Rainbow Rare Earths Phalaborwa project shaping up to be one of the lowest cost producers globally. Watch the video here.
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Overall I am pleased with the rns for one main reason as it also a window for Q1 2024 update to land by 2 week of April as per usual timelines which will allow for a broader update on the business particularly interested to see plans on Niger being strongly articulated, also interesting to see how the accugas business is performing and if we are still growing our volumes by double percentage production. I always maintained in any circumstance or whatever is the outcome of SS I wanted to come back after the full year results of 2023. So I will be supportive of a further extension until mid June and come to market post full year 2023 results.
As for the rns last week I believe it’s probably to intended to make public the difficulties in completing the South Sudan deal I.e outing the South Sudan investment environment as a difficult place for
Investments. I believe if savannah think they have completed all there workstreams and the only thing now outstanding is government approvals than they are hoping a public statement will shame the government into action, especially with the South Sudan oil conference in June 2024, it could be savannah way of saying to the government you are your own stumbling block to approvals and a public statement could pressure South Sudan government and make it look bad especially when they are also looking to attract investments.
As for deals I believe Andrew should pursue an oil acquisition in Nigeria and if he can land another prior to re-listing that would be a bonus. Even a small acquisition of 10,000 Bopd and 50 million in 2p reserves would take us another level.
I want to remain optimistic on progress and closing of SS but I remain skeptical and believe if a rns does provide more detail next week it would likely be a public outing on the SS approval inaction more than anything else. I for one like all want a positive outcome on SS but let’s see the detail behind the detail that Savannah intend to provide.
The RNS next week could be as strong as savannnah have completed all work streams and if they don’t get approval in the next 6 weeks I.e by 17th May we will terminate the deal and come back to market it could be the final ultimatum to the SS government and a public outing
The argument for approval at the moment could be that low oil exports and pipeline disruption and government coffers running dry could tempt approval from government if the exit tax or approval fees are tasty and high $100 - $200m dollars and could tempt the government into approval when they are struggling to pay salaries at the moment
If we invited Petronas to become shareholders in the enlarged group of Savannah could it convince SS government in approving the transaction they will still get the comfort that they have Petronas still operating albeit through Savannah shareholding. Perhaps we could offer Petronas 20-25% of the enlarged share capital. I brought this point as I saw that the recent deal announced by Ithaca will see eni take an enlarged share capital in Ithaca and become a major shareholder on completion.
https://www.ft.com/content/ba599bb2-dd8e-4289-a80e-8a4d40ae6395
If the economics still made sense than it wouldn’t be a bad outcome although anything above 20-25% would reduce value enhancement for existing shareholders
The last thing I’d want would be issuing equity unless it was at a significant premium to 26.35p. I would not be adverse to issuing Petronas 20% of our company in shares as a part payment for the balance we owe from the $1.25bn - economic interest payment. Let’s say the balancing payment at deal closure is $400m.
With 1.412bn shares fully diluted we would need to issue Petronas with 353m shares giving us a new shares in issue number of 1.765bn. For the 353m shares I would want to see a minimum of 40p which is 50.4c @ fx 1.26. This would equate to $178m coming of the $400m leaving $222m to be paid for from future production.
On another note I was looking through all my transactions on SAVE while by yet pool this afternoon. I hold them in various accounts and what a crazy trip I have been on:-
First purchase 42p July 2015
Continued to buy all the way down with my lowest buy price 8p in March 2020
Bought well over half my holding sub 10p
Continued to by all the way up and got spiked in June 2022 @ 40p
Continued to buy all the way down to Nov 2022
Bought 1m in the 23’s in Nov 2022 anticipating a decent rise upon Chad closure
God knows what we will re-emerge at and to be honest, the way I feel at the moment, I’d be more than happy if we came back at 26.35p. Yes this would be disappointing after all we have hoped for, but I still do fear coming back in the teens and having to wait a few more years before true value is realised. However, the recent deal in Nigeria does give me some comfort and let’s all hope we see a descent rise this year due to what we could possibly achieve in Niger. On top of those, the ICC cases and debt restructure could give significant leg-ups if and when we see positive outcomes on them both.
I find your regular contact with IR deeply unethical from SAVE's side. I recall you "having a feeling things would go quiet" for a while and selling a portion of your holding - and no dobt vice versa.. It stinks. The company is a joke allowing snides to gain an advantage.
Smeddyo: I for one am very grateful for the time and effort RR puts into contacting IR and summarising the conversations on this board. IR are open to questions from all of us but most do not make that effort.
As your most recent post is little more than a rephrased version of your last post on 8th July 2023 I’ll limit the effort I put into this post by simply repeating Komakino’s reply.
“Smeddyo, nothing IR give out is price sensitive so I'm not sure what advantage you think is being gained over other investors. It can be useful to have them clarify certain things in RNS's or from presentations, and sometimes to confirm published plans are on track etc, so nothing untoward with getting information from them.”
This imo is one of the best boards I have experienced where everyone tries to help everyone else. RockyRide makes a major contribution and it is much appreciated by almost everyone. I regret I am unable to pay you such a compliment.
Well I guess at times it’s impossible to please everyone. I personally feel enormous gratitude towards all the good contributors. Without you all, especially Zengas, I’d have sold @10p, or below. I’m happy for the Rocky-return, after the Aga-hiatus. Happy Easter Monday! Rns Tues 7am?
Firstly, a big thanks to all the regular posters on here who supply excellent content and debate in Savannah. Whilst it has been frustrating for many of us shareholders on the length of the suspension, I really do hope AK’s luck changes somewhat for the better.
Secondly, I am not a regular poster at all but fail to see how a cryptic analysis of someone’s feedback from IR, can establish them as not acting in good faith. It is tantamount to slander imho.
RR et al please please keep up the faith and the excellent feedback. Happy Easter to all…..