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RBD currently owns 59% of Rathlin, as per previous RNS:
"We are pleased to have completed the Rathlin Investment, increasing Reabold's look through interest in West Newton to ca 39 per cent."
So purchasing Humber's 16% may work out in our favour, if they were to struggle to raise their share of the funds and our guys can get a good deal through, meaning RBD's share of WN could go upto 55%.
Reabold are not going to Farm into a drill that is already theirs. That’s as stupid as Rathlin farming in to their own drill. In any case, farming into drills is not the RBD business model. RBD buy into the operators, Corallian, Gaelic, Danube, Rathlin, all wholly or part owned by Reabold. They buy operators. They don’t Farm into drills. If Humber can’t stump up the cash then their 16.66% Farm in to WN will have to be put on the market. That will take as long as it takes.
If we did take some of Humbers share then we might have to do a small dilution. imo
I wouldn't trust Humber to pony up the funds, they don't even have WN listed on their website as one of their projects:
https://humberoilandgas.co.uk/
Probs not important enough for them.....
Hopefully, RBD chaps can play this to our advantage
JackDiamonds
Makes semse
Maybe they are waiting for UJO to get their funding in place first then that only leaves Humber to sort out.
Luckyman2
We are fully funded and then some. I would expect Lang would want to keep his interest in WN and RBD would want a cracking deal to give him a way forward.
It’s a question of I have 16.6% of a valuable asset, I want to retain an interest, but can’t stump up the cash!
There is a deal there somewhere!
Jack
I hope we dont have to raise more money to buy some of Humbers share as well.
This is never ending.
Lets get going with the EWT and prove up this find before we get bogged down in who pays for what etc
Great work and yes our intrepid hero's should find a way to grab more of the spoils if this is true.
imo the delay is therefore not a bad thing
Brilliant find, GP. Not ideal news but I expect these things happen often. Our two heroes will know how to get max advantage out of Humber's little problem. From what I have been reading on LSE, it looks like UJO is short of cash too and there are suspicions it is being manipulated. Ho hum!!
If Humber cant come up with their share of the WN appraisal program it helps explain how the WN EWT has gone from a "pause" to a delay. If ultimately, Humber's share of WN is distributed among the partners who do come up with the appraisal money we could end up with an even bigger slice of WN. Is that why the BOD are filling their boots?
Something of possible significance Egdon's Accounts RNS this morning:
"Note 4. Trade Receivables: During the year, one of the Group's joint venture partners on PEDL253 (Humber Oil and Gas Limited), defaulted on a balance due to Egdon. The payments were due under the Joint Operating Agreement (JOA) and the Farm-out Agreements. The outstanding balance at the date of default was £0.78 million. Egdon (as Operator and on behalf of the remaining joint venture partners) have enforced their rights under the JOA default provisions and commenced proceedings to recover the sums owed. Under the terms of the JOA, the defaulting party can be removed from the licence and that party's share of the asset redistributed amongst the remaining joint venture parties. Humber remain liable for the outstanding debt but in the interim the remaining joint venture parties have assumed responsibility for the payment of invoices. Egdon's pro-rata share of the outstanding Humber JOA default amounts to £327,200".
If Humber owe £0.78 million on their Biscathorpe licence, their 20% interest in it suggests that the items on which they have defaulted must have cost about £3.9 million, If that's the case, then Humber probably owe for the whole of the Bisc-2 well costs plus a few other items. Does this indicate potential funding problems within the WN consortium, or am I concerned about something that's not relevant to us?
Im would hazard a guess that the Langs may also have been selling the last of their shares after the volumetrics rns to go so.e way to funding their share of costs
Union Jack may be struggling to raise £5 million at the moment, or not perhaps, but it's AIM listed. But how are Humber O&G going to raise a similar share of the cost of the forthcoming work programme at West Newton? Unless the Lang family (who own Humber) have very deep pockets, and they may well do so, I reckon that Humber's share of WN will soon be on the market after all the recent positive news. Maybe RBD, along with UJO, will try to buy Humber out, if they are not already talking to them??
I think the question as to whether Humber, a 16.7% licensee of WN, is cashed up and ready to rock with WN, has not been discussed enough.
The apparent delay with the EWT, WNB et al, is contingent on all parties ability to proceed and what options they maybe considering
Jack
RE: Humber Oil and Gas16 Nov 2019 09:25
Was it,
You might be onto something there.
We know Humber are on exactly the same WN farm in agreement as UJO. See UJO RNS dated 05th Nov 18
“The second significant commercial collaboration between Union Jack and Humber is the Farm-in for a combined 33.3% economic interest in PEDL183, where Humber has also entered into a Definitive Agreement on identical terms to that of Union Jack that will result in each of Union Jack and Humber acquiring a 16.665% interest.”
Humber have just filed their accounts for the Period to Dec 18, with £10k of negative net worth. See filing history 29 Oct 19:
https://beta.companieshouse.gov.uk/company/11117055/filing-history
We know Fraser Lang left UJO in a hurry back in Aug 19. The WN opportunity has left all parties scrambling for cash.
I don’t think any of the parties would carry the others, so they all need to be cashed up and in a position to proceed.
I guess Fraser Lang has a number of options with Humber. A cash raise for them, a share swap with RBD shares or maybe back the whole of WN into Humber and IPO.
I think the news void has a purpose but it’s irritating that we are left in the dark
Jack