We would love to hear your thoughts about our site and services, please take our survey here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
On the face of it one would think that perhaps 15th December would be the deal or no deal date, being a year from the PSA announcement but even that doesn't hold water as the rns was released on 12th December last year.
The mind boggles.
I had thought that just maybe the 1st Dec could have been Saves own internal hoped for date to publish the adm doc.
After a year, what is it that’s really holding it up and taking it closer to the 15th. What is there that hasn’t been concluded to date that can be done suddenly in the next 14 days to get an adm doc issued ? It was to be issued giving details of the conditions necessary to conclude the acquisition.
It’s baffling after so long that we know so little from the company. They string out the same standard responses but can’t say what exactly the P2 reserves or net production was/is and refer only on query, to the original RNS which gives a gross figure of production but no reserves.
I also think that with all the bad luck SAVE have had that AK maybe consolidating what we have and biding a bit of time. We’ve spent circa $30m - $40m on Doba / Totco / Cotco / Agadem and SS for now hing at the moment. I think AK will be very nervous of committing to another potential large deal until we see some reward from the above. You can only spend $20m CAPEX adding >$300m to debt with no production so many times and I think we are at our limit ATM. Yes Accugas is stunning but it can only support so much. We need to see red lots from something ASAP as we all know so well.
The biggest winners of the oil major divestment in Africa will be local African independents not international independents. May seem like a small difference but quite material in terms of getting government approvals.
Strange thing is Chappal Energies is a newcomer and if they are able to acquire assets producing 25,000 bopd, it just goes to show deal making is art form and not science majors are willing to sell to local new players, it does not matter whether they have previous experience or any of the other criteria
Plus I feel majors might be willing to sell to new african independents if it means the likelihood of government approval is higher regardless of there is experience, as long as they are able to put the capital for acquisition up.
Rocky - would love a deal in Nigeria, I know we had reviewed the Equinor assets in Nigeria OML 128 & OML 129.
Looks like those assets are being sold to a local player Chappal Energies in Nigeria.
https://www.offshore-energy.biz/equinor-disposes-of-its-nigerian-business-and-stake-in-chevrons-offshore-oil-field/
I am sure there are other assets that we could go for.......
I’d like to see us buy in to an oil play in Nigeria with a chunk of renewable projects bolted on to sweeten the Government.
Nigeria budget: President Tinubu says budget offers 'renewed hope' https://www.bbc.co.uk/news/world-africa-67567480
Licence extensions beyond 2026 are surely key. We can hardly sign up if the licence expires in three years' time. This uncertainty exists for ONGC and CNPC too, of course.
I do hope Mr Kiir manages to stay on for a bit...
Komakino - If we go down the route of deemed vs explicit consent it will all depend on the perception of investment climate South Sudan wants to create in it's oil and gas industry and also it's appetite for a long and drawn out arbitration process and also it will highly depend on the banking structure and how the funds are distributed to all shareholders in the holding companies.
When the government which is highly dependent on the oil industry for it's economy, having funds frozen in the event or arbitration and going into a election year could be a political gamble to far, and safe option may be an approval.
However lets wait and see, of course I am still expecting approval to come after the admission document and not in tandem as many have suggested, but nevertheless will not complain if it came all in one although it's not the usual course of how oil and gas deals are completed.
Thanks TiL,
The 2012 Petroleum act states this on pre-emption rights
' 23.Pre-emption
(1) Where a contractor decides to dispose of all or part of its interest under a petroleum agreement, the National Petroleum and Gas Corporation shall have the right of first option to acquire the interest on the same terms as agreed to with the potential buyer.
(2)If the agreed consideration is not a monetary value, the National Petroleum and Gas Corporation shall have the right to pay the corresponding monetary value of the agreed consideration.
(3)The National Petroleum and Gas Corporation's right of pre-emption shall lapse unless exercised within sixty (60) days after receiving notice of the acquisition.'
The recent Caltech fiasco will have ocurred after the 60 days notice so suspect that there's an element of the SS Govt. making it up as they go along. Hopefully the recent court ruling around the Chad situation will caution the SS govt. on trying something similar and will enable us to get this over the line.
Did a bit of research in the approvals process and here is my summary:
The 2012 Petroleum Act of South Sudan outlines the key terms and governance of PSAs in the country, and the roles of companies and the government entities.
On assignments, Article 41(6) states that any assignment of rights/interests requires prior written consent from the Minister of Petroleum. No timeframe is specified.
However, the 2013 Model Production Sharing Agreement issued under this Act does contain more detailed provisions:
Article 1.6 specifies a 90 working day period for the Minister of Petroleum and other authorities to respond to requests for assignment consent, also providing for "deemed consent" if no response after this period.
So in summary:
The South Sudan Petroleum Act requires government approval for PSA interest transfers
While the law itself doesn't specify a response timeframe, the model PSA template under this legislative framework gives 90 working days for explicit denial/consent from the government, after which deemed approval applies, which is standard sellers right's protection in most production sharing agreements.
No not at all Scotpak. It was merely pointing out that the adm doc should be able to come out whether S Sudan completion is imminent or not as in the case of Accugas.
Maybe it’s actually some of the work streams and the data on 64 different fields that’s needs to be agreed over and include in that document hence the delay ????
For me there are 2 big things that need to happen for any chance of price rising on re admission , i SS Deal is done , 2 Acugas finance has been restructured on very favourable terms. We will also be including negatives which will impact SP that have occured since last traded.
Chad nationalisaition and ICC case ( we spent alot of money on this and at present have no sight of a cash return or generation)
Niger: Again spent alot of money here including fund raises at higher sp (some people say the broker put no value into SP for Niger, however the market will be all over the fact that we will have missed another deadline albeit not our fault)
Our debt position has increased (was it a one off currency conversion (we are still getting paid alot in dollars)
I have been in this share along time and the areas in which we operate currently offer more risk than reward and that needs to change.
So AK pull your F--kin finger out
He isn't suggesting that at all, just stating a fact that we waited nearly 2 years for Govt approval after adm doc issued and resumed trading.
You are suggesting we should brace ourselves for a 2yr wait for completion of south sudan?
On the Save website media section.
Adm doc for Accugas acquisition released and resumption of trading in Dec 2017.
Completion November 2019.
Zengas - one would hope there are learnings from the chad deal factored Into the South Sudan deal or any other future deal
Can’t find it at the minute but I had an old copy of S. Sudans PSCs . Just wondering if SSUdan can’t complete on an alternative deal with somebody else come the one year anniversary can Save say it completes? I wouldn’t like a similar situation as they announced on Exxon in Chad. I’d like to see clear closure and the government fully behind it.
Zengas & CYB - Over the last year I believe this question has come up a number of times. I believe rocky did check and the answer was approval is not required for admission document releasing and returning to market, but it was AK's preference to come with approval at hand alongside but not a formal requirement.
As far as my experiences go with all oil and gas deals i have never heard of formal approval being granted the same time as the admission document is released and very unlikely that this is the case here.
There is confusion between preference and requirement based on what we have heard from posters who have spoken to IR.
You may well be correct, Zengas (which is my way of saying I don't really know!) You have a great track record of being on top of such matters!
But that gets us back to a deal which is "subject to" goodness knows what. It may be that management is once bitten, twice shy on that approach after the Chadian pantomime; and of course it may also be that relationship and legal circumstances preclude such a move.
And if we did relist, subject to various conditions precedent being fulfilled, how does that give appropriate price discovery?
I don't like being suspended but it's the least worst option, in my opinion at least. Perhaps I'm missing the point: wouldn't be the first time...
Like all on here I want to return to market with SS deal completion but another extension till the end of March 2024 wouldn't be so bad it the grand scheme of things...........
1) It would allow us to see if the SS deal still has legs and how serious are the SS government is in approving our deal.
2) Continue to build cash from accugas for when an acquisition finally comes our way.
3) Additional gas contracts.............
3) On the cusp of compression project completing.................... by mid year 24. Transforming the companies capacity to process gas.
4) Niger pipeline probably started and exporting first oil, with hopefully us being able to logistically plan well test in Niger.
5) Hopefully debt restructuring completed Q4 2023.
6) Further clarity on Chad / Cameroon and everything associated with it.
6) Perhaps time to secure an additional acquisition if not in motion already. This remains an interesting one as not sure the level of flexibility they have on this are they able to supersede another acquisition ahead of the SS Deal with the SS Deal still intact, who knows as this is more a practical and legal question which I don't believe anyone has yet asked the company or knows to date.
Hi Cyb, I thought we just need to get the adm document out and then it’s possible to relist. Did this not happen with Accugas as well as the Chad acquisitions ? That’s my understanding but maybe I’ve misread it.
CYB - yes its definitely a ‘binary’ situation we find ourselves in with a VERY BIG ‘0’ and a VERY BIG ‘1’!!!
Good grief: what idiot programmed the filter here? You can't even say s-p-a-r-s-e without some editorial fascism. Spbackside, perhaps?