Drilling Rig Thanks for sharing johnnie
Drilling Rig Regarding Halifax thought I’d share some correspondence I had with Hurricane a short while ago, nothing sensitive obviously so I expect they won’t mind the share. Ember 2 Alpha.png784x334 35.6 KB
Drilling Rig Ricfle: If the directors raise cash, by whatever means, for drilling with this level of income and cash in the bank, we should vote them all off the board ASAP. They have clearly got to fund something which demands a lot of money e.g. continuing to search for more oil whist also putting in the equipment necessary to develop the oil that they have already located without waiting until they have saved up enough income to afford to do this without borrowing or issuing more shares. Just like newly weds whose savings are inadequate but who have a secure enough income (and are still young enough) to justify getting a Flortgage
Drilling Rig bobsson: We have different “understandings” regarding the non dilutive fundraise, mine is that the money raised would be for additional GLA drilling. I agree we have a different understanding, mine is clearly it would be for FFD. We all ready know that hurricane have approx’ $144m in the bank. According to Hurricanes guidance they will be producing oil at 11k barrels per day till year end at $60 oil and $25 OPEX that is an profit of $385,000 per day. In less than 2 1/2 months Hurricane are planning to be producing at 20K barrels per day, at $60 oil and $20 OPEX that is $800,000 profit per day. If the directors raise cash, by whatever means, for drilling with this level of income and cash in the bank, we should vote them all of the board ASAP.
Drilling Rig riverside_red: You are not taking into account the financial risks of drilling as a North Atlantic winter approaches. riverside_red: It is no coincidence the JBL is on a lower rate until Easter. I may, or may not, have taken into account the financial risks of drilling as a North Atlantic winter approaches, but from your post Transocean certainly have by lowering the day rate. The original Lincoln well was completed in December 2016 and the following Halifax well in March 2017, so clearly Hurricane also understand the financial risks. If there is less drilling in the winter common sense tells you that the rates for tugs and supply vessels will follow Transocean’s rates downwards. In conclusion money is not a problem and winter is not a problem.
Drilling Rig You are not taking into account the financial risks of drilling as a North Atlantic winter approaches. Tug supply is already tight increasing day rates , the available weather windows are narrow both for rig moves and supplying the rig and almost non existent for plumbing in a well assuming the hardware is available. It is no coincidence the JBL is on a lower rate until Easter.
Drilling Rig Hi Ricfle, Regarding the drilling you may be right, instead of moving the TL to safe harbour for maintenance during the harsh winter season, keep it out there drilling for HUR. I do not know when the TL was last in for maintenance or what its schedule is for coming in for it. We have different “understandings” regarding the non dilutive fundraise, mine is that the money raised would be for additional GLA drilling. We know HUR had $81.4 million cash at the end of H1, but as we all know it is better to raise cash from a position of strength. The oil business is a risky business therefore it is always good to have a position of cash behind you, if things go wrong to to borrow from a position of weakness is not good. atb
Drilling Rig Bobsson bobsson: Hopefully there will be a couple of wells drilled on GLA in 2020, most likely a separate rig will be needed, not sure if Transocean have another available. Would be great if there are two rigs on the go for HUR at the same time I cannot see the need to wait until 2020 to drill Halifax. The rig Hurricane is using is “harsh environment”, they have drilled both Lincoln and Halifax in the winter previously. They have the cash. As Hurricane are expecting to be “interrupted” they need to crack on and drill Halifax and prove up its value. As to a “non dilutive fundraise” my understanding this is for FFD of the GLA, at present programmed for 2025, which cannot realistically happen without further drilling on Halifax.
Drilling Rig Thanks for the numbers research Ricfle. Hopefully there will be a couple of wells drilled on GLA in 2020, most likely a separate rig will be needed, not sure if Transocean have another available. Would be great if there are two rigs on the go for HUR at the same time. We know the cash flow will come in over the year but HUR have already stated they may need a non dilutive fundraise of some kind. Could be forward sell some oil or a short term revolving credit arrangement. Hope we have official news this week.
Drilling Rig I think there will be a separate rig for the GLA. Hurricane have commitments of $99.4m for the tie in ($46.9m) and 3 wells ($52.5m) on the GWA. This takes us up to the end of Q3 2020. Their is also a commitment for GWA FFD FEED of $50m starting in Q4 2020, but unless all the preceding events go to plan this can be ignored. From the Interim Results Presentation Hurricane had $81.4m in the bank on the 30 June 2019 including the sale of the first off load. The next 4 off loads are approx’ 1,790,000 barrels at say $60 oil and $25 Opex giving $62.7m profit or a total off $144.1m in the bank as today and 2 1/2 months of production left in the year. Hurricane should know by now if the EPS is preforming as expected and hence be in a position to look at rigs for the GLA. What to drill? Looking at [link] page 2, by far the largest unrisked item is Halifax at £1.80 per share, so this must be the place to drill. Looking to maximise information, ignore the original Halifax well and drill a new one, it should be as far into Halifax as the wax will allow for a tie back to the FPSO and consist of a vertical well followed by a horizontal well to be flow tested and suspended as a producer. Cost approx" $70m as the spirit farm in presentation. I think Hurricane will have already planed a course of action to do just this.
Drilling Rig Bobsson If this rig contract is for the 3 wells in the GWA in 2020, I cannot see a well drilled in the GLA using this rig. The present 3 well contract for the GWA is 8 months long, the new rig contract is 8 months long. Hurricane will also need a rig for the completion of the Lincoln well to tie it back to the FPSO. From Spirit’s point of view I am sure they would be happy for Hurricane to continue using the rig, after all there works were complete if time allowed.
Drilling Rig Hi Bobsson, Thanks for the correction. I had no intention to deceive anyone. Another drill on Lancaster looks as if it is likely and as Ash pointed out the rates for the initial phase of the drill rig hire are extremely favourable to Hurricane. Carliol
Drilling Rig Hi carliol, Just one correction to your post, HUR are not free carried for the 3 well 2020 drilling campaign, have a look at either the Spirit farm in presentation or keep scrolling down the Q3 presentation above to note that HUR are budgeting in excess of $100m in 2020 for cap ex on GWA. HUR are paying around $46m for all the tie backs and host mods and also look to have to pay around $80 or $90 million for a 50% share of the GWA drilling. You will note that strangely the Transocean contract has been broken down into separate hire costs and periods. My thoughts are that HUR have the PBLJ for a one well drill on GLA before moving to JV drilling on GWA. We shall see, but now the rig details are in the public domain HUR may be in no immediate rush to announce the 2020 schedule. IMHO
Drilling Rig Hi All, It’s re-assuring to see Hurricane is continuing to fulfill it’s commitment with Spirit to appraise and develop the Greater Warwick Area with three wells. The schedule of the Paul B Lloyd is in two segments. ( See copy and paste below. ) There appears to be sufficient time in the second segment for the three wells on the GWA to be drilled but I wonder what the PBL will be doing in the first part of the hire? Perhaps an additional producer on Lancaster or further work on the Lincoln Crestal in preparation to get the well into production? deepwater.com October%202019%20Fleet%20Status%20Report.pdf 2.58 MB The following link is to the Q3 Corporate Presentation 2019. You will note on page 8 that the A & D of the GWA is in line with the hire of the PBL. [link] Given that Hurricane continue to have a free carry on the drilling on the GWA, I wonder if Hurricane has any further plans to drill on it’s 100% owned assets of Lancaster and Halifax? Hurricane have a shed load of cash from Lancaster oil production so it makes sense to use this cash on further exploration, development and appraisal work. There should be an RNS issued soon to provide investors such as ourselves with detailed information of next years drilling plans. Carliol
Drilling Rig $160k and $205k aren’t bad rates.