UK 22:05 Tuesday, 29 September 2026
Breaking news and expert analysis on fast-moving AIM and LSE listed shares
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
I have history with Bowleven (BLVN). I invested heavily in the company back in 2009, during the depths of the market crisis when its shares could be bought for less than the cash on their balance sheet. 2009 was a very good year for crisis investors, although it didn't feel very good at the time.
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Comments
Paul Curtis
Re the LTIP I’m told had to be within 42 days of Results and they waited as long as they could in the hope of getting President’s signature. Ran out of time.
I don’t understand why some of you think this is a no brainer future pay off?
IMO just the opposite! Forget the discount to cash and focus on the performance conditions. They have to be in top 50% before they get 20% and sliding scale thereafter. To get the lot they have to be in top 4 of 14 comparator companies.
Accepted we don’t know who the comparator companies are but I will find out.
Point is assuming these companies aren’t basket cases it is by no means a slam dunk that BLVN can finish well into top 50%. Others such as Ithaca, Premier, Enquest, Tullow, Sterling Resources, Iona, Faroe etc are all deep discount to NAV plays and will easily bounce 50% with oil price.
BLVN will need drill success to compete.
The attraction of BLVN, and as with Was, it’s my largest E&P holding, is that we get exposure to 4 high impact wells and still have over 30p per share net cash. IMO if all four wells disappoint we will sell our 20% stake in Etinde but won’t get a great price since I doubt Lukoil interested if the upside appraisal wells don’t come in.
Hence might get 40-50p total cash and imo shareholders will insist on large cash back.
Also, imo small O&G are walking dead since will never achieve premium ratings that allow them to access capital without excessive dilution. The genie is out of the bottle and markets will always view drill success as a future funding liability! And US shale has shown the dangers of underestimating technology. We dismiss solar power etc at our peril.
We currently have a perfect window for making money since low poo stimulates growth and demand whilst curbing renewables. Suppy decline is inevitable at $60 Brent. But once oil has bounced we will have to be extremely selective. The future is takeovers.
Paul Curtis
Re the LTIP I’m told had to be within 42 days of Results and they waited as long as they could in the hope of getting President’s signature. Ran out of time.
I don’t understand why some of you think this is a no brainer future pay off?
Forget the discount to cash and focus on the performance conditions. They have to be in top 50% before they get 20% and sliding scale thereafter. To get the lot they have to be in top 4 of 14 comparator companies.
Accepted we don’t know who the comparator companies are but I will find out.
Point is assuming these companies aren’t basket cases it is by no means a slam dunk that BLVN can finish well into top 50%. Others such as Ithaca, Premier, Enquest, Tullow, Sterling Resources, Iona, Faroe etc are all deep discount to NAV plays and will easily bounce over 50% with oil price.
BLVN will need drill success to outperform.
The attraction of BLVN, and as with Was, it’s my largest E&P holding, is that we get exposure to 4 high impact wells and still have over 30p per share net cash. IMO if all four wells disappoint we will sell our 20% stake in Etinde but won’t get a great price since I doubt Lukoil interested if the upside appraisal wells don’t come in.
Hence might get 40-50p total cash and imo shareholders will insist on large cash back.
Also, imo small O&G are walking dead since will never achieve premium ratings that allow them to access capital without excessive dilution. The genie is out of the bottle and markets will always view drill success as a future funding liability! And US shale has shown the dangers of underestimating technology. We dismiss solar power etc at our peril.
We currently have a perfect window for making money since low poo stimulates growth and demand whilst curbing renewables. Suppy decline is inevitable at $60 Brent. But once oil has bounced we will have to be extremely selective. The future is takeovers.
Terrys Chocolate Starfish
The unintended consequence of these type of annual LTIP awards is they encourage directors to trash companies in order to get a huge bounce as opposed to gradual consistent outperformance that nets less in bonuses.
Annual underperformance is not punished/has no cost so a simplistic game theory analysis suggests it makes sense for directors to deliberately incur several years of underperformance to get that one year lottery sized LTIP win.