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They also said that there are just two parties with which they are still in talks. These parties are not discussing buying Angus, they’re discussing some ownership arrangement with regard to Saltfleetby. If Angus is to sell all or part of Saltfleetby, they have to get the approval of the Lenders first. And why are they in negotiations to sell the only asset they’ve got that stands a chance of rendering them a cash flow sufficient to meet their annual expenses? The two parties they’re talking to are not identified, so they could be AAOG and Forum, couldn’t they?
The can has been kicked further down the road at Saltfleetby today. First gas is not sales gas, there’s a ton of inspections/sign-offs before the gas can flow to the NG pipeline. It’s a sign of the trouble they’re in that the good news today is another fall in the UK price of gas. There’s a placing round the corner too.
Angus said today:
"Anticipates wet commissioning to begin at or around May 15 and expects it to last around two weeks. Continues to target first gas by June 1, allowing for one full month of unhedged production."
This could be the reason for the sale termination.
Angus Energy - Saltfleetby construction in progress - First Gas in May (in less than two months)
Hey Folks
Not sure if this is relevent or Maybe someone here who knows a lot more can dig further
https://twitter.com/TopTradersADVFN/status/1509555360234975237?
Dutch uit Amsterdam
Petroleum1: well, in that case and in view of the very effective ramp that’s being put on at the moment, I’m sorry. I’m a long term investor, I don’t indulge in speculative day-or week-trades. I’m very much expecting a share placing this week or next, though the extent of this rise may have got Gneiss out of their 39.2mm shares - and possibly one or two large holders out of theirs, who will have been disappointed by the lack of progress on a bid. Time will tell, though I’m sorry to have been a factor in your missing a 100% profit in short order. The long term outlook is little changed by this ramp - though if it carries on much higher, they might raise enough money in a placing to pay for the sidetrack. Or tide them over a couple of weeks’ losses on the July hedge. Or pay the last instalment on the Joule Thomson valve, or overtime for the welders and electricians. The naivety of many AIM investors allows unscrupulous managements to take appalling liberties, institutional investors would look askance at the claims made by Lord Lucan in his recent LSE interviews. We shall see, though - there’s a chance they may get Saltfleetby into production in time, with enough gas to meet the hedge contracts’ terms.
OofyProsser
I took your advice and not bought into ANGS. But if I was to gamble between a newly drilled well
becomming productive and not dry and ANGS finish on time I wil bet on the latter.
No one is talking about first gas in April (well, one or two company shills and day traders may be inventing stories but that’s AIM for you). Two indispensable pieces of kit are not scheduled to arrive before 27 and 29 April respectively. They then have to be tied into the plant with electrical wiring and welded pipes. Then it all has to be tested and NG will have to give it their seal of approval. First gas is not sales gas, there’s tons of regulatory hurdles to pass before they can start the gas flowing. They can’t borrow any more money, under the existing Debenture terms. The current share price is likely the prelude to a large share placing - the only recourse they have for fresh money. Lucan said they’d have it finished in the summer of 2020. Every successive deadline he’s announced - and there’s been too many to number - has been missed, as has every successive budget. They’re in a race to get it finished before the hedge contracts apply in July. It’s possible they’ll make it. If they do, the gas will need to flow well and uninterruptedly. The volume required to meet the hedge contracts rises a lot in October, to a level that the two existing wells/compressors can’t meet, so they’ll need production from a sidetrack by then. They haven’t got enough money to do a sidetrack, though they may soon raise enough to do it, but then there’s regulatory permission required for drilling a sidetrack while producing from a contiguous well. They haven’t got that yet.
Why have they put the company on the blocks if they’re so confident? Why has their largest shareholder irrevocably accepted a low all-paper bid from another minnow? My interpretation is that the management feels it is quite likely they will miss their targets and the company may fall into the hands of its lenders before they can get enough gas flowing to meet the Debenture/hedge terms.
Every one is talking about first gas in April. If they need more money to acheive that there will not be a shortage of lenders with the gas price so high. Lucan said they will be debt free by end of year. There is no need to sell the company.
Angus is short of the money it will need for a sidetrack, it’s got no cash to spare to invest in AAOG. The Sound “bid” appears to have been a successful attempt to get the share price up for the February placing. The latest little ramp of which the LSE interview was part may well presage another share placing. Their pressing problem is the gas hedge contracts which apply from 1 July, not the tax they may or may not have to pay. They’ve still got tons of work to do at Saltfleetby and important parts of the plant not expected before the end of April. Angus has always been grossly optimistic in its timing forecasts. The uncertainty as to whether they can get the plant on stream in time probably explains their stated desire to sell Saltfleetby or Angus itself. It seems they can’t sell Saltfleetby without the approval of their Lenders - and why would the Lenders approve a sale? And the uncertainty surrounding the timing of first production for sale of gas from Saltfleetby and the consequent uncertainty over their ability to meet the terms of the hedge contracts would put off most buyers. Still, this is AIM and anything can happen. Many AIM companies are not run for the benefit of their investors, they're run for the benefit of their managements.
ANGS keeps talking about being taken over by other companies. It will be better for them to takeover AAOG and stop all this nonsense of takeover by SOU or any other.
How about SEL reverse takeover of AAOG? Problem solved and SEL will be richer by £42m. This is more than market capitalisaton of ANGS by 2.5 times.
Fair. point oofy but hopefully you get my drift of thought.
Irishmouse: Angus is a poorly run company and has been a rotten investment but it has never achieved a market capitalisation as low as £1mm.
Two years ago Sarah Cope informed us that a deal could be done with SEL for a quarter share of the saltfleeby field and this was the deal.
The consideration for the exercise of the Option shall be the issue and allotment to SEL of such number of ordinary shares in the capital of AAOG as is equal in value to £8m.
At the time this seemed to be a ridiculous amount as Angus who own half the field had a MC of just over a million, as I type they have a MC of 16.3 million. Is it now time to close the deal, raise some cash and move on ?
With luck we will get an RSN asking share holders to vote on the deal.
Thanks for the explanantion
So there is some possible light (comeback) in in this one !!!
Dutch
Dutch this my help.
Option to acquire UK Petroleum Licences
The Company will tomorrow enter into an option agreement (the "Option") with Saltfleetby Energy Limited ("SEL") to acquire a 25% interest in in the Saltfleetby gas field, East Lincolnshire.
SEL holds a 49% legal and beneficial interest in Petroleum Exploration and Development Licence 005 (the "Licence") and is a party to a joint operating agreement regulating the operations under the Licence (the "JOA") . On exercise of the Option AAOG would also become a party to the JOA.
Sorry should read 49% holding
Morning Dutch.
AAOG have an arrangement with SEL who own 41% of the saltfleeby gas field to buy into half of their holding, so basically if Angus is a success and we do a deal with SEL we could be up and running again.
This is a very basic description of what is going on as I am typing on my phone and the keyboard is very small.
Sorry ..I still have holding at AAOG at least i have not been notified its history .... but can someone just briefly explain what the conections with Angus etc means for AAOG or if there is still any hope of revitailising ?
I do know that AAOG had some Tax Shell leftover but thats all
Dutch
Yes, the people on the Angus site are getting quite excited. The EA approval is more than three months later than Angus predicted in late 2021 but no one thought it would be withheld. The statement from the company that they have all the regulatory and planning approvals needed before first gas conceals the fact that to get to steady sales gas production (not the same thing as first gas) they’ll need to pass HSE and NG inspections.
The way this has been done suggests to me another share placing is imminent. The existing overhang of 39.2mm. shares in the hands of Gneiss may mean that any share ramp this time may be short-lived.
Those people in the data room as well as SOU are taking their time to make an offer for Angus.
Perhaps they are waiting to see if Angus makes it to the finishing line on time. I will also wait and see what wil happen next.
Tue, 22nd Mar 2022 16:29
RNS Number : 6527F
Angus Energy PLC
22 March 2022
THIS ANNOUNCEMENT IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE TAKEOVER CODE AND THERE CAN BE NO CERTAINTY THAT AN OFFER WILL BE MADE, NOR AS TO THE TERMS ON WHICH ANY OFFER MIGHT BE MADE.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR"), AND IS DISCLOSED IN ACCORDANCE WITH THE COMPANY'S OBLIGATIONS UNDER ARTICLE 17 OF MAR.
22 March 2022
Angus Energy Plc
("Angus Energy", "Angus" or the "Company")
Regulatory and Planning Matters
Angus Energy plc (AIM: ANGS) is pleased to announce that the Environment Agency has issued its Variation Notice for the existing Saltfleetby gas field permit. The site permit now encompasses the new activities of processing and compressing of gas for direct export to National Grid. No further regulatory or planning permissions are required before First G
The Lenders are not a hedge fund. They’re commodity traders. Use of commodity derivatives contracts are meat and drink to them. The hedges cover only a little more than 50% of expected gas production from October. If they agree with Angus’s estimate of 10mmscfd , the rest of Saltfleetby production over and above what is covered by the hedges will be quite valuable. Why would they want to forgo the revenues from the total production from the field, given the chance? I wouldn’t, and I’m not a hedge fund manager either.
What expertise has Angus got that the Lenders haven’t? The Chairman is a PR glad-hander. The MD is a finance man, and not a very good one, going by his record over three years at Angus. There’s a Finance Director and Mr. Hollis, the sign-off for all technical releases. and a number of other subsidiary staff, all of whose jobs would be in the balance in the event that Angus’s assets are taken over, though a few of them might be kept on. A bright young MBA at Mercuria would welcome to chance to take Saltfleetby on, and they’d hire the appropriate people for a field of this type. It would be cheaper and better than leaving it with Angus and the Lenders would keep all the profits, not just the profits on the hedges and the royalty. Alternatively, they might sell it, once they'd got it into production.
If Angus get the gas flowing at over 5mmscfd and sold to Shell in June, they’ll be fine. If they can’t get it flowing at the rate required by the hedge in July, not only will they not be able to drill a sidetrack but they’ll be in default on their loan terms. Why would the Lenders write such a tight and detailed Charge document on their Debenture if they have no intention of exercising the rights the Charge gives them? And why has Angus declared itself open to bids at this stage - three months before it says gas will start to flow?
Also the last RNS said Angus will be making £1.5m/month from the unhedged gas only as they are expecting a flowrate of 5 mmscf/d. They can drill a new well (onshore)anywhere throughout the field. I am expecting that the flowrate is higher than 5 mmscf/d.
Hedge fund people are traders. They cannot develope the field if they decide to take it over from Angus. It will be in their interest to let the hedged gas flow and make a fortune ie let Angus continue their work.