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I’m not saying you’re wrong as. The figures show what the figures show. It’s just where they are put and the assumptions made with them.
When mr Forrest took over from the Russian federation de-com costs were £12.8 million. Given the Angus management’s history with costs and timescales being out by a factor of 10 I would suggest that the Russian federation where closer in their estimation…..That’s why I maintain Mr Forrest got a very sweet deal offloading the de-com costs. Anyone looking at a buy out, and those 5 companies that had a look when Angus was up for sale, would also be asking the same question regarding the huge £8 million difference in de-comm in the accounts!
And the associated deeds link:
https://www.gov.uk/hmrc-internal-manuals/oil-taxation-manual/ot28701
Add to that, Angus has the below to benefit from for decommissioning:
Tax relief for abandonment costs credited to
abandonment year cash flow; reference
Decommissioning Relief Deeds, FA 2013
The next stage of growth WG, watch the interview if it's not too painful lol!
Another wasted long day Joiler lol. Angus will never de-commission any of their assets because they will be repurposed, so grow up like Angus Energy moving up to the next of growth. And guess what wobblegob,Angus will be bought out in time making shareholders very wealthy who hang onto their stake in the company, see ya!
If I could delete the last paragraph of my last post I would as you’re quite right WG818 the old pipe work is still being used with a new extension, but I don’t accept that Angus’ estimate of the decommission costs is incorrect.
However, even if I’m wrong about the decommissioning costs Angus still got a great deal. Saltfleetby has plenty of gas and will be an ideal storage site when it runs out/become uneconomical to produce.
Ab76
Angus bypassed the original threadnedlethorpe refinery by installing a 700metre pipeline straight into the national grid terminal. The 8 mile pipeline hasn’t gone anywhere or the eventual de-commissioning. It just has another 700 metres at the other end now.
When Angus acquired 51% of Saltfleetby Energy Limited on June 19th 2019 there was no certainty that it would have any producing assets.As the RNS announcing that acquisition stated, “Angus Energy has obtained quotes… to effect abandonment (£1.75 - £2.5 million), each of which fall below the sum of the proposed payment by Saltfleetby Energy. Saltfleeby Energy has agreed to retain the liability for all abandonment costs surrounding the subsurface pipelines from the two sites to the Theddlethorpe Gas Facility together with certain redundancy costs which would otherwise fall to be treated as expenses under the JOA.”
Therefore, at that stage Angus was responsible for the abandonment costs other than those concerning the subsurface pipelines, which remained the responsibility of Saltfleetby Energy. Saltfleetby Energy appears to have estimated those further costs at £1.225 million, taking the total abandonment costs to between £2.975 million and £3.725 million (Angus’ last account show abandonment costs of £4.36 million and that also includes its share of the various oil assets).
Although abandonment costs are estimates, Angus’ accounts make clear that provision for decommissioning is recognised on full installation of oil and gas production facilities and the amount recognised is the present value of the estimated future expenditure (see page 54 of the accounts).
In those circumstances the decommission costs of Saltfleetby are unlikely to be anywhere in the region of £12.5 million.
Although the production assets at Saltfleetby were correctly re-recognised as tangible assets as the field came back into production, the two pipelines to Theddlethorpe can’t have been included in that as there’s no gas facility there anymore.
Hell hath no fury, like a wg scorned.
ab76, you have listed out why our wg/ruthy is so angry,
she predicted the complete opposite of all of these.
'In any event, Angus’ purchase of Saltfleetby has been a success: it’s producing about 10mmcf of gas, debts are being repaid, cash is being generated, plans are being made for expansion and production is being managed by experienced people'
Yes. But that was because the pipeline and sites were moved from a liability to an asset. Once the gas falls back to uncommercial levels they will be moved back into the liability column.
Look at note 7 on page 7 of Saltfleetby’s accounts for the period January 1st 2019 to May 31st 2020 (they were filed on July 27th 2021 and are available here: https://find-and-update.company-information.service.gov.uk/company/00953066/filing-history ). The decommissioning provisions were reduced from £12.8 million to £750,000 (by May 22nd 2022 they’d been increased to £1.225 million). That reduction has been audited. In any event, Angus’ purchase of Saltfleetby has been a success: it’s producing about 10mmcf of gas, debts are being repaid, cash is being generated, plans are being made for expansion and production is being managed by experienced people.
The cost of de-comm is available from companies house in Saltfleetby Energy Ltd Accounts. The year in question gave a figure of £12.5 million for abandonment.
Agreed that there are many puzzling questions surrounding why a one man band with £ 80k in the company at the time was even allowed to take over from the Russian federation? Then the fact that Wingas (formerly Saltfleetby Energy Ltd) and Angus shared the same address. Finally the joint directorships in other companies.
The one you gave a link for.
“ Saltfleeby Energy has agreed to retain the liability for all abandonment costs surrounding the subsurface pipelines from the two sites to the Theddlethorpe Gas Facility together with certain redundancy costs which would otherwise fall to be treated as expenses under the JOA.”
What’s the relevant RNS WG818? Angus put Saltfleetby’s decommissioning costs at £2.5 million at the time of the initial acquisition and had that confirmed by outsiders. That remains the provision in the accounts - see note 22 on page 69 of https://www.angusenergy.co.uk/wp-content/uploads/2023/03/Angus-Energy-Annual-Report-2021-2022-1.pdf (Saltfleetby’s total provision isn’t individually listed, but they increased the provision by £1,225,000 following the acquisition of the outstanding 49% indicating that the total is just under £2.5 million).
Correct up to a point ab. The first deal was when Angus took 51% and that excluded £12.5million the gas pipeline de-com costs (see the relevant RNS).
Taking over Saltfleetby Energy Ltd, puts that cost onto Angus now when the field becomes uncommercial. So yes he did offload it I’m afraid.
The existing pipeline is not suitable for gas storage and a new one would be required with an estimated cost of £200 Million 15 years ago.
WG818, Paul Forrest didn’t offload anything. Some posters seem to thing that he owned Saltfleetby for some time and didn’t know what to do with it, but that’s not correct. He was clearly negotiating with Gasprom and Angus simultaneously.
This can easily be seen by looking at Companies House’s records for Saltfleetby Energy Limited at https://find-and-update.company-information.service.gov.uk/company/00953066/filing-history . They clearly show that Gasprom (which appears as the Russian Federation) gave up control on June 17th 2019 to Forum Energy. Angus then announced it acquisition of 51% of the company two days late on the 19th - see https://polaris.brighterir.com/public/angus_energy/news/rns/story/ry53g9w
MULTIPLIER 66,964
FIXED PRICE £0.7597
MERCURIA PAYMENT TO ANGUS = £50,870
MULTIPLIER 66,964
SPOT PRICE £0.8129
ANGUS PAYMENT TO MERCURIA = £54,434
LOSS on SWAP is £3,565 (made up from a loss on swap 1 £25,235 and a profit on swap 2 £21,670)
-----------------------------------------------------------------------------------------------------------------------------------
DAILY PRODUCTION therms 98,156
SPOT PRICE per THERM £0.8129
GAS SALES PAYMENT BY SHELL TO ANGUS = £79,791
GAS SALES gross profit = £76,226
Month to date GAS SALES PROFIT £532,162
less Shell 1.5% and Ntsec 0.386p/therm
1)SAP used instead of NBP
... We had a great many questions around other assets (Brockham, Lidsey, Balcombe) and projects (Geothermal and Storage) as well a new seismic interpretation and a study on deliverability and volumentrics at Saltfleetby which will be informed a month or two’s flow and pressure data on the third well. We will update with a full presentation to shareholders over the summer on these initiatives whether singly or with a combined presentation online. (answer to Investor Question asked on 31/05)
Producing gas again, keeping the cash register ticking over.:-)
10/06/2023 01:00:00 10/06/2023 System Entry Calorific Value, Saltfleetby, D+1 41.2700 11/06/2023 12:01:01 L
10/06/2023 01:00:00 10/06/2023 System Entry Volume, Saltfleetby, D+1 0.2508 11/06/2023 12:01:01 L
Lol WG / Joiler still wanting Angus to disappear asap. Thanks for letting shareholders know that we will now save £12m ,due to the site being used for storage with the Hydrogen ready 8 mile pipe in future you numpty LOL!!!!!
This is not specific to Angs, the junior markets in general are in a terrible mess. This is my 17th year investing and it's probably the worst I've seen it. Shorts will take full advantage hence GSA still hanging around.
As a company, ANGS is doing everything it's supposed to be doing. Saltfleetby is performing and producing, which is reassuring. From a share price, ANGS cannot determine this. The best 2 performing companies on LSE from Friday, ITS and AMGO. Both on the brink of collapse. AMGO was up at one point to 276%. Fun and games, sure both doing really well, lol. Once the permanent connector is in place at B7T and the flow rates are consistantly above 10mmscfd, the price will start to move. Q3 around the corner, so not long to go.
He also managed to offload the £12.5 million de-comm costs listed in the Saltfleetby Energy accounts for the 8 mile pipeline onto Angus shareholders. A very sweet deal for him!
We are hearing about the Namurian reservoir now but the Southern lobe has become less prominent.
In exchange for selling his 49% stake, Paul Forrest gained an investment in a liquid asset, Angus shares.
I don’t think Paul Forrest has any regrets.
Gasprom paid him to acquire Saltfleetby, he handed over Gazprom’s cash and 51% of SFY to Angus, waited patiently whilst Angus developed SFY, and then sold his remaining 49% for over £14 million (since parts of the payment were in shares the exact amount depends upon the price at which he sells them - he’s done well so far selling many well above the issue price).
That said, I don’t think Angus shareholders should any regrets either. We’ve acquired a very valuable asset (gas now, storage in the future) for very little.
It’s true that Angus’ financiers will also make a great deal of money (although they got very lucky with the hedge), but then they took most of the risk. They’d have nothing if the processing plant hadn’t worked and we wouldn’t have that much, for now at least whilst the hedge is in place, if they hadn’t also funded the initial stages of the sidetrack (it’s a nuisance that it overrun in time and expense, but that was always a foreseeable risk and one that will become less important in time).