Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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"BG, based on the comments from Orca, they’re still reviewing which PSAs they may look to renegotiate,"
peking, they only have the one PSA. The (Songo Songo PSA)
yes, i go along with a lot of that vike1, WEN has no apatite for risk, why should they, they are siting very comfortably and in these uncertain times, my guess is they will only consider a share of Ntorya if they can get it for a song.
I think WEN would be happy to be attached to an operator, which if they merge with AEX, would be hooked to ARA. WEN have no operational team. They're basically a bunch of accountants, a few on-ground ambassadors, and a well-paid semi-retired Chairman who lives in Gibraltar. M&P, operator of Manzi Bay, have stated they have no interest in investing in more local exploration anytime soon (have bigger fish to fry), so there is nothing going at WEN, aside from depositing their monthly royalty cheque. Not a bad position to be in I suppose, but boring as h3ll. Ntorya would give them a project to be involved in for the next few years at least, and they would have a chance to strip out their (bloated) SG&A costs.
Nobody has yet explained to me what it is that attracts Zubair to invest $40m and more in Tanzania. Consider there could be three gas providers and crucially a large junk of the year where Hydro takes over. Zubairs revenue stream will be erratic to say the least. Apparently government still owe the Chinese about $1bn for the gas pipeline which they paying off with the gas throughput. I can't imagine much gas going through the pipeline right now, and Mr M. is sitting on vast untapped reserves which he needs to capitalize. I imagine domestic and business will only account for a fraction, so what is the hidden prize Zubair are willing to spend a small fortune for ?
That should be when you SAY discover.
Lager in the sun after a long day not helping my typing!
BG
When you discover, could you mean buy?
Buy additional reserves?
Like Solo's share?
;)
I don't think so peking after all the only PSA that AEX has got relates to Kiliwani and that is currently producing jack ****, so who cares? The real deal is Ntorya and we don't have a PSA on that yet so it can hardly be affected. Ntorya will be one of, if not the, first PSAs completed since the PSA review so should be future proofed. I can only hope that most of us are still alive to see it!!
BG, based on the comments from Orca, they’re still reviewing which PSAs they may look to renegotiate, this hasn’t actually happened yet, ffs. So many conflicting views that this was now completed. Is this serious?
I think a WEN / AEX tie up would have been far more likely whilst AEX was still the operator of the Ntorya License. If WEN want to be in "Exploration" then it is more appropriate to join with an operator methinks. Does Kiliwani count? Mothballed and tiny? Maybe but not much of a prize....
plus Orca needs assurance that their psa license will be renewed when it expirers 2026. i think it interesting Jay Lyons has been appointed interim CEO and not forgetting Linda Beal is a NED, i still have a hunch something going on in background.
https://orcaenergygroup.com/wp-content/uploads/2020/01/Material-Change-Report-1-Strategic-Review-Results-Authorization-of-SIB_9992159_7.pdf
"Under the Songo Songo PSA, we currently have the right to produce and, together with TPDC, market and
sell all gas in the Songo Songo Block in excess of the Protected Gas requirements, referred to as "Additional
Gas", until the Songo Songo license (the "Songo Songo License") expires in October 2026. Our current
contractual obligations related to Protected Gas end July 31, 2024 at which time all gas produced will be
Additional Gas unless otherwise agreed through contract revisions. We have the right under the Songo
Songo PSA to request TPDC to obtain an extension to the Songo Songo License. If accepted, an extension
of the Songo Songo License may require negotiations on the Songo Songo PSA and new contractual
arrangements with the TPDC and the Government of Tanzania ("GoT") to continue to produce and market
natural gas from the Songo Songo License. Such extensions may, in the view of the GoT, be required on
new, as of yet unknown, terms and we cannot assure you that we will decide to enter any such new
arrangements, if available, or that our own attempts to amend the Songo Songo PSA might be accepted.
We understand that the GoT is currently reviewing for a potential renegotiation, the terms of all existing
licenses and related production sharing agreements in Tanzania. For each of our petroleum contracts,
including the Songo Songo PSA, we cannot assure you that any renewals or extensions will be granted or
whether any new agreements will be available on commercially reasonable terms, or, in some cases, at all. "
edgar "The alternative view is that both companies dont need growth elsewhere because they can see how Tanzania is shaping up."
yes agree, but both companies, need to discover additional reserves if they want to fuel that growth.
Bearish on growth prospects elsewhere. Could be they see opps domestically, as WEN has announced (ahem, merger with AEX). Interesting though that a cash rich company such as ORCA has no appetite to grow int'lly when so many O&Gs are on life support. Sounds like a good time to pick up value.
Bearish?
The alternative view is that both companies dont need growth elsewhere because they can see how Tanzania is shaping up.
Interesting 'non announcement' from Orca (the other gas producer in TZ) on its change in strategy. Now says it plans to drop plans to expand across Africa, and is staying local to max'ze returns from SS. Also, its CEO is stepping down.
Not unlike WEN, which are both CF positive/ BS rich companies, that seem content to operate as a utility. Not sure what the takeaway is, but both operators have turned bearish about using TZ as a springboard for growth.
https://orcaenergygroup.com/2020/09/16/orca-energy-group-inc-announces-changes-to-its-strategic-direction-and-senior-management-team/