£1096.8m market cap
55.95p last close
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 (523mmbbl 2P reserves + 2C resources) is targeting first oil in H119.
Investment summary
Hurricane Energy is a UK-based E&P focused on hydrocarbon resources in naturally fractured basement reservoirs. Hurricane’s CPRs ascribe 2P reserves + 2C contingent resources of 2.6bn boe (gross) across all assets. With the FPSO now hooked up and securely moored at the Lancaster field, early production system (EPS) first oil remains on track for H119. Hurricane will now focus on topside commissioning prior to start up which will be followed by a ramp-up period to a gross plateau of 20kbd. Once production has stabilised, focus will shift to data gathering to enhance reservoir understanding. Successful confirmation of modelling parameters will aid in the de-risking of full field development. Hurricane’s three-well drilling programme is expected to commence in Q219, at Warwick Deep. This accelerated GWA programme is being made possible by Hurricane’s 2018 farm-out to Spirit Energy. Our updated valuation stands at 102.3p/share.
Y/E Dec |
Revenue (US$m) |
EBITDA (US$m) |
PBT (US$m) |
EPS (c) |
P/E (x) |
P/CF (x) |
|---|---|---|---|---|---|---|
| 2017A | 0.0 | (14.6) | (7.0) | (0.4) | N/A | N/A |
| 2018A | 0.0 | (12.6) | (18.5) | (2.2) | N/A | N/A |
| 2019E | 109.4 | 24.2 | (21.5) | (2.5) | N/A | 463.8 |
| 2020E | 345.8 | 209.3 | 109.6 | 12.9 | 5.7 | 7.6 |
| Last updated on 17/05/2019 | ||||||
Industry outlook
The Lancaster EPS development is forecast to generate a point-forward IRR of c 40% based on our US$70/bbl long-term Brent commodity price assumption.
Last updated on 17/05/2019
Sector |
|---|
| Oil & gas |
Share price graph
Balance sheet |
|
|---|---|
| Forecast net debt (US$m) | 102.9 |
| Forecast gearing ratio (%) | 17 |
Price performance
% |
1m |
3m |
12m |
||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
|||||||||||||||
| *% relative to local index | |||||||||||||||
Key management |
|
|---|---|
| Dr Robert Trice | CEO |
| Alistair Stobie | CFO |
