Reading the comments on the LSE bulletin board today, I am inclined to agree with one, Christine Taylor, who’s opinion seems to me to be the case when David Bramhill releases news or makes comment on operations.
Whilst he remains responsible as Executive Chairman, along with the board, for decisions made on the day to day running of Union Jack, timescales are dictated by the operator. The company are purely investors and rely on the operator to develop the assets in a timely, cost effective fashion.
This means that when Mr. Bramhill indicates a timescale, he has been briefed by the operator on when they intend/expect to commence with any mobilisation.
That information is passed to shareholders by official RNS, a news item that the content has been examined by the broker and authorised by the Nomad. It is scrutinised, questioned and all information authenticated prior to release to ensure the market is not being misled in any way.
However, that information can only be deemed correct on the day of the release. Things can change overnight and this does not reflect on the management unless it is a change instigated by them.
Shareholders have expected a number of actions over the past 12 months which have not come to fruition, even after the operators have confirmed them.
Keddington is the perfect example after Egdon Resources stated quite categorically a timescale they failed to meet. This has no reflection on the Union Jack management as they were fully financed and happy to proceed. How anyone can attach any blame on the company is beyond me.
One could say the same about the gas to grid at Wressle, another action that was intimated at by the operator that has failed to materialise.
David Bramhill in my opinion is unfairly castigated for operator failures beyond his control. He has brought Union Jack to profitability with his investment decisions, he has ensured the cash is there to move forward with all of the asset developments, paid a few dividends, bought back some shares and made what I believe to be the best decision yet, to take an interest in the United States. Shareholders have no fear of any dilutive fund raising either!
The UK onshore oil business is no longer viable. Exploration and development is met with unworkable taxes and planning complications. I feel taking a secondary interest outside of this is a sensible move by Union Jack which will provide a long term safety net for shareholders until, if, anything improves over here.
Just imagine if the company just sat there waiting for their operators, paying costs and not increasing revenues, a total stand still.
2024 is now looking far more exciting than it could have looked whilst resting on its laurels and I personally applaud the board for their diligence and forward thinking.
