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Hurricane Energy

LN: HUR

Market Cap£60.8m

Last Close 3.05p

Hurricane Energy is an E&P focused on fractured basement exploration and development in the West of Shetland region. The company’s 100%-owned Lancaster oil discovery achieved first oil on target in H119.

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Investment summary

Following the downgrading of reserves and resources in the Lancaster field (to 2P reserves of 7.1mmbbls and 2C resources of 37.9mmbbls), Hurricane has proposed a financial restructuring plan with 69% of the group’s convertible bond holders, under which US$50m of the company’s US$230m debt will be swapped for shares, and the maturity date of the US$180m remaining debt will be extended from July 2022 to December 2024.Three potential investment scenarios have been developed with HUR highlighting that the most likely scenario is for no further activity. The court sanction hearing for this plan was due to open on 21 June 2021. Production from the P6 well is currently stabilising and targeting c 11,000bopd (and will continue to decline), after the ESP tripped and was restarted. Our valuation remains suspended.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (c)
P/E (x)
P/CF (x)
2018A 0.0 (12.6) (18.5) (2.2) N/A N/A
2019A 170.3 (11.7) 30.0 (2.5) N/A 0.7
2020E N/A N/A N/A N/A N/A N/A
2021E N/A N/A N/A N/A N/A N/A
Industry outlook

HUR’s ability to mitigate declines at Lancaster will depend on the outcome of its ongoing engagement with stakeholders regarding the nature and timing of future investment in the field.

Last updated on 22/09/2021
Content on Hurricane Energy
Hurricane Energy – Resource downgrade warning
Oil & gas | Update | 18 August 2020
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Share price graph
Balance sheet
Forecast net debt (US$m) N/A
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual 44.3 103.4 3.4
Relative* 44.4 101.7 (17.7)
52-week high/low 5.0p/0.7p
*% relative to local index
Key management
Richard Chaffe CFO
Beverley Smith Interim CEO
Philip Corbett Head of IR