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Apologies - I meant compressed gas
Https://cityreviewss.com/looming-controversy-over-shake-up-at-ministry-of-petroleum/
Is the CCgas not expected to command an ivreased price?
Zengas - if there is a signing bonus attached to approval and deal it could expedite approval especially when the government is in need of cash
F/book 1 hour ago reporting on an interview with the minister of information saying the 23-24 budget will not be met as oil production reduced, gelling in 2 pipeline stations and difficulty getting oil out from port sudan due to the attacks on shipping in the red sea.
They intend to strengthten the non oil sector for the economy. Saying that we don't know what the actual oil production numbers are, they could be down as little as 10-20k but which still makes a huge difference to meeting their budget. One would think the government wouldn't be in the position for buying up oil assets.
Also this article on the challenges for S.Sudan via the red sea/houthi attcks on shipping.
https://bnnbreaking.com/world/yemen/south-sudan-oil-exports-hit-by-yemeni-houthi-attacks-amid-sudan-conflict
Buffett is bullish on energy “ When the dust settles, America’s power needs and the consequent capital expenditure will be staggering”
https://www.forexlive.com/news/warren-buffett-capital-spending-on-americas-power-needs-will-be-staggering-20240226/amp/
Zengas
Thanks for the reply and the clarification.
Thanks Zengas - as ever appreciate your thoughts but at the same time the company could do a lot better with comms on such questions in my opinion, answers even as small as the one you provide for example go along way. I am hoping sooner or later Savannah are able to fully articulate the full value of the accugas asset
For 2022. The average gas price was $3.69 mcf spread across 8 contracts for 2022.
Revenue was $212.5m ($181.1m for gas, $29.8m for oil and condensate and another $1.6m for handling 3rd party oil).
If we were doing 200-220 mmcf/d consistently it would be $270m - $300m plus another $30m+ oil from S.Creek.
So to run consistently at 200 - 220 mmcf/d at present capacity or when the compression project completes it could generate an additional $90m - $110m revenue with most of the fixed costs already taken for. That size revenue would be a game changer as would the debottling of S.Creek oil that practically double capacity/sales.
Trust as i see it we're buying 3rd party gas so we should be doubling on the purchase price i would think given what Save sells the Uquo gas to Accugas for. I don't think there'll be any valueing 3rd party gas reserves as we don't own them but yep there should be a value given to the sales portion and certainly a good growth market for 3rd party suppliers such as Amocon.
We have 200 mmcf/d processing and rising to 220 mmcf/d with the compression project - maybe a bit more but surely the emphasis is on safety.
The pipeline capacity is up to 600 mmcf/d so around 400 mmcf/d spare depending where the gas goes in.
Zengas - One thing that will be interesting is how the company and market values third party gas reserves for example the gas that goes through our network from Amocon, the company did mention they see a lot of stranded gas assets that can be converted or utilised through our pipeline.
It will be interesting to see the book value of 2p reserves from third party licences or acreage and how they can value this or provide numbers to for example the gas that we get from AMOCON is licence OML 156, I couldn't find 2p reserve number for this licence online, but it would be interesting data point purely because if Amocon have significant reserves and the only way to cash in is through our pipeline than that gas effectively strengthens our 2p numbers albeit not our gas if that makes sense.
Any thoughts on this ?
Noix, They do total that, but the ones over and above the 3 originals are for 'an up to amount' which i don't beleive is fullfilled consistently at that rate. They are also buying in up to 20 mmcf/d gas from Amocon.
"Gas supplied from Amocon does not require processing by Accugas and therefore does not utilise available capacity at the Uquo CPF" = 31/5/23 RNS
Https://www.spglobal.com/commodityinsights/en/ci/research-analysis/petronas-announces-exit-from-south-sudan-noc-evaluates-portfol.html
Old but worth a quick read on Petronas motives for exit
Scotpak - agreed but clearly still plenty of deliberation ongoing still, one would think if Petronas and Savannah have kept it alive till now, neither parties will flake out. So effectively forcing the SS government to take a formal stance on the deal either through an approval or formal rejection.
Maybe the minister wants to ask Petronas on reasons they sold and their thoughts on Savannah as an operator for his peace of mind before approving deal? Might not necessarily be to plead for Petronas to come back. Of course Im gonna be biased as I hold a large SAVE share position.
TrustLie
Thanks for the explanation.
Tier - Sounds to me like they are clinging on to Petronas I wonder if they are trying to convince them to stay. Approvals still seem far away 4 weeks to go don't think we will get it to be fair.
This suggests still no government approval for Save.
#South_Sudan's Trade Minister and Ambassador meet Mark Fitzgerald, Vice President of #Petronas for Intl. Assets, in #Malaysia to discuss the company's activities in 🇸🇸. However, in December 2022, Petronas decided to sell its entire oil and gas business in 🇸🇸 to Savannah Energy.
https://twitter.com/PatrickHeinisc1/status/1762424020379505150
Noix - 200 mmcfd is the amount of treated / processed gas, our total capacity is 600 mmscfd. So that's the difference it depends on whether the customer wants treated gas or untreated where they are happy to process themselves. I would imagine most customers would want treated gas and hence we commenced the cpf capital expenditure
Recovery of Naira is a 3 step process:
1) Mop up excess black market liquidity so speculators and arbitrage trading does not affect naira stability.
2) Increase dollar exports and decrease dollar imports
3) Make oil and gas investment attractive through regulation thus increasing FDI through it's oil and gas sector/
If Nigeria can do all this than I am confident Nigeria can reverse all the devaluation that happened since June 2023.
Although it will need the Nigerian federal government, central bank and oil and gas regulators like minister of petroleum alongside NNPC to work together in this, it's possible but requires openess from all parties and ego's and politics will need to be put aside
Zengas
I've just had a top up of our gas contracts as per the Company website and they total 276 mmscfd.
Whilst accepting that some of these are on a 80% take or pay basis, presumably we have to have sufficient gas at any one time to fulfil any one customer's total requirements ?
Can you please explain to me how this reconciles with the current design capacity of 200 mmscfd.
If Nigeria can increase it's oil exports mainly through oil and with the additional reforms supporting it I can see Naira trading below 1000 against by end of 2024. Any significant refinery surplus which can be exported will bring in US dollars inflow to Nigeria, whilst domestic oil refinery product providing fuel to Nigeria should alleviate dollar import pressure of importing fuel from foreign countries.
Therefore it's highly important for Nigeria to get all it's refinery in full flow this year to export markets whilst also meeting domestic demand.
Some additional significant news on Naira today
https://africa.businessinsider.com/local/markets/nigerias-central-bank-resumes-sale-of-dollars-to-bureau-de-change-operators/z3hdnyd
https://www.bloomberg.com/news/articles/2024-02-27/nigeria-delivers-jumbo-rate-hike-to-aid-its-battered-naira
Trust sorry just seen your question
The 2 trains do 100 mmcf/d ie 200 mmcf/d total design capacity.
One was run at 110-120 on test from memory.
They are both being upgraded to 110 mmcf/d each according to the section in the annual report which gives more detail re pressure etc.
So they should be safely capable of doing 220 mmcf/d instead of the name plate 200 mmcf/d.
I'd need to understand or see the pressure rating explained to fully understand why the increased pressure is needed ?
They can add a modular bolt-on processing train when needed is my understanding so could lift production further when demand/contracts are there.