Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
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What is Capital Reduction
Capital reduction is the process of decreasing a company's shareholder equity through share cancellations and share repurchases, also known as share buybacks. The reduction of capital is done by companies for numerous reasons, including increasing shareholder value and producing a more efficient capital structure. After a capital reduction, the number of shares in the company will decrease by the reduction amount. While the company's market capitalization will not change as a result of such a move, the float, or number of shares outstanding and available to trade, will be reduced.
There will poss be less day trading and more stability.
I would welcome more understanding views on the subject
My pessimistic view
CPO5 Pavo real q2 maybe early q3 by completion Indico Appraisal Well finished by q4 2nd appraisal spudded at best but more likely q1 2020
Put 8 pushed into 2020 spudding q2
Put 9 and put 12, will we really get 3 wells in H2 this year, I have my doubts so I’m guessing just 1 this year I’ll be pleased if we get 2
So of the 10 guided I’m predicting a pessimistic 4. On the bright side I’ve heard that there may be jam in 2020 ish
Morning all .... though no one has made a direct reference to the translated article it's nice to see positivity returning to the group.... we are all in it together and things are definitely happening but not at the pace we would all like lol
The setting up of the dividend accessibility has to be seen as a good thing ( whether it happens or not or when )
The financial structure of the company is setting itself up for accelerated growth, accelerated production increases and increased revenues.
In addition some institutional investors may wish to see dividend payments before allocating funds.
The dividend may well attract a new style of investor for Amerisur shares.
Both partners probably issue dividends.
All part of the growth process ....... great opportunity to buy if you have the funds. Amerisur is on the move !!!
BBN and Jaggers, I agree with both of you, I think this is getting ready for dividends off the back of FY19 results. The level of profit and reduced internal capex commit should create a decent FCF which could be disbursed this time next year. CPO5 and OXY exploration should continue to drive up production, revenue and consequently profit. I think they are getting ready to deliver some of that profit back to shareholders in both the buy back and capital reorganization proposals.
They must be very frustrated as a board that the company's progress is not being recognized in the share price, these are two ways of increasing shareholder value which I think would be very welcome, but also show increasing confidence in the state of the business.
They have said they intend to have 40 million in the bank at the end of the year. Seems they view this as being a reasonable bit of petty cash to take advantages of opportunities and as a buffer should ONGC ramp up the spending on CPO 5. I’d think it’s likely that additional funds over and above the 40 million could be subject to a distribution at year end 19. I’d think somewhere between 0.5p and 1.5p divi around this time next year is on the cards maybe even 2p
"Things are looking up for AMER.''.....apart from the SP!....;)
@Pickedpeck I did read that but alos noted a further comment that the company had no intention of paying a dividend at this time.
My own suspicions are that the company is preparing itself for a possible dividend payment off the back of the 2019 accounts but it will be dependant on the level of success experienced between now and then. So circa 12 months of work.
The OXY farmout has certainly given them the excuse to do this because if all goes to plan they could well be drilling 5 blocks next year for what would be limited calls on their cash reserves. It's difficult to justify it when so many blocks lay idle.
It is also a sign of the confidence they have in their ability to increase production moving forward, led of course by CP0-5, which I think will explode into life next year.
Things are looking up for AMER.
On the next exploration success in CPO5 I see a dividend as being highly likely (assuming both Indico appraisal wells also contribute to production as expected at 2x 1k net to AMER).
Very little not to like about the way this year is now shaping up.
Peddle to the floor plse! 2 rigs for 2 jags!
3.3
Resolution 12 (Capital reduction)
As many shareholders will be aware, the Company’s early years were largely focused on oil exploration and development. The level of oil production is now greater than in the early years and the Company and its subsidiaries on a consolidated basis (the “Group”) has been profitable since 2017. However, as would be expected given the Company’s historical operations, the balance sheet of Amerisur Resources plc on a standalone basis continues to show an accumulated negative retained earnings position of $76.1m and share premium of $144.9m as at 31 December 2018.
For technical reasons under the Companies Act 2006, the Company would be unable to pay dividends until such time as the retained earnings were positive and showed sufficient distributable reserves to permit such payment.
The majority of the Group’s trading has historically taken place in the Company’s subsidiary companies and, whilst the consolidated accounts of the Group show positive distributable reserves, it is the reserves of Amerisur Resources plc (i.e. the parent company of the Group) on a standalone basis that determines its ability to pay a dividend. The Board does not currently have any plans to pay any dividends; however, the Board is of the view that it is now an appropriate time to restructure the Company’s balance sheet so that the Company will have the flexibility to pay dividends in the future, should the Board consider it to be appropriate.
Accordingly, resolution 12 is proposed as a Special Resolution to approve the cancellation of the amounts standing to the credit of the Company’s share premium account (the “Capital Reduction”). Such amounts, once cancelled, would create retained earnings, thereby eliminating the accrued deficit in the Company’s retained earnings and creating positive distributable reserves.
The Capital Reduction itself will not involve any distribution or repayment of capital or share premium by the Company and will not reduce the underlying net assets of the Company. The distributable reserves arising on the Capital Reduction will support the Company’s ability to pay dividends, should circumstances in the future make it desirable to do so.
The Capital Reduction is subject to the approval of the High Court of England and Wales (the “Court”). Application will be made to the Court following the passing of resolution 12 at the Annual General Meeting. An announcement will be made once the Capital Reduction has become effective.
The Board reserves the right to abandon or to discontinue (in whole or in part) the application to the Court in the event that the Board considers that the terms on which the Capital Reduction would be (or would be likely to be) confirmed by the Court would not be in the best interests of the Company and/or its shareholders as a whole.
Hi colonel drake, re the oil not sold December last year but was going to be sold in q1, do you think any has been sold yet. Cheers
The gift that keeps on giving !! Price now approaching my average ! If it falls below it I’ll average down ... amazing assets and great margins but one of the worst management teams in the world ! I’ll be voting against all resolutions at the AGM!
Looks like current production is up a good 40% on where we were in the first quarter. All we now is to get the drill bit turning and things should start to turn.
Likely forward production guidance was deliberately (and rightly) set low given some risk albeit low, associated with the dual zone workovers. They seem to be progressing on track. OBA throughput in the coming days over 4k pd (post P7 work and pre infill well) would suggest production upside. Infill well spud news I’d expect close to AGM.
On top of that, am convinced there will be a 2nd rig in CPO5 in 2H - too much to go after there with a single rig which could be required at Indico for months to come.
If Plat production were to settle down at 4-5k (and I think it could easily be higher) we will be in rude shape with solid POO and global supply remaining tight for the foreseeable.
Would also expect the Co to look agin at the N sands in Plat where past drills encountered good pay.
Hope it brings some positivity back ....... a 3 monthly production actual RNS would do nicely .... the end of year report was more of expectation ...... increased and quoted production increases could see the SP move significantly
Carlos Andrés Martínez Bonilla, CEO of Amerisur Exploración Colombia.
Got there in the end guys .... happy reading and discussing from this new Amerisur voice in ColomBia
And the reserves for the operation in the Llanos?
If we talk about CPO05, which is where we have a 30% stake, we estimate resources close to 50 million barrels.
If we talk about the 3P reserves (proven, probable and possible) for the case of Amerisur, according to the latest certification including Platanillo and the operation in the Llanos, these are calculated at 31.9 million barrels.
Did the signing of the peace process help improve the conditions for the development of the operation in Putumayo?
At the beginning of the operation there were adversities that made the operation complex. The guerrillas entered the camps to sabotage the tasks. They put explosives in the drills, burned the tank trucks, opened the valves, killed contractors and kidnapped personnel.
But after the signing of the peace process, the possibility of expanding the operation was opened as the risks practically disappeared.
How are the Prior Consultation tasks with the communities?
In the operation of the Caguán-Putumayo Basin, we have advanced in the processes of Prior Consultation in a relationship with about 122 indigenous communities and over 220 settler communities. They have already been managed for the blocks PUT12, Tacacho and Mecaya. And we have several scheduled in the short or medium term. Tasks begin once prior consultation and environmental licensing has been completed. This, because the company complies with all the parameters that the law dictates.
WITH GREATER EXTENSION
"We are not from the largest oil companies, it's medium. But as for hectares, it is one of the 10 oil companies in the country with the largest number of hectares for exploration and production. We own 1'030,000 hectares (10,300 square kilometers which in size is similar to the department of Sucre, in addition the department of Putumayo has an area of ??24,800 square kilometers). We only have presence in Paraguay and Colombia. In Paraguay there is a level
More to follow
The bet of the British oil multinational Amerisur Resources for Colombia increased to such an extent that its administration decided to disburse four times the amount of investment that the company destines for 2018 by 2019.
In a dialogue with Portafolio, the CEO of Amerisur Exploración Colombia (subsidiary of the aforementioned multinational), Carlos Andrés Martínez Bonilla, affirmed that with the signing of the peace process they can expand the operation in areas where they previously had no access.
(Amerisur starts exploration to find more crude).
And he specified that for the tasks in 2019, the oil company allocated US $ 100 million with the task of extending the operation to 11 exploratory wells (developed four in 2018), as well as to seismic work.
What is the balance at the close of the first quarter?
Of the 12 contracts with the National Hydrocarbons Agency (ANH), 11 are located in the Caguán-Putumayo Basin, and one more in the Llanos Basin. In 11 we are operators, and in the agreement that we are not, it is the CPO5 block, precisely in this last basin. There the operator is the state company of India ONGC. There we developed two wells producing different discoveries, one is Mariposa and the other is Indian.
In the Caguán-Putumayo Basin there is the Platanillo contract, which is the only one that is in the development stage. The rest of the contracts are in exploratory stage. These are: PUT12, PUT08, PUT09, PUT14, Tacacho, Terecay, Mecaya, PUT30, Coati and Andaquíes.
And partners in the exploration tasks ...
With Occidental Andina (Oxy), we are partners in the Tacacho, Teracay, Mecaya and PUT09 contracts. We have another partner that is PlusPetrol in the PUT12 contract, and we have another partner that is Carrao (from the Arrow Group).
Under these agreements with the ANH, by 2019 the investment is close to US $ 100 million for both seismic and drilling exploration wells in the south of the country.
Mainly where will this investment go?
The investment points to the maximum development of 10 exploratory wells. In addition to the seismic tasks. The National Government has a goal for 2019 of 55 exploratory wells.
In 2018 we drilled four wells for exploration and the total investment was 25 million dollars.
That is to say, that for the present year the investments four times more than the one registered last year.
What is the projection regarding reserves?
Currently our production in the Caguán-Putumayo Basin is close to 4,300 barrels per day (bpd). It is a modest figure compared to the total operation of the country, but with a projection that can exceed 20,000 bpd.
In terms of reserves, we are close to 25 million barrels. It is an important number in terms of the volume of remnants. But if we go to the level of resources in our contracts, that is, what is not proven, added to what the geological studies indicate, the potential that could exist in this basin exceeds 500 million barrels.
And
Mine was at 14:42 , 149,023 buy. Sell also at 14:42 149,411, both are not shown in the trades for the day. It cost me 388 shares moving it into ISA, plus the dealing fee.
I can't see why this would be not a listed pair of trades. Seems odd.
... and that's £18K bought back,
Question for colonel drake, hi, re the OBA figures do you think the increase over last few weeks is due to work overs. ? Is it that they are just pumping the oil not sold in December and making the most of higher prices now. I think they originally said it would be sold in q1 but it does not look like it was. Cheers and thanks for your insightful posts. Looking forward to you update next week on II holdings.
@Roth1 That is a fantastic find and I thank you for sharing. I posted some numbers a while back that indicated that production was coming in at over 6,000 bopd. As has already been said this now places production at closer to 7,000 bopd with a healthy percentage delivering the better returns driven by the OBA.
With further workovers and new drill to come at Putamayo we could see yet further increases and a push to a year end figure pushing 9,000 bopd even if they only drill Platanillo and CP0-5. That would certainly shake things up around here given this marked increase in Q2 is enjoying the very best Brent prices of the year.
Thank you once again.
think that was me.
sold down £20K to buy PDL .... and 10% up on that one already.....
Probably :)
He may be counting the Platanillo workovers around mid year that screwed up production!