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"If we found and proved 31 Tcf recoverable it would still be worth between $40 and $100 per share to Sound. I'd settle for 40-100p. In fact I'd do cartwheels down the street."
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I am stunned by the ignorance of some (either dishonest or non-clever - either way, ignorant IMO).
Pontcanna sees this whole saga for what it is - SOU has gone from hero to zero as the company's resources get stolen (legally) from right under our noses.
The laws of the land become ever more nonsensical allowing the transfer of wealth to the few at the expense of the many.
Tough old game as most PI's play on a non-level playing field. It is what it is.
Longwait- There may also be economies in tying in production to the Horst facilities. If we get the deal, I hope we have very detailed plans of the route, financing and NPV.
There are much lower risk targets out there than TE8, 9 and 10. The aim was to hit one and we'd all be happy. We didn't and the plan was lacking in backup/support of core value. If the deal comes, we may have a chance to take the lower risk route.
If there is a deal, then that means the farminee must think there is a realistic chance of finding 1 TCF of gas.
'Jesus it's rampy on here tonight. Talk of 31Tcf and dividends.'
Ps and I are speculating that SOU and partners (if they materialise) could find 1 TCF and that, together with TE-5, could result in an annual dividend of 5p.
That is, by any standard, a conservative estimate of prospects.
We are talking about 1 TCF, not 31 TCF!
Jonesy, I don't seriously think there's ever going to be 31 Tcf. The market revulsion for the share now means that 1 Tcf would make it a multi-bagger. Scratch that, NO MORE Tcf could see it being a multi-bagger.
>>>and the (ex)CEO is Vlad the Impaler.
Except the (still current) CEO has a strong hand on the tiller.
LONGWAIT, I concur. Once this deal gets over the line, there is massive potential upside. That 1.4p dividend should be easily achievable even with a 14.3% interest which would also mean having scads of cash for further exploration. Another Tcf would be game changing, as you say, tripling the potential dividend. I've been lucky enough to be able to average down to where a 1.4p divi would recoup the majority of my paper losses and at 5p would be in clover. Sure there are serious risks but ironically the "high risk high reward" strategy actually makes more sense *now* than when everyone was dreaming of a four-digit SP.
Pontcanna, no, I don't think we were taken for a ride. Only the naive think there is a low risk route to huge investment returns. I confess to the same naivety as many on here in thinking SOU might be such a thing, but I take responsibility for my own decisions. This board has now sunk into a Slough of Despond which is a classic example of the market cycle of emotions. Euphoria led investors to blissfully ignore the risks at the top of the cycle, now despondency has given them a deep revulsion for the share at the bottom. Every piece of company news is now seen through a lens in which the chairman is Machiavelli and the (ex)CEO is Vlad the Impaler. I can understand it, but I'm unashamedly treating it as a window of opportunity.
You know, ps, if it's true that SOU's share of the gas from TE5 would sustain an annual dividend of 1.4p per share, and IF any subsequent finds paid out at the same rate, then an additional find of 1 TCF would sustain a dividend of 5p per annum, which over a ten-year period would amount to a return of more than 2700 percent of the present share price.
Even if the estimates are not quite right, it gives an idea of just how undervalued the shares are if the deal goes ahead.
If we found and proved 31 Tcf recoverable it would still be worth between $40 and $100 per share to Sound. I'd settle for 40-100p. In fact I'd do cartwheels down the street.
I’m actually optimistic about future exploration & although the deal isn’t the best we’d hoped for, on the face of it at least gives us a chance to hit the TCF’s.
I’ve been trying to think of a similar story in terms of asset sale where the share price has been so out of touch with what’s on offer but can’t really think of one.
14th is getting very close..
Noodles,
Based on the present understanding of the proposed sale by Sound Energy of 51% (24.2% out of a total of 47.5%) of its share in the Eastern Morocco Portfolio, Sound Energy would be left with a 23.3% share of the Eastern Morocco Portfolio. An interest that would be held synthetically through a new joint venture.
In the event the Purchaser exercises their option to acquire a further 9% of Sound Energy’s remaining interest, Sound Energy’s interest would be reduced to 14.3%.
In the event the joint venture were to subsequently ‘prove up’ more TCF in discoveries, then if commercially developed (and funded through to commercial production), then the increase in revenues through the joint venture ought to generate a corresponding uplift (or possibly downward adjustment) representing a 23.3% or 14.3% share, to the level of royalty potentially distributed in due course (to PIs as well as other shareholders on the register) – although this will clearly depend on a number of things; JV decision making on how to utilise profits after allowing for operating costs/expenses, taxes, GSA terms, gas prices/infrastructure costs etc etc etc (the list goes on).
There’s a lot of unknowns with this one currently, but hope that helps.
Please can someone advise me, when we are finally sold and some one else finds 31TCF do PI investors receive any of the royalties.