Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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CPerkin - My $8m was an approximation based on what we used to get from KN1, when that was running at 12-15mcf/d, which was $800k-900k/month? So about $10m a year for 13.5mcf/d, whereas we are looking at the equivalent of 10mcf/d for 25% of the minimum EPS. I then gave AEX a budget of $2m for running/development costs, so that left me with $8m as a profit figure. All fag packet stuff really. If it is $12 I'm happier, if the flow is greater I'm happier again, but trying not to get too optimistic until we start seeing some progress. At the moment 1.5p would feel like a success!
BF - No, pun not intended. Impressive photos from KMR, and good news on execution.
Cheers cperkin. Understand.
I wouldn't bother reading but it sets the scene.... wait and see what tomorrow brings.
the long stop extension RoJo if we're lucky : )
Yes Edgar at the full 140 MM/scfd =$40 Million (pending the new PSA terms) I was responding to Highland Matts $8 million for 40 MM/scfd when the presentation gave $12 Mill for 40MM/scfd, although under the new terms he might be closer, who knows?
What exactly are you all getting so excited about?
The SP is two-thirds of a penny. Not a lot is it?
"yes its all hard to quantify, but its going to be a damn sight more than where we are now." yes indeed BG but to be fair anything at all would be considerably more than where we are right now.
Seriously though yes, I think there is considerable upside to come here - that is why I am still a shareholder, haven't sold out and indeed hold more today than at any previous point (are you listening FJ?). The problem though BG as we have all experienced in the past, there have always been far to many breaks in activity for the sp to gain any sort of momentum; even if we get the F/O approval will the "pipeline" of activity - (in no particular order) F/O approval, seismics initiated, drill selected and booked, spud date "booked" for CH1, 25 year Dev License approved, pipeline build initiated, CH2, 3 and 4 locations isolated, GSA signed etc, etc, etc- follow in quick succession? Can we resign the experience of the last 10 years to history or will the pattern of glacial progress and minimal support from the Tanzanian Administration continue unabated?
Oh and of course I haven't even addressed Nyuni and KN1, unpaid invoices and deal or merger talks so there are an awful lot of potential catalysts for a good sp rise BUT these things have to be resolved quickly otherwise any sp rise will quickly dissipate.
With regard to the "merger" discussed earlier today I only hope that we are in a position to negotiate a equitable deal that does not involve transferring most of the shareholder value from AEX shareholders to our new JV/Merger partner in much the same way that our current proposed F/O to our cornerstone investor does.
Cperkin
That pre dates the October presentation and then the January 2019 EGM presentation.
The 40 mm cf/d relates to the early production system, I believe.
Both the latter documents are clear about up to $40m pa net to Aminex.
"$12 Mill PA at 40MMcfd of fully carried cash flow"
http://admin.aminex-plc.com/uploadfiles/180717_Ruvuma%20Farmout%20July%202018%20Presentation%20Secured.pdf
Depends on the new PSA terms of course.
page 58/59
http://admin.aminex-plc.com/uploadfiles/181207_%20EGM%20Circular%20(web%20version).pdf
5.5 Development Plan
"The operator does not currently have an approved development plan for the field. The initial intention
is to use the existing two exploration/appraisal wells (Ntorya-1 and Ntorya-2) as development wells
together with the planned Chikumbi-1 well which is expected to be drilled in Q2 2019. Ndovu has two
development cases. Case A, contains the initial three well development (two of the wells already drilled
and the third will be drilled in Q2 2019). Case B, contemplates a further development of an additional
eight wells based on the minimum number of wells required to reach the facilities availability of 140
MMscf/d. A pipeline will connect the well heads to Madimba Processing Plant."
Case B
"RPS is proposing an ‘Intermediate Development Scheme’, Case B, whereby further wells could be
drilled to take up much of the remainder of the Madimba plant capacity. It is recognised that the field
has further upside potential which would necessitate a future processing plant upgrade (Madimba) or a
dedicated processing plant located within the field. Export options would require further examination but
there is a possibility of a tie-in to the main 36” trunkline to Dar es Salaam."
The farmout gets Aminex to $40m pa net to Aminex. See corporate presentation October? 2018.
Dredging this conversation from the depths of my mind (i.e. a few months ago).....25% of the EPS minimum flow (40mcfd?) equates to about $8m per annum, so mcap of £60m or 1.5p. Expected flows are much (3x) higher, and that was just the EPS.
Full field development at Ntorya is circa 6 wells. All free carried.
We also have the re-entry and perforation potential at Kiliwani and Ntorya. Down hole seismic also.. this would further derisk and move toward e+p.
IF the farm happens.
"The "real" value and the upside is the future earnings attributing to the 25% that we retain and that is difficult to quantify."
yes agree Crusty, 25% of nearly 2 tcfs of GIIP, as things stand and with potentially an 8 well development and what might those wells produce at considering the high pressures at the NT-2 well, yes its all hard to quantify, but its going to be a damn sight more than where we are now.
Alot of sticky shares!
Eclipse would own 28.35% so roughly 30% might be not in free float.
It will move fast...
Notified interests:
Eclipse Investments LLC
28.35%
Majedie Asset Management Limited
7.92%
Aminex Board of Directors
0.08%
edgar just to be clear it is NOT $40m it is $5m plus $35m of credit and that is far from the same thing; with $35m in my pocket I have total freedom of when and how I spend the money - AEX could diversify outside of Tanzania - with the current arrangement they have no choice. That will severely undermine the perceived value of that $35m..... the other $5m has already been spent on tax! So the "cash" value of that deal - circa $20m in my view and that is already in the price methinks. The "real" value and the upside is the future earnings attributing to the 25% that we retain and that is difficult to quantify.
Froth + Speculation "phase"
Edgar222
Post farm >> 3D seismic + drilling please! ;-)
Foolsandcrows
Should not be too difficult to work out. Do you prefer a reserves or an income basis?
Assume Aminex is receiving $40m pa undert he farmout. Whats a fair p/e. 10? 20?
What is fair value post farmout?
Commencement of 3D seismic + drilling should be announced around the same time?