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Skittish: that’s me!
Gazprom sold him its UK Wingas subsidiary, which owned the Saltfleetby gas field (which had been closed for 18 months following the closure of the Theddlethorpe refinery), in May/June 2019, apparently for a nominal consideration. They also gave him £12.5mm (was it? Or £14nm? for site abandonment provisioning. Wingas was renamed Saltfleetby Energy Ltd later that year. Their offices were next door to Angus Energy’s and a deal was arranged - we don’t know when or how - with the Earl of Lucan, who had been appointed to the vacant MD job at Angus earlier that year following the Tidswell share dealing scandal and subsequent ousting of Paul Vonk, though he had no knowledge of oil or gas or experience in the industry.
Lucan bought the gas field for £1, plus £2.5mm for either an abandonment reserve or to bring the field back into production by installing refining facilities and connecting pipelines at an existing site to replace what had previously been done at Theddlethorpe. Lucan said the £2.5mm would more than cover the cost.
Since then, Saltfleetby has cost probably £2-3mm of Angus’s pre-existing cash, after which they spent a year negotiating a £12mm loan to finish it. They’ve had several placings in addition. The loan is at usurious rates and requires repayment of capital and interest, combined, of c. £4.5mm this summer. There are, in addition, hedge contracts over most of the expected gas production, which if not met will result in losses to Angus - possibly very large ones.
There are charges on the loans which forbid asset sales without the approval of the lenders and entitle the lenders to take over the assets of both Angus and SEL (the latter are guarantor of the loan) in the event that they don’t make the payments.
Saltfleetby is very late and it looks to the more analytical followers of Angus as if they are quite likely to fail to finish it in time to meet the payments.
All the assets in SEL (according to the May 2020 latest accounts) apart from some inter-company balances and £750,000 in cash, are the pipeline and gas site assets bought from Wingas. If they can’t make the payments due in June/July, the lenders may own SEL’s assets. Where the abandonment liability will reside, for which Wingas paid them all that money, is a moot point.
The suggested shuffling of part of SEL’s share of Saltfleetby into another company may well turn out to be a rearrangement of the deck chairs on the Titanic. The revaluation in the SEL accounts reflects the write back of the abandonment provision, since the gas field no longer appears to need such a reserve, being brought back into production again. It’s not clear what happened to the rest of the money that was not passed on to Angus, or if there was any. If he paid himself a dividend, he’s done well! Unless he finds himself liable for abandonment costs one day.
Sorry just read your post in full, of course you were aware of it.
Skittish, did you spot that he was made a director of AAOG last week ?
I know that some on here do not seem to rate Paul Forrest much in terms of financial acumen, and he does seem to present as as something of a provincial accountant of likely modest means, however it appears to me that he may have hidden talents.
For example, on 17-6-2019 he acquired the stranded Saltfleetby Gas Field via ownership of Saltfleetby Energy Limited (SEL) from Gazprom. We have never been told how much he paid (bearing in mind his limited means), but I'd hazard it was £1.00.
Whatever he paid, SEL was the recipient of not only the gas field but also £14M in cash inherited from Gazprom as "decommissioning costs", as at that time it was apparently intended the field would never be brought back into operation; and also £61M in tax losses.
On 19-6-2019 SEL sells, for £1.00, 51% of the gas field to ANGS, paying them £2.5M in decommissioning costs for the liability they were now taking on - in the short space of 48 hours the field is now viable once more.
ANGS is co-opted to resurrect the Saltfleetby field, tapping its own shareholders as required.
So over the space of two days (17-9-2019 to 19-9-2019) Mr Forrest turns a £9M profit, via the suddenly reduced decommissioning costs - and later ANGS says that even the £2.5M was too high! And SEL's 49% share of such decommissioning costs is now shown as £700K in their accounts.
Not only that, but SEL's latest accounts (1-1-2019 to 31-5-2020) show that it made £12M profit - we don't have access to the P&L, just the balance sheet showing accumulated losses falling from £61M to £49M - probably by shifting the worthless "abandoned assets" into the valuable "soon to be producing assets" column.
He then uses some of the £14M given on the sale by Gazprom to buy up 25% of AAOG for £500K and acquire effective control of a company which has a further £42M of accumulated losses against with future profits can be written off. Not satisfied with that, SEL grants AAOG an option for a mere £8M in shares to buy 25% of the previously worthless Saltfleetby. Last week he was sufficiently influential to be appointed a director of AAOG.
So, in the space of 3 years Mr Forrest, with no visible major means of support,
acquires a stranded gas field,
achieves control of SEL and AAOG, is appointed a director to both
co-opts ANGS into resurrecting Saltfleetby,
"pockets" (not personally) £9M+ from Gazprom which is then used to pay for SEL's share of the resurrection,
grants AAOG an £8M option to acquire 25% of the previously worthless Saltflletby
makes a £12M profit in the SEL accounts,
and acquires effective control of company losses to be set against otherwise taxable profits, totalling £103M.
For someone with little financial acumen, he doesn't appear to be doing so bad.
He must think he's won the Lotto.
And I don't think his backers are Filipino.
And I wonder who bought some of the 175M new shares ANGS issued last week?
mmafr
RMP was an oil and gas small cap co in Greenland. After it went bust due to drilling a dry hole It relisted as FME, a miner in Australia after 2 yrs suspension.
But the share has already been suspended from trading for some time, hasn't it?
And if it is revived, it will certainly be in a new company. AAOG will probably no longer exist under this name. Actually, shortly before the suspension of trading, you should have buy more (which I did).
Also I am going to watch the situation after first gas and see whether I should increase my investment in AAOG. I have already averaged down 4 times in the past and final average is 2.2p.
OofyProsser
In short , the way I see it is that AAOG has £42m in tax benefit and this is alot of many for any company. This had made the company to be taken away and hidden for two years so that it can be used now. RMP in the same situation and I recovered one third of my investment so far. I am still waiting to recover my investment from AAOG. Apart from hedge restriction I see this is a better investment than that of RMP.
Oofy, I don’t feel that you butted in, I welcome any one who posts their views on any board as long as it is rational and has some bearing on the company. If we ever do get resisted the umpa lumpa’s will invade the board so let’s enjoy our time here for as long as it lasts.
irishmouse: yes, I understand. I only butted in here to share my view on developments at Angus but it hasn’t helped anyone invested in this, I appreciate that. I hope it will come good for you here, somehow.
Oofy, Re Paul Forrest, we don’t know what he has or his intentions for the company, but he and forum are the only chance we have at this moment in time.
MrEMC2: I wasn’t trying to criticise. It just seems to me that people like Mr. Forrest are given too much credit on these sites.
Most of the time it seems to me they make it up as they go along. He hasn't got much money, at least he hasn’t in his quoted companies. If he is a front man for rich Filipino interests, that’s a different matter but where’s the evidence of it and what’s the plan? I hope your investment here will come good for you in due course.
Hi OofyProsser I had a gamble on AAOG because (and after) Forum put in £500k. Looked like a good bet at the time. AIM and shell company; I knew I was playing at highest risk. Cheers
Yes, MrEMC2, I understand that but his taking a stake in AAOG is not really a positive endorsement of his financial acumen, is it? You’d have to believe he still had the backing of a Filipino entity to impute to him any financial capability, surely?
RNS 20 Jan 2020
Forum : notification of major holding
94,041,011 23.71%
RNS 20 Jan 2020
Paul Forrest, Chief Executive of Forum, commented, "Forum is pleased to have taken a strategic stake in the Company and we are looking forward to working with the Board to create shareholder value. Forum has, through its investors and network, access to sources of funding as well as exciting and viable projects in the natural resources sector that could be suitable as acquisition targets for AAOG."
I don’t really understand the level of interest expressed here in Mr.
Forrest’s activities. There’s precious little in assets or cash in any of SEL, Forum or Orwell - other than, presumably, the Saltfleetby-Theddlethorpe pipeline, which is mortgaged to the Lenders. I’m not aware of his doing anything very impressive in any of these companies (though if Angus had managed the Saltfleetby project competently, the huge rise in gas prices would have given him a massive windfall). Can someone tell me why he’s taken so seriously here?
Paul Forrest selling at Angus - now we know why. £1.4m placing @ 0.8p at Angus.
Remember, that was exactly 2 years ago now :
Sarah Cope, chair of AAOG, said, “The Board has considered several offers to purchase the ISA Shares and has, in consenting to the purchase by Forum, given consideration to the long-term interests of the Company rather than purely immediate financial gain. The Board is confident that, of all the potential partners considered, Forum has the clearest vision and best contacts that will enable it to deliver value for shareholders in the long term.”
Paul Forrest, Chief Executive of Forum, commented, “Forum is pleased to have taken a strategic stake in the Company and we are looking forward to working with the Board to create shareholder value. Forum has, through its investors and network, access to sources of funding as well as exciting and viable projects in the natural resources sector that could be suitable as acquisition targets for AAOG.”
Good find, irishmouse,.....
Appointed on,
1 February 2022, as Finance Director : (Paul FORREST, https://find-and-update.company-information.service.gov.uk/company/04140379/officers ),....I hope there is some positive AAOG news to come, following this appointment.
BW
Pawlo, why indeed would an accountant take a directorship as finance director when the said company has no finances to direct?
The said company also can’t pay a salary or pension contributions, he is either stark raving bonkers or knows a little bit more than we do, which would not be hard.
Why would you become a director of a company that is not trading? Something Is happening behind the scenes looks like good news coming. Fingers crossed!
Wow!! Top find, good job Mouse. This definitely gives hope again!
Here is the link, it’s the most encouraging piece of news we have had in a long time.
https://find-and-update.company-information.service.gov.uk/company/04140379
The appointment of Paul Forrest was lodged at company house last night.