Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Appreciated Hamz
22 Questions & Answers Annual Report page 14 query :- From the H1 Results of 30th March - "Perenco has not, to date, sought to directly discuss its plans for the future of Etinde development with Bowleven or LUKOIL, although we have been made aware of some of their potential ideas indirectly. We consider the financial and strategic acquisition merits of Perenco’s purchase to be compelling and there are options we think are currently being assessed that would lead to commencement of production at Etinde in a cost effective and profitable way for the benefit of all Etinde JV Partners." However, on P14 of the AR concern is expressed on the possible negative implication for Etinde development of an absence of "public comment" and "private communication" from Perenco. Would management care to comment on the apparent change of "vibe"
When New Age informed the JV partners of the proposed transaction, we were informed that they expected the transaction to complete in Autumn 2022, although they subsequently extended this at the end of the year. Since then, a further 11 months have passed, including the 12 month long stop date of the original transaction, essentially with little to no development.
This is a concern.
After 18 months, can management offer any possible suggestion for such SNH delays given the centrality of O&G revenues to the state set against the RDR fields being in significant decline and Sanaga gas output being projected to "fall off a cliff" in 2026?
No. We cannot speculate on the intentions of the Government of Cameroon.
21 Questions & Answers Annual Report page 10 query :- "We anticipate the current uncertainty will be resolved by early 2024 at the latest by either the transaction completing or by some other means" - what other means do management envision?
There is a possibility that SNH and the Government may not approve Perenco’s proposed acquisition, which will require a change of strategy by New Age or different steps by Perenco. In, addition, we also consider that there is a possibility that New Age may seek or be approached by an alternative buyer to Perenco.
Annual Report page 11 query :- Is it correct to interpret what appears under "Short Term Outlook" as a JVP ambition to avoid having to hypothecate c 70mmcfd for domestic gas generation to maximize gas available to render a Bioko or a Perenco Plan B development more viable?
No, not in the way implied by the question. When we study the technical requirements for producing wet gas (condensate) at a fixed rate, for a finite period of time (for example to meet the commercial requirements under a Gas Sales Agreement) there are corresponding IM-act on the way the field is operated, and this has practical ramifications on liquids production levels and therefore on other commercial and economic considerations which impact the valuation and future cash flow of the Etinde project. In our view, the supply of natural gas to the Cameroon domestic market needs to be assessed as part of the overall development project.
Annual Report page 14 query :- Clarification please on timing of possible money raise given mention of present funds lasting through to Spring/Summer and possibly "a small number of additional months in practice" set against on p14 "a raise will be required by early 2024"
There are two slightly different considerations:
• How long will the existing Bowleven Group working capital last and how can we maximise this period of time using specific expenditure control mechanism, whilst, as a minimum, maintaining our obligations under the PSC agreement, based on the existing draft 2024 work plan and budget (or any amendment following a change in Operator), whilst maintaining a necessary safety margin; and
• The second reflects the time it will need to find new potential investor(s), agree commercial terms with them and then seek the necessary shareholder approval at a subsequent EGM. This needs to be completed prior to Bowleven fully exhausting its current working capital.
Firstly, is it known whether the absence of consent to the NA to Perenco transfer is down to no decision apparently being reached or is it because SNH are seeking to attach conditions to the transaction that are unacceptable to the parties?
There has been no formal correspondence from SNH to Bowleven or the JV partners as a whole on this subject. New Age has not provided any specific details of their negotiations on this point.
Annual Report page 5 query :- references to "a major shareholder" and "our major shareholder" - can we assume both references are to Crown Ocean only?
Crown Ocean Capital in this context.
Annual Report page 9 query :- "core initial IM Only field development" not even plus IE-2? What are the projected flow rates of gas and liquids for IM?
There is no simple answer as it depends on multiple factors, including (but not limited to) development concept, the acquirer of natural gas produced and the contractual terms of any gas sale agreement, the number of wells drilled, which reservoirs are being produced from and the capacity and design of the gas processing facility. Technically, the maximum rate of initial wet gas production is likely to be up to about 150 mmscf/d.
Annual Report page 10 query :- "However, progress delays with the outstanding completion issues and obtaining governmental approvals has been much slower than anticipated. The June 2023 long stop date was not met and Perenco and New Age have informally agreed to continue to work together to resolve all outstanding issues and complete the transaction in due course" - "All outstanding issues", are these all entirely with SNH or are they also between the two parties and has even this Lukoil issue referred to in the H1 Results been settled - "Under the terms of the deal, a number of conditions precedent remain outstanding. Completion of this transaction is notably dependent on Perenco reaching both governmental agreement with SNH as well as commercial agreement with LUKOIL relating to some logistical matters. We understand from New Age that regulatory approval is expected to be issued by SNH and the Government of Cameroon in mid-2023, and that discussions are ongoing between LUKOIL and Perenco."
We are not party to the Transaction between New Age and Perenco or any discussions these parties have with LUKOIL regarding specific aspects of their deal that impinge on LUKOIL. So far as we are aware, given a level of communication with New Age and LUKOIL, none of the potential issues relating to the SPA between Perenco and New Age have been resolved. We understand that SNH has raised some issues with Perenco that impinge on Perenco obtaining Governmental approval to acquire New Age’s stake, but we are not aware of all the details and cannot comment more than we already have done.
[ Now run into word or character limit, see next posting for more ]
I attended. At the end of the AGM presentation, there is a Q&A section addressing some questions posed that reference the annual report.
https://www.bowleven.com/system/files/uploads/financialdocs/agm-presentation-2023_1.pdf
In my next posting, I will try and copy and paste it, but there may be some kind of word limit (some other pastes seem to have been cut short ).
Then next week I will also send some notes from the chat at the AGM.
Any interesting developments at the AGM today? If any who went can share with us I would be grateful
Shareholders should have had an email or message via brokers, but just in case anyone did not, the 84 page annual report is now on the site. The AGM is in London on Wednesday December 6, and I plan to attend it.
I thought the RNS was quite upbeat considering, Ocean Capital will support BLVN until they bring home the bacon.
They would raise at a substantial discount to 0.6p. these people are worse than thieves, bring back Kevin Hart!!!
"Business as Usual" for Perenco in Gabon, according to this Bloomberg article
https://www.bloomberg.com/news/articles/2023-10-23/family-owned-africa-oil-driller-perenco-takes-coup-in-its-stride
So Gabon should not be causing delays now.
Short term hope now is some eleventh hour approval of the Perenco New Age deal. Bowleven has said the two companies are trying to "progress" it, and the companies have also been reported saying the same thing. If Bowleven is not party to the discussions, as they say, they may not know all the details. In theory approval could come at any time.
Unfortunately retail investors are helpless when it comes to companies that are controlled by large shareholders.
By their own definition the board values the shares at over 40p and there is a $25 million cash voucher sitting in the cupboard (to be redeemed on FID).
Any sane person would take out a loan to cover this short period of a (possible) funding shortfall rather than gift away shares that are worth 40p (their words not mine)… but don’t worry it’s not their money is it?!
"The Company is currently considering a fundraising proposal from a shareholder which contemplates the shareholder providing equity capital at a very substantial discount to the current market price of Bowleven's ordinary shares".
Just reposting this link to an article published in July
Perenco "expects progress on approval of its acquisition of New Age’s interest in the Etinde gas field project"
https://www.africa-energy.com/news-centre/article/cameroon-perenco-signs-rio-del-rey-production-deal-eyes-new-age
but it is not clear who at Perenco was quoted, or exactly when.
Has Gabon delayed matters? This article gives an impression of "business as usual" in Gabon
https://energies-media.com/gabon-petrole-plus-de-la-moitie-de-la-production-assuree-par-perenco/
The Franco-British company Perenco produces 110,000 barrels of oil equivalent per day out of an average national production of 200,000 barrels of crude oil per day
The Franco-British company Perenco achieved production in Gabon of 110,000 barrels of oil equivalent per day in 2022, making it the largest producer of hydrocarbons in the Central African country.
The data was presented following an audience granted by the Minister of Oil and Gas, Marcel Abeke , on September 22, to the Africa director of the Perenco Group – Jean Noël Bouassi Bouassi – and to the general director of Perenco Gabon Adrien Brooch (photo, d).
Gabon currently produces around 200,000 barrels of crude oil per day.
Hart was a disgrace, and was ousted for a reason. Don’t get me on about Bonomo. However you’re right that it’s clear the dividend was misguided in hindsight
Kevin Hart would not have paid that - relatively huge - dividend.. Crown Ocean Fund basically used that dividend as a bribe to take the reins here.. shareholders bit on the bribe ..... and 'their' gamble has backfired massively, alas
(But ,it's all a game of chance..... and this BET is a car crash for me, alas ..still, in the round AIM O&G is a sector I'm thankful I play hard..)
I think I will agree with you on that, all the original directors about 5-8 years ago should all be fined as it looks like they had no idea of how to run a company. Who was it hart or someone. so long ago now it's hard to remember who drove this into the ground.
Looks like another vog.
I'ts so easy to blame the Gov or Cameroon but it's the Bl**** directors that are/we to blame. and yet again they all walk away free to do it again to other companies and shareholders.
This will go into liquidation eventually. Another write off from my portfolio :-((
This thing has been a complete gamble for the last 10 years. The previous board never developed anything or created a revenue stream so it was a sitting duck.
The new team took over to release the cash that was sitting in the account and that’s what they’ve done.
It’s shocking to hear that the government is sitting on their hands and still haven’t approved the sale, but judging by the speed this whole saga is taking it’s not surprising.
The fundraising isn’t worrying as such as the current board sees the true value above 40p. The smart thing would be to take a loan and not dilute the share price.
0.9 to buy 0.8 to sell , spread still 25%
RNS ... it is considering a fundraising proposal from a shareholder which contemplates the shareholder providing equity capital at a "very substantial discount" to the current market price of its shares, whilst allowing all current shareholders to participate at the same price. Says the discussion is not yet at an advanced stage.
My post two months ago 20/7/23 now looks unlucky not lucky better if mistake was made , might have got them back even cheaper now.
AIM just not for Pi's
Such a brutal journey here, alas... And a terrible bet for me generally.. but I've had plenty of big wins in AIM O&G thankfully.. and taking the rough with the smooth is the nature of this brutal betting game.... it can still 'come good in the end' of course too
Mates rates - to allow them hugely get their average holding price down.. but Pi's would be granted the same opportunity too - comes to mind for this potential raise.. but you've got to hope the Nomad will be acting as some sort of fair arbitreur
Generally, my guess is this path is now very likely to be pursued.. and assurances given that the offer won't change off the back of todays s/p - further - collapse ... and as you don't want to get too close to running out of money, perhaps done by this year end too.
And after a long search, its the best option they've been able to find... and as a very substantial discount to current s/p - raises are often at a small /medium discount not a huge one - the Nomad believes it to be material information an so RNS advance warning appropriate... But big ouch
Ouch with that update.
Very substantial discount could be as low as 90% of the closing price of Monday evening.
I know that sounds OTT but it's happened many times on AIM recently with TWD [near 92% doscount] and they still went bust.
With a 50% spread be very very careful
What I can’t understand is why he would come out and tell us what he’s already told us, that a fundraising is needed. We’ve known this for years. Yes this crashes the share price even further and even gives the incoming funder a chance to drive the price down further over the coming months.
He even says in the announcement that the fundraising has no guarantee of being completed, which means it’s not material information needing to be released to the market. Maybe someone will correct me, and perhaps there’s an AIM rules that requires this release, but to me it seems completely negligent towards existing shareholders. The only silver lining is that existing s/hs will be able to invest in the fundraising, and the benefit, as I’ve said before, is that a fundraising, while painful, makes it much more likely of getting to FID without going bust. But still it seems a very strange announcement to make.
Apologies, it was £50 million! Been so long I had forgotten exactly how much we had pi*sed away
But if only these clowns had kept the £25 million instead of dishing it out as a divi, we would be in a much stronger position. Even to have purchased another project whilst waiting for this transfer to perenco to complete.