Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
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"Contractor Shares
The Company continues to employ the Contractor Shares scheme to settle fees otherwise due to various contractors. The Company aims to utilise the Contractor Shares Scheme in a prudent manner, balancing cash management with equity dilution.
The relevant services have now been provided and therefore the Company will issue 9,500,000 new ordinary shares to those contractors (the "New Contractor Shares"), representing 1.1% of the 848,260,742 ordinary shares in issue prior to the issuance of the New Contractor Shares.
The New Contractor Shares will rank pari passu in all respects with the Company's existing ordinary shares. An application will be made for the New Contractor Shares to be admitted to trading on AIM, ("Admission"), and it is expected that Admission will become effective and that dealings will commence on or around 19 February 2020."
I don't believe for one moment that contractors want to invest in CERP and be 'aligned with shareholders', they simply want to be paid for their work.
So how does CERP persuade contractors to be paid in shares rather than cash? I presume that CERP calculates the number of shares to be allocated to contractors at a discount to the prevailing SP otherwise contractors will lose out if the SP should fall while they are still in the process of selling on the open market. There has to be an incentive for contractors to be paid in shares otherwise why would they take the risk of accepting payment via this method? There must be some kind of assurance that they will not lose out by accepting payment this way. I can't see contractors agreeing to this method of payment unless they are guaranteed not to receive less than they would get if they were paid in cash. The only mechanism I can envisage to achieve this would be to calculate the number of shares to be issued to each contractor on a favourable, discounted basis. Maybe there are other guarantees in place such that if the SP falls below a certain level that additional shares will be issued at a later date to cover any loss/shortfall in the amounts received? We don't know what has been agreed with contractors but you can be certain that contractors want to be paid for their work and talk of being aligned with shareholders is IMHO just a way of selling this to shareholders who are diluted each time another block of shares is issued to cover costs. I doubt contractors want anything more than being paid 'at least' what they would recieve in cash.
So what is the incentive that persuades contractors to take shares in lieu of cash? And don't anyone please say it's because contractors know what's going on and want to share in the benefit of any upcoming good news. If that were the case why would they start selling as soon as possible? It has already started.
Hi LGO
The figures are only a calculated guesstimate
Plans for another drill in Bonasse were announced in that update maybe at Clove.
The revenues per barrel are too good to go elsewhere . WTI today about $55 making $45 per barrel revenue
ATB:))
Should be 6-12m divided 2 !
Hi Garnheim
My estimates are based from other wells in similar layers but the difference here at Saffron is geology, Bonasse 2 is outside of the updip so I am being conservative with my figures but won't be disappointed with 50 from the Middle Cruse.
I still believe it would be best to joint venture with Prd better for both parties but they were adamant on that board at the weekend to go it alone.
There's definitely one thing though it's Cerps rig not Fram's
I would suggest rereading the Rns from Prd regarding Innis.
The geologist stated they are only doing the pilot from the Herarra 2 sands as that is the best option. This reduces the recoverable barrels in half immediately , which will equate to less revenue. Also the new estimates of between 8-15m recoverable are high estimates not Pmean which is more like 6-12m divided x 2.
This is why I have changed my opinion over the weekend and hoping for the $4.2m
ATB:))
All this speculation about bopd is, as fun as it may be, rather meaningless. The production coming from the Saffron drill in itself was never meant to be a game changer. The plans for the SWP, following a satisfactory results, could be a game changer. However, the latest corporate update hasn’t produced any plans or insights towards the next phase of the SWP...so unless this changes, 2020 looks like another transition year. Up to the BOD to prove otherwise
To provide a little clarity on my ‘unknown’ statement and depending on its success.
**Pace of development is in Company’s control.**
• expected net funding requirement for fast-
track full development – circa $2.9m (maybe already in bank)
• sources of funding could include equity, debt,
forward sales, farmout, working capital facilities (or a mixture) (previous Lind drawdown maybe).
Was told by a few big guys not to be nervous regarding CERP. BigMJ also reassured me to hold on.. good news awaits.
Morning Bamps,
Can I assume that your middle Cruise estimate is formulated from previous drilling ie Bonnasse-2?
Re: PRD. I think it may become a little more come complex for the purchase as it may require a reverse takeover meaning a re listing for them. Also.. from what I’ve seen the proposed CO2 trial is for 9 months with a minimum of 3 months.(could be wrong).
Knowing CERPs strategy beyond Saffron is definitely an unknown, swinging on the success of this well.
btw, final results for echo are out, 30% down atm.
I will wait for final results before selling unless news from other front will raise the sp and let me out with my 3.4p avg, wrote two times we need to wait, but im less optimistic then most here, taking too long, looks to me commerciality is in doubt and in that case even if it is commercial that is not what Im in for.
after all its all about alternatives.
wish luck for all invested here.
Well that's a contradiction one minute you're waiting for results the next minute you're saying there isn't 11m barrels, how do you know that explain yourself please.
There is every chance there is more , remember the Middle Cruse was not in the estimate
we are still waiting for final results but looks to me saffron is not a company maker, had the potential if the 11m bboe that were hoped for were discovered but that is not the case, the case is now about commerciality or not and boarder line commerciality is not very profitable so by my view more of the same.
the rates of 50-100 bbopd is nothing, that is a rate that will take years to cover the development costs and the exploration costs.
we are still waiting for rns with final analisys but that is my take and Im just waiting for a little rise to sell out.
good luck
Saffron is in my opinion still a company maker.
The 3 horizons even though not thick could still produce at commercial rates.
When you look back at LGO wells in Goudron the Lower Cruse was very thin but produced the huge initial rates seen at some of the wells. This tailed off dramatically as we all know so what's different, well it's the updip situation. The oil is being pressured towards the updip trap/traps at the 3 horizons if managed properly these should continue to produce. I believe Cerp are managing it correctly and will get the best outcome.
However if this doesn't go to plan the Middle Cruse looks commercial and will still produce revenue growth. I would imagine it to be 50-100 barrels at $40 that's $2,000-4,000 per day $730,000-1,460,000 per annum 2 year pay back.
The Chinese problem won't last forever, growth will return with a sudden jump in oil prices.
With the $4.2m from Prd one of the 12 targets can be started or which I would prefer boost Suriname and South Erin for quick returns and more infills on Bonasse
Nervousness is definitely showing on this board let's just take one step back an look at what's happening.
Oil prices are slipping due to 2 reasons the coronavirus in China stunting growth and oil demand, and the Libyan civil war (that is explained on the oilprice.com)
Schroders are selling out due to company policy of exiting from oil.
I have posted before that this quarter would be a difficult one financially based on the planned work programme in my opinion.
Saffron testing is still ongoing and seems to be hampered by ministry approval, the financials for revenues per barrel are still very good at $40 I'm still very optimistic .
On the Prd board they seem quite adamant that they want Prd to buy Innis,
That would mean $4.2m coming Cerp way probably by diluting their shares. They seem to think that buying Fram will give them access to the workover rig and crew. I doubt that will happen.
Suriname is progressing, oil from Sept