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Meanwhile naira at record low today. New record every day.
He could be prolonging the issue of the AD until a done deal pending SH final approval and then signing an SPA for the ‘2nd deal’. My rationale for this is on the assumption that the ‘2nd deal’ would not constitute a RTO on the enlarged company with SS included but would constitute a RTO without SS in the bag.
Anyway, whatever is going on, the balance payment for SS is reducing by the day and Nigeria is bank shed loads of cash.
I won’t say what I want to happen next, but you know my views.
PS I was first told that AK wants to issue AD with Gov approval at the AGM.
As far as acquisitions go, I fully believe that AK would and will be pushing for an oil acquisition as at the moment we are heavily weighted on gas. I don't think gas is out of the question but he probably feels the gas numbers will grow with time with the accugas asset so the focus is definitely on an oil acquisition.
Even a small acquisition of 5,000 - 10,000 bopd will do wonders in changing our production mix an put the company on a new trajectory. I am sure there must be other small deals to be made for instance we were after ENI Tunisia asset previously which i recall was circa 5,000 bopd of oil.
Moho - I think it's safe to say we all want it back trading however I believe the company is looking to maximise this prolonged suspension window to bring a deal to market as acquisitions is a major part of it's strategy, I am of the opinion that's the intention of the company as they will find it difficult to seek future suspensions if they return without deal and than ask for a another suspension further down the line.
It's perhaps a lot more easier to keep on extending the current suspension window to complete a deal than to return and suspend again.
Zen - Your last comment mirrors my views exactly. Why the preoccupation of not coming back without a deal ? If there's not a deal and the share price tanks it will realign when the deal is announced to something close to what it would relist at if there was a deal. Likewise if never any deal. I don't necessarily understand he logic of those not wanting it back trading. I just want some ops updates on existing business, and at the moment it seems they don't feel inclined or obliged to supply this. If there's any further extension, I would assume AIM being taken for a bit of a ride.
Zengas
We don't know the level of assurance and evidence being given to Aim to warrant extensions and how these assurance and evidence being provided fit with fixed goal posts as supposed to moving goal posts. But 100% agree seems like savannah want to return to market with approvals alongside adm doc and not just the adm doc. This probably aligns with what Rocky had been feeding us from IR over the past year he did say AK preference was also to come to the market with ADM document and approval.
Savannah may have taken this decision as the deal has progressed based on what they feel gives them the assurance they need that they will not be played with and perhaps they have than come to a decision assessing all factors that it was prudent for this particular deal to come to the market with approvals.
I wouldn't blame them considering how chad deal went, and also recent evidence of Maurel Prom / assala deal falling through both instances government intervention occurring and assets being state controlled.
Trustilie
My thoughts are - If SAVE wants to avoid cancellation from AIM then the simplest thing to do is publish the admission document.
What is missing from it that can't be published ? (seems to be not dependent on Govt approval as necessary and none of the other acquisitions were - ahead of previous adm docs, Nigeria, Chad.)
It's already clear that when they announced the deal, the adm doc would come followed later by govt approval - says so in the original RNS.
It was intended to be published in H1 23, (RNS 12/12/23), again reiterated for publication H1 23 (RNS 13/4/23). RNSd again for adm doc publication by 30/9/23 (RNS 27/7/23).
Since then no mention of the adm document -
Then completion moved to 1/2/24 (RNS 14/12/23) - specifically mentions completion with no mention of the adm doc.
Again no mention of the adm doc when it was moved to latest timeline of 2/4/24 (RNS 1/2/24) but completion with reciept of in-country approvals.
Is that the reason we may be close and why there's an agreement from AIM this past two times of 8 week extensions ?
Surely if AIM says either publish or don't and be cancelled, then the Adm doc should come to prevent that.
Regardless of a short term gyration to the s/p with the adm doc issued, it would surely rectify itself when govt approval is given ?
I was about to post the same link, oilbagger!
Savannah BoD and PR team should watch this, although it'll most likely simply be reinforcing their own philosophy.
The conclave continues to work wonders. I begin to wonder if Savannah's hoped-for success buys me a home, or just a care home.
Zengas & StreetsofGold - I refer to your posts on Friday whilst I agree that the South Sudan government probably haven't officially pre-empted the asset so could be positive sign otherwise Savannah would have to report back to market. Referring back to the rns on 1st Feb saying seeking in country approvals, does that mean that have ironed out all the commercials with the government ? surely approvals only come after some sort of commercial agreements in place otherwise in would be a slight jump.
Do I feel like we will get an admission document in this suspension window in all honesty no, if we are likely to than my guess is probably some point in Q2 2024 which may require an additional extension, as ever this is just my opinion from very little that's available to us in the public realms.
As for having backed up extensions of completing the south sudan deal I guess there comes a point where extensions may become meaningless if there isn't progress but we will never know what progress looks like as the company provides limited info.
When the AI article rereferred to a "few"weeks in terms of closing and the article was from 30th Jan 2024. In my mind I view the term "few" as 4-6 weeks so the date being roughly 15th March 2024 which is the date I mentioned yesterday so if we haven't had anything by than it would be safe to say we would not hit 2nd April and may need a further extension. Again these are just my own interpretations
porsche - i would view anything coming out of that company with caution. they talk out of there **** a lot and if you read the rns it lacks a lot of clarity and details
Good to see South Sudan MOP are supportive of at least one small UK based oil company.
Wildcat receives approval from the South Sudan MOP https://www.lse.co.uk/rns/WCAT/wildcat-receives-approval-from-the-south-sudan-mop-wnlxyuy9dykke1z.html
With every extension in my mind I always think if we don’t get anything with 2 weeks to go till the extension deadline that we are at the same place so for this extension in my mind I have put 15th March as the date if we haven’t made any progress or received news from the company than we are in the same place probably looking at a further extension.
The reason the nigerian central bank is devaluating the currency is to bring it more in line with the street rate (i.e. to close the FX gap). They do this to ensure currency is at correct value. This will make foreign investor more willing to invest USD into the local economy. Often the IMF push countries to do this as a pre-condition to giving them more loans. Post these recent devaluations Nigeria's FX flows should improve, and it may actually help get save's deal refininanced (given FX gap is closed). In terms of devaluation being a good thing. This is definitely true and not just mgmt talk. As revenue are in contracts fixed in USD, this means when the local currency devalues, and local currency costs are paid, this will generate an FX profit. Currently local costs likely consist of wages, and costs of local contractor. The main problem SAVE has is that there biggest cost is the USD interest paid on their $300m bank facility. Once this is refinanced into Naira, SAVE will be in a much better position, given stonger Fx offset.
FB Article:
South Sudan Oil Shutdown by Sudan Rapid Support Forces.
February 12, 2024.
Tut Gatluak Manime, the Presidential Advisor for National Security, has now put South Sudan and the South Sudanese at the road to destruction.
Oil of South Sudan is shut down now in Station 3 and Staion 4 by Sudan Rappid Support Forces (RSF) this morning.
The reason for the RSF shutdown is that Tut Gatlauk Manime insulted RSF as nilitias during the Saturday, February 10, 2024 consultative meeting in Juba.
All the Sudanese political forces that are opposed to the RSF and allies to Gen. Burhan were invited by Presidential Advisor Tut Gatluak Manime to abuse and insult RSF and its leader Gen. Mohamed Hamdan Dagalo (Hemedti).
Tut Gatluak Manime denied the FCC and Former PM Hamdok and all the civil societies to come to Juba unless they agree to work with Gen. Burhan.
All the Taqqaddum Groups are Sudanese who do not want NCP and former Islamists.
Tut Gatluak Manime must be given another assignment away from the Sudanese file before South Sudanese collapsed economically.
Thanks Scotpak - from what you say, does this mean that the further devaluation of the NGN should have no impact in SAVE’s endeavours to refinance the debt. To be honest, I do struggle to get my head around this part of the business.
And why does AK constantly mention the ‘true-up’ process, inferring that it’s a very good insurance process which works in our favour against any currency fx swings?
Our gas contracts are paid at a rate fixed to dollars, so revenue isnt affected by the naira devaluation. Any oil and gas revenues received will also be in USD. The main negative effect is on the pile of cash Savannah hold locally at Nigerian banks denominated in Naira to pay local costs.
massive long shot and probably wishful thinking. but save could possibly involved but acting under nda restrictions to keep their name out of the public domain.
whether it’s due to the icc cases or ss deal or both, save are noticeably keeping a very low profile and only putting the very bare minimum out via rns & nothing via tweets. last one was over 3 months ago on 6th november and they’ve not even announced who they’re sponsoring in paris this summer (if you know, you know)!
there’s definitely a company (companies) missing from the gabon line-up. could it be us but undercover at the moment for whatever reason.
lastly, unlike a few others, if we see a further extension, i still think they will tell us nothing else until they feel compelled to or our nomad forces them to.
horrible being in the dark so much for so long, but i honestly don’t think about this as much as i used to. it is what it is and there’s jack **** we can do about it!
Fully agree Zengas. It’s (SS) clearly alive and kicking.
Also note from my read of TIL’s helpful posts/links that the Gabon deal, which, as I suspected, being a simpler deal with a highly motivated host government acting within a set deadline, has progressed relatively quicker than our SS deal.
However, unless I missed something, Gabon still seems to be missing:-
1) a named and experienced Operator - potentially whom can provide some equity / skin in the game / introduction to or actual financing; and
2) 3rd party financier.
Is there a role for SAVE as (1) to act as a credible operator for (2) a trade house to provide the finance by way of a PXF?
Really, really interesting…
Maurel and Prom announce the Assala deal on 15/8/23.
With what looks to be within the 3 month time frame and which i take as when the govt and Cemac is notified, the Gabon govt say they take the decision to exercise their pre-emption right on 25/11/23.
M&P update the market on 25/1/24 re the Govts pre-emption and their right to do so.
M&P update the market today noting yesterdays signing of the deal between the Govt and Carlyle for the Assala assets and the end of the deal for them and done/dusted in 6 months.
At no point have Save informed the market of any pre-emption by the S.Sudan government nor has S. Sudan said they were pre-empting the deal in the last 15 months.
I would have thought that if S.Sudan had said they were pre-empting the deal, then SAVE would have had to tell the market by now of that fact.
I beleive like Accugas/Nigeria they are continuing on the so called (lengthy) workstreams and approvals - mentioned (on 1/2/24) by AI to be concluded in a few weeks and backed up by AIM extensions.
Thoughts or views anyone ?
Sources with knowledge of the matter said GOC -- which is believed to be short on cash -- had paid a deposit but had not yet secured financing. The SPA is not contingent on financing, but closing is. The NOC, which had been in discussions with trading houses, claims it has made progress with various parties, the sources said.
"They have agreed a few months to raise the financing," said one source. "Yes, they can borrow money, but unlikely the total amount needed."
Carlyle declined to comment further on the details of the deal or the financing. GOC did not respond to requests for comment.
Https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/oil/021624-gabon-celebrates-13-bil-assala-oil-deal-but-questions-linger-over-financing
https://www.energyvoice.com/oilandgas/africa/ep-africa/547974/gabon-commits-to-assala-deal-maurel-calls-it-quits/
Looks like savannah may not be involved after all although there isn't any clarity on who or how it's being funded.
Hi All
Looking forward to the next RNS re SS immediately after the Easter W/E at the very latest. Who knows, could be bit before then and will we get any RNS’s on any other subjects prior to then?
In the meantime, earlier this week I sent a few questions to IR which heave been acknowledged but my contact this time has been away this week so I’m hoping for a reply next week. I’ve covered the USD - NGN issue in what I sent.
Nice W/E to one and all and catch you soon.
PS O/T you may wish to look at AXL which is my 2nd largest holding and has excellent prospects. Only 285m shares, zero debt 0 to 3.2k production and a fully funded 15 well drilling program for 2024. BOD have masses of expewriance in building and selling small O&G companies and Arrow is looking like the CEO’s swan song.
As ever DYOH but this is really exciting me at the mo at 20p and has an excellent chance of 3 to 4 bagging within 24 months max.