I may be wrong but I seem to recall that, late last year, there was a report that International Trade Arbitration was expected to continue finding in CNE's favour after having forced the Indian Government to pay Cairn ~ £53m for lost revenue and share value caused by this unreasonable and false "TAX" claim.
It appeared that expectations were this could result in a settlement early in 2018 but there has been no news so far - only continued Indian intransigence.
IMHO, every company should beware of the huge level of corruption in the Indian Sub-Continent and invest elsewhere rather than risk what amounts to much more than daylight robbery.
I am disappointed the UK has not stated that any further Overseas Aid payments will be withheld until India stops playing silly beggars with a company who has helped their trade deficit by producing a major part of India's oil purchases from elsewhere.
Looks like 15 million shares traded to day, a huge increase from average with the price rising.
Could Cairn be the undeclared farmin partner who has reached commercial terms with providence and landsdowne to farm into the Barry roe oilfield with 340 million bbls of independent certified oil reserves of 2c undeveloped reserves?
Cairn are already partnered with pvr on Spanish point field, so they know each other well.
Watch for more high volume if its true.
SYDNEY/DAKAR (Reuters) - Oil exploration company Cairn Energy (CNE.L) is in talks with BP to sell a 30 percent stake in its deepwater SNE field offshore Senegal, which could be valued at around $600 million, banking sources and a Senegal oil ministry source said on Monday. We are aware that BP wants to acquire a stake in Cairn Energy, but they are awaiting validation by the state (of Senegal), an adviser to Senegals oil minister, who declined to be named, told Reuters by telephone.
I know this is like an old record, but I am still hearing that Cairn (CNE) are in the process of selling around 30% of their stake in their offshore Senegal discovery. My latest gossip, and that is all that it is, suggests that BP (BP.) will buy that stake and the operatorship of the project.
This may make Far Ltd and Woodside (WOPEY) to a lesser extent look very smart but who knows, time will tell I may be completely wrong!"
All very much speculation going on here....no mention of any sale price by him either.
IF any sale were at $300m it would be a steal for a proven resource of 2billionboe +
Bear in mind the group have worked up this license, shot seismic & drilled several prospects and follow on appraisal wells and also then tested them with costs in excess of this figure...so a sale at $300m would be underwhelming and suggest desperation to depart the project.
NB Chevron bailed out of this consortium selling it off to Woodside (if FAR don't stop the transaction for there own ends).
"WTI $54.54 +24c, Brent $60.62 +13c, Diff -$6.08 -11c, NG $2.93 +4cA sluggish start yesterday for the oil price; the inventory stats were fine, but the API had taken the kudos the day before, so it was a bit like after the Lord Mayor's Show. ..."
I believe the recent payment is not part of the much larger disputed value relating to the 10% of CIL shares being blocked by the Indian Government which is the real core of the dispute as has been pointed out here.
This recent amount is in respect of the losses from the market value of the share price and dividends so the much larger sum covering the 10% still blocked may now be a more realistic indication of the release of the embargo on that 10%of the CIL shares.
If I have been mistaken in my assessment of this unreasonable matter, please correct me.
I agree that the share price currently values the shares/dispute at negligible levels, but management appear very bullish and resolution is slated for early 2018 so I would have thought that the share price should start to price in some upside unless winning the dispute will not lead to resolution.
I'm no expert and have bought into Cairn based on the discoveries in Senegal & Norway being brought to production largely by receipts from Kraken and Catcher as well as existing cash. Sure, we are going to use the credit cards too, but there is a route to production here.
As regards the dispute with India; I look to the Vodafone dispute with India which I think followed the same arbitration route as us did it not?
Vodafone were vindicated and demands for monies were dropped.
If the board are right, and we are innocent, I am confident that we will get our withheld dividend payments and access to our shareholding in what was CIL.
For compensation I am not too sure how that will go. We are going to have to fight very hard and hopefully the UK Government will get involved like they did with Vodafone.
Tricky situation for them though whilst trying to negotiate trade deals with India.
Market has discounted the withheld assets, until things change one way or the other I am doing the same.
The total value of assets blocked by the Indian tax dispute is $930 million, which has been completely discounted in the share price, so any settlement of this matter will have a huge impact on the share price.
Reading the interims management appear bullish on winning the dispute. I am not clear as to whether the Indians will pay up. I was wondering whether anyone has any knowledge on the enforceability of international tribunals?
In my opinion a successful outcome could have a large upside
"WTI $47.64 +27c, Brent $51.87 +21c, Diff -$4.23 -6c, NG $2.94 -2cA flash blog today as I am venturing north of the border and will update from there if appropriate. A quick run through of various bits of news from Tuesday and Wednesday, ..."
So cairn have now started drilling sne north in Senegal for 294 gross recoverable reserves which has an independent report chance of success at 60% .
Senegal NPv for pre development oil is $6 per bbl , so a discovery here is worth an additional £0.93 per share.
Of course the giant potential is the Druid and drombeg well offshore Ireland being drilled by providence where cairn have 3o% of potential 2 billion recoverable bbls, newss soon.
"WTI $49.16 -$1.01, Brent $51.78 -97c, Diff -$2.62 +14c, NG $2.82 +3cThe oil market was fast and furious yesterday and, in heavy trading, both WTI and the new front month of Brent crude for October struggled under a welter of mainly disappointing ..."
"WTI $44.40 +17c, Brent $46.48 +17c, Diff -$2.48 n/c, NG $2.93 +6cThe oil price was up, admittedly, but without much trade, a low grade investment bank picked up on last week's gasoline data but not much else happened. As I said yesterday, demand ..."
This is from Enquest's announcement today. Great news.
EnQuest CEO, Amjad Bseisu said:
"EnQuest is delighted to confirm that first oil has been achieved on the Kraken development, delivered on schedule and under budget. Drill centres 1 and 2 are fully complete and work continues on drill centre 3; as a result, further production capacity will come online into 2018 as these further wells are put onstream.
Kraken is a transformational project, made possible by EnQuest's differential capabilities; the right mix of integrated technical capabilities, high levels of efficiency and cost discipline. With production from Kraken, EnQuest is moving from a period of heavy capital investment, to a focus on cash generation and deleveraging the balance sheet.
A further update and additional analysis will be provided with EnQuest's 2017 half year results."
"Back in mid-May, there was every expectation that the oil price would be stuck at about $55 a barrel for the foreseeable future............As luck would have it, the price peaked at just below that level as Opec sat down in May. It has now plunged about 13 per cent to trade last night at $47.33 in New York last night.
Share prices of the two big London-quoted companies, BP and Royal Dutch Shell, have held up tolerably well. They have cut costs and indicated they have the flexibility to hold down capital spending in the future. With a $50 price on a barrel they can probably maintain their dividends for the near term, meaning they provide one of the highest yields on the stock market, about 7 per cent.
The medium-sized producers have not fared so well. Premier Oil shares, one of this columns tips for this year at 74p, have fallen about 20 per cent since Opecs deal to close at 50p last night, despite having gained the approval of investors this week to the refinancing of its £2 billion-plus of debt after months of wrangling.
That fall looks like an overreaction. The company has wells in the Far East producing relatively cheaply and is well enough placed in the North Sea, having at the start of last year bought some cut-price assets from Eon, the German energy company.
The problem is that the lower the oil price, the less profit it makes from those wells and the longer it takes to pay off debt. Much the same might be said for Tullow Oil, whose Ten off Ghana came on stream last August and should produce 50,000 barrels a day this year. The company reckons to have 80 per cent of that production hedged ahead at $60 a barrel, while both Ten and the nearby Jubilee field break even at well below $50. The shares are off about 25 per cent since Opec; again, that looks like an overreaction.
Shares in Cairn Energy are down by about 14 per cent. This is working off the coast of Senegal, while it will get first oil from the Catcher and Kraken fields in the North Sea this year. These produce at $20 and $14 a barrel respectively contrary to popular belief many North Sea fields are highly profitable. Cairn says the economics of Senegal work at the current price. The shares were recommended for the long term in this column only recently.
Finally, Ophir Energy, which is developing the Fortuna gasfield off Equatorial Guinea. The company says the gas is sold forward at fixed long term prices, while production costs $15 a barrel. The market appears to have taken this on board, and the fall is only 8 per cent.
No one would say there are no further shocks ahead, but some of those shares look attractive long term. Or you could just take the yield from BP and Shell."
This one a new exploration well, low COS but pretty exciting stuff
Below from the FAR press release
Shareholder update: FAR back to exploration drilling
FAR to drill first pure exploration well offshore Senegal since the SNE discovery
Exploration well to be drilled in the South Fan prospect in the Basin Fan play
Well will evaluate potential for improved reservoirs in the Basin Fan play
FAN South-1 will be drilled on completion of SNE-6
SNE-6 has reached Total Depth and operations are progressing in line with plan
FAR Limited (ASX: FAR) and the Senegal Joint Venture are drilling the FAN South-1 exploration well into the Southern FAN prospect in the first pure exploration well to be drilled offshore Senegal since the discovery wells of FAN-1 and SNE-1 in 2014.
FAN South-1 will be the next well to be drilled in the current Senegal drilling campaign and will be drilling into the South Fan prospect. FAN South-1 is the first well drilled into the Basin play since the initial FAN-1 discovery well in 2014. The well will assess the upside potential for improved reservoir presence and quality in the basin. FAR assesses the FAN South prospect to contain 134 mmbbls* of recoverable oil on a best estimate basis, with an 18% chance of success (refer ASX release 7 February 2017). Figure 1 below shows the location of the FAN South-1 well.
The South Fan prospect consists of several stacked reservoir targets. The well will be drilled to an estimated Total Depth (TD) of 5,317 metres in a water depth of 2,139 metres. The firm well plan for FAN South-1 includes logging programs prior to the well being plugged and abandoned.
FAN South-1 will be drilled on completion of the SNE-6 appraisal well which has now reached Total Depth and operations including wireline logging, collection of samples and drill stem testing are underway. SNE-6 has been drilled ahead of planned timing.
Managing Director, Cath Norman said,
It is great to be back drilling a pure exploration target offshore Senegal, and the first well in the basin play since our original FAN-1 discovery. We are drilling in a part of the basin where we expect to encounter improved reservoir presence and quality and gain valuable information in understanding the substantial potential of the large deep water basin area.
With drilling continuing to progress ahead of schedule, without incident and safely, we look forward to bringing further news of the planned interference test in SNE-6 in the coming weeks.
The Indian govt does just what it wants, even the new administration under MODI..
They withdrew all large notes INR 1000, and 5000, giving just24 hours notice. That was in November. Cant produce enough new notes to supply demand, and they dont fit into ATMs, yet we fawn after them in seeking new deals.
Perhaps Cairn will announce a special div at the AGM.
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