrel, up from US$60.
Specifically, for Premier Oil, the analyst believes Brent crude prices at around US$70 through 2018-19 will remove any remaining balance sheet concerns and it will allow the management team to focus more on growth projects.

PREMIER OIL PLC
("Premier")
Inclusion in FTSE 250 Index
31 May 2018


Premier announces that it has been notified by the FTSE Group that it will be joining the FTSE 250 Index with effect from Monday 18 June.

StockMarketWire.com
Premier Oil on Thursday left its outlook on full-year production and operating costs unchanged, after production fell in the first-half of the year, compared to the same period a year ago, amid asset sales and natural field decline.

Production averaged 76,100 barrels of oil equivalent per day (boepd) for the first six months of the year.

The firm also blamed the lower output on planned shutdowns at the Huntington and Solan fields and lower Singapore gas demand amid end-buyer maintenance.

Full-year guidance of 80,000-85,000 boepd was maintained. While full-year operating costs of $17-$18 per boe, and expenditure of $380m was in line with previous guidance.

Year end net debt is forecast between a $300m and $400m range at current oil prices.

Catcher plateau production rates was steady at 60 kbopd (gross) following the start of gas export and water injectivity in May, the company said. 'Catcher delivering stable plateau production is an important milestone for Premier. This, coupled with the ongoing strong performance from our underlying portfolio and our continued focus on cost control, will result in significant free cash flow generation and material debt reduction in the second half,' said Tony Durrant, Chief Executive.

https://www.fool.co.uk/investing/2018/07/12/is-the-premier-oil-share-price-heading-for-300p-again/

Is the Premier Oil share price heading for 300p again?

If you had been brave enough to buy Premier Oil (LSE: PMO) at the beginning of 2016, when the shares plunged to an all-time low of 19p, today you would be sitting on gains of just under 600%!
This performance is due to a combination of factors. The price of oil, which fell to a low of just under $30 a barrel in 2016, has charged higher and now changes hands for $74 and change. Meanwhile, Premier itself has taken action to improve profitability by slashing costs and putting major development projects on hold. And I believe this is just the start of Premier’s turnaround.

Cash is king

I’ve written many times before that the most significant headwind facing Premier’s shares is the company’s debt. The firm has essentially staked its future on the success of its flagship Catcher development in the North Sea, which has cost billions to develop.
Until last year, Catcher was nothing but a drain on profitability, but now, production is ramping up. Output across the group averaged 76,100 barrels of oil equivalent per day (boepd) in the first half of 2018, and recently exceeded 90,000 boepd. For the full-year, management is guiding for 80,000-85,000 boepd.

Rising production, coupled with that $74 a barrel price tag, oil is allowing Premier to rapidly de-lever its balance sheet. The bulk of the group’s oil production for the second half of the year is hedged at $60/bbl, below the current market price but fixed to give clarity on earnings. At this level, management believes net debt will fall by $300m-$400m for the year, taking a significant chunk out of the $2.72bn net debt balance reported at the end of 2017. The group’s leverage ratio — the ratio creditors rely on to judge whether Premier can meet its obligations — is forecast to fall to 3x EBITDA by year end 2018 and 2.5x EBITDA by the end of March 2019. At the end of 2016, the ratio had ballooned to 5.9x.

Desperately undervalued

With leverage now nearly halved since 2016, in my opinion the shares look desperately undervalued. In the past, the stock deserved a low multiple because of the bankruptcy risk surrounding the business. Now this risk has receded, but the stock still trades at a depressed valuation, giving a wide margin of safety for investors, in my view.

City analysts believe the company is on track to report earnings per share of $0.32 for 2019, or 24p based on current exchange rates (based on the current production rate this looks probable). This means the shares trade at a 2019 P/E of just 5.4, compared to the broader oil & gas sector average of 11.4. As Premier continues to clean up its balance sheet, I see no reason why the stock cannot trade up to this multiple — as long as the price of oil doesn’t collapse again.

Put simply, as Premier’s borrowings continue to fall over the next 18-24 months, I believe the shares could be worth between 250p and 300p. There’s still time to profit from the Premier recovery.

Investec today reaffirms its hold investment rating on Premier Oil PLC (LON:PMO) and cut its price target to 130p (from 135p).

Peel Hunt today reaffirms its buy investment rating on Premier Oil PLC (LON:PMO) and set its price target at 140p.

https://www.investegate.co.uk/News/-/844288/

Broker Forecast - RBC Capital Markets issues a broker note on Premier Oil PLC
By BFN News | 10:00 AM | Monday 15 October, 2018
Premier Oil PLC Ord 12.5P (PMO)

RBC Capital Markets today reaffirms its top pick investment rating on Premier Oil PLC (LON:PMO) and raised its price target to 230p (from 180p). Story provided by StockMarketWire.com Broker Forecasts data provided by www.sharesmagazine.co.uk

Barclays Capital today reaffirms its overweight investment rating on Premier Oil PLC (LON:PMO) and cut its price target to 130p (from 180p).

StockMarketWire.com
Premier Oil stuck to its annual production guidance after it achieved higher-than-expected output in November and December.

The company said it was still forecasting full-year production of around 80k barrels of oil per day.

Production in the year to date had averaged 79.4 kboepd, with production in November and December at 92 kboepd, with a record daily production rate of 98.7 kboepd achieved on 4 December.

'This strong production performance has been driven by high uptime across the group's producing portfolio, including at Premier's operated Catcher area, which has averaged 68 kboepd in November and December to date,' the company said.

Premier Oil also confirmed that it had completed the sale of its interests in the Babbage area to Verus Petroleum for £30.3m. The sale proceeds would be used to cut debt.

In addition, Premier Oil announced that drilling had commenced at the Zama-2 appraisal well offshore Mexico.

The well would aim to confirm the oil water contact and was expected to reach the reservoir early in the New Year.

https://www.proactiveinvestors.co.uk/companies/news/212303/premier-oil-beats-debt-reduction-expectations-in-year-of-strong-production-212303.html

Premier Oil beats debt reduction expectations in year of strong production

Barclays Capital today reaffirms its overweight investment rating on Premier Oil PLC (LON:PMO) and cut its price target to 105p (from 130p).