Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

Hurricane Energy (HUR)

Tinderboy
Lemon Pip
Posts: 61
Joined: December 29th, 2019, 2:55 pm
Has thanked: 10 times
Been thanked: 34 times

Re: Hurricane Energy (HUR)

#393453

Postby Tinderboy » March 7th, 2021, 8:11 pm

Think the parties over, all the BOD need to do is gradually release the Kraken and open up the taps releasing pressure in the only good well, the Parrot is Dead!

Tinderboy
Lemon Pip
Posts: 61
Joined: December 29th, 2019, 2:55 pm
Has thanked: 10 times
Been thanked: 34 times

Re: Hurricane Energy (HUR)

#398309

Postby Tinderboy » March 23rd, 2021, 1:40 pm

Preparing for the head shot as they say on The Wire......

wanderer101
Posts: 41
Joined: November 5th, 2016, 6:47 am
Has thanked: 8 times
Been thanked: 36 times

Re: Hurricane Energy (HUR)

#402184

Postby wanderer101 » April 7th, 2021, 8:34 am

CPR summary and stakeholder engagement update out today:
https://www.investegate.co.uk/hurricane ... 00115936U/

The BoD can't really be making it any clearer:

The Company continues to engage with an ad hoc group of its convertible noteholders over the Company's forward work programme, strategy, financing and balance sheet recapitalisation. It should be noted that there is a risk of significant dilution to existing shareholders from a possible restructuring and/or partial equitisation of the convertible bonds and of potentially limited or no value being returned to shareholders.



If no agreement can be reached with the Company's stakeholders on additional development activity at Lancaster, the field could continue to produce from the P6 well before reaching its economic limit, the timing of which would depend on oil prices, actual production levels delivered and the level of cost savings achievable. The field may then be decommissioned, with potentially limited or no value returned to shareholders.

Disc: former holder, took a loss, relieved to have taken the hit

Tinderboy
Lemon Pip
Posts: 61
Joined: December 29th, 2019, 2:55 pm
Has thanked: 10 times
Been thanked: 34 times

Re: Hurricane Energy (HUR)

#402200

Postby Tinderboy » April 7th, 2021, 9:28 am

Looks as if they are handing the responsibility to the UK-OGA, a bit like phoning your mate and offering him £25 to take your old car to the scrappy...

dealtn
Lemon Half
Posts: 6072
Joined: November 21st, 2016, 4:26 pm
Has thanked: 441 times
Been thanked: 2324 times

Re: Hurricane Energy (HUR)

#402239

Postby dealtn » April 7th, 2021, 11:06 am

wanderer101 wrote:CPR summary and stakeholder engagement update out today:
https://www.investegate.co.uk/hurricane ... 00115936U/

The BoD can't really be making it any clearer:

The Company continues to engage with an ad hoc group of its convertible noteholders over the Company's forward work programme, strategy, financing and balance sheet recapitalisation. It should be noted that there is a risk of significant dilution to existing shareholders from a possible restructuring and/or partial equitisation of the convertible bonds and of potentially limited or no value being returned to shareholders.



If no agreement can be reached with the Company's stakeholders on additional development activity at Lancaster, the field could continue to produce from the P6 well before reaching its economic limit, the timing of which would depend on oil prices, actual production levels delivered and the level of cost savings achievable. The field may then be decommissioned, with potentially limited or no value returned to shareholders.

Disc: former holder, took a loss, relieved to have taken the hit


It might be true they can't make it any clearer, but it's still not clear what the outcome might be.

Potentially limited could be 5p a share, I think we can work out what no value means.

At around 3p to buy there could be either profits or losses made yet.

FabianBjornseth
Lemon Pip
Posts: 82
Joined: July 6th, 2018, 10:41 pm
Has thanked: 95 times
Been thanked: 102 times

Re: Hurricane Energy (HUR)

#402874

Postby FabianBjornseth » April 9th, 2021, 12:21 pm

Expronews reports on the Halifax "discovery" - no new insights, but a short summary of events to date:

https://expronews.com/company-news/the-billion-barrel-west-of-shetland-discovery-that-didnt-exist/

Nimrod103
Lemon Half
Posts: 6468
Joined: November 4th, 2016, 6:10 pm
Has thanked: 939 times
Been thanked: 2256 times

Re: Hurricane Energy (HUR)

#402984

Postby Nimrod103 » April 9th, 2021, 6:43 pm

ReallyVeryFoolish wrote:
FabianBjornseth wrote:Expronews reports on the Halifax "discovery" - no new insights, but a short summary of events to date:

https://expronews.com/company-news/the-billion-barrel-west-of-shetland-discovery-that-didnt-exist/

Thank you Fabian. As this sorry story slowly unfolds, drip, drip, drip. The scale of half truths (if not outright lies) and deception is mind blowing in proportions. How on earth this can happen in a supposedly civilised and just society is breath taking. Nobody seems to be held to account. I suppose that's a large part of why AIM market is the choice for such misadventures.

The whistle blower (I forget the name) at the OGA who was silenced after voicing serious concerns about HUR seems to have been on the money. That makes government depts part of the "crime". Utterly disgraceful.

RVF


A bit unfair on the OGA I would say. It is not their job to comment on the technical merits or otherwise of any particular field or prospect. It is their remit to encourage companies to explore, develop and produce as much as possible to the maximum benefit and minimum detriment of the UK taxpayer.
Caveat emptor
If you want to point fingers, point them at those who produced the competent persons' reports.

Nimrod103
Lemon Half
Posts: 6468
Joined: November 4th, 2016, 6:10 pm
Has thanked: 939 times
Been thanked: 2256 times

Re: Hurricane Energy (HUR)

#403048

Postby Nimrod103 » April 9th, 2021, 10:51 pm

ReallyVeryFoolish wrote:
Nimrod103 wrote:
ReallyVeryFoolish wrote:Thank you Fabian. As this sorry story slowly unfolds, drip, drip, drip. The scale of half truths (if not outright lies) and deception is mind blowing in proportions. How on earth this can happen in a supposedly civilised and just society is breath taking. Nobody seems to be held to account. I suppose that's a large part of why AIM market is the choice for such misadventures.

The whistle blower (I forget the name) at the OGA who was silenced after voicing serious concerns about HUR seems to have been on the money. That makes government depts part of the "crime". Utterly disgraceful.

RVF


A bit unfair on the OGA I would say. It is not their job to comment on the technical merits or otherwise of any particular field or prospect. It is their remit to encourage companies to explore, develop and produce as much as possible to the maximum benefit and minimum detriment of the UK taxpayer.
Caveat emptor
If you want to point fingers, point them at those who produced the competent persons' reports.

You miss the point, perhaps? An OGA staff member expressed serious concerns about the assets Hurricane Energy were so bullish about. I recall he was asked to resign and his concerns not taken seriously. Yes I absolutely agree with you, the untruths (lies?) were well documented elsewhere by others. But OGA do not have clean hands as far as I can see. I really need to see if I can find the articles relating to the OGA staff, if I can. Anyway, nothing will happen, it's history now.

Edited to add - Malcolm Pye, OGA Geologist.

https://www.energyvoice.com/oilandgas/n ... -shetland/

RVF


I think he was acting ultra vires.

thehaggistrap
2 Lemon pips
Posts: 110
Joined: January 2nd, 2020, 8:20 pm
Has thanked: 1 time
Been thanked: 54 times

Re: Hurricane Energy (HUR)

#403093

Postby thehaggistrap » April 10th, 2021, 8:34 am

^ Certainly something stinks here....

No doubt the 2017 CPR contained massive technical errors - which have cost private investors. Many investors made decisions based on the 2017 CPR and a false belief that Lancaster / Halifax was the largest discovery on UK shelf since 1970s. A down grade from 1 billion to less than 10 million barrels is eye-watering...

Now : *Perhaps* the 2021 CPR (kitchen sinking) remains overly pessimistic too? It remains possible the truth still lies somewhere in the middle... ?
Certainly there was a battle for control of Hurricane which Dr Trice lost (... rightly based on what we know now and the rising oil-water contact). However I still don't believe for a minute the new board are acting in the best interest of share holders either! The remains of Hurricane likely has value to someone based on the tax losses, acreage and cash in bank. The only plausible reason new-board are actively keeping share price low is because I believe Kerogen are the bond holder. The identity of bond holder(s) has never been published in public domain. Good luck getting that information from investor relations who will obfuscate when asked such direct questions.... We should remember that Kerogen quit their seat on board following the original downgrade having commissioned Alan Parsely to write the technical report.

Kerogen, like everyone else, have a lost a lot of money investing in Hurricane since 2016. I believe they now want to "kitchen sink" the company and take controlling interest for as cheaply as possible? Such outcome would salvage some value for them at direct expense of remaining share holders. The new board is clearly representing the interests of the bond holder (who I believe are Kerogen) rather than the share holders.

A total shambles in which PIs and long term investors were basically mugged by incompetent 2017-CPR.
The OGA and Schlumberger certainly need to take a long look at themselves.
I sold out in September 2020 at considerable loss.

thehaggistrap
2 Lemon pips
Posts: 110
Joined: January 2nd, 2020, 8:20 pm
Has thanked: 1 time
Been thanked: 54 times

Re: Hurricane Energy (HUR)

#403559

Postby thehaggistrap » April 12th, 2021, 10:33 am

Would any private-investors be interesting in talking to a journalist about the Hurricane Energy fiasco?
Any technical perspectives would be much appreciated.
Send me a PM with email address and I can provide further details.

thehaggistrap
2 Lemon pips
Posts: 110
Joined: January 2nd, 2020, 8:20 pm
Has thanked: 1 time
Been thanked: 54 times

Re: Hurricane Energy (HUR)

#404020

Postby thehaggistrap » April 13th, 2021, 9:46 pm

One thing certain : Crystal Amber have very big balls ...

Either the truth is somewhere in middle and Lancaster will carry on producing. Or they are trying to catch a falling knife. Fascinating

FabianBjornseth
Lemon Pip
Posts: 82
Joined: July 6th, 2018, 10:41 pm
Has thanked: 95 times
Been thanked: 102 times

Re: Hurricane Energy (HUR)

#404518

Postby FabianBjornseth » April 15th, 2021, 2:48 pm

ExproNews has a follow-up article, putting the focus on the Competent Person's Report system. They also have a private investor in Hurricane on record, who has a story to tell which is probably shared by many:

“Based on the 2017 Competent Person’s Report, I decided that an investment in Hurricane had a very good chance of success,” said Doug Bryce, a private investor who has recently sold his Hurricane shares at a significant loss. Not having a technical subsurface background himself, it is the CPR that people like Doug and many other investors help to guide their decision to invest. His line of thinking was, “Even in case the development only makes the P90 volumes, it would still be ok.” A fair point, one would argue.

In hindsight, he made a mistake, as it has turned out.

The second CPR that was published last week proved that the trust Doug had put into the initial assessment was misplaced, as the volumes now estimated for the Lancaster field have been reduced from 486 MMboe of 2C Contingent Resources in 2017 to 34.7 MMboe of 2C Contingent Resources in 2021.


https://expronews.com/resources/the-competent-persons-report-system-is-ready-for-review/

Nimrod103
Lemon Half
Posts: 6468
Joined: November 4th, 2016, 6:10 pm
Has thanked: 939 times
Been thanked: 2256 times

Re: Hurricane Energy (HUR)

#404585

Postby Nimrod103 » April 15th, 2021, 7:03 pm

FabianBjornseth wrote:ExproNews has a follow-up article, putting the focus on the Competent Person's Report system. They also have a private investor in Hurricane on record, who has a story to tell which is probably shared by many:

“Based on the 2017 Competent Person’s Report, I decided that an investment in Hurricane had a very good chance of success,” said Doug Bryce, a private investor who has recently sold his Hurricane shares at a significant loss. Not having a technical subsurface background himself, it is the CPR that people like Doug and many other investors help to guide their decision to invest. His line of thinking was, “Even in case the development only makes the P90 volumes, it would still be ok.” A fair point, one would argue.

In hindsight, he made a mistake, as it has turned out.

The second CPR that was published last week proved that the trust Doug had put into the initial assessment was misplaced, as the volumes now estimated for the Lancaster field have been reduced from 486 MMboe of 2C Contingent Resources in 2017 to 34.7 MMboe of 2C Contingent Resources in 2021.


https://expronews.com/resources/the-competent-persons-report-system-is-ready-for-review/


Interesting article. I speak with more experience than I care to mention but will make the following comments:

1) The relationship between oil company and consultant (producing the CPR) can be a difficult one. It is just like that between a company and its financial auditor, but with a much lower magnitude of fees. I have been involved in CPR work where the client has refused to pay because they think the CPR is too pessimistic, and not many consultants can stand that kind of income shortfall, nor the impact of getting a reputation for being too pessimistic. It all relies on the technical integrity of the consultant.

2) It is a well known dictum of the oil industry that exploration and development are better performed by partnerships of companies. A single licence holder provides the opportunity for prima donna managements to get their own way regardless of technical merit.

3) It is also a well known dictum of the oil industry that fractured reservoirs give surprises, usually unpleasant ones, so any investor must be on their guard.

4) In any fractured reservoir, in fact in any reservoir, the only important questions are how much oil in place, how much recoverable, and at what recovery rate. Fractured reservoirs usually produce at high rates because of the enhanced fracture permeability, so such fields can look good at the appraisal, early test/early production phase. The oil in place is particularly difficult to estimate in fractured reservoirs because wireline logs are not much help. Drill stem tests are really what matters, and in Lancaster the supposed OWC was not well tied down by DSTs. Fractures tend to die out with depth into (in this case) granitic basement, so it is very difficult to place the OWC with confidence. MDT pressure data is usually used elsewhere to define the OWC, but in fractured reservoirs such data is very unreliable - if it exists at all.

The vast majority of fractured reservoirs have a matrix of low porosity/low permeability, which contains the bulk of the reserves of oil, but in Lancaster, the matrix was granite with essentially zero porosity - so where was the oil? The operator had a model for zones of smashed weathered rock alongside the major fractures, which contained enough porosity to host the reserves. But really there was little evidence for this, it could not be clearly seen on wireline logs. The operator should have collected much more whole core to elucidate what porosity was there. The production history suggests that there is not actually much porosity except for the main fractures.

5) Forgive me because I have been retired for a few years so my nomenclature may be a bit off, without going back to my books and revising for a few days. As I recall there is a major difference between the US and rest of World reserves auditing systems, which may account for some of the problems. The SEC in the USA rely for OWC very much on the lowest DST which produced (significant) oil. Anything deeper is speculative.

On the other hand, consultants in the UK would be much more familiar with a probabilistic reserves distribution produced from Monte Carlo simulation of the different variables. And then they often assume the P90 equates to what is proven.
However, that is not necessarily the case.
If the upside (P10) is very large, it can have the effect of pulling the whole distribution higher, such that the P90 may be larger than what can genuinely be regarded as the proven case.
I suspect this may have happened in Lancaster.

Tinderboy
Lemon Pip
Posts: 61
Joined: December 29th, 2019, 2:55 pm
Has thanked: 10 times
Been thanked: 34 times

Re: Hurricane Energy (HUR)

#404949

Postby Tinderboy » April 17th, 2021, 1:56 pm

All the huffing and puffing will be over soon, HUR have to either extend the AM or give them one years notice by June 21, i dont believe there are any other options on the table at this time.

Tinderboy
Lemon Pip
Posts: 61
Joined: December 29th, 2019, 2:55 pm
Has thanked: 10 times
Been thanked: 34 times

Re: Hurricane Energy (HUR)

#406706

Postby Tinderboy » April 24th, 2021, 8:42 pm

Is it feasible that CA will loan the capital to HUR for the drills in exchange for bonds?

Tinderboy
Lemon Pip
Posts: 61
Joined: December 29th, 2019, 2:55 pm
Has thanked: 10 times
Been thanked: 34 times

Re: Hurricane Energy (HUR)

#406961

Postby Tinderboy » April 26th, 2021, 8:19 am

A scenario would be for CA to fund the drills, the SP would go to say 5p, CA could then sell at 5p, I think there is a bigger picture here for sure....Will find out soon enough...

FabianBjornseth
Lemon Pip
Posts: 82
Joined: July 6th, 2018, 10:41 pm
Has thanked: 95 times
Been thanked: 102 times

Re: Hurricane Energy (HUR)

#407484

Postby FabianBjornseth » April 27th, 2021, 9:34 pm

The ERCE CPR on Hurricane's assets is now out for everyone to read:

https://www.hurricaneenergy.com/download_file/view/603/255

Some thoughts:
  • The oil-water contact is now determined using pressure points that were explicitly stated as invalid in the 2017 CPR from RPS. Had these two reports been issued simultaneously pre-production, it would be hard for a lay-person to judge which interpretation was more correct. With the production data in hand, it's obvious that the 2017 CPR was far off. It is a good example of the level of detailed insight required to distinguish a commercial hydrocarbon development project from a non-commercial one, as Nimrod pointed out on this board many years ago.
  • In the 2017 CPR, porosity in the basement was calculated from well logs to be 4%. In the 2021 CPR, we are looking at a value of 0.3%, estimated from the history matched reservoir model. The previous understanding of the reservoir was a hill full of connected fractures providing both storage and permeability. It is now seen that only the top 10-16 meters of the hill has an average porosity of 5%.
  • Although references are made to a history match model, no model results or indeed dynamic bottom-hole pressure data is included. It is stated that production below bubble-point is required, but no estimate is made for when this may occur.
  • Ultimately the calculated STOIIP numbers in the CPR are not used to estimate reserves. The production forecast range is made based on log-linear extrapolations from a trend which is not historically log-linear. All that can be said is that the uncertainty is large.
  • STOIIP is used for estimation of contingent resources though. These numbers all depend on the implementation of water injection, and unnamed analogue field recovery factors are used. Without any details on how this would be implemented, it is difficult to ascribe any confidence to the estimates, and ERCE themselves acknowledge as much on the introduction page.
  • The resource estimates for P8 infill well is reservoir-model based, and the better the -6 well performs, the less attractive infill drilling looks. This would have supported the decision to defer any drilling to 2022.
  • The estimated resources for Lincoln and Warwick are all in the basement/granite wash. As the dynamic relationship between the basement and the sandstones on Lancaster is still not well defined, and the wells on these discoveries have performed significantly poorer than the Lancaster wells, it is understandable why no further development has been sanctioned to date.
Ultimately the CPR provides welcome details on the current subsurface understanding, but does not change the picture as far as I can tell.

thehaggistrap
2 Lemon pips
Posts: 110
Joined: January 2nd, 2020, 8:20 pm
Has thanked: 1 time
Been thanked: 54 times

Re: Hurricane Energy (HUR)

#408272

Postby thehaggistrap » April 30th, 2021, 9:57 am

Wow.... 95% dilution. FWIW : back in October the head of investor relations (Phil Corbett) assured me on phone that dilution wasn't an option. However he had a history of lying to me but not putting it in writing/email. Thankfully I didn't trust him and sold out - like everyone at a large loss....

It isn't mentioned who the bond holders are in today RNS. However I am near certain that KEROGEN CAPITAL just acquired Hurricane Energy on the cheap. The £50 million they paid to acquire the company is peanuts and easily covered by the cash in bank!

Despite the well documented problems the whole thing stinks. Kerogen clearly see something in the corpse...
Tax right off against debt, acreage, cash in bank <etc>. They commissioned the revised technical report then quit their seat on board (Dr Parsely) once that work was delivered.

The new-board (Anthony Marris and co.) have deliberately trashed share price to a point where there are no long term share holders left to vote against this.

thehaggistrap
2 Lemon pips
Posts: 110
Joined: January 2nd, 2020, 8:20 pm
Has thanked: 1 time
Been thanked: 54 times

Re: Hurricane Energy (HUR)

#408278

Postby thehaggistrap » April 30th, 2021, 10:13 am

^ share holders could in theory trigger a VONC in board.
However I agree, there wont be a vote.
FWIW : I still hold 1 single share to remind what a bad investment HUR was :lol:

whilst it is very sad the Anthonny Marris board have worked for last 12 months to ensure KEROGEN get all value left in the company...

dealtn
Lemon Half
Posts: 6072
Joined: November 21st, 2016, 4:26 pm
Has thanked: 441 times
Been thanked: 2324 times

Re: Hurricane Energy (HUR)

#408288

Postby dealtn » April 30th, 2021, 10:45 am

thehaggistrap wrote:Wow.... 95% dilution. FWIW : back in October the head of investor relations (Phil Corbett) assured me on phone that dilution wasn't an option. However he had a history of lying to me but not putting it in writing/email. Thankfully I didn't trust him and sold out - like everyone at a large loss....

It isn't mentioned who the bond holders are in today RNS. However I am near certain that KEROGEN CAPITAL just acquired Hurricane Energy on the cheap. The £50 million they paid to acquire the company is peanuts and easily covered by the cash in bank!

Despite the well documented problems the whole thing stinks. Kerogen clearly see something in the corpse...
Tax right off against debt, acreage, cash in bank <etc>. They commissioned the revised technical report then quit their seat on board (Dr Parsely) once that work was delivered.

The new-board (Anthony Marris and co.) have deliberately trashed share price to a point where there are no long term share holders left to vote against this.


There are clearly multiple bond holders.


Return to “Oil & Gas & Energy (Sector & Companies)”

Who is online

Users browsing this forum: No registered users and 11 guests