The late payment from our customers over the 30 days is also old news. Actualy alot of the stuff in that article is old news.
yes we did burn through $10 of our $20 million.. but they're called once off payments for a reason.. i.e the $6.8 mil to CHL... and operating costs... the article also states that over one year we moved from x negative received to x positive received. He just glides over the fact that revenue is now growing at a steady pace.. We literally have 3 customers about to start consuming! We pushes us well into operating cash positive.
Aaaaand then there is the matter of RSM's overdue payment - again old news... as we Jacko had to get the auditors in. And yes - it is not surprise that we decided to settle instead of fight for Jack's half... We just didn't have the to pay for it and cover the expenses at the time.. and the sp was already at an abysmal rate - so no chance of another dilution either.
Did I mention a lot of this article is based on old news and worded to make VOG and Foo look like they're rinsing the investors - including Jack who has put in ALOT of money and has fought tooth and nail to stay in the project.
The following are extracts from the above; Victoria Oil & Gas Plc, the AIM quoted oil and gas exploration company with assets in Cameroon and the Former Soviet Union, is pleased to announce that, through its subsidiary Rodeo Development Limited (“RDL”), it has signed agreements with a private company, Cameroon Holdings Limited (“CH”), for the provision of drilling services, local advisory services and funding (“the Transaction”) for Logbaba.
CH will undertake and manage the drilling of the first two wells at Logbaba, which will satisfy RDL’s minimum requirements. The shareholders of CH are PR Marriott Ltd, an experienced UK-based drilling company, a highly respected Cameroonian manufacturing, construction and investment company and HJ Resources Ltd, a company owned by a discretionary trust connected to Mr. Kevin Foo, is also a shareholder.
As Mr. Foo is both the Chairman of the Company and connected to HJ Resources Ltd, the Transaction is classified as being related party under the AIM Rules. Accordingly, Mr. Foo has not participated in the Board's deliberations with regard to the Transaction.
As compensation, CH will receive an average royalty payment of approximately seven per cent from RDL’s share of gross revenue over the life of the Project.
It's all there in black and white.
Nothing we didn't / already / should have known if you ask me.
Royalties are normally based on value of sales either gross, or net if there are discounts. Sometimes there can be a % deduction from the base amount. There's no indication here that they are not based purely on sales value.
Royalties are payable regardless of profitability.
The 2013 accounts (page 2) had a small note saying the 20 year contract rates where subject to inflation adjustment on each 5 year anniversary.
The last information about SHN's intentions was sometime midyear when It was said that a draft agreement was with them for approval. Presumably that hasn't happened yet.
Has anyone calculated the actual SCF rate achieved last year? My calculations are that VOG received $16356 per mmscf on an average of 2.22 mmscf per day. This reflects the fact that the gas is priced per btu.
An LPG plant costs Zillions and takes time to build. LPG plant builders need a return so that might affect prices. First mover advantage got us pipes and pipeline companies charge. Mind u the effect of Bowleven's activities may be clearer in the next year or so. FDilution noted prices would weaken in a research note on Bowleven. (Quite entertaining really !). Looks to me as if VOG can hope to keep prices up for a few years and so justify sunk cost capex. Of course lower prices would raise the barrier to entry bar for others. Mel
Leaving grim out the royalty interest would be to the CAM.GOV., ? if that is the case profits are not necessarily involved royalties could be based on o/p figures etc., many different formats for royalties and they certainly do not only as of a necessity which your post implies come from profits.
Simply put Royalties can be based on gross or net revenue or just the right to operate a business
I also thought royalties were taken from well head o/p but someone some time ago blogged it was not the case.
As for BOK.H they will attack anywhere and take anything which is why the health warning is in place plus no westerner would walk around any place at night without armed guards.Sacremongering to what purpose? its a fact.
Surely any new contracts will be short term at commercial rates and not the original 20 year BOD ideology with matching high gas supply prices.
Its entirely possible we will get news of new contract and contract renegotiations as alternatives pricing structures become available by alternative gas suppliers step in with LPG costs at one fifth of the original BODs contract prices. One of the BODs prize facts was the high price being negotiated for long term contracts with the advent of the fall in energy prices and potentially different supplier what will that mean to future forecast for fiscal income model?Or will 95% of BBers discount the points made as having no validity?
The whole basic supply and tie ops were supposed to be finished at least two years ago.One of the great delaying factors which was not the BODs fault was the government delays in giving various permissions and several minor challenges to the land VG purchased. Those and other delays have all but removed first mover advantage. Easy to check out other gas company intentions of gas supply in the area.
Mrjim we have a different understanding of manners,better stick to ramping as you would call it.
sence2 cant agree on some of your points here. i think you are really going over the top if you think Cameroon strife torn borders. you say they have, radical and deadly idealism in the North of the country.well this is not true as Boko haram are not based in Cameroon but Nigeria. Now are you saying that Douala, Bonaberi are any more different than any other citys or towns in cameroon. i can tell you that there are many places in britain that you cant walk around a night. also, where have you heard that the BOD scarcely visited the country.if i remember rightly one was based over there for most of the time.
now one point about ownership, they say 60% owned by GDC, a VOG subsidiary, and 40% by RSM Production Corporation ("RSM") of Denver Colorado) now in that interview with IG foo says SNH and RSM our partners will have to pay there share of the two drills planned for next year.So have SNH taken there option and paid there share of costs? i have read nothing saying they have. Also if they have taken there option it should state that fact in the ownership % as it would reduce our % down to 57%. a clear as mud as usual.
now also i hope the fact that foo saying grimm will be paying his share of those drills puts to bed you view that vog plan on trying to cut RSM out of future plans, so as to do him out of his 40% gas cut. that was never going to happen. i still have not heard him say as jim tried to say, that he was going to make it clear in these interviews that there would be no dilution.?
R Dont want to be pedantic.....but If I was drawing up royalty terms to attract seed capital on a long shot project, I would do as much as I could to make it attractive and clear. Ultimate sale price for gas/ profits would be so far down the line no investor could read it. KF took a punt a long time ago and my guess is that royalty owners have a formula more based on market gas prices than net of all costs prices. You could be right....but just think it unlikely. mel
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