interesting eroton want to invest into LPG and power production…from an article 2018…
“Diversification is key with plans ongoing to venture into the mid-stream sector by investing in areas such as LPG and power production. Eroton plans to be the number one indigenous operator in Nigerian upstream and intends to challenge IOCs in terms of overall production. We are uniquely placed to do so thanks to our competent team and strong commitment to corporate governance.”
“NCDMB has projected that in the next two years there will be an additional $25 billion investments to be invested into the oil and gas sector of Nigeria. And, with the resolution of some of the cash call challenges the joint ventures were facing which stagnated projects & investments in the oil and gas sector, a lot of opportunities are springing up again.”…
very interesting this article from nnpc…
“Total export crude oil and gas receipt for the period December 2017 to December 2018 stood at $6.06bn. Out of which, the sum of $4.56bn was transferred to JV Cash Call as first line charge"
by the looks of this statement from nnpc eroton has received the $20m owing from the cash call…
“It was quite fulfilling that in 2018, that is for the second year in a row, we concluded the fiscal year without any cash call arrears.”
just re reading some old report from hot stock rockets and albeit it is 2 years old, what they have printed is only just beginning to happen ie buy backs dividends and of course tenders…and news wells are being drilled and planned ( due to nnpc cash calls now received to increase new well production on oml18 etc)…
unfortunately dates have now got to be drawn out to 2022 imo due to nnpc in the past not paying their cc dues!!..
best bits of article…
Right now OML is producing 50,000 boepd but it has produced at double that rate and output is set to increase again over the next few years as more wells are drilled on the acreage. This field will still be chucking off cash in 20 years time.
Currently a lot of production is hedged at $95 but that will unwind. But on a fairly cautious analysis, San Leon will generate at least $530 million of free cash by 2020 and it will carry on generating cash for many years after that.
San Leon’s Board has committed to distribute 50% of available Nigerian free cash flow back to shareholders for the next 5-year period, in the form of cash dividends or share buy-backs so that works out at around £200 million. If it cannot find anything better to with its cash it may well return more. The current market cap is £230 million. That is clearly far too low.
Analysts at Brandon Hill reckon that at 54p the 2017 yield is 16%.
Of course there could be oil price weakness. But equally there could be strength and these forecasts are based on conservative assumptions. One should accept that San Leon has goofed before but it is not the operator so surely it cannot mess this one up? We accept that the track record and risks inherent in oil merit a premium yield – say 8% but that would imply a doubling of the share price.
We are not that greedy. We assume that a modest increase in the oil price plus investors starting to forgive past sins and appreciate what a cash cow San Leon is today will drive a pretty quick re rating of the shares.
I thought that payment was already announced, but there is (was) a similar amount still outstanding from 2016?
I think with prices around $65+ there wont be any more cash flow problems. Disagreements over apportioning losses from pipelines is more likely, but they seem to be less too. Ironically, a much higher price would attract more pipeline interference from potential thieves probably.
Perhaps this is a Goldilocks spot for the Niger delta
SLE have to get an extension to the agreement in 2020 though? I’m sure I read that but can’t find it in the old docs at moment. I may have scanned past it cos I keep getting disturbed at moment.
Thats why the use of that date I believe …
" Eroton and only approximately $20 million of arrears remain for 2016"
Yes this the amount I was saying about…
the 2020 extention you mention about eadwig… there has to be no extention required… as that is only a given date from the article that if eroton would have received all their cash call back in 2016 etc this is the cash amount sle would/could have been generating ie the $530m…
but as we know nnpc have only recently paid up to date cash calls and eroton are now just starting the new drilling actions etc to increase production they would have started in 2016…hence I just put imo we are 2 years behind in regards to those figures…
ABUJA, April 21 (Reuters) - Nigeria’s Nembe Creek Trunk Line, one of the two major lines transporting Bonny Light crude oil, was shut on Sunday after a fire prompted a force majeure, operator Aiteo said.
Aiteo said its emergency response team was activated once it was notified of the fire and it was forced to shut the line.
other line to bonny is TNP…
Trans Niger Pipeline Loopline
The Trans Niger Pipeline (TNP) transports around 180,000 barrels of crude oil per day to the Bonny Export Terminal and is part of the gas liquids evacuation infrastructure, critical for continued domestic power generation (Afam VI power plant) and liquefied gas exports. The loopline project creates an alternative route to avoid sabotage, bypassing an area where theft and illegal refining have been common. In addition, the project will install monitoring systems to detect any intrusion or leak. The pipeline will not be completely covered to allow security patrol boats to quickly access all pipeline sections.
Ogale, Alakiri, Cawthorne Channel and Bonny
Shell Petroleum Development Company Ltd (SPDC) is the joint venture (JV) operator of an unincorporated JV with a 30% interest
Nigerian National Petroleum Corporation (NNPC: 55%), Total E&P Nigeria Ltd (10%), and Nigerian Agip Oil Company (NAOC: 5%)
The project aims to secure the evacuation of crude from assets in the eastern part of the Niger Delta, and of natural gas from the Gbaran, Agbada, Okoloma and Alakiri gas plants to the Bonny terminal. After completion it also allows for more easy access to maintain the infrastructure.
The project consists of three parts:
1.a 12.5km 30inch pipeline from Ogale to Eleme/Ogu Bolo over land terrain;
2.a 25.5km 30inch pipeline from Eleme/Ogu Bolo to the Cawthorne Channel Junction Manifold, and a 2.4km 8inch pipeline from Alakiri to Ojikiri spurline, both over swamp terrain; and
3.a 20km 30inch pipeline and a 20km 24inch loop pipeline leg from Cawthorne Channel Junction Manifold to Bonny Oil and Gas Terminal, both over swamp terrain
" This pipeline has a capacity of 150,000 b/d at Nembe Creek, however, up to 600,000 b/d of liquids can be evacuated from the end point at Cawthorne Channel."… on oml18…
Brent crude, the global benchmark, rose as much as 3.3 percent a barrel and was last up $1.98 to $73.95
“It is with deep sense of satisfaction that I inform all Nigerians and the whole world that every molecule of crude oil produced in Nigeria, the quantity loaded is known and tracked to final destination including stopovers with applicable discharges. "