IGas said this morning it was having talks with a “potential strategic investor” as it headed towards a predicted failure to meet financial obligations.
A company statement said it forecast it would not comply with its leverage covenants as at 31 December 2016.
But it said discussions with the investor were “well-progressed” and ongoing.
An agreement would, the statement said, “remedy any leverage covenant breaches as at 31 December 2016”. It would also remedy the forecast breach of daily liquidity covenants predicted for late March 2017, when the next interest payment on secured bonds was due.
The statement added:
“there can be no certainty that an agreement will be reached”.
On 26 October, IGas asked bondholders to waive the company’s daily liquidity covenants. Holders of unsecured bonds agreed but the secured bondholders did not.
Five days later, the company confirmed it was in talks with Trans European Oil & Gas (TEOG), thought to be a leading holder of its secured debt. TEOG had proposed the sale of IGas’s conventional assets, which include oil and gas fields in southern England, the East Midlands and sites in north-west England.
In early November, IGas avoided a breach of its daily liquidity obligations by selling secured bonds with a value of $8 million.
This morning, it said:
“The Company has recently met with certain of the Company’s bondholders and potential strategic investors to discuss its capital restructuring options and valuation of the Company, as it continues to assess options which will allow a new capital structure for the Company that is sustainable in the current oil price environment and enables IGas to capitalise on value accretive opportunities.”
The statement confirmed that IGas had another five months in which to deal with the breach of the leverage covenant expected at the end of this week. IGas suggested it could inject additional equity to cure the breach.
The compliance certificate on the covenant for the 12 months ending on 31 December must be delivered by 30 April 2017. According to legal advice, IGas said it could cure a breach within 25 days of delivering the certificate. That would mean the latest date for the equity cure would be early June 2017.
The statement added that IGas cash resources stood at $32m at 22 December 2016.
At the time of writing (1pm), the IGas share price was down 7.25% at 10.78p.
Categories: Industry
DRILL OR DROP? 
“At this festive season of the year, Mr Scrooge, … it is more than usually desirable that we should make some slight provision for the Poor and destitute, who suffer greatly at the present time. Many thousands are in want of common necessaries; hundreds of thousands are in want of common comforts, sir.”
“Are there no prisons?”
“Plenty of prisons…”
“And the Union workhouses.” demanded Scrooge. “Are they still in operation?”
“Both very busy, sir…”
“Those who are badly off must go there.”
“Many can’t go there; and many would rather die.”
“If they would rather die,” said Scrooge, “they had better do it, and decrease the surplus population.”
Suddenly those work houses are looking pretty good, arent they?
“Scrooge never painted out Old Marley’s name. There it stood, years afterwards, above the warehouse door: Scrooge and Marley. The firm was known as Scrooge and Marley. Sometimes people new to the business called Scrooge Scrooge, and sometimes Marley, but he answered to both names: it was all the same to him.”
it seems Trans European Oil & Gas (TEOG) will probably not paint out the IGAS name either, after all, its all the same to them. loads of lovely debt, good for off shore tax havens at least.
No pro fracking victorious triumphalist crowing from the roof tops today?
Actually i feel sorry for you, i am sure i could spare a penny or two, after all “tuppence is tuppence” and Jacob Marley wont miss them.
Happy New Year
Peeny will be along in a moment to tell us all how startlingly well the frackers are doing financially!
I wonder if he has not yet returned from the north pole?
Maybe he was checking out the new fracking licences under Santa’s toy factory.
More jobs for the elves, and reindeers make tasty reindeer burgers, and you get a free red nose toy.
I understand Santa got arrested for illegally flying over a fracking site. He is reported to say he will not pay the fine.
Your glee might be misplaced. IGAS hold key licences. Perhaps they will still manage to develop them, or perhaps a bigger fish will see a little fish with something they want and gobble them up to get it.
Where there are little fish, there are bigger ones in the shadows. You might just find that when they come out into the light they are a little harder to deal with.
Sorry, Santa never made it. Chopped up with the bats and raptors by the wind turbines, hence the reindeer burgers.
The old Star Energy management pre-Petronas will take over I-Gas apparently.
Bah humbug! Paul Tresto was complaining that wind turbines are never turning even in high winds? Perhaps there were no raptors or bats or reindeers around? Maybe all those conglomerate corporate ghosts keep getting their chains fouled up in the turbine blades?
Phil C. – Wind not too bad tonight (about 30%LF) – but wind output still not as high as coal, and look at GAS! Solar of course is zero.
http://www.gridwatch.templar.co.uk/
In 2015 Germany produced 122 TWh from wind and sun.
In 2015 the UK produced 48TWh from wind and sun
Germany slightly better for solar than UK
UK wind speeds far superior to Germany.
In 2015 the UK exported more gas than it imported in LNG
Plenty of home grown gas.
Huge untapped UK renewable resources.
Wakey wakey Conservative Government
Your record has stuck John, same old same old…. How much electricity did Germany generate from coal and gas vs UK?
Paul. If you were not so biased against wind power, you might take John’s information seriously. I much prefer his ‘record’ to yours; in fact I would put him in the top ten!
http://www.eia.gov/todayinenergy/detail.php?id=26372
I will answer the question for you John, as I expect you may not want to:
Germany – About 350 Twhrs from Coal and gas in 2015 (nearly all coal).
UK – About 176 Twhrs from coal and gas in 2015 (more gas than coal)
Which country was better for climate change / C02 etc.?
Wakey wakey John…..
And wakey wakey Sherwulfe….
Lets see what the figures are in 2016 – and why not read the linked article Sherwulfe?
Did we export more gas than we imported? This is the key question? Or is there something particularly bad about LNG only?
Am wide awake Paul. You have eyes wide shut.
You’re waffling Paul. Tomorrow night is the one for excessive alcohol…
No alcohol Sherwulfe. But I don’t understand why you / John don’t want to discuss the imported gas issue? And the Germany vs UK per capita emissions. These are things that John keeps raising but the doesn’t seem to want to address the main issues? Not to worry, most of us can understand the figures and what they mean.
Read the posts back through the year. The truth is out there, the information you need too; you just don’t want to see it. It is clear you wont digress from your mantra, so no point going over old ground.
‘Your record has stuck John, same old same old…’
A bit rich from someone who waits for the sun to go down so he can post there is no solar being produced.
The same person who repeatedly posts when wind speeds are low.
I brought something fairly new to the conversation in that we exported in 2015 and 2014 more gas than we imported in LNG
Quite a serious subject in the grand scheme of things when we talk about energy security and frozen pensioners.
John , you avoided the question, did we export more gas than we imported? This appears to be what you would like people to think. I haven’t checked, I assume you will let us know the figures? Or don’t you want us to know? I will look now:
Click to access Gas.pdf
So far for 2016 UK gas production is about 113 Twh per quarter, imports about the same, and exports about 40 Twh. My maths tells me that we use around 186 Twh / quarter. So we are reliant on imports of 73 Twh or 40%. LNG or not LNG, still imports?
I only check Gridwatch when you tell us how great wind power is, which is often enough. Right now wind is 4.6GW, about the same as coal. Is this good or bad? Seems pretty low to me as there is nearly 15GW capacity monitored. But it is probably near average for the year.
Paul you really are becoming a typical fracker.
I posted that we exported more in 2014 and 2015 than we imported in LNG.
Full 2016 figures are not yet out.
You chose to ignore my factual figures from 2014 and 2015 but quickly mention incomplete data from 2016.
Sorry, but the facts are clear about 2014 and 2015.
.https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/579510/Gas.pdf
page 45 for anyone interested, although the whole report is very interesting.
If you disagree with the stated Government figures for 2014 and 2015 on exports and LNG imports please state why.
No solar at present. Save you going out.
If you watched Germany gridwatch in 2015 you would have seen 122TWh recorded from wind and sun.
Proven renewable power
Much more planned.
Someones getting it right
John – no one is arguing that we exported more gas than we imported in LNG. What I have said, which you don’t seem to want to clarify, is that we we imported a lot more gas than we exported, net import around 40%. Why throw in the LNG only red herring?
Frozen pensioners are a very serious issue:
https://www.theguardian.com/society/2016/dec/30/millions-families-living-fuel-poverty-england-statistics
Of course the Guardian doesn’t mention the extra costs on our bills which pay for renewables ROCs, FITs and CFDs (and to turn wind turbines off when it is too windy).
Extra costs for renewables / green stuff are estimated at 20% on our electricity bills and 6% on our gas bills for 2016-17.
http://www.energy-uk.org.uk/customers/about-your-energy-bill/the-breakdown-of-an-energy-bill.html
It should make me laugh when the pro crackers shed crocodile tears over energy poverty and freezing pensioners, but it doesn’t, it makes me sick to my stomach at the hypocracy of the fracking industry profiteers. Energy poverty and the failure to raise pensions to a liveable rate are political strategies to further political and social agendas and has nothing to do with caring for the pensioners.
You betray yourselves by moaning how much you have to pay to support pensioners with increased energy bills. Absolutely typical that with you it all comes down to money doesn’t it? You have no real concern other than how much it costs you and how you can use that to further the aims of your industry. Absolutely sickening and pathetic.
The real reason is that the government makes energy companies financially support winter energy costs. Now the energy companies, who all ready pull the wool over everyone’s eyes by having impenetrable tarrifs and bewildering choice that automatically rise at the end of the contract unless you challenge them or switch. What they do is to pass on the costs of this winter payment to the customers, it actually costs them nothing, but the customers pay more. That is what you are moaning about, you could not give a damn about pensioners otherwise. Its just ammunition to fire at the enemy, how sick is that?
Its a fraud, only renewables and sustainability will drag us out of this bureaucratic nonsense. Fracking is neither renewable or sustainable and will pollute air water land and destroy peoples health, just as it has done all over the world.
Pensioners and their plight are just fodder for your propaganda cannons aren’t they?
Sick little crackers.
Well that’s a new one! I meant frackers of course, but crackers works well too, I must have been angry, gets me that way sometimes, good thing too, shows I’m not pacified yet!
And Phil, not only are those Unchristmas crackers using pensioners as pawns, but energy companies are sitting on billions of pounds of direct debit customers money: A programme on Radio 4 last week spoke of pensioners in particular being affected; one 94 year old had over £4000 in over payments.
‘Of course the Guardian doesn’t mention the extra costs on our bills which pay for renewables ROCs, FITs and CFDs (and to turn wind turbines off when it is too windy).’ – or the massive tax breaks for oil and gas companies. Paul, you are showing you true colours. So much for charity at Christmas! Hang on a minute; you posted on another thread that they don’t turn off the turbines….which is it Paul…are you becoming confused with your ever increasing vehemence?
Agreed absolutely right Sherwulfe we are all being fleeced right down the line and pensioners lives and health will be ruined by fracking pollution too, so its a double insult and threat. That same industry crocodile crying about poor freezing pensioners would rather poison their air, their water, their homes and their health, their homes will become unsaleable. All for profit. Some care and concern that is isn’t it? What utter disgusting hypocracy.
AndI did post about turning turbines off – I said that I had driven past Caton Moor twice in a week and both times the turbines were static but it was nice and windy? Is this the post you are referring to?
Phil C – not new at all. The subject was raised by John Powney “Quite a serious subject in the grand scheme of things when we talk about energy security and frozen pensioners.”
My response was accurate.
I agree with Sherwulfe about the direct debit issue which needs resolving. Although with OVO it makes sense to save money via their DD scheme as they pay you 3% interest.
Paul, “that’s a new one” referred to my spell checker changing “frackers” to “crackers” I was referring to my own post.
Getting back to that however I would still say that pensioners are used by government and industry as little more than political cannon fodder. Real poverty, not just energy poverty, is a growing and deeply despicable deliberate action by this government and for you to use that real poverty to make a propaganda attack is just as unacceptable as this hateful governments contempt for any one poor and vulnerable. Pensioners, disabled, homeless people are real people, not statistics to be used for political gain.
I would say this to your industry, if you care so much for the criminally disadvantaged people in this 21st century 2nd world country, then do something about it. Lobby government on their behalf, house the homeless and pensioners and disabled, support them financially out of you tax haven profits, just DO something to show you mean it.
Or do you say “are there no prisons? No workhouses? Do you suggest they just die and decrease the surplus population?
Okay, I misunderstood Phil C. Yes, we have lots of problems, as do other countries. I can’t offer solutions unfortunately. It is very difficult to penalise / stop those who are milking the benefits system without having some impact on those that really need the help. Successive Governments have failed. Unfortunately you will not turn business into charity any time soon. Whether it be O & G, renewables, fast food or anything else. By the way, what makes you think I have “tax haven profits”? I am UK resident, and pay my taxes just like you do (?).
You may be surprised but i do quite a lot for the community up here, mainly with biodiversity, but also with not for profit community broadband installation ( anti BT).
And yet again you assume I am pro fracking when what I am actually pro is gas. And nothing from John / Philip / yourself / Sherwulfe/ Refracktion / John Hobson (same?) / posted on here / read in the Guardian / FOE / Greenpeace / WWF has convinced me otherwise or that there is a viable alternative for most of our heating and 50% of our electricity.
Good answer Paul, no i wasn’t referring to you when i said tax haven profits, i was referring to industry in general, not just oil and gas, and that is correct, corporations do hide their profits in offshore tax havens.
I am glad you are doing what you can to help and i appreciate you doing that and saying so, i tend to concentrate on local communities, visiting pensioners and helping and educating locally, trying to build local support groups and get us out of this divisive idea that we can farm out our old and sick and disabled onto a collapsing benefit system which demeans and insults on a daily basis, and hence allow ourselves to turn our backs on them. The benefit system, such as it remains, is not, will not and has never been the answer.
You talk of benefit fraud and dependency, but that is a deliberate policy by government to have a captive slave lower class that can be pushed around to feed the nastier end of our sick society, drugs, prostitution, child sex exploitation, trafficking and the sicko dregs of the evil system that feeds off them.
None of this is natural, its an artificial construct, like so many illusions in this upside down world, it serves a purpose, jobs simply no longer pay a living wage for the struggling poor, while fat cats cream off the profits and exploit the system and 4% own 90% of the wealth in this world. For the poor and disavowed, the predators crawl out of the woodwork and prey upon the desperate disenfranchised poor, the system is an exploitation tactic by the unscrupulous and it serves political propaganda to troll it out at every opportunity rather than turn this dreadful system back up the right way and turn it back to humanity, not money.
Dickensian poverty is returning with a vengeance and with undisguised glee that once again the elite can snigger as they stroll through the rich streets and turn their backs on the starving beggars, and maybe if they are drunk enough, throw a few pennies and watch them scrabble and fight amongst each other for the amusement of the rich.
The money system itself is fraudulent in the extreme, the banks and the government go hand in hand and have plunged the whole world into a dog eat dog travesty of human existence the world has become a heartless nightmare of deprivation and exploitation, rather than a viable future for our noblest aspirations, we get war, mass murder, conflict and hatred child rape murder and slavery, the worst filth of this planet feed off that division and hatred and laugh at our stupidity for putting up with it and trusting they have our best interests at heart, they do not.
Forgive me, i get angry, i see phrases like, “government is too compassionate” “benefit fraud” “swampy” “jobless” “parasites” being bandied around, when all these epithets actually are more accurately attributable to those who we stupidly let run our lives.
And then we get the industry you defend, what do they do? The most pernicious invasion of our countryside since the last bunch of despoilers, seemingly deliberately chosen to be squatted in our most beautiful remaining countryside, and with a long record of disasters across the world poisoning and destroying health, lives, water air and land, scrawls their contempt for the mildest opposition in these pages!
Angry? Moi? Yeah? Well, its about time some of us got angry, its the first stage to empowerment.
Happy New Year
“John / Philip / yourself / Sherwulfe/ Refracktion / John Hobson (same?)” ??? What are you suggesting? Are you saying we are the same person? No way! Just because the pro fracking Illuminati use multiple addresses for the same person, doesnt mean anyone else does!! You betray that mindset once again, you know what tactics are used by your industry and you know there are multiple addresses and alter egos used by the same people, the more obscure, as we have seen to day, the more abusive, it is always interesting to watch the same ID’s being used by obviously different people in style and grammar, and new ones are regularly popping up all the time, usually abusive.
You have my word of honour, remember that concept? That what i personally post is 100% me, no other, i dont use any other ID’s either, what you see is me and no other.
So dont you dare try and tar me with the pro frackers anonymous brush, we know they use multiple corporate sponsored addresses and we know they use the same address for several different people. and don’t you dare try and suggest otherwise!
Phil C – I was referring to the last 2 possibly being the same (Refracktion / John Hobson (same?)). Clearly the others noted are different people. And you have a very individual style of writing. But you seem to be a bit touchy about it? Don’t worry about it. I have been accused of blogging on here in different names – quite funny really. Why would I ever want to do that? A quick Google and it is confirmed, John Hobson and Refracktion are one and the same….. no big deal but why bother?
The benefits fraud issue I have first hand knowledge of it – there are many people playing “the benefits game” in Morecambe who have chosen not to work, even though they are quite capable of it, and have opted for the freeloader lifestyle taking money that should go to those that rightly need it. And of course there are also many more (hopefully) who deserve the benefits they receive.
What is a viable alternative to the current system?
Even the Swiss voted against a common annual state payment to all in their recent referendum.
Happy New Year to you also and lets continue our debate in 2017.
Hi Paul, yes, apologies, i am a bit touchy about everything today arent i? I wonder why? it must be 2017 first night nerves? Or perhaps i am just yearning for the fjords? I wasnt bringing your posts into that either by the way, you also have a distinctive style and wit, sadly not matched by others that shall remain anonymous!
Happy New Year to you too, anyway, i must get out of this old hag costume and get out the over sized baby clothes ready for tonight!
All shale companies are on their nose atm with debt. Big private equity and big oils are circling and ready to jump on the dead corpses. This does not necessarily mean a good thing for anti frackers because these guys have deeper pockets and will move things more aggressively.
Even big fish will not throw bad money after worse. When I Gas fails, the licenses will go back to the government. They will be cheap as chips in the next round; no one wants them just now. My advice for I Gas shareholders- get out now while there is still money in the pot.
The long run trend for the price of oil is down while the long run trend for the extraction costs of oil is up. That means more and more oil companies and oil states are heading into bankruptcy and what is happening to IGas is indicative of this trend. Both trends, rising extraction costs falling prices are the arguably result of oil depletion in the long term. Or that is the argument of the Hills Group Consultancy whose ideas I find plausible.
If we are to believe the calculations of the Hills Group Consultancy then after 2012 the amount of energy that it has taken to explore for, lift, refine and deliver oil to its point of use has exceeded the amount of energy that that oil delivers to the rest of the economy (when we also take off the energy of an inevitable amount of some waste heat – e.g. the energy dissipated by radiators in vehicles when they burn the refined oil).
In the model of the Hills Group “the price of a unit of petroleum can not exceed the value of the economic activity that the energy it supplies to the end consumer can generate.” When the amount of energy delivered to end users is less than the amount of energy that is needed to get it to them then the oil industry is in deep problems – just as IGas is.
This is far more than a unique problem for IGas it is a problem for the economy as a whole. It has commonly been assumed that as depletion occurs then extraction costs will rise. This is because using new technologies like fracking to get oil (and Gas) out of harder to get sources is a more intensive operation, with more wells, more activity, more logistics, using more energy and so it costs more too. It has been assumed that prices will go up and up with the rising extraction costs. However what we are now seeing is that that is not true. Economies cannot afford a higher and higher proportion of income to go to meet the rising costs of the energy sector – higher prices crash the rest of the economy. Indeed it has only been possible to keep the (financial) economy afloat so far because of more debt and because interest rates have been brought down very low. The economy is in deep debt. Rising energy prices in these circumstances are deflationary – they take money out of the pockets of the rest of the economy, destroy confidence, leading to secular stagnation – the effect is that oil prices come down even as the extraction costs go up.
We must still resist this industry because it has shown in the USA (and in some small examples in the UK) that it can do a lot of damage to environment, communities and health but it is important to note that it has been cash flow negative during its entire existence in the USA.
http://www.thehillsgroup.org/depletion2_022.htm
“these guys have deeper pockets and will move things more aggressively” a fascinating implied threat that all these little “hocked up to the eyeballs” tin pot little companies are just soft hearted corporate cuddly pussycats and we should be grateful and happy they keep the big bad wolves from our door?
Ha! Well they had all better strap their selves onto their corporate potties, its going to be a rough ride!
P36 of todays Times.
Looks as if Santa dropped one before he was minced!
If that turbine had been put up by Cuadrilla, there would now be a cry for them all to be dismantled before someone was killed!
Global warming and alternative energy, supported by too much bad science. This is a gravy train out of control, eating up huge amounts of money and still producing poor results. If any individual company had invested such billions and produced the same returns they would have been out of business many years ago. Too much compassion within politics and not enough clear thinking always produces a huge waste of resources, just the same with overseas aid. If a collective decision is made to spend so much of other peoples money, just make sure it is invested wisely, otherwise the next generation picking up the bill will stop the investment altogether.
‘If a collective decision is made to spend so much of other peoples money, just make sure it is invested wisely, otherwise the next generation picking up the bill will stop the investment altogether.’
Exactly what has happened in Germany
The majority of the German public are in support of their huge successful renewable programme.
They are happy to spend 2.5% of their disposable income on securing their energy needs.
Big subsidies to get it going.
Subsidies coming off this year.
Common sense really
They have proved renewable potential and are proposing a lot more.
Wakey wakey UK Conservative Government before we get left behind
A Government who does not want to maximise on the potential of an infinite free source energy supply is not acting on behalf of the people.