Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
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I agree Elgin and that was my take also, however the appetite for oil explorers is not what is was and it may be much harder to raise funds this time round, so I would have preferred them to husband their cash as much as possible at this stage. Focus on the core project and get fancy when markets improve or if you manage to raise more at a big premium. If the deal offered fantastic returns I could understand them rushing to do it at this stage, but could they not have found a better return in the jaws of the sector sell off last year. It makes little sense.
'Our decision to form this new majority held renewable energy company was partly driven by a lack of oil and gas acquisition opportunities that are as good and as prospective as the ones we already hold.'
If they think the current assets are that good, then just focus on handling those those in the right way to maximize shareholder value with minimal dilution. It's almost as if they just wanted to spend the money to run down the balance sheet and look like they're doing stuff. Couldn't find anything else to spend the money on so just went for whatever was on offer. Feels like a shifting of the goalposts because Guyana isn't going anywhere ... (yet). Sometimes being a good boss is knowing when to do nothing.
Tbh I always thought they would do a raise closer to the drill, even before this loan, They did it last time on the run up to jethro at 80p when they were fully funded
It doesn't support the SP if it leaves the company having to raise more funds that it otherwise would have, especially in this market. RBD have supposedly made the second biggest ever oil find onshore UK and their SP has been sideways for months despite this. Today they did a big placing well under recent highs.
Really can’t see what all the fuss is about, we all bought in and still buying at this price, awaiting the drills in Namibia and Guyana, I can only see the latest acquisition as something to support the share price for extended period, therefore a benefit. Namibia will probably still happen this year, with Guyana next year. This is still trading far below where it should be considering the future benefits. All recent sales and just knee jerk short term era wanting their small percentage. Keep filling your boots at this dream price !!
I see buys coming in, but for the first time in years I'm not sure I can be ars_d to buy. Fully funded for drilling, so what. How about admin and other cost, then we get time creep on drilling and before you know it you need another placing just to get to the end of the drill program. Moreover, if you think they will go into drilling without ensuring they have a chunky amount of cash for afterwards then you're a chump. I'm certain we will get another placing ahead of drilling.
SR123 Imo this Solar project is small change; Its still all about Namibia farm down and Orinduik drilling.
The market is generally depressed today, its not all knocking the Renewables I don't think.
Most of the majors are slashing their exploration budgets to the bone. BP have sacked most of their exploration department and cut the budget to a fraction of previous figure. Doesn't look good for ECO. The business model is outdated. Maybe just as well they are going to diversify. At least it will keep the BOD in a job!
Welcome the green point , just the 13% of returns do not make the justification. Invest in Europe and the returns are 22% gross profit.
Think all oil company's trying the green approach so can raise funds in the future
I agree phoebus.
Could do with a Gil interview; I understand this is a loan to kick it off but is it a medium term investment or less? They must have reasons for this strategy.
Hmm.
Gil said in his last interview that we expect a lot of activity on our Namibia this year. I don’t think they’d have invested £6m if they weren’t confident of a farm in / injection of cash from those licenses.
Why have we spent 1/3 of our cash on this? This is not what we signed up for and has muddied the waters of what was a clear oil exploration proposition. Green energy is in vogue, but the return on this investment is known and far from impressive and has significantly reduced our cash position. If I invest in an oil exploration company I'm expecting much more than a 13% return per year.
Prior to this news I thought there was a chance we might get another placing before drilling started next year, but now I feel certain we will and for a much larger amount. How easy will that be to pull off with the current lack of appetite for exploration drilling? As a long term investor here I do not welcome this turn of events and have reduced my holding.