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.
Interim results at the end of the month so not long now.I am expecting :
Morocco - trial completed and results imminent
Utah - copy and past of business update in Jan
MSC -- copy and past of business update in Jan
Americas - copy and past of business update in Jan
Time to get my questions prepared for the IMC
'Copy and paste' not 'copy and past'.
“Time to get my questions prepared for the IMC”
I’m sure Jason is shaking in his slippers as we speak!
"I am expecting :"
Don't think your expectations influence much.
'Don't think your expectations influence much.'
100% correct.I don't expect them to infuence anything.
Interim results last year were announced on 28 March, and in 2021 on 29 March.
Going by the update on 23 February, the Morocco trial should definitely have started but might not be completed by month end, although it's quite possible that one of the fuels will have completed it's trial I'm thinking maybe not, and certainly not both, as QFI said ".... the Company is now finalising the trial schedule with the client and anticipates fuel trials to commence prior to the end of Q1 2023", end of Q1 being the end of March of course, so may not start until close to the results date, unless the client can/will fast track them.
MSC trial would be progressing on several fronts. Just because the ship is not in dock for the work needed, does not stop the many other work streams from progressing.
Utah, TOM have extended their deal deadline to 31 March (a shorter extension than previous one's suggesting the deal is very close to sign-off), so there could be good news on that front close to the results (or hopefully a lot sooner).
Other projects have probably not moved much since the business update of 16 January, but there could always be a surprise.
“MSC trial would be progressing on several fronts. Just because the ship is not in dock for the work needed, does not stop the many other work streams from progressing.”
Really? Can’t say that’s been my experience of QFI over the previous decade or so. More Haggis fluff.
===
Utah - copy and past of business update in Jan
MSC -- copy and past of business update in Jan
Americas - copy and past of business update in Jan
===
My favourite copy is Lavazza
My favourite past is tagliatelli
On a serious note , if the markets go tits up as a result of the Silicon Bank default and contagion soreads,then Qfi are going to have a really hard time with a fund raise unless we have some concrete news on a lot of fronts.
Its gonna be batten down the hatches time.
"On a serious note , if the markets go tits up as a result of the Silicon Bank default and contagion soreads,then Qfi are going to have a really hard time with a fund raise unless we have some concrete news on a lot of fronts."
No, none of this is true. The contagion would have to spread to a pretty unimaginable degree. And you can then say that about anything
SR,
Agreed. The contagion is only relevant to those holding bonds that they are losing money on, so a few banks and institutions might lose a bit of money, but that is normal and it'll get absorbed by the big profits they have been making. That's the whole point of UK and EU forcing banks to have enough cash behind them to avert contagions like the SVB issue.
QFI may not need any cash, as Morocco just needs to go to a commercial supply agreement and then it has good revenues. If it wants to top up cash after that, it will have loads of options for funding, as the risk level will plummet.
"The contagion is only relevant to those holding bonds that they are losing money on"
And only then if they need to sell them *right now*.
“QFI may not need any cash, as Morocco just needs to go to a commercial supply agreement and then it has good revenues”
This is an absolute garbage comment from Brian McShaggis. He knows very well commercial contracts for Morocco supply will take many months to put in place after any successful trial. Then planning and engineering works to create fuel production. Many more months (6/9).
There is zero chance that income from Morocco can avert a fundraise.
At best the SP will lift to a more acceptable level where any placing does not dilute us severely.
Haggis is a shameless ramper, end of.
Yes, Salinger, true — plus, it's hard to predict how long it will take to seal agreements with customers and suppliers. QFI were quite bullish on rapidly getting the LONO supply-side agreements sorted out, and that certainly hasn't panned out in the timelines they anticipated.
And I agree with your second point (broadly), that securing the signatures for Morocco would be much stronger basis for another raise than our current status. The same applies same for LONO supply deals and getting POC and LONO sailing underway. It seems vanishingly unlikely that the company will be generating sufficient revenues within the runway available to avoid a raise — but they have plenty of opportunities to make the situation much less dilutive by delivering on their key project milestones.
If they can show an executed contract for services rendered they can approach the debt markets for funding instead.
Which is debt finance, not revenues, big difference.
"Excluding discretionary project costs, the current spend rate of £240k per month (fixed plus development costs) is sufficient cash until end Q4 2023."
"Morocco refuelling opportunity (2-5 kbpd total)"
From the presentation: Annual General Meeting Business Update Presentation, 25.11.2022
So long as QFI conclude the fuel supply agreement within H1 2023, as planned, the cash runway should not be an issue.
16 January update:
"Quadrise expects a successful trial to be followed thereafter by discussions to conclude a commercial fuel supply agreement in H1 2023 as planned."
Worst case scenario: 2000 BPD at a small £10 per barrel to QFI is £600k per month. Outgoings are only £240k per month.
The only issue going forward for the company is production. Can it produce sufficient quantity to cover demand if the testing is completed to the companies, industries, and its potential customers satisfaction. Their own RNS's have brought this point to bare and we haven't been informed if a solution to this problem has been found.
"Which is debt finance, not revenues, big difference"
Huge difference (small difference) but the subject was raising money. And getting a bridging loan because a MNC *owes* you money isn't in the same ball park as throwing your hat in the ring for another dodgy dilutive AIM fundraiser.
Just going back to this having slept on it.
"Worst case scenario: 2000 BPD at a small £10 per barrel to QFI is £600k per month. Outgoings are only £240k per month."
If I remember correctly we were looking at $10/bbl profit for MSAR many years ago, is that right?
Does anyone know the profit on bioMSAR? I suspect not, as I've not seen anything from QFI advising that.
bioMSAR is a premium fuel that saves money on a premium fuel (Biofuel), whilst significantly reducing CO2 emissions, and reducing Particulate and other emissions.
Biodiesel is multiples of the price of HFO and VLSFO by the looks of these:
https://www.neste.com/investors/market-data/biodiesel-prices-sme-fame#ffb486b1
https://shipandbunker.com/prices#IFO380
So my thoughts are that I would be very surprised if QFI was not making £5 to £10/bbl on bioMSAR after costs.
At £5/bbl to QFI, we would only need Morocco to use 1,578 barrels per day to cover the cash burn of £240k per month. The minimum QFI state for Morocco needs is 2,000 barrels a day.
Here's how it looks for the range given by QFI at my minimum level:
2000 at £5/bbl = £304k per month
3000 at £5/bbl = £456k per month
4000 at £5/bbl = £608k per month
5000 at £5/bbl = £760k per month
Anything above £240k per month is adding to the cash in the bank. £10/bbl and we are laughing all the way to the bank.
As I said, bioMSAR competes with Biofuel. As per the Edison note of November 2022:
"Quadrise calculates that bioMSAR generates savings of 10-15% compared with biofuel for the same reduction in CO2 emissions."
https://www.edisongroup.com/research/key-role-in-transitioning-to-net-zero/31706/
And as I said in my previous post:
Biodiesel is multiples of the price of HFO and VLSFO by the looks of these:
https://www.neste.com/investors/market-data/biodiesel-prices-sme-fame#ffb486b1
https://shipandbunker.com/prices#IFO380
From a quick look at the meanings, FAME is Biodiesel from recycled oils and fats. RME is Biodiesel from crops like Rapeseed. FAME is best suited to cold climates, so maybe transcontinental shipping would more likely use RME?
I'll leave you to work out the savings afforded by bioMSAR, 10-15% of Biodiesel cost, around 8 barrels per tonne.