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On your point around continuing to still grow head count, one would hope that there are genuine reasons that we may not be privy too that justifies continued growth in headcount......................
Rockyride - I do sincerely hope that we don't have to wait 2.5 month for the next rns. Hoping for a few operational update RNS's. For me personally the following 2 will go along way:
1) News of additional accugas contracts
2) debt restructuring - if they had a term sheet already that we shouldn't have to wait till December 15th for news on debt restructure .
Acquisitions or not the company, AK, and the board need to do a better job in keeping the market and the investor base appraised on existing business as a bare minimum......................
All quiet on the channels I monitor so far RR. No more additions regarding the NY appeal from CityBank. I guess it could be a while before that is heard.
TiL - TY for monitoring so many channels for any snippets on SAVE. Re this one - you would like to think that AK is confident of some incremental NOI for somewhere or other if he is still recruiting and growing the team in the UK and abroad.
What were the focus areas for 2023:-
1 Close SS
2 Add another hydrocarbon acquisition
3 Get to 1GW - now put back the next year
4 Re-structure Accugas debt
I’d be ecstatic if we completed on 2 & 4 by the end of 2023.
Surprised we’ve not seen more trade press / Social Media. I hope Z and Komakino are still researching all this lot along with Komakino’s excellent research on progress re the New York and Paris court cases.
Https://careers.savannah-energy.com/job/London-Assistant-Company-Secretary-LND/956531755/
Hmm, perhaps they might need to devise or structure contracts that allow us to maximise up to 200 mmcf//d or at least until 180 mmcf/d, helping us maximise as close to our current processing capacity
The 8 gas contracts
https://www.savannah-energy.com/operations/nigeria-3/our-assets/
They sold 142 mmcf/d for all of 2022.
I don't know if they have spare capacity for new contracts because if those cornerstone customers take their 80% TOP as well as the others taking 80% of theirs, they could be running at 212 mmcf/d. They mightn't meet those contract requirements.
Correct me if I am wrong but according to H1 2023 update we are averaging daily production from Nigerian operations was 25.3 Kboepd. If I our processing capacity is 200 MMSCFD that's equivalent of 35,000 Kboepd.
So in theory we still have plenty of leg room to sign additional gas contracts to the tune of 10k still lets hope we can start to ramp this up. Personally I don't think it's a tough ask to get to 30k plus in the next few months minimum...........
Anybody notice the 8 trades today all for 4,025,000 @ 26.25p = £1,056,562 per trade and 32.2m shares in total?
On ADVFN they all show as positive numbers but on LSE 5 of the trades show positive and 3 trades negative.
Can’t be Joseph’s shares going through as he only bought 6 m at 26.35p.
Strange why these are showing today and does anybody have any thoughts? Hope it’s not a placing going through, although if it is at least it would (hopefully) provide Sime support at 26.25p and you would think we would not be coming back in the teens or worse.
Oil cartel leader warns of prolonged high prices https://www.bbc.co.uk/news/business-66985654
I do wonder legally or ethically how long they can keep rolling on the suspension. It's currently suspended on the basis of a deal that wasn't the reason for the initial suspension, and talk of working on another deal if SS fails, and a another extension to the already extended suspension period does make we wonder if they are playing a bit fast and loose to avoid having the shares trading until they have possibly managed to pull something out of the hat. Can anyone shed any light on what the Nomad might need to support an extension request ?
My wish list in order:-
Debt refinance
Additional 10k - 20k hydrocarbon deal
Niger drill test
South Sudan RTO
New renewable deals announced
Compression project update / new customers
ICC cases with the court in Paris
What would we be worth if all that lot proved to be successful - ker-ching
And conversely…ouch
What’s the chance we will get it if still not by Dec 15th? Six months passed the original deadline. I don’t have high hopes for SS but as long as we have another big deal signed by year end all is fine. Let’s hope so.
TiL, don't forget Save have an objective of a further acquisition completed by end of year, and AK reiterated that at the last meeting, so whether we come back or not by December, we should hopefully have another one in the bag by then.
Zengas - On the basis of what you are saying, I think if we if don't receive news by end of November than it is fair to say we are probably in the same place as end of September. My personal opinion is that the first 2 weeks of December probably aren't going to change the position we are in at the end of November. I tend to discount December as a slow month as it's pretty hard to get things moving quickly leading up to Christmas and new year break. So in reality wouldn't put it past if there was another extension till end of Feb / March 2024. Again Jan tends to be a slow month as well going into the new year.
So if December 15th is not achieved than with every chance we are looking at 31st March 2024.....................
'Took a further 12 months to complete Exxon on 9/12/23' - should read 9/12/22
Bear in mind
On 2/6/21 we were suspended on the basis of a proposed acquisition and RTO of Exxons interest - There was NO SPA signed.
On 13/6/21 just over 6 months later we signed the SPA with Exxon - but also signed the SPA with Petronas for their interest re Chad.
2 weeks later the adm doc was issued for both SPAs and suspension was lifted -overall in 7 months on 31/12/21.
Took a further 12 months to complete Exxon on 9/12/23 and we discontinued with Petronas in Dec '22.
This time around we've signed the SPA with Petronas for S.Sudan on 12th Dec 2022 along with immediate suspension.
We had a general statement for the adm doc to be issued in H1, then it was moved to be by 30/9/23. This time however it's a mid December month guideline - why not Dec 30th ? It's on or by 15th Dec - so is this seen as the overall final date, both for completion & approval.
Even though we signed the SPA with Petronas in Dec 2022 - i would think it was under discussion long before that - so why i think Jan 2022 might be the effective date.
That leads me to think that when AK said they hoped to have another significant acquisition before the end of 2023 - it could be well progressed.
If S.Sudan concludes - suspension is lifted and there'd be no need for a further suspension unless its a very large acquisition in its own right.
If S.Sudan doesn't go through then they should come back to trading immediately.
Perhaps this could throw a further acquisition into dissaray or they wait and leave a period of trading before an announcement which could be weeks, months away or not happen.
I think the date of 15th December is possibly significant regardless of Christmas - it's mid month and eaxctly 12 months since the SPA was signed.
I think the Government perhaps has been looking at an alternative deal in August on the basis of pre-emption which must be done in a defined period ie getting more money from somewhere else and run the asset themself.
Problem is they want a 5 year payment holiday and they are genuinely broke. From what i know all their oil is pre sold up to 2027 so have no flexibility imo and why i think the touted amount sought from Caltech has been so much to make an alternative deal worthwhile. On the basis of their pre sold oil, i'm not sure if that was based on much higher production figures say pre 2019 and which has fallen way down to todays numbers. Such a deal would leave them in an even more precarious state ie totally dependent on oil revenues something the world financial aid partners are totally against.
Https://cityreviewss.com/savannah-energy-to-delay-acquisition-of-petronas-assets/
Don’t think this says anything that we don’t already know; suspension extended because so far it didn’t get approval.
I wonder if we are exploring compressed natural gas (CNG) options in Nigeria. I assume the have one or two buses knocking around.
Nigeria's President Tinubu increases wages as national strike looms https://www.bbc.co.uk/news/world-africa-66976445
Https://twitter.com/PatrickHeinisc1/status/1708247943734587531?t=plrlA5vtk7KOS59363lL3g&s=19
Picked this up and thought it was interesting that it does seem to have been a very last minute surprise delay in admission doc
Thanks, useful.
I’d hope if SS fails shareholders would be given an opportunity to adjust their positions before another suspension, regardless of any potential new deal in the pipeline. The medium term Shante piece performance has been pedestrian, and that’s being polite.
It’s interesting that both of the main brokers to the company have no view on the valuation of the company as it currently stands.
Who knows how the relisting share price is determined behind the scenes in the absence of any normal supply/demand dynamics.
All a mystery.
Welcome Ian. RR beats me to it and explained beautifully.
I’d say AK will only announce if the new deal is all done and dusted. I doubt he would want another prolonged suspension. I’m hoping two done deals announced at the same time, or ver close to each other in a matter of days.
Ian - I’ll have a go in my layman’s terms as I am no expert in this area but my understanding is as follows:-
In simple terms, if a company tries to acquire another company larger that it’s own it is deemed to be a Reverse Take Over (RTO). The rules that determine a RTO seem to be very complicated and there are quite a few of them. However, as a rule of thumb I tend to think of it as being if the market cap of the assets being purchased are larger that the company buying - then this is a RTO.
If a RTO is triggered it comes with a mandatory suspension until a new admission document is issued or the deal fails. Upon either of those two scenarios occurring then trading can resume.
My concern here is that if SS should fail and we immediately sign another SPA with another company larger than ours, we could possible go directly in another back to back RTO and subsequent suspension for another 6 to 12 months.
I’ve got a lot of capital ties up in this company and have been frustrated by not being able to adjust my position (in either direction). One thing I fail to understand is why the shares were actually suspended in the first instance. In other bid situations on the main market, shares almost always remain traded, allowing holders to take a view either way on the likelihood of a corporate action succeeding (and the likely impact on the share price).
Can someone explain why this situation is different?
FinnCap gave some costings on the renewables last year. (Page 4-5 July 22)
For the mix of solar & wind and 750 MW they had a 13p valuation which was unrisked until in development and up and running.
They estimated 75% would come from debt financing such as specialist infrastructure funds suggested by AK - the remaining 25% provided by SAVE.
For wind the cost was estimated at $0.7m MW. For solar $0.5m MW - an average of $600m GW on a 50-50 wind/solar basis ?.
SAVE were aiming for 1 GW in motion by this year end and 2 GW end of next.
It was to be mid -late next year before the up to 250 MW Niger will be sanctioned with 1st revenues in 2026. On the basis of the F/Cap estimates - that would mean a cost of around $175m of which SAVE would need to find around $44m of their own money but likely spread over 2 years.
Overall on the F/Cap estimate for the 2 GW to be in motion by the end of next year - the cost could be around $1.2 billion with $300m needed from Save although the first 1 GW up and running is likely to self finance a proportion of that with maybe $200-$250m needed to reach 2 GW ?.
Save is aiming for 2 GW by end of next year so it wouldn't surprise me to see projects for 4-5 GW by the end of the decade given the massive target market of an estimated 240 GW across Africa by 2030 from memory.
FinnCap are using about 13p for 750 MW for the mix of wind and solar last year net to SAVE.
That would suggest that a 50/50 mix of wind/solar could be about 17.3p per GW - so if they build out to 2 GW maybe over 34p and if long term there's something like 5 GW about 86p - if reasonably close this would indicate why AK sees it as once in a lifetime opportunity on top of the value from Accugas and the separate hydrocarbon acquisitions and Niger.
On project financing and an average cost of $600m per GW (50/50 Wind/Solar) - we'd need about $150m of our cash per GW.
Obviously a proportion of that becomes self financing when the earlier projects are up and running to help fund later projects.
The net debt profile on Nigeria should still be on track to be cleared in around 2 years (taking into account the added ownership of COTCo interest) - so you'd think should provide a significant level of freed up cash. Over the next 2 years id be disappointed if they haven't increased gas sales by another 25-50% or another $50-$100m sales.
If they can land that crucial and sizeable oil acquisition that can throw off $2-$300m FCF such as Petronas S.S which must be already significantly discounted since the effective deal date - this i would think will be able to build future cash reserves and cover our contribution to grow the renewables. Most of these divestments have a pay back time of 3-4 years from effective date and earlier at much higher oil prices and why i think they're crucial to the entire game plan.