Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
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Think there are other factors to add over pre June 2021. The entire region seems to be even less stable, particularly Niger, the deals that we have tried to do have bloated the size of the company for seemingly no additional revenue, the legal bills must be through the roof and money seems to be promised left, right and centre to renewable deals on the basis that hydro carbon revenues are going to go through the roof. In addition, we are further diluted as there was a fund raise for Chad.
Accugas debt looked like it would refinanced but that has also been a constant thorn in the side.
This share is clearly high risk and anyone invested will hopefully have realised that anyway but the reality is Chad may or may not get sorted in a favourable way, Niger may or may not start producing and be caused problems by the ongoing political issues and SS may or may not go through (if it does it may or may not be impacted by issues with Sudan). The likely outcome of a relist with the company no further on than before is horrendous for existing holders as there will be little patience for positive resolutions of all these ongoing opportunities/threats.
Zengas - Most people are short sighted and let emotions get the better if you were pre June 2021 holder when the acquisition strategy was not in place and the share price was 19p or so and you were a happy holder knowing that at that point Savannah could be a 50p+ company through accugas and niger alone. Most people have started to get their knickers into the twist............................. regarding acquistions..
With every passing day net debt will turn into net cash with the accugas asset which has potential to double or even triple production from new gas contracts.
Niger - Benin pipeline completion looming and could kick start things there as well..............................
AIM listed Wentworth Resources reference - 5 December 2022, the boards of Wentworth and M&P announced that they had reached agreement on the terms of a recommended all cash offer by M&P for the entire issued, and to be issued, share capital of Wentworth (the "Acquisition"). The Acquisition was approved by Wentworth Shareholders at the Court Meeting and the General Meeting which were held on 23 February 2023, but remains subject to the satisfaction or (where capable of being waived) waiver of the other Conditions to the Acquisition.
These Conditions include, inter alia, (i) consent from the Minister responsible for petroleum affairs in Tanzania under the Petroleum Act 2015 (the "Act") and any other applicable laws; (ii) the waiver of any right of first refusal or pre-emption right to which the Tanzania Petroleum Development Corporation is entitled in respect of the Mnazi Bay asset; and (iii) approval from the Tanzanian Fair Competition Commission ("FCC"), in each case on terms satisfactory to M&P, acting reasonably.
On 11 July 2023, Wentworth was notified that the FCC has issued a decision notice that application for FCC approval shall not be determined at this time and that this application will be marked closed by the FCC.
Following this, there have been a number of discussions between the parties to the offer including recent meetings in country between the CEO of Wentworth and relevant Tanzanian government stakeholders, as well as the CEO of M&P and relevant Tanzanian stakeholders, to seek to bring the Acquisition to a successful conclusion before the agreed 31 December 2023 Long Stop Date, including at the highest levels of government in Tanzania.
There has been positive progress in these discussions, although there can be no certainty that the Conditions will be satisfied or (where capable of being waived), waived by M&P. The Company and M&P are working towards the satisfaction or (where capable of being waived) waiving of the Conditions in Q4 2023.'
As for Perenco - BLVN etinde for reference https://www.bowleven.com/system/files/press/agm-presentation-08-12-2021.pdf
No not suggesting that SAVE are after Etinde - although we do know that they said they were evaluating other hydrocarbon deals in Cameroon.
What i'm saying is that all these deals are difficult to wade through and i've always said not unique to SAVE. On the other board i've seen the CEO lambasted for bringing us into this. If we want the same kind of deals that everybody else is trying to build and grow from in moving their companies higher up the value chain, it's the price we pay on the emotional swings. Some others think that we are the only company doing this or somehow learn a lesson from it. I'm sure SAVE and its negotiating teams and their advisors who specialise in asset transactions are well versed in these matters. As far as i can see SAVEs net debt on its Nigerian asset will be eliminated in 24 months or less - so we are left with an $800m minimum asset (45p) still able to grow in value. This doesn't affect what happens re S.Sudan but peoples emotions will never think of this in the short term re value.
Perenco is a 270k boepd producer with about 85k in Cameroon - so i wonder why a deal for them is taking so long to get approval there especially when they are such an established operator in that country.
This only adds to my recent posts on the timelines and delays for not only SAVE in various countries but for other companies that i highlighted in August and September from when SPAs were signed.
Afentra - 3 in Angola - 2 pending, Save - Nigeria (how long was that), Chad completed with issues, - S.Sudan pending. Seplat a very long established operator in Nigeria yet from 25/2/22 Exxon Nigeria still delayed. M&Prom Assala Gabon pending. Now Perenco deal in Cameroon long delayed. Even AIM listed Wentworths takeover by M & Prom was turned down first time around by relative safe haven Tanzania. These are only the deals in the last 12-24 months.
Zengas - Wouldn't surprise me I did hear that we were interested in upstream assets in Cameroon so wouldn't come as a total surprise.
I agree with Rob this will not be agreed by Friday and I don’t see it’ll ever be agreed. All isn’t good judging by the silence from the company. Don’t look forward to reopening. Good luck all as we really need it.
Zen, I hope you're not suggesting that we may be getting involved in Etinde! Taking on development risk for a greenfield gas development offshore Cameroon may be a prompt for me to sell out.....
Re Cameroon contd -
'The Company notes that SNH's approval, the next key milestone towards completion of the Transaction, has remained outstanding for a significant period and it remains uncertain when a decision will be made by SNH whether to approve the Transaction, if at all.
Whilst Bowleven is not a party to Transaction discussions, the Company understands that, although the formal long-stop date under the agreement between New Age and Perenco passed on the 30th June 2023, both parties continue to seek to progress with the Transaction. The extended delay, with no established timeline to closing of the Transaction, has created uncertainty as regards potential additional risks associated with the Etinde project and the Company is currently considering a fundraising proposal from a shareholder which contemplates the shareholder providing equity capital at a very substantial discount to the current market price of Bowleven's ordinary shares.'
You have to wonder about what's holding up the Perenco - New Age transaction in Cameroon that Bowleven announced 16 months ago would have benefitted on FID to the tune of $25m - now as of today they are very low on cash of $1.25m and doubtful going concern unless a very substantial cash raise at a discount to yesterdays close
7/6/22 - Change of Partner and Operator at Etinde Licence
BLVN announces that it has been informed by New Age (African Global Energy) Limited ('New Age'), the operator of the Etinde JV, that New Age has signed a definitive conditional agreement with a subsidiary of Perenco S.A. ('Perenco') to transfer all of New Age's participating interests in the Etinde permit.
The Transaction is subject to a number of approvals, including the customary regulatory approvals by the Cameroon government and the approval of the Etinde JV partners. Under the terms of the joint operating agreement, both LUKOIL and Bowleven have a 30 day right of pre-emption over New Age's interest.
"The prospect of Perenco becoming our partner and operator at the Etinde permit is very positive news. We believe that Perenco's proven Cameroon oil and gas developments and substantial experience provide an opportunity to accelerate our efforts to secure FID and the associated USD25m payment to Bowleven.
8 July 2022 - Bowleven, the Africa focused oil and gas Exploration and Production Company with key interests in Cameroon, today announces the expiry of the 30 day right of pre-emption period pertaining to New Age (African Global Energy) Limited's ('New Age's') definitive conditional agreement with a subsidiary of Perenco S.A. ('Perenco'), to transfer all of New Age's participating interests in the Etinde permit and operatorship of the Etinde JV to Perenco.
Neither LUKOIL nor Bowleven exercised their right of pre-emption over New Age's interest.
A number of conditions to Perenco's acquisition of New Age's interest in the Etinde permit remain outstanding, including customary regulatory approvals by the Cameroon government, competition approval and, exclusive exploitation authorisation (EEA) Titulaire confirmation (by way of a letter issued by the Minister).
26/9/23 - New Age Etinde stake sale to Perenco
Despite the elapse of time since the signing of the agreements for the sale by New Age (African Global Energy) Limited ("New Age") of its 37.5% stake in, and the operatorship of, the Etinde project (the "Transaction") to Perenco S.A. ("Perenco"), completion remains outstanding.
The Company understands that a number of conditions to the completion of the Transaction remain, principally including the approval of Société Nationale des Hydrocarbures ("SNH"), the national oil and gas company of Cameroon. The Company notes that SNH's approval, the next key milestone towards completion of the Transaction, has remained outstanding for a significant period and it remains uncertain when a decision will be made by SNH whether to approve the Transa
Besides our investment in South Sudan would have been greater than $1.25bn if we signed a couple of renewables deals there as well. So the argument around the deal going beyond the purchase is totally wrong assumption as alluded to in the announcement. If we signed a couple of renewable deals that in turn would lead to investment infrastructure development around the projects and beyond as a matter of cumulative effect
Appreciate your comments Ed, objectively, it is a good insight and a good developing story. Reading between the lines can possibly give some context as to how SS operate as you allude to.
I think its quite clear we are seeing the major flaw in the plan here.
it is a plainly obvious strategy - ie take on divested assets from the majors and revamp the fields, bring in the revenues to everyone involved etc.
it is also quite obvious, and lets be honest, the MO for most of the African countries where these assets exist, that there has never really been a political will to do right by the people. Its quite clear that these assets come into existence by the majors when the countries are in very different situations. Discovering and bringing onstream these projects transform the financial potential of the countries, and the controlling governments it has been documented (in some cases, especially Nigeria) the payments through shady middlemen that were made for majors to get licenses and access to oil rights. this is not really acceptable these days and not really possible to get away with it internationally. i believe part of the divestment of the majors is to distance themselves from jurisdictions where this has happened alongside their ESG requirements for their debt holders and investors.
On that basis i suspect we will not see this deal cross the line, we will not see approval from the government. a deal which simply pays Petronas, and takes over the asset i suspect will not be enough for the people in power as long as they are able to prevent the transfer of the asset, and somehow bring some benefit from it either personally for nefarious reasons, or to squeeze some additional benefit from the country as a whole for altruistic reasons.
SAVE may well be checking the status with the authorities, but you can bet they will not be getting a straight answer, and the timeline here does not belong to them.
Cheers Ed much appreciated, perhaps they could have been discussing some other corporation but I cannot see how they can raise money for $3bn considering the size of the entity.
Thank you for providing the update, Ed. Do you have any sense of what may be the next move from the South Sudanese here?
RockyRide - They wouldn't want to put something out now to put the deal in jeopardy and neither would we if it put the deal in jeopardy, lets let them work....................
Besides an update is due on Friday regardless so not long to wait
Hi, just to say that I've updated my story on this purported deal, with some comments from Caltech.
https://www.energyvoice.com/oilandgas/africa/536054/savannah-competition-petronas-purchase-south-sudan/
It seems to me that there's little prospect of this particular agreement (if it even is that) disrupting Savannah's purchase, but it does raise some fairly obvious concerns about state capacity.
Ed
Hi K - I do tend to agree to a certain extent. But with all the stuff going around yesterday, including the official FB page it’s always going to be a subjective view of PI’s to ascertain what’s real news and what’s fake. Additionally I don’t think the onus should be on PI’s to scour the new to look for what May or not be official documents. People who don’t read these boards would have virtually no chance of finding all the pieces of the jigsaw that we collectively put together on here.
My main point is that I’m sure if we were trading we’d have been updated but as we are suspended we were not. I’m also guessing that the same applies to other stuff that’s going on. I’d be amazed if more material stuff has not gone on in Nigeria that we have also not been updated on.
This is not a whinge but just a personal view which I have fed back to IR and NOMAD.
Anyway, let’s just wait for Friday which can’t come quick enough.
RR, i think they didn't issue an RNS because of the official post from the Ministry of Finance saying it wasn't true. I also think they want to work out what is actually happening behind the scenes before they comment, as they were obviously taken unawares based on what IR said.
Like with all deals in africa approval has to be granted from the very top i.e. the president and his office.
I find it surprising that based on all the worrying news flow yesterday that SAVE have not wanted to / been instructed by NOMAD to put something out by now. If we were still trading and this happened it would have created large volumes of trade and SP volatility and I’m sure we would have had to puts something out then - so why not now?
With regards Chol who’s a member of the People’s Liberation Movement, did any of you read last week that they stormed out of parliament last week while Kiir was at the UN? The were rebelling about the way change was taking place in SS and some stuff to do with the upcoming elections. Kiir had to give some ground to get them back in last week while he was in the US but I don’t have any detail.
Although there was some backtracking yesterday I find this very worrying (no smoke without fire) and I genuinely feel for AK and the team at SAVE, however, the ruthless part of me says ‘you make your bed and you lie in it’.
Should SS fail I have no idea what we would come back at. I think it would be a head to head fight between negative market sentiment (along with MM’s plying their trade) vs the EXCELLENT progress being made in Nigeria as TiL rightly notes.
Anyway, we know we will be updated from SAVE before Friday with the interims and all we can do is hope for some positive news along side the 1H update.
Sincere GLA here to all as we bloody need it.
Https://www.datanyze.com/companies/caltech-trading/355852590
Blimey.
Bit of background...
https://en.m.wikipedia.org/wiki/Puot_Kang_Chol
https://radiotamazuj.org/en/news/article/opinion-the-looming-collapse-of-peace-in-south-sudan
Obviously the opinion piece is one-sided but, together with the Wikipedia biography, it does tell us that Kiir and Kang Chol appear to be on different sides of the political table.
In terms of the options available to SS. Unless SS can find a credible partner willing l to pay more than $1.25bn than they have a choice to make. My guess is if the deal has been in the works for more than 18 months then they must have tried finding other credible options but no one else is interested and out of all the players out there. So they will have to pull a rabbit out the hat if they want another buyer possible but is it probable………………. If it was probable then they would have announced a credible buyer like Exxon or chevron etc…………….. As supposed to a last ditch attempt with an American giant caltech……………..
It quite simple really if you look at it without the noise the grand question…….. Is there a credible buyer in the market willing to take on the risk of a jurisdiction like South Sudan and pay more than $1.25bn. Otherwise the only option that remains is Petronas slowly winding down the asset till production depletes without any new investment
Don’t believe we will see an rns till Friday and Savannah will not issue anything till Friday when interims are due as the caltech deal and news has been retracted by ministry of finance.
Here are all the possible scenarios that could play out:
1) We get admission document Friday without sign off (unlikely) as we know from various conversations on here Andrew prefers to come to the market with approval.
2) We get admission document with sign off (highly unlikely) unless they want to cover up the caltech fiasco quickly with superseded good news approving savannah.
3) We get another extension for 1 or 2 months more likely.
If the other work streams are complete than there will clearly be a decision to make here does the company wait till approval is granted when there is no legal requirement from a listing perspective to do so.
Our next update on SS is going to be alongside our interims so we will have to all wait till Friday.
The ministry of foreign affairs website still shows the guy who was recently fired (Deng Dau Deng) as acting head. So we have new broom at MOFAIC (James Pitia Morgan since end of August) and Finance (Barnaba Baak Chol since 3 August) as well. I wonder where Puot Kang Chol, the eloquent minister for petroleum, is in all this. Btw, the central bank head was recently changed too.
Apparently, Kiir wants elections on schedule: https://www.theeastafrican.co.ke/tea/news/east-africa/kiir-says-polls-to-be-held-on-schedule-4377898
This is all looking like an SS internal squabble. Savannah will need to RNS something, I think; though goodness knows what they can say. I imagine they'll wait until Friday when perhaps they'll have figured out t least some of what's going on. The chances of securing these assets now looks far more remote to me: I'll be delighted to be proven wrong (at a sensible price, of course).