focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Celebrated highlights of the week
" Complete nonsense Jollyboydrewky. " 1. RoJo
" an estimate of the gas in the ground is no basis for a valuation of AEX whatsoever " 1. Crusty Pete
= = = = = = = = = = = = = = =
Working Capital:
Cash and cash equivalents stood at US$5.81 million," 1..AEX 2022
Current assets include the cash.
When the current liabilities exceed the current assets, you have what is known as a negative working capital. Aminex has a negative working capital. This means that the business does not have enough liquid assets to pay for its short-term obligations. They MUST generate cash flow and they MUST generate it soon. The situation should be cause for concern for lenders, creditors and shareholders alike.
= = = = = =
Re: Questions for AGM.
Last week's list has been narrowed down to 5. This is more manageable for Tanzania.
Questions to ask:
1) The dispute with the Tanzania Revenue Authority is ongoing. What's the plan to get free from this head lock?
Tanzania, you might also want to ask about the deposit required for an appeal.
2) The negative Working Capital requires attention. How big of a Capital raise are you working on?
Be prepared for them to pull the wool over your eyes Tanzania. Double down with insistence for a clear, concise answer. The Capital raise will entail dilution which subsequently entails further weakness in share price.
3) The Scirocco deal has yet to obtain a 'Clearance Certificate'. Also, there has been no closure for a GSA, 25-year license or FFD. ARA knows very well that the only leverage they have is to stall. How long of a stall can Aminex afford to sustain?
They will deflect this question. Just the mere act of deflection is very revealing.
4) Are you still on schedule for October gas production?
Best prepare yourself to have your eyes opened and your jaw to drop. The 'silly list' poster has been promoting this as a fundamental fact. You are about to learn what reality is all about Tanzania.
5) As a non-operator with no say, sway or control over anything, wouldn't the company be better off seeking a strategic alternative?
With nothing to do, management will continue milking this for as long as possible. They'll figure out some way to respond to this question.
" So incredibly frustrating this.... as management continues to fail in achieving anything at all, but reward itself as if they are doing a wonderful job..... Hopefully this is over soon, I just can't bear it any longer." 1. Mick2020 on WEN chat board as related to WEN. Ditto for AEX. Mick2020 warned you, over and over again, to get out of AEX whilst it was trading at > 4p.
= = = = = = = = = = = = = = = = = = =
The company has no raison d'être. Before it is too late, what you want to hear from management on July 13th, is the following .....
" We have come to the realization how difficult things are at present and thus we have opted to se
"Encourage the takeover of Aminex. Apparently, even a takeover has regulatory risk as witnessed with Wentworth and Maurel & Prom. Be happy with a 30% premium to market and, hopefully, the takeover will get approval without attracting too many regulatory bodies each requesting a fee."
There's lots of ways ARA can gain economic value from AEX:
1. Sell % equity stake it has in AEX which don't involve a change in ownership
2. Use AEX to raise capital (once it has multibagged from the current price)
These are the two most obvious benefits that ARA has in having its interest held via a plc and why I think it will continue with this structure for a while yet.
Careful mctripe!
Remember we have our very own free Presbyterian minister preaching here.
He's not interested in discussion. He thinks he's a street preacher telling all the sinners what God has told him in a dream. Do you stop and listen to street preachers? To you believe a word of what they say? Or do you walk by as fast as possible and leave them to their delusion because you know there is no point trying to strike up a debate with them? On here we have the filter, why don't you use it and leave him to his delusion?
Looks like someone's been on the Prosseco
Already agreed Mick.... er er Proscuitto, not for me at 86 years. Let me ask you a couple of questions. Are you eligible to pose questions ? So many other posters here notice you ignore anything to do with the 'free carry'. Why is that? The extra special Hydro is at best 7 years away. How much gas can be pumped up in the time (a mean estimate will do). Accenuate every negative, eliminate the acreage positive is your way, yes ? I'm sure other posters here have their own questions for you but you always, but always duck them, don't you ?
Re: asking a question at the AGM
" ... could we not find and elect one spokesperson to represent our case?" 1. Tanzania
Yes, the most senior person deserves this ... namely, Tanzania.
It will be interesting to hear how management plans to make a silk purse from a sow's ear. The challenges are formidable to say the least. Select at least five questions from the list below. Make sure to ask question #10 Tanzania .... eyes wide open.
Questions to ask:
1)The dispute with the Tanzania Revenue Authority is outstanding. What's the plan to get free from this head lock?
2) The negative Working Capital requires attention. How big of a Capital raise are you working on?
3) Watching what's happening with Wentworth and Maurel & Prom, are you concerned that a takeover of Aminex may not be possible?
4) Did you have faith in the poorly defined 2D seismic cartoon? Of the 3D seismic you have seen, is it mostly small stratigraphic traps?
5) The Scirocco deal has yet to obtain a 'Clearance Certificate'. ARA knows very well that the only leverage they have is to stall. Are you expecting ARA to stall on Ruvuma because of this?
6) What is the cause of the hold up on the 3D seismic at Kiliwani North Development License?
7) Is there any institutional interest at all?
8) Could you provide an update on NT-1, NT-2 and CH-1, rig?
9) Are you any closer to a 25-year license, GSA or FFD? Do you expect ARA to stall until these three are approved?
10) Are you still on schedule for October gas production?
11) Are there any ongoing discussions with respect to the Nyuni farm out?
12) Will the completion of the Julius Nyerere Hydropower Project (JNHPP) have a significant negative impact on gas demand?
13) Other than sharpen pencils, what does management do all day long?
14) With no control over anything, why should the company even exist?
15) Do you foresee a day when this company will actually turn a profit?
16) With the persistent delays, what is the ultimate 'expiry date' or date of 'no return' for the company?
This is a classic case of where the emperor wears no clothes. The illiquidity could rapidly evolve into insolvency. It's time to look up and recognize that this emperor wears no clothes. A generation of investors have been left disillusioned and, with no control over anything, the company has no raison d'être. The company is a profoundly helpless and hopeless.
Encourage the takeover of Aminex. Apparently, even a takeover has regulatory risk as witnessed with Wentworth and Maurel & Prom. Be happy with a 30% premium to market and, hopefully, the takeover will get approval without attracting too many regulatory bodies each requesting a fee.
Prosciutto will be there because Prosciutto likes a good mass debate over AEX.
Prosciutto - buy a share and go to the AGM and put your concerns / questions to the directors yourself. I expect all shareholders would love to hear the debate between you.
" On 9 June 2023 the Company announced that representatives of the Company and M&P had attended a preliminary hearing before the FCC in Tanzania on 7 June, at which various Tanzanian governmental parties were present and that a number of concerns were raised which may impact the likelihood of the FCC to approve the Acquisition in its current form." Wentworth June 12th, 2023
Not exactly ' investment friendly' news. If this Wentworth / Maurel & Prom deal falls through, Wenworth shareholders will find themselves transforming back into the same helpless predicament that Aminex is currently in with no control over anything. Wentworth share price is not reacting well to this news,
Multiple levels of bureaucracy need to align. The Ministry, TPDC, TRA and the Fair Competition Commission all need to be satiated and that is a very tough task considering how voraciously hungry they are.
1) How is the Scirocco Energy deal moving along? Unless there is a resolution, ARA may elect to slow things down at Ruvuma.
2) How many brown envelopes do you need for the outstretched hands?
" .... this is Africa. The local lads will be queueing up, hands outstretched, to discuss "the fees" required to (i) satisfy the minister, plus (ii) to forego TPDC's rights of pre-emption to take over the Mnazi Bay asset and plus (iii) for final approval by the FCC.
Only after all those shovels have been inserted into the £61 million on offer from the purchasers, will WEN shareholders get their hands on whatever is left over. And as for a completion of a takeover by 31st December, it's most unlikely to be 2023. Pick a different year, the local lads are in no hurry to cut a deal. Just look at the troubles Tullow have had in monetizing their assets in both Uganda and Kenya, geographical next door neighbors to Tanzania. Not a single barrel sold since major oil discoveries some ten years ago." 1. gewillia on WEN chat board Jun 11th 2023
3) How long are you willing to suffer with these delays?
4) How far will the price drop with the next anticipated Capital raise?
We are still waiting on the Ruvuma 3D seismic interpretation. You really don't want to read about " small stratigraphic traps". Remember, this is still an exploration asset and not a development asset. Chikumbi needs to come in big as an outlier success.... no small feat. You can't rely on the poorly imaged 2D seismic but the 3D seismic will provide that binary decision point.
Aminex exhibits a life of desperation whilst the clock counts down and the ' lost opportunity ' costs continue to soar. Encourage the search for a strategic alternative such as a takeover of Aminex. Be happy with a 30% premium to market and hope to hell the takeover will secure regulatory approval.
At the AGM, it will be interesting to hear how management plans to make a silk purse from a sow's ear. The challenges are formidable to say the least.
Well of course you're not impressed.
I didn't expect you to be.
I know you are freemen of the Honorable Company of Straw-clutchers.
We're not impressed.
We're Not impressed
All one of you RoJo ?
We're not impressed
All
If only we were paid by the number of optimistic posts, or the number of straw-clutchers following a share.
But we're not.
We're paid by the performance of the SP, and the Market is totally unimpressed isn't it ?
🚛 👷🏽♀️
Before Orca started selling anything
Item .................................
1. Gas Production .... 0 MMscf/d.....
2. Cash Flow per share ... negative ...
3. Working Capital ... negative ..............
4. Cash / equivalent .. minimal ........
5. Net Income ...... negative ...........
6. Dividend Yield .... No dividend ........
Lets compare once the gas starts flowing....
This company's mandate should be to try to put together a decent return for shareholders. For a generation, it has failed miserably to do so and will most likely continue to fail. There has been nothing to show for it except years and years of lost opportunity. Referring to this company as a major disappointment is being generous.
The company is powerless because all of the events are outside of the company's control. It's a fact that they are in financial distress. This fact was published in their financial statements. Creating true shareholder value is an impossible task for the management team.
Even if minimal production does actually proceed, it won't have much impact ... ie .. compare Aminex with Orca Energy Group. This level is where Aminex would love to be at. Even at this level, it won't make a damn bit of difference because Orca Energy Group is still being ignored by the investment community.
Item ..............................Aminex ........Orca Energy Group
1. Gas Production .... 0 MMscf/d..... 95.5 MMscf/d (+ protected gas of up to 45 MMscf/d, sold at cost)
2. Cash Flow per share ... negative ... US $3.40 /sh
3. Working Capital ... negative .............. US $61.5 million
4. Cash / equivalent .. minimal ........ US $96.3 million (US $4.84/sh .. trading at US $3.90)
5. Net Income ...... negative ........... US $1.39 /sh (and the 'at cost' protected gas arrangement terminates July 31, 2024.)
6. Dividend Yield .... No dividend .........7.6%
Orca Energy Group desires to have a license extension past 2026. It is trading below the cash/sh level. Institutional investors simply aren't interested in either one. The luxury Orca Energy Group has is that, without a license extension, it can simply hand over the keys and distribute the ever-increasing bundle of cash which is kept offshore for a reason.
ARA will pull through eventually, but Aminex is no ARA ... far from it.
1. Production by October ... a pipedream .. more are starting to move towards this realization.
2. Capital raise .... there exists a high probability of an upcoming dilution. It doesn't qualify for a loan.
3. The Tanzania Revenue Authority is putting the squeeze on Aminex. They'll need one third of the disputed amount to be deposited just to hear the appeal. Either way, what do you suppose will happen to the deposit?
4. The negative working capital is a fact. This is serious because this WILL require remediation.
5. By hook or by crook, with a sequence of deliberately engineered delays, Aminex could end up being taken over for a song.
Wentworth / Maurel & Prom have yet to obtain their " Clearance Certificate'. Regulatory changes may cause the deal to go off track. Wentworth could find themselves back in the same predicament that Aminex currently finds itself in with no control over anything.
Encourage the takeover of Aminex.. Be happy with a 30% premium to market and hope to hell the takeover will secure regulatory approval.
Thank-you prosciutto !
Most posters here have entrenched positions for a variety of reasons.
Your posts are a breath of fresh air.
You make a very convincing argument against tbh
1. Julius Nyerere Hydropower Project (JNHPP), otherwise known as the Stiegler’s Gorge project should be ready late 2024. At 2,115MW, its capacity is higher than national peak capacity today.
2. Tanzania’s power utility firm Tanesco entered into a joint venture with United Arab Emirates' Masdar to generate a further 2,000MW of electricity using renewable sources by late 2024.
That is a massive amount of Power. The above will have an impact on local gas demand. An export pipeline to Mombasa and Nairobi would help but that has been under discussion for over a decade.
= = = = = =
re: Kiliwani North Development License (KNDL)
" The [3D] incursion into the KNDL should provide valuable data to improve structural mapping and refine the prospectivity of the Kiliwani North and South structures " 1. Charles Santos
There has been a delay with the 3D seismic over the Kiliwani North Development License. The timing of the interpretation has extended to Q4 now. Will the cash flow from KNDL arrive in time to save Aminex?
Let's not discuss Aminex fundamentals because that would be a total waste of time other than to say they are absolutely atrocious. Looking at the balance sheet elicits a visceral sensation of repulsion. Without continued external financial support, they are in trouble. They certainly cannot afford the luxury of maintaining the operator status. Without a Gas Sales Agreement and without even one cubic foot of 1P reserves, the company doesn't qualify for a loan. The expected 30% drop due to the anticipated capital raise could be surpassed.
Orca Energy Group has US $93.6 million in cash. They are skilled as an operator and intimately acquainted with the World Class 'SongoSongo' reservoir. Assuming the 3D seismic interpretation proves to be awe-inspiring, Aminex should be more than happy to farm out most of their 63.8% position in KNDL. The bigger concern is, would Orca Energy Group want to farm in? Orca Energy Group's decision isn't a known.
Without any control and without any say or sway over anything, its usefulness is limited. This company's management team has about as much influence over events as does a bump on a log. This company has gone well past its 'best before' expiry date. The only useful function left is its ability to extract more capital from the easily deceived Old Age Pensioner. Management needs to seek out a strategic alternative in order to enhance shareholder value. A Wentworth-styled takeout, with a 30% premium to market, would be a godsend gift.
At the Annual Meeting, it will be interesting to hear how management plans to make a silk purse from a sow's ear. The challenges are formidable to say the least.
Maybe not October first gas.
Funded through to end of 2024 as per RNS
Tanz wants this to happen what more can a business ask for.
You have assumed if they need cash they ll raise via a placing.
With the GSA agreed and signed they can raise finance elsewhere
The following are two questions for serious deliberation.
1) Production by Oct 2023 or not?
2) Will they require a Capital raise or not?
No Gas Sales Agreement, no NT2 flow test results, no 'Clearance Certificate' from the Tanzania Revenue Authority ( TRA) for the Scirocco deal, no Ruvuma 3D results, no FFD sign off, no 25-year development license, no Ch1 pad construction, no Rig contracted, no Spud date, no drilling of 3rd appraisal well, no NT1 well workover, no Pipeline completion, no contractors hired for the pipeline, no First Gas Production from NT2., no KNDL 3D seismic. no KNDL farm-in partner signed up, no Nyuni farm-in partner signed up, no resolution with the TRA.
The TRA is determined to extract a pound of flesh from Aminex.
" In Feb 2020 and June 2022, The TRA issued the Group with several tax assessments " 1. AEX 2022 Annual Report ..Note 1.
It is nearly impossible to win an appeal for a case with the TRA.
And you say production by October????? Wouldn't most of the above have to be resolved first?
If you believe that this will happen, then you are an eligible candidate for " The home for incurable straw-clutchers and hopeless optimists".
The company is running out of money. You can't live off of hot air or nonsense 3'rd party broker reports. They are going to have to find some more funding. What price will the Capital raise be set at? Hopefully, the dilution creates no more than a 30% drop from here. This anticipated Capital raise isn't the first one and won't be the last one.
Just a reminder .. earnings per share is negative, cash flow per share is negative, working capital is negative, yield is zero per cent. This company has some of the weakest fundamentals ever which leads one to wonder where on earth are all of the gullible investors coming from?
The 'going concern' clock continues to run down. Is this because of bad timing or by a 2'nd party design?
At the Annual Meeting, it will be interesting to hear how management plans to make a silk purse from a sow's ear. The challenges are formidable to say the least.
Well I think prosciutto's 'reality list' is very good. Much better than drewky's alternative effort.
It's a great shame that you can't see the validity and veracity.
Hey ho, I guess you are all too emotionally invested, not to mention nursing big losses.
Truth hurts eh guys ?
6. Earnings per share is negative"
7. Cash flow per share is negative."
8. Working capital is negative."
9. Yield is zero per cent"
10. Prossywotsits reputation on anything Aminex minus 10 per cent. : )
The " Reality List" ...... not the silly list.
1. " Production by October is nothing more than a pipedream." 1. Prosciutto
" if the pipeline IS complete and operational by November 1st, I will sell up and never post here again, BUT you must agree that if it is NOT complete by then you will do the same." 1. RoJo
" Do you honestly believe those timelines will be hit?" 1. Crusty Pete
" I expect a delay of at least 6 months as I do not think the pipeline will be ready as soon as predicted. This will put additional pressure on liquidity that will require some sort of funding, equity or loan." 1. High Yield
2. Aminex requires some sort of funding, equity or loan. Contingent reserves don't qualify as appropriate loan collateral, so it will have to be equity. This massively obese structure is about to become grotesquely obese. Dilution tends to cause weakness in share price. The big unknown is, how far will the share price have to drop in order to entice the gullible to partake in the new dilution?
3. The KNDL seismic project timeline is delayed by at least a year. Orca Energy Group has US $93.1 million in cash / cash equivalent. It is a reasonable assumption that Orca Energy Group could be the KNDL farm-in partner. The delay of production from KNDL would be an annoyance for Orca Energy Group but, without that same cash cushion, any delay would be serious for Aminex.
4. ' going concern ' ...yes, but how much longer? The brick wall is getting closer.
5. A co-venturer could run down the clock a little longer to end up with the remaining 25% of Ruvuma for a song.
6. Earnings per share is negative
7. Cash flow per share is negative.
8. Working capital is negative.
9. Yield is zero per cent.
10. No 'sane' qualified investment advisor would dare give this a "BUY" rating.
ad infinitum
At the Annual Meeting, it will be interesting to hear how management plans to make a silk purse from a sow's ear. The challenges are formidable to say the least.