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Sitiain, an early investor in Tlou means you have been invested for probably 10 years. Luckily I did not invest at the time of ASX or even AIM listings, so my value destruction is considerably less that poor souls who did.
Many here have asked me why I am so ‘bitter’ towards the company. That reason has yet to play out fully but suffice to say, I totally Buy the fantastic potential for Tlou in Botswana. But I totally don’t or didn’t buy their apparent ease of achieving commercial success in Botswana. Many here still are clueless on the problems of doing business in Botswana; instead they hitch their wagon to futureproofing success because the Pension Fund are heavily involved. They may be right; I remain yet to be convinced - but I am totally open to being persuaded!
You mentioned Reserves in your prior messages. They are of course vital for the success of Tlou. The Contingent Resources previously announced are huge; the Proven Reserves can not yet be trusted however. Why?
Because the 2 horizontal wells L3 and L4 are not yet performing to a level that might allow SRK to increase their previously released Reserves figures which actually were fairly minimal - but of course hopefully these will scale up (and dramatically) in reasonably quick time.
The risk that this might not happen has not yet been openly considered by most on this board.
I am intrigued to know the reason for flushing the 2 wells, just as I am keen to see the company start releasing ever improving gas cows.
Again, these are by no means assured; and yes most here have simply assumed there is no problem lurking within this work and it’s outcome ahead.
Time will tell, as always.
It would appear the market is not prepared to trust a bullish outcome; rather it seems they want to see, hear and read improved numbers certified by SRK (or valid independent certification company).
One word of caution - don’t agree with me too much. You will be accused of being me under one more of my 20+ different aliases.
Also, I would be more than delighted to chat with you, given your longevity here.
Found a working source for Greyhound racing using my screen scraper!
Visual Studio 2017 also present - so I forced the a load of LSE/TLOU url and received back confirmation that it must be LSE not Windows 11 , rejecting my request.
https://www.lse.co.uk/ShareChat.asp?ShareTicker=TLOU&share=Tlou-Energy
LinkPage Error The remote server returned an error: (403) Forbidden.
https://www.lse.co.uk/ShareChat.asp?ShareTicker=TLOU&share=Tlou-Energy
LinkPage Error The remote server returned an error: (403) Forbidden.
https://www.lse.co.uk/ShareChat.asp?ShareTicker=TLOU&share=Tlou-Energy
LinkPage Error The remote server returned an error: (403) Forbidden.
Thank you, i hear you as i was one of the first shareholders many years ago.
All my African adventures over the years, except maybe CHAR, hit the toppish for once many years ago have been a disaster.
The continent has so much potential. The commitment by the pension fund here then is very very encouraging as it avoids your point here.
Unless you have a huge balance sheet and are a recognised global player, Govt will make you wait. And wait. And wait some more. And some more again …….
I wont be buying any more , but will watch with interest .Gas results will be the catalyst.
Need to look at what these reserves could be worth . Certainly it is one of those with enormous potential.
Thankyou
Saitiain,
MM generally raise good points here about the prospects of Tlou, and he seems able to communicate with some on the management team.
BS lives for Tlou. An elderly gentleman who loves nothing more than to share his view on Tlou if asked. He will not hear a bad word written about the CEO; in fact his adulation of the gent is most strange. He also loves nothing more than spending hours on Google searches, taking and bending everything he reads into his version on how Tlou is joining up the dots. He also loves telling everyone he filters me; yet always seems to know what I post.
My posting this will spoil his day, and probably send him into orbit of abusing me.
My only crime, in reality, is saying starting 2017 that the company was nowhere near as far advanced in its business journey. Many posters here chose to ignore local politics, when really there is no other reason for the significant delays Tlou (and many other exploration commodity type companies) experience as they try to commercialise. Unless you have a huge balance sheet and are a recognised global player, Govt will make you wait. And wait. And wait some more. And some more again …….
Sitiain, the pension fund is our biggest shareholder - with millions of shares many costing them 11p. They are 100% committed to seeing TLOU succeed!
TLOU has no income so cannot repay any funding until that changes?
Borrowing on one credit card to pay off a previous credit card was popular with young people a while ago - TG is never going to do that!
It was discussed on here years ago , and Damo or Down to Earth (if I remember rightly, apologies to whoever it was if I am wrong) , posted that a 2 year repayment holiday was the industry norm for startups.
We have 6 months in which to pay any dues, so the 18 months was chosen to allow us those 2 years , no accident.
Tlou will be liable to pay after 18m or 2yr (not sure which) , but, if they cannot , then the charges will be accrued and payable a.s.a.p. It is why I never thought we needed funds as urgently as most on here did! By taking the funds, TLOU are showing confidence in having a sufficient income within 2 years or an affordable period soon after. And the pension fund must believe them - and are surely better informed than we are!
We have rights to trillions of cu ft of gas worth a fortune for security.
I think TG was clever - the convertible funds are really a sole party placing - surely cheaper than a proper placing - and 7.75% pa is all we have to find in cash!
Not only is the cost of getting the CBM cheaper than Australia, but in 2016 the price was $10-$12 per unit in Oz, compared with up to $30 in Botswana.
The Govt want the gas urgently , drilling is being resumed .... the only way is forward apart from the downward drill! There is plenty of cash 2.6m and a further 5m for poles/wires and substations.
If Synergen need some solar power to complement the current gas then the options might produce cash for them - but that is going to have to be announced soon!!! The drilling that MM tweeted suggest SM are not going to be doing that!
It looks all systems go on power to Serowe , which will keep the conservatives on here happy. The Hydrogen supporters will hopefully have that to look forward to. It won't go away unless SM are another pie in the sky outfit.
Thank you, MM
much appreciated.
SO they are making all these investment decisions on those gas reserves or do they know something we don't.?
My thoughts are years of gas flow make people very confident.I wish I was more knowledgeable regarding this resource.
Thank you for your time.
sitian - there's more.
The BPOPF (Botswana Public Officers' Pension Fund) also own 50-odd million shares (c.*%) at 7.25p or so.
They are very heavily committed tto funding the CBM industry in Botswana.
If and when Tlou convert the resource to reserves and successfully extract it they have literally 100s of MW of power for many decades. That totally underpins the whole of the Botswana economy.
Don't take it from me. This is what the BPOPF's CEO said when we did the funding deal:
Mr Moemedi Malindah, BPOPF CEO, said
"Tlou Energy is building vital assets and infrastructure for Botswana. We are committed to long-term support of the project and look forward to its continued success.
This is a long-term strategic investment, and we are very pleased to be able to support the Company and help bring clean reliable power and sustainable employment to Botswana."
Thank you for your reply.
So what is confusing me. The pension fund commits to 10 million dollars of convertible debt.
Interest can be delayed until 18 months ...so ( that's a lot of risk)
This debt is done purely on the gas reserves? Sorry, if I am frustrating you.
So the gas reserves are high enough already to support that amount of risk ? Is there a calculation/example of value for those reserves? I guess not as very unique and I think Tony mentioned getting gas out of Botswana is a fraction of the price of getting it out of Australia.
Sorry, I think I'm just waffling. Getting that loan agreement would seem a very good move for the company .I am not sure of current cash reserves, more liquidity to expedient drilling, Or perhaps another convertible loan, which would be very good for the share price.
An interesting slant on how you view the company MM.
My main worry about the low shareprice has been and is now , how cheaply a hostile takeover would be. £12m for TLOU is a ridiculous valuation for a company with bigger aspirations than TG's two billion dollar successes.
Imho, it shows how anonymous TLOU is, or how many options there is world-wide for energy companies. It possibly reflects on the difficulties of succeeding in new African business ...... AVN for instance! And then the possibility of new Mugabe and Idi Amin types! TG selected Botswana because of the stability of the Govt and the amount of gas available.
Europe, and North America are safer prospects for the big boys perhaps?
As for your post MM, your final paragraph includes this view "i.e. don't wait for actual production as that would increase the price exponentially."
Imho, I cannot see why TG would sell out with an imminent exponential gain in value at the end of the tunnel, closer than the horizon perhaps?
He probably expected to be operational by now , and if you are right , out of Botswana with his pension in the bag for his well deserved retirement. And there lies the rub! Will he retire once TLOU is operational and expansion of the company will be a relative doddle compared to what has gone before?
He has always said that once the initial dewatering is complete, then further dewatering for additional wells is much easier as is the whole process.
Add in Hydrogen, carbon, crypto, solar , and Orapa and the excitement of seeing TLOU becoming a bit more than a CBM producer, and I cannot imagine why he'd turn his back on the challenge, but who knows if he is looking forward to retirement and what that will bring?
"CBM is recovered by drilling down to the target coal seam or seams and then often drilling horizontally along the seam(s). A sump is set below the seam(s) and formation water from the coal is pumped out, a process known as dewatering. This reduces the pressure within the coal and so allows the methane to desorb and flow to the primary well and then to the surface."
The rule of thumb for virgin sites is that more water leads to higher gas flow rates.
We expected to have dewatered Lesedi #3 and #4 within months, but it is taking years!
Our first wells at Selemo were dewatered in months and has provided on-site electricity for years. That power has saveds expenditure on diesel (thousands of barrels). All our production at Selemo , however , is subject to royalties of 3% up to 12% depending whether the gas or electricity from the gas is measured.
TLOU expected the same results at royalty free Lesedi , which appears to have much more water to remove - and therefore more gas!
Larger volumes of water = larger surface areas of coal being exposed as the water is pumped out = greater potential for the gas to escape into our clutches.
Hope that helps.
Hi sitiain
This is the most recent reserve statement, I think.
https://www.lse.co.uk/rns/TLOU/further-material-increase-in-gas-reserves-lbmdz1skma8idvl.html
The confidence comes from the high degree of uniformity and continuity of the coal seams from the current production pods at Lesedi (and before that at Selemo) and into the rest of the tenements.
The coal seam width, depth and type of coal (incl. contained gas) is very consistent.
The reserves will be upgraded as new production drilling and dewatering occurs - this will help confirm the uniformity and continuity of the seams.
Personally I don't think we will get to the point of big money arriving. At some point in the next 15 months, as the well field is expanded and the line to Serowe nears completion, a big regional power utility, miner or industry will see that Tlou's expansion is just a matter of the size of the available balance sheet. At this point an offer for the company would make sense, i.e. don't wait for actual production as that would increase the price exponentially.
We will see what Tlou's management do then.
Q, please
Could someone with Gas experience explain what TLOU have and why they are so confident of increasing their gas reserves, please?
This now, I think with the line going in becomes a gas play . Energy in S/A (world) just going up and up.
Interesting to see this .
The big money isn't going to arrive, in my opinion until we can price forward revenues.This won't happen until the reserves are up.Any thoughts please as to how and when, please.
Thankyou
'NERSA confirmed yesterday that power utility Eskom’s standard tariff customers would see an the average tariff increase of 9.61% while municipalities would see a 8.61% hike.'
+ picture of Lesedi operations
Tlou Energy @TlouEnergy
Our highly experienced engineers preparing the rig for flushing operations on the L4 production well.
Systematic flushing of the pods combined with our drill program should see further sustained improvements in gas flows.
Lesedi - 19th March 2022
#Tlou #NaturalGas #Botswana
https://twitter.com/TlouEnergy/status/1505463394404605952