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Marcos, you should be careful about calling anyone devious. Below is your post from earlier this month, in which you misleading stated what the Polvo March 2013 bpd was. While all the other amounts are Polvo's production at 100%, the March 2013 amount is the BP/HRT share as the total production was over 13,000 bpd as in January and February 2013. This amount comes via Van's link to the monthly production figures released by ANP.
You claimed that HRT was making headway as the decline in March was not as large as in the first two months of the year, but that was not the case. In effect, you made a false statement ... and I don't think it was unintentional.
Since you are not to be trusted, macros, maybe you should look elsewhere to spread your "misinformation."
marcoscsleite Wednesday, 05/07/14 04:51:37 PM
Re: None
Post # 3509 of 3937
Paralleling the monthly production reports for the first quarter of 2013 and 2014, the production of Polvo in March 2013 was virtually the same in 2014 in the range 8xxx boe / day. Below is a comparison:
Jan/13- 13.517 boe/day Jan/14 - 11.874 boe/day
Fev/13- 13.134 boe/day Fev/14 - 10.729 boe/day
Mar/13- 8359 boe/day Mar/14 - 8.086 boe/day
average output 1t13 - 11.670 boe/day
average output 1t14 - 10.229 boe/day
difference. 1440 boe/day
[color=red][/color]
North, I don't believe this is the Agora's BK. He would not jeopardize his position @ Agora by entering into a hotly discussed topic on a MB ... he might type an offending remark that would require Agora to act against him.
Also, the comment doesn't read like him. It reads as if Ogo were the author; it only lacks the "what's the broken parts here" phrase.
Great post, RZ. Several of us on this board has addressed the lack of professionalism and completeness at HRT in the administrative, financial and legal ranks, including those third parties, hired to provide "review of disclosures and documents." This obvious error is another example of the amateurish and uncaring approach HRT's management, current and past, has towards shareholders.
Having been an employee of, as well as watching, companies who are top management focused, I have no trouble believing your expectations, RZ and North, of what might happen to the minority shareholders in any actions taken by this management team.
We need to vote "NO" to put HRT/Tanure and his group on notice that they are being watched and challenged when their actions are deemed unfair and exclusion-oriented of those minority shareholders who have been in the stock for years.
We might only be little mosquitos on their proverbial elephant's butt, but they might feel the stings if there are enough of us mosquitos such that it makes HRT to think twice if it knows we aren't going away quietly.
The more votes that say "NO," the better chance we have of being heard and less chance of being scr**ed over by HRT/Tanure.
For those who believe the vote is a foregone conclusion (which it probably is), regardless of what the minority shareholders do, then you should vote "No" so that HRT/Tanure knows you want to be treated fairly, too; agreeing with them does not provide you with any comfort or assurances that you will be treated fairly under the new by-laws et al.
IR has finally replaced its truncated version of the Public Request for Proxy Authorization for the Special Shareholders´ Meeting of 06/13/2014.
Its value is that the old version and the changed version are shown side by side and with the changes marked accordingly.
http://ir.hrt.com.br/hrt/web/conteudo_en.asp?idioma=1&conta=44&tipo=32105
As always, thanks, Drill, for the information in all three of your posts this AM.
Did anyone listen to the CC yesterday? If so, was there anything of note discussed, especially the proposed changes to the by-laws?
Thanks in advance to those responding.
Van, U.S. investors might be factoring in the 2¢/share Deutsche Bank "Tax" due next month.
Bovespa must have had an order imbalance at the open as it appears HRT was delayed. Good start up 6 centavos (?) with close to 2 million shares traded.
Gus, my point, though not articulated clearly, is JV's are all right in Brazil, but total 100% control is troubling.
As to your other points, glad to read you are positive as to the reasons for buying HRT. I think most of us on this board are still holding, regardless of the 2¢ fee forthcoming for the HRTPY owners.
Brazil is touchy about natural resources. I believe the BRICS do not have formal agreements regarding foreign ownerships, so that is why I mentioned Rosneft might not able to pull it off.
I like some of your "Bug" comments on SH and if you did buy 100,000 shares, that means something to some of us who have read your negative assaults on HRT (proven to be on the mark) over the last few years.
Gus, you have a point, but probably not any public company that reports on GAAP basis. Those rules would require to include its portion of earnings or loss in its financials if it has an ownership of 15-20%.
Your idea, if true, might be geared towards Petrobras, if it isn't Tanure and his cronies. Rosneft might be a candidate, but Brazil laws might make it a difficult deal for them.
I agree that you would expect Goldman to hold firm and vote against the removal of the poison pill. MS will vote as its clients' wish.
In fact, why would anyone vote for its removal unless they would be on the inside of HRT's new future as a private company?
Didn't Discovery want to remove the poison pill, too, and Tanure said "No" at that time?
What a soap opera!!!
BTW, rzbern, are you still there? If so, what is your opinion?
CD, that will probably be next year, not this one, since the reverse split voting occurs on the 13th of June and the GDS assessment is based on shares owned by shareholders of record on the 12th.
Van, you are right it is interesting.
In the document titled, "Public Request for Proxy Authorization for the Special Shareholders´ Meeting of 06/13/2014," on page 69, there is a ¶ that is being added on the bottom of the page, but there is nothing further. I sent email to IR about it.
BTW - Did everyone receive a PR re: this meeting? I received the one issued on the 12th about MS's % reduction, but not this one, issued on the 13th.
I believe it affects only the American investors ... I'll avoid using any adjectives before "Americans."
Unfortunately, MM and his team 4-5 years ago were full of hubris that they did not negotiate very adeptly with the Germans. Nor did current management in getting this "Tax" reduced.
But then, again, we all thought back then that any share number of 15¢ would be a weekly or monthly or quarterly dividend, not the SP.
Effectively, those with GDS's are being "Taxed" @ rate of 12-15% of the current SP range.
Tough call for those who might want to sell some shares to pay the "Tax" with the idea of buying back when the SP falls back 2¢ as the Repsol results on WW-1 well will be forthcoming on either side of June 12th.
All right, I was a little harsh and am sorry for that, but I look at the trend of production, not one month's comparison and for the quarter it wasn't good.
It was possible March 2013 production was lower because BP had maintenance done, which would tie into their March year-end and it had a budget to spend.
Hopefully, there will be some discussion during next week's CC as to Polvo's near term production plans and drilling.
When is a 12.3% drop in quarterly production considered "... virtually the same ..."? If one would follow that logic year after year, in 2018 production would be down 40+% from 2013, but every year would be "... virtually the same ..."
Get real!
This is probably why BWO said, "Adios" to any ownership in Polvo, as well as the $$ asked by HRT. They probably questioned its viability long term.
Production in Polvo down 32% from January ... it can't all be blamed on Lent and Mardi Gras. So, why is Brazil SP up ~20% today? Down tomorrow ... BIG?
Are we due an announcement? Why is HRT pushing higher w/out one in the last two hours or so, especially with the volume shooting higher, too? Does someone in Brazil know something?
Thanks, Van, for pinning this on the top.
Robnhood, there is a problem with the Google Translator and probably the others, too: they translate the currency signs, but not the numbers. Thus, the cash numbers should be BR 300 million and BR100 million, not US$ as the translated version states.
Van, will you pin the ANP link noted in original post to the top for quick reference going forward?
Thanks.
North, my interpretation is that GS has ownership with the "acquired" announcement whereas MS "holds" means that the true owner(s) is someone else with an MS account.
Does anyone know if Brazil is joining the NATO nations in sanctions against Russia, which might impede Rosneft's acquisition of the 6% and future cap ex in the Solimões? I wouldn't think it would (BRIC association for one reason), but what else would explain the drop over the last few days. [We knew about the failed Polvo deal 10-12 days ago.]
Given Tanure's history of buying assets at distressed values, I would think the Brazilians would be buying into HRT, not selling out of it, to cash in on Tanure's expected good fortune with HRT.
Translation
What did the HRT with BW was a bad deal dissolution of the former CEO bad price to sell productive assets shortly after he took command in março/2014. The biggest struggle for partnerships would be in Solimões and Namibia. In Solimões already managed to transfer the operation for a major (Rosneft) as the sale of 6% of the blocks. And in Namibia with the high demand for oil, as the recent purchase of Shell, has a great chance of Farmout. source:
http://www.upstreamonline.com/epaper/article1352484.ece
Translation
The businessman Nelson Tanure is working to accelerate the entry of Russian Rosneft in exploration blocks that HRT in the Solimões Basin (AM). Thus, HRT will be minority and with no obligation to bear the heavy commitments related to operation.
At the same time, plans to buy 40% stake in Maersk Polvo field (Campos Basin), where HRT owns 60% of the business.
Tanure also want to sell just the blocks in Namibia, where each hole for exploration costs 90 million dollars. (Until now there were three holes in the water literally). The box of HRT is only 200 million.
By Lauro Jardim
Renzo, see the PR in Post #3311, which has "acquired" in it.
Thank you, Renzo, for your reply. I realize the controlling party (Tanure) can diminish economic value by actions he and his puppet board takes but if it is flagrant and abusive, it will trigger lawsuits about his and the officers' fiduciary responsibilities, for one thing.
It is good to know, however, that any take-out price is 100% of economic value.
As to the GS stake, it stated "acquired," as opposed to the MS "holds." I wonder why it bought those last 30,000 shares that put it over 5% and required GS to publicly report its ownership level.
RZ, possibly you can answer this question as it might be impacted by the HRT by-laws and Brazilian securities laws:
If Tanure does not own 20% or more of HRT, is he able to make an offer to the s/holders for the whole company but at a price that does not equal the 115% of HRT's economic value, but at a price much less?
If he can do that, other than rejecting his offer, is there anything the minority s/holders can do?
John and Van, that was my point as to why Rosneft only bought 6% of Solimões, rather than the 10% it could have. Why pay $28 million for the 4% of one project when it could buy ~20% of the whole company for less than $25 million with direct access to Polvo and Namibia and the prospects with each.
In the Morgan Stanley PR, it is interesting that MS holds 5.8%, not owns. Of course, this could be an HRT translation issue, but there has not been any retraction on the use of the word, "holds."
So, who holds/owns the rest (~12%) of the Discover shares?
As opposed to Tanure's group buying the shares, is it possible Rosneft bought the Discovery shares since it only bought 6%, instead of the 10% it could have purchased, of the Amazon project?
If Rosneft paid US$42 million for 6%, they kept US$28 million in the bank, which is several million more more than the US$ value of the Discovery shares that were sold.
Not surprising after the lack of mention of the sale to BWO at last month's AGM.
Hopefully, IR will issue a statement with some explanation of what happened. Wasn't someone speculating that Tanure may buy the 40% of Maersk?
Thanks, Drill.
Drill, so was the management team lying to us in the CC regarding the large capital outlay on the Polvo well?
Here is the comment from the CC transcript:
The wells that we intent to drill can be drilled with this rig. Our initial estimate is that each well will cost around R$35 million, total cost of 100% to be divided by the joint venture partners.
Whereas, you state:
The gross drilling, completion, and hook-up
costs for each well were estimated to be U.S.$35 million based
on the most recent drilling cost data provided by HRT O&G.
They claim reais and you US$. Which one is it? For a company that can't keep track (or doesn't want to) of its wallet, this is a big difference ... unless the exchange rate is par by then. LOL!
BVE, thank you for your thoughts. One correction per the transcript on Seeking Alpha is that the Polvo drilling costs will be R$35 million per well, nor US$.
I think you are too hopeful that the 1Q CC will be any more revealing from these guys. I thought they were good at not answering the questions with any new information or insight.
They did not address the status of selling 30% to BWO, which raises the question as to whether it will happen or not. Is the daily decline in production from last year a deal breaker?
But you are right that, especially if you have been here for a while, it is not practical and too pre-mature to sell now.
Overall, the PR was poorly done from a professional standpoint.
First, how can this be a fourth quarter report when there are NO Fourth Quarter numbers. It is a Fiscal 2013 synopsis. The charts are disorganized in that some have 2013 first, others have 2012 first. This cacophony can be found in the financial statements with the balance sheet and income statement have 2012 first, and then the cash flow follows with 2013 first. [The proper presentation is the current year is always first as that is the most important year.]
In the third quarter report, 2013 revenues for nine months were R$5.4 million. For the full year, 2013 revenues were R$4.4 million. So, they lost one million reais in REVENUE. How does that happen? That might be the reason for no fourth quarter numbers.
It is apparent that Petrobras is not going to participate in the 2014/15 campaign of the Solimões Basin (“ongoing talks”) as no discussion of the agreement the three parties signed in the summer of 2013 is noted anywhere. In keeping with the lack of transparency, we are not told all the details, including contingencies, that might exist in the Rosneft agreement should HRT not make good on the cash calls it receives from Rosneft as the development goes forward. So, the future farm-downs in the Solimões might not be for selling a piece thus bringing in cash as it will be giving up a piece so cash does not have to be paid out.
Let’s face it, the Brazilians on the ground know what this firm has or doesn’t have in its assets. If there were some good news brewing, Brazilian buyers would come forward and push the SP up. Even, the farm-down of Polvo has to be questioned since there is no mention of it in the press release. Maybe, the potential buyer is worried about the 16% decline in production from January and February 2013 to the same period in 2014 … also, not addressed by HRT.
I hope there is a Q&A session during the CC tomorrow that will lead to a discussion of some of these facts or that HRT’s management provides remarks in their speeches about them.
For those who listen in, please share your thoughts with those of us who can’t. It will be greatly appreciate by many, including this concerned skeptic.
Thanks, Van, for the email. I sent a reply to the reporter that she needs to read the HRT PR more closely to understand the cash calls are valued in that amount as well.
One comment to Drill on his later post about cash position: remember that $54 million was received before year end, at which time, HRT told rzbern that the money was for the cash calls. So, there is only $42 million forthcoming in Fiscal 2014.
Van, if HRT gave rzbern the correct figures of the cash call payments, then it appears the $54 million received in the fourth quarter was settlement of that and the 6% and rigs were sold for $41 million and a one year credit line of $40 million.
With that info, what is the value that should be assigned to the Amazon? Whatever it is, it has to be greater than its current market value.