Column: Is the U.S. shale oil revolution over?


U.S. production of petroleum and other liquids more than doubled to 19.5 million barrels per day in 2019 from 9.1 million bpd in 2009, according to the U.S. Energy Information Administration (EIA).

U.S. marginal production (+14.5 million bpd) captured nearly all the increase in global consumption (+14.8 million bpd) between 2009 and 2019.



https://www.reuters.com/markets/commodities/is-us-shale-oil-revolution-over-kemp-2022-11-22/

AGM and EGM just finished. Hopefully management will upload the video or important points in website soon.

Dr Kenneth answered most of the questions with confidence.

Very happy to see that. Will hold Hibiscus till 2026

Biden Plans To Refill The SPR When Oil Prices Fall Below $72


https://oilprice.com/Energy/Energy-General/Biden-Plans-To-Refill-The-SPR-When-Oil-Prices-Fall-Below-72.html



I wish Biden has chance to refill SPR at $72, then hibiscus might have chance to buy another valuable cheap oilfield again in 2023.

Another excellent write up by zhangzuode !!

MUST READ !!

Hibiscus - Future is bright


https://klse.i3investor.com/blogs/ZZD/2022-10-10-story-h1650143472-Hibiscus_Future_is_bright.jsp

Hi, @ogre2021

1) I reposted my comment on 20/02/2022 and 17/07/2022 which were before announcement of quarter report of Q4FY2022. By end of 30 June 2022, hibiscus has unrestricted cash of RM 544.7 million and net debt of RM88.8 million. According to Corporate and Business Update for Q4FY2022 , page 12, total debt balance as at 30 June 2022 relates to the outstanding balance of a revolving credit facility drawn down during the Current Quarter to aid working capital requirements.

https://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=129104&name=EA_GA_ATTACHMENTS


2) According to AmInvest Research, date 21/07/2022,
Petronas Carigali, which holds the remaining 50% ownership of the North Sabah PSC, has been paying the SST given that all its other PSCs in Sabah are under Sabah’s jurisdiction. Management of hibiscus also clarified that North Sabah and Kinabalu PSCs are the only 2 PSCs that undertake oil lifting activities in the Labuan territory.

repost my comment on 20/02/2022



agree with you, i3lurker.

Sure will maximize hibiscus in my portfolio if got chance to buy the dip, may be around 80sen. Will wait patiently.

but hibiscus is quite different with Serba in view of :

1) hibiscus is debt free company

2) hibiscus sells North Sabah crude oil to one company only, which is Trafigura and share 50% profit with Petronas. So it is quite difficult to manipulate the accounting.

3) hibiscus sells Anasuria cluster crude oil to one company only, which is BP Oil and share 50% profit with Ping Petroleum. So it is also quite difficult to manipulate the accounting.

4) hibiscus has no asset or project in Middle East. hibiscus got bad experience in Oman business before.

5) hibiscus plans to acquire another asset in Southeast Asia, not in Middle East

6) For next 3 years, hibiscus will be quite busy with Repsol assets, Teal West Project and Marigold Project.

7) hibiscus management team has excellent track record. Shell, Exxon Mobil, Repsol, Petronas, Petrovietnam, BP Oil and Trafigura trust Hibiscus and quite happy to do business with hibiscus

repost my comment on 17/7/2022

Warren Buffett kept telling us, “ Don’t buy stock, just buy business”. Why I prefer Hibiscs business than other company :

1) Debt free company
– no risk of bankruptcy
– no worry in current higher interest rate environment

2) No inventory risk
– Hibiscs able to sell out every single drop of crude oil and natural gas it produces

3) Low cost producer
– average OPEX below USD 20/bbl
– if Brent price more than USD 30/bbl, Hibiscs able to generate positive cash flow by delaying CAPEX ( less risk of bankruptcy)
– if Brent price more than USD 40/bbl, Hibiscs able to generate net profit
– if Brent price ranging USD 50-70/bbl, Hibiscs able to generate margin of net profit around 10-20%
– if Brent price more than USD 70/bbl, Hibiscs able to generate margin of net profit more than 20%
– if Brent price more than USD 80/bbl, Hibiscs able to generate strong free cash flow
– FYI, Hibiscs can sell crude oil with Brent price at least 5% premium.

4) Excellent management team
– always acquired valuable oilfields at extremely low price during low Brent price environment
– able to maintain average OPEX below USD 20/bbl without compromising safety issues.

5) Strong moat
– no obvious upstream competitor in Malaysia for next 5 years
– Very difficult to get borrowings from bank or private fund to start up a brand new upstream oil and gas company due to ESG issue
– company needs to have experienced management team, good track records and strong financial sheet to deal business with Shell, ExxonMobil, BP Oil, Repsol, Petronas, PetroVietnam and Trafigura.
– During Repsol assets bid last year, Repsol chosen Hibiscs even though Hibiscs’ bid price was lower than his competitors

So, can you recommend me another company in Malaysia better than Hibiscs which has excellent management team, debt free, no inventory risk, low cost producer and strong moat?

May be the new definition of dodgy financials is a company with market capitalization of RM 1,800 million and net debt RM 88 millions, merely able to generate net profit of RM 613 million and core net profit of RM 342.7 million.

Another excellent write up by zhangzuode !!

Hibiscus – What Warren Buffet sees in oil


https://klse.i3investor.com/blogs/ZZD/2022-09-19-story-h1649162325-Hibiscus_What_Warren_Buffet_sees_in_oil.jsp

A Price Cap On Russian Oil Could Cause A Supply Catastrophe


If Russia refuses to use any maritime services associated with G7 countries, "Russian oil will have to sail on non-Western tankers - and there aren't enough vessels to handle Russia's millions of barrels," they argue.

"The result: less oil, higher prices, and less pain for Russia."



https://oilprice.com/Energy/Energy-General/A-Price-Cap-On-Russian-Oil-Could-Cause-A-Supply-Catastrophe.html

Charts suggest oil will bounce short term then head lower, Jim Cramer says


Cramer added that if oil falls below $80, the next potential floor is at around $60 — and with the Federal Reserve gearing up to raise interest rates next week in its aggressive campaign against inflation, it wouldn’t take much to push oil down even more.


https://www.cnbc.com/2022/09/14/charts-suggest-oil-will-bounce-short-term-then-head-lower-jim-cramer-says.html


Hopefully Jim Cramer and rr88 are right.Then Hibiscus will has another great chance to acquire another valuable oilfield asset in Brent price USD 60 environment.

Top shale executive says U.S. oil output gains to disappoint


U.S. oil output this year is likely to disappoint, with even lower growth possible next year, said Scott Sheffield, chief executive of leading shale producer Pioneer Natural Resources



https://www.reuters.com/business/energy/pioneer-natural-resources-says-us-oil-output-likely-below-expectations-2022-09-07/

Biden Officials Weigh Buying Oil at Around $80 to Refill Reserves


At the same time, officials are trying to reassure oil producers that the administration won’t let prices collapse amid intense volatility that’s fueled massive daily swings.


https://www.bloomberg.com/news/articles/2022-09-13/biden-officials-mull-buying-oil-at-around-80-to-refill-reserves?leadSource=uverify%20wall

1) Location of North Sabah oilfields : 33km offshore Kota Kinabalu, Sabah

2) Location of 2012 Kinabalu oilfields : 5° 30' N 114° 50' E , approximate 40km offshore Labuan and approximate 55km nearest coastline Sabah

3) Article 3 of the Law of the Sea Convention 1982 (LOSC) clearly states that a coastal State may claim up to 12-nautical miles (approximately 22 kilometers) of territorial sea from the baseline of the coastal state

4) ON June 22, 2012, Sarawak and Sabah lost their sovereign rights and jurisdiction over the area of the Continental Shelf, consisting of the seabed and its subsoil beneath the high seas contiguous to the territorial waters of the Borneo states, when Territorial Sea Act 2012 (TSA) came into effect, limiting both their jurisdictions to three nautical miles (5.5 km) from the coastline.

5) The implication is that with the reduced breadth limits of its territorial waters, the state’s rights to fisheries, marine and mineral resources, tourism sites in marine areas and so forth are now confined to only 3 nautical miles (5.56 km) from its coastline.

6) Territorial Sea Act 2012 (TSA)
https://people.utm.my/tlchoon/files/2015/09/Territorial-Sea-Act-2012-Act-750.pdf


7) Hibiscus does not own the oil produced before the point of sale – the legal ownership of the oil produced is held by Petronas from the point of extraction until the eventual point of sale. Hibiscus, as the independent contractor, is then entitled to receive a pre-agreed portion of the oil as settlement-in-kind for services provided to Petronas

8) The point of sale takes place outside Sabah as Hibiscus’ share of oil is offloaded and sold via crude oil tankers at a single buoy mooring located 5km offshore from Labuan crude oil terminal, which is outside of Sabah’s tax jurisdiction.

9) The Sabah state government has issued a notice to Hibiscus that working permits for its North Sabah and Kinabalu fields will be cancelled on Oct 1, 2022, if payment of the taxes and penalties are not settled. The potential termination of workers’ permits will only affect non-Sabahan workers going in and out of the state. 24% of Hibiscus’s total workforce are Sabahans

10) Hibiscus highlighted that both PSCs’ operations will be able to continue its production with some temporary operation disruptions due to manpower bottlenecks. To minimise any potential production impact, Hibiscus may reallocate its workforce composition by diverting more ancillary workers that are involved in maintenance and other supporting activities to production-related roles.

11) Hibiscus is in a unique situation compared to other oil producers in Sabah mainly because Hibiscus’s oil goes directly to Labuan and not into the Sabah state. Hibiscus is the only company landing oil in Labuan.

According to Fourth financial quarter of financial year ended 30 June 2022, page 14 and page 15:

Save as disclosed below, the Directors are not aware of any material contingent liabilities or contingent assets, which, upon becoming enforceable, may have a material impact on the profit or loss, or net
assets value of the Group.

On 1 April 2020, the Sabah State Government decided to impose state sales tax (“SST”) on petroleum products sold by SEA Hibiscus Sdn Bhd (“SEA Hibiscus”) and HML (“Companies”) in relation to crude oil being sold from the Labuan Crude Oil Terminal (“LCOT”).

On 21 June 2022, SEA Hibiscus received a payment notice from the Permanent Secretary and Director of State Sales Tax for the SST and a penalty amounting to RM97.31 million in total. SEA Hibiscus vide a reply dated 20 July 2022, informed the state that for SST to apply, SEA Hibiscus would have to be in the business of selling or producing taxable goods in the state. SEA Hibiscus informed the state that it was neither in the business of selling or producing taxable goods in the state and was therefore not liable for the SST payment.

On 8 July 2022, the Companies received a letter from the office of the Chief Minister of Sabah (“Letter”) which stated that the Companies are liable for SST on the basis that the Companies are providing “taxable goods”, namely crude petroleum oils and natural gas from the State of Sabah. On 11 July 2022, the Companies responded to the Letter to clarify that pursuant to the Petroleum Development Act 1974, the Companies cannot and do not provide such “taxable goods” from the State
of Sabah and are therefore not legally liable for SST. This is a position which has been affirmed by the Companies’ external legal advisors.

On 10 August 2022, HML received a payment notice from the Permanent Secretary and Director of State Sales Tax for the SST and a penalty amounting to RM14.18 million in total. HML is currently taking external legal advice.

The Directors are of the view that no provision is required in the Group’s financial statements at this juncture based on the facts surrounding the matter and the legal view from the Companies' external
legal advisors that the sale of crude oil in the specific case of the Companies would fall outside the scope of the State Sales Tax Enactment 1998.

5 Common Trading Multiples Used in Oil and Gas Valuation


1) EV/EBITDA compares the oil and gas business to EBITDA, and measures profits before interest.

2) EV/BOE/D doesn't account for undeveloped fields, so investors should determine the cost of developing new fields to get an idea of a company's financial health.

3) EV/2P requires no estimates or assumptions, and helps analysts understand how well a company's resources will support its operations.

4) Price/Cash flow per share allows for better comparisons across the sector.

5) Many analysts prefer EV/DACF because it takes the enterprise value and divides it by the sum of cash flow from operating activities and all financial charges.



https://www.investopedia.com/articles/basics/11/common-multiples-used-in-oil-and-gas-valuation.asp

IMF: Saudi Arabia Needs $80-85 Oil Price To Balance 2019 Budget


The oil price slump in the fourth quarter of 2018 has certainly affected the public finances of the biggest oil exporting nations, including OPEC’s biggest, Saudi Arabia.


https://oilprice.com/Latest-Energy-News/World-News/IMF-Saudi-Arabia-Needs-80-85-Oil-Price-To-Balance-2019-Budget.html

How Will Iran’s Return To Oil Markets Impact Prices?


Yet OPEC+ has demonstrated that it can be flexible not only with regard to production control but with regard to prices. Few remember that far back but it was less than two years ago that various OPEC officials signaled a range of $60 to $70 per barrel of Brent crude was a good one for the cartel.

Now, some analysts are arguing that OPEC wants to put a floor on oil and this floor is $100.


https://oilprice.com/Energy/Oil-Prices/How-Will-Irans-Return-To-Oil-Markets-Impact-Prices.html

US oil producers defy calls to open taps and tame war-driven energy prices


“We don’t feel the need to grow production,” said the company’s chief executive Vicki Hollub. “We feel like one of the best values right now is investment in our own stock.” Billionaire investor Warren Buffett’s Berkshire Hathaway has built an almost 20 per cent stake in Occidental, helping its share price more than double over the past year.



https://www.ft.com/content/137e38d3-c0e5-493b-9690-7c2fae36483f?ftcamp=traffic/partner/feed_headline/us_yahoo/auddev

Clark: What's Up With The Oil Market


For the last 8 years or so, shorting oil on any sign of recession in either the US or China has been a good trade. Hence I can understand the temptation to see the inverted yield curve, or weakening activity in China and US as signs to get short oil. There are however some big problems with a bearish oil view here.


https://www.zerohedge.com/markets/clark-whats-oil-market

Energy Aspects: Crude Oil Demand Not Declining In Recession Pattern


This time the slowdown or a recession will be very different from the major recession brought about by the credit crisis in 2008. It would be more like the recession of 2001 or in the early 1990s, Sen said, noting that global oil demand continued to grow in those periods.


https://oilprice.com/Latest-Energy-News/World-News/Energy-Aspects-Crude-Oil-Demand-Not-Declining-In-Recession-Pattern.html

OPEC+ Is Now 2.84 Million Bpd Below Its Oil Production Target


As OPEC+ is unwinding its cuts, more and more members are falling further behind their quotas due to a lack of capacity or investment in supply. In June, the compliance rate at the OPEC+ group soared to 320% from an estimated 256% in May,


https://oilprice.com/Latest-Energy-News/World-News/OPEC-Is-Now-284-Million-Bpd-Below-Its-Oil-Production-Target.html

What Is Value Investing?


https://klse.i3investor.com/blogs/kcchongnz/2022-07-26-story-h1626969923-What_Is_Value_Investing.jsp

High Crude Prices Are Here To Stay


Between OPEC’s shrinking production capacity, the U.S. shale labor shortage, and investors’ insistence on emission reporting and net-zero commitments, it’s not hard to see where oil prices are going, even if sanctions against Russia suddenly drop, which is not happening, even if the war in Ukraine ends, as multiple EU officials have said.


https://oilprice.com/Energy/Crude-Oil/High-Crude-Prices-Are-Here-To-Stay.html

Warren Buffett kept telling us, “ Don’t buy stock, just buy business”. Why I prefer Hibiscs business than other company :

1) Debt free company
– no risk of bankruptcy
– no worry in current higher interest rate environment

2) No inventory risk
– Hibiscs able to sell out every single drop of crude oil and natural gas it produces

3) Low cost producer
– average OPEX below USD 20/bbl
– if Brent price more than USD 30/bbl, Hibiscs able to generate positive cash flow by delaying CAPEX ( less risk of bankruptcy)
– if Brent price more than USD 40/bbl, Hibiscs able to generate net profit
– if Brent price ranging USD 50-70/bbl, Hibiscs able to generate margin of net profit around 10-20%
– if Brent price more than USD 70/bbl, Hibiscs able to generate margin of net profit more than 20%
– if Brent price more than USD 80/bbl, Hibiscs able to generate strong free cash flow
– FYI, Hibiscs can sell crude oil with Brent price at least 5% premium.

4) Excellent management team
– always acquired valuable oilfields at extremely low price during low Brent price environment
– able to maintain average OPEX below USD 20/bbl without compromising safety issues.

5) Strong moat
– no obvious upstream competitor in Malaysia for next 5 years
– Very difficult to get borrowings from bank or private fund to start up a brand new upstream oil and gas company due to ESG issue
– company needs to have experienced management team, good track records and strong financial sheet to deal business with Shell, ExxonMobil, BP Oil, Repsol, Petronas, PetroVietnam and Trafigura.
– During Repsol assets bid last year, Repsol chosen Hibiscs even though Hibiscs’ bid price was lower than his competitors

So, can you recommend me another company in Malaysia better than Hibiscs which has excellent management team, debt free, no inventory risk, low cost producer and strong moat?

Thanks for current weak sentiment, finally able to accumulate and switch to Hibiscs till 45% of my portfolio ( other 55% is Genting Berhad only). As a long term investor, I am willing to take the risk to grow my wealth for next 3 to 5 years together with hibiscs and Dr Kenneth.

Average Brent price

April : USD 105.82/bbl

May : USD 110.92/bbl

June : USD 116.94/bbl

Q4FY2022 , April - June : USD 111.31/bbl

** Hibiscus can sell crude oil with Brent price at least 5% premium due to tight market


https://www.investing.com/commodities/brent-oil-historical-data

Question 1: How many percentage of top 100 richest people in the world accumulate their wealth by owning business ??

Question 2: How many percentage of top 100 richest people in the world accumulate their wealth by using technical analysis ??


https://www.celebritynetworth.com/list/top-100-richest-people-in-the-world/

I haven’t met a Rich Technician -- Jim Rogers


https://tradefolly.wordpress.com/2015/05/19/i-havent-met-a-rich-technician/

@Raymond

Please read the excellent write up by zhangzuode on 26/05/2022

He might clear up your concern.





Hibiscus 3Q22 Review

https://klse.i3investor.com/blogs/ZZD/2022-05-26-story-h1623448629-Hibiscus_3Q22_Review.jsp

1) Hibiscus closing price on 24/6/22 was RM 0.905 (market cap RM1.8b)

2) For Q4FY2022, hibiscus plans to sell 2,076,751 boe of oil and gas, with estimated revenue of at least RM800m and net profit of RM150m-200m. By the end of 31/03/2022, hibiscus had unrestricted cash of RM273m. It is safe to estimate hibiscus will has unrestricted cash of RM400m by 30/06/2022

3) For FY2023, Maybank estimates hibiscus will generate EBITDA of RM1,482m and Hong Leong estimates hibiscus will generate EBITDA of RM1,463m

4) EV = Enterprise Value = Market cap + Total debts - cash
For FY2023, EV / EBITDA = ( 1800m + 0 - 400m ) / 1463 = 0.957

5) The largest shareholder, Datuk Micheal Tang bought total of 10,792,100 shares in between 18/02/2022 - 14/03/2022, with share price at least RM 1.10. He bought another 20,000,000 shares in between 22/06/2022-23/06/2022

As a value investor, can you miss a chance to invest in a company with excellent management team, zero debt, low cost producer ( average OPEX less than USD 20/boe) , potential of growth ( Teal West Project, Marigold Project, unlock 2C resource of North Sabah, acquisition of another valuable oilfield) and extremely low EV/EBITDA ( deeply undervalued). Datuk Micheal Tang doesn't think so

FYI, the average EV/EBITDA of Oil and Gas (production and Exploration) of United states for January 2022 is 8.28

Roadway Congestion Returns To China, Signals Tighter Global Oil Supplies


Vitol Group Chief Executive Officer Russell Hardy told the audience Tuesday at the Qatar Economic Forum that China's increasing fuel demand in an already tight global market means prices won't drop that much.


Hardy's similarly bullish message was echoed by Exxon Mobil CEO who said this week that global oil markets may remain tight for another three to five years largely because of a lack of investment since the pandemic began.


https://www.zerohedge.com/markets/roadway-congestion-returns-china-signals-tighter-global-oil-supplies

Why should value investors buy hibiscus at RM 1.00 (market cap RM2b) ?

1) At RM 1.00, EV/2P valuation of hibiscus is around USD 5.5/barrel. FYI, EnQuest's valuation is around USD14/barrel and other peer comparisons average USD18/barrel. Dialog just bought Pan Orient Energy Corp (POEC) with a valuation of USD16.2/barrel recently.

2) For Q4FY2022, hibiscus plans to sell 2,076,751 boe of oil and gas, with estimated revenue of RM 800m and net profit of RM 150m-200m. By the end of 31/03/2022, hibiscus had unrestricted cash of RM 273m. It is safe to estimate hibiscus will has unrestricted cash of RM 400m by 30/06/2022

3) With capex ( Repsol + North Sabah + Anusuria) of RM 330m - RM 450m per year, Maybank and HLIB estimate hibiscus will generate free cash flow of RM 400m-RM 700m per year for FY2023 and FY2024. I wont surprise hibiscus will generate total unrestricted cash of RM 1.5b by 30/06/2024, ( excluding capex for Teal West and Marigold Project).

4) Big shareholder, Datuk Micheal Tang bought total of 10,792,100 shares in between 18/02/2022 - 14/03/2022, with share price at least RM 1.10.

As a value investor, if you plan to hold hibiscus for at least 3 years, RM 1.00 will offer a very good entry point.

@nazrzach , thanks for sharing

How much you have to pay if you want to take over Hibiscus?

1) Dialog announced that it is acquiring the entire 100% equity interest in Pan Orient Energy Corp (POEC) for a cash consideration of USD38.7m

2) POES(siam) is the operator of Concession L53/48, onshore Thailand, which expires in 2035 with an optional 10-year renewal period, is located 100km northwest of Bangkok and consists of 7 onshore producing fields. POES produced 2,700 barrels of oil per day (bopd) in 2021, averaging 1,105 bopd in 1Q2022.

2) Based on HLIB calculation, the POEC is valued to be USD16.2 for each dollar of its 2P reserves (EV/2P)

3) With current share price of RM 1.30 and market cap of RM 2.6b, Hibiscus’s estimated 2P reserves of 77.3m as at 1 Jan 2022 and 75.9m as at 31 March 2022, HLIB and Ambank highlight that the market currently values Hibiscus at an EV/2P valuation of USD7.4/barrel, at a discount of 49% to EnQuest's US$14/barrel and 59% to the regional average of US$18/barrel.

4) If Dialog plans to take over Hibiscus with EV/2P valuation of USD 16.2/barrel, Dialog has to pay
= (16.2/7.4) x RM 1.30 = RM 2.85

So, you have to pay RM 2.85 per share to take over Hibiscus based on Dialog latest valuation.

Corporate and Business Update
Kuala Lumpur, 7 June 2022 – 6.45pm


Our discontinuance of the payment of SST under protest (in the case of RML) and our non-payment of SST (in the case of SEA Hibiscus) may lead to the state authorities taking action against HPB, its subsidiaries and / or its directors.


https://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=126731&name=EA_GA_ATTACHMENTS

Yes, we need these excellent directors with "big balls" to make risky decision. Not the " Yes Man" directors. That's why I will hold tight tight hibiscus

Citi And Barclays Raise Oil Price Forecasts


Citi’s second-quarter 2022 Brent forecast is now seen at $113 per barrel.

Barclays now sees Brent prices averaging $111 this year and next.


https://oilprice.com/Energy/Oil-Prices/Citi-And-Barclays-Raise-Oil-Price-Forecasts.html

Goldman Again Hikes Oil Price Target, Now Sees Barrel Hitting $140, Up From $125



https://www.zerohedge.com/markets/goldman-again-hikes-oil-price-target-now-sees-barrel-hitting-140-125

In 2020, an estimated 5.8 million Americans aged 65 years or older had Alzheimer’s disease. This number is projected to nearly triple to 14 million people by 2060.

In 2010, the costs of treating Alzheimer’s disease were projected to fall between $159 and $215 billion. By 2040, these costs are projected to jump to between $379 and more than $500 billion annually.


https://www.cdc.gov/aging/aginginfo/alzheimers.htm

In today AGM, the management team mentioned that TauRx might sell HMTM drug almost same price with Biogen's Alzheimer drug Aduhelm, which cost around USD 28,200 per year.

Population of Alzheimer patients is around 50-55 million.

If TauRx manages to capture 10% of market, revenue will be
5 million patients x UDS 28,200 per year
= USD 141,000,000,000 per year !!
= USD 141 Billion per year !!

Aduhelm is given through infusion ( injection). HMTM drug is given in oral form, no need injection, more convenient for patients and caretakers !!





Biogen Slashes Price of Alzheimer’s Drug Aduhelm, as It Faces Obstacles


Biogen slashed the price of its controversial new Alzheimer’s drug Aduhelm on Monday as the drug faces weak sales and mounting criticism.

The price was reduced to $28,200 a year from $56,000 on the same day that a group of Alzheimer’s experts and health advocates called on the Food and Drug Administration to pull the drug off the market and said they were supporting an effort to file a formal petition with the agency to withdraw it.

https://www.nytimes.com/2021/12/20/health/alzheimers-aduhelm-price.html

Q: How long does the drug approval process take?

A: The 1992 Prescription Drug User Fee Act (PDUFA) established a two-tiered system – Standard Review and Priority Review.

Standard Review is applied to a drug that offers at most, only minor improvement over existing marketed therapies. The 2002 amendments to PDUFA set a 10 month goal for a standard review.

Priority Review designation is given to drugs that offer major advances in treatment, or provide a treatment where none existed. The goal for completing a Priority Review is six months.


https://www.fda.gov/drugs/special-features/frequently-asked-questions-about-fda-drug-approval-process#4

Drug Review Steps Simplified

1) Preclinical (animal) testing.
2) An investigational new drug application (IND) outlines what the sponsor of a new drug proposes for human testing in clinical trials.
3) Phase 1 studies (typically involve 20 to 80 people).
4) Phase 2 studies (typically involve a few dozen to about 300 people).
5) Phase 3 studies (typically involve several hundred to about 3,000 people).
6)The pre-NDA period, just before a new drug application (NDA) is submitted. A common time for the FDA and drug sponsors to meet.
7) Submission of an NDA is the formal step asking the FDA to consider a drug for marketing approval.
8) After an NDA is received, the FDA has 60 days to decide whether to file it so it can be reviewed.
9) If the FDA files the NDA, an FDA review team is assigned to evaluate the sponsor's research on the drug's safety and effectiveness.
10) The FDA reviews information that goes on a drug's professional labeling (information on how to use the drug).
11) The FDA inspects the facilities where the drug will be manufactured as part of the approval process.
12) FDA reviewers will approve the application or issue a complete response letter.


https://www.fda.gov/drugs/information-consumers-and-patients-drugs/fdas-drug-review-process-continued

Average Brent Oil Price

April 2022 : USD 105.82/bbl

May 2022 : USD 110.92/bbl


https://www.investing.com/commodities/brent-oil-historical-data

Any sifu can explain the "cash flows from operating activities"?

For cumulative 9M2022, total revenue of DNex just RM1,005m , but "cash receipts from customers " showed RM1,276m??

---page 6 of THIRD QUARTER ENDED 31 MARCH 2022

OPEC+ Unlikely To Boost Oil Production More Than Planned


“We will announce that we are going to increase our production by 432,000 bpd even if we are no longer able to do so,” the source added.


https://oilprice.com/Latest-Energy-News/World-News/OPEC-Unlikely-To-Boost-Oil-Production-More-Than-Planned.html

Excellent write up by Zhang Zuode !!

Must read !!


Hibiscus 3Q22 Review

https://klse.i3investor.com/blogs/ZZD/2022-05-26-story-h1623448629-Hibiscus_3Q22_Review.jsp

Oil Prices May Not Drop, Even If There Is A Recession


A recession will surely impact oil demand, but it could just weaken its growth, not lead to an annual decline in global demand.


https://oilprice.com/Energy/Oil-Prices/Oil-Prices-May-Not-Drop-Even-If-There-Is-A-Recession.html

When’s my RM 3.00 ??

Can hibiscus reach RM 3.00 within 12 months ??

According to latest Hong Leong Investment Bank research, published on 9th May 2022, for FY2023 ( July 2022 - June 2023), assumptions :

1) average realised crude oil price for FY2023 = USD 90/bbl
2) net production for FY2023 = 23,380 bbl/day
3) revenue RM 2628m, EBITDA RM 1565m, net profit RM 626m
4) cash RM 714m , debt = zero

If share price RM 3.00 , total share 2012m, market cap should be RM6,036m

How to evaluate hibiscus ?

1) Price to Earnings Ratio (PER) method
PER for FY2023 = market cap / net profit = 6036 / 626 = 9.64

2) EV / EBITDA method
EV = Enterprise Value = Market cap + Total debts - cash
EV / EBITDA = ( 6036 + 0 - 714 ) / 1565 = 3.4

3) EV/ 2P reserves method
EV = Enterprise Value = Market cap + Total debts - cash
USD to MYR conversion rate = RM 4.1
Latest 2P reserves = 77.3 million boe
EV = 6036 + 0 - 714 = RM 5,322m = USD 1,298m
EV/ 2P reserves = 1298 / 77.3 = USD 16.8/boe
If compared with EnQuest = USD 12/ boe.
Range of EV/ 2P reserves for other medium E&P companies in Norway and UK = USD 13.6-31.1/boe

Conclusion : If the local and foreign fund managers are willing to evaluate hibiscus at PER around 10, EV/EBITDA around 3, and EV/ 2P reserves around 17 , hibiscus has possibility to reach RM 3.00 in FY2023

EIA Sees Brent Crude At $107 In Q2 2022


However, the EIA cautioned that it made these projections on May 5, prior to any EU ban on Russian oil imports, which, the EIA says, would raise prices further.


https://oilprice.com/Latest-Energy-News/World-News/EIA-Sees-Brent-Crude-At-107-In-Q2-2022.html