Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Full Article - I hope it's a Vitol / Savannah Due even though the article does not mention Savannah.................... Surely Vitol would like a credible partner to operate these assets are they really willing to risk providing a loan of such magnitude without a credible operator also working alongside the Gabonese government remains to be seen but either way I believe the deadline is end of Feb.
Vitol wants debt paid before helping GOC buy Carlyle's assets
Published on 12.02.2024 at 05:40 GMT
Geneva-based trader Vitol remains the Gabonese government's preferred choice for a loan of several hundred million dollars needed for the Gabon Oil Co (GOC) to buy Carlyle's assets, which have been operated since 2017 by Assala Energy.
Vitol will however only lend the money if the Société Gabonaise de Raffinage (Sogara) pays off its debt of several million dollars for past deliveries of petroleum products. Gabon's oil ministry, headed by Marcel Abéké, has so far refused to link the two cases.
Carlyle is putting pressure on the GOC to find the funding as quickly as possible. Oil company Maurel & Prom signed a purchase agreement with Carlyle in August 2023, a few days before Brice Clotaire Oligui Nguema's coup. He has since decided to pre-empt these assets through the state company, which is active via direct stakes in all of Carlyle's blocks. The deal represents almost 45,000 bpd of production.
Would be nice if Savannah was able to get in as operators or have some role to play
Looks like Vitol is ready to provide a conditional loan although looks like Savannah isn’t mentioned this time so may be they are happy for the Gabon oil company to be operators without a third party
https://www.africaintelligence.com/central-africa/2024/02/12/vitol-wants-debt-paid-before-helping-goc-buy-carlyle-s-assets,110158233-bre
On a separate note may the year of the dragon be with savannah energy plc and Andrew Knott. Hoping everyone prosperity and good fortune
Mukesh and Komakino - with every extension I have always felt that the intention is to return to market with a deal I am sure in the back of AK mind you don’t want to have wasted 14 months in suspension to not come back with a deal and than ask for another suspension to pursue deal making strategy will be hard sell to shareholders so the idea being come to market with a deal following the current suspension period would be the most prudent and sensible course of action now whether that’s with South Sudan or another deal or South Sudan and another deal who knows. Now since December 22 it’s only recently after over a year we have started to get a little more commentary on the deal itself:
1) first time since suspension savannah added a little context to the rns on 1st Feb 24 - saying in country approvals are being pursued this can be viewed in many ways it could mean from Savannah point of view they are reaching a stage where they have completed all they need to and have satisfactory lined up t
Workstreams in order to complete that to me is how I read it effectively they are now saying the ball is in SS government hand but savannah has got everything ready to go if approval is granted.
2) Shore capital - saying realistically expect admission document in the new suspension window.
3) Africa intelligence saying on 30th Jan article due to complete in the next few weeks.
4) the IC interview loosely touching on completion shortly.
Now that’s the most drip feed or breadcrumbs we have had since deal announcement which has been over a year in the last few weeks.
Folks can view the above with caution or optimism……. ……………….
AK said the plan was for another acquisition in 2023. Assuming that SS is the reason for the delay in announcing this, it's more than reasonable to assume it would have have an effective date of early 2023 at the least. So there is definitely the possibility in my mind that we could announce the SS deal quickly followed by an SPA for another acquistion.
The sun is shining so feeling optimistic this morning :-)
Just food for thought!
I bet AK is also negotiating another deal,in the background for 2 reasons, if the S.S deal falls through, I would imagine this next asset as a back up will be in a better country in Africa. So backup required in case the deal don`t go through.
Also just imagine if the S.S deal goes through, and we start trading with a much bigger market cap and everything is in place we could annouce the other deal and no need for suspension as it should not be bigger than our current Mcap after S.S.
Assuming this is the outcome, and S.S completes sometime this year we could be picking up another asset shortly after and if this was being discussed in 2023 there could and should be an affective date from beggining of Jan 2023 or July 2023.
Yes you are all correct I have my Rose Tinted Glasses on! it`s the weekend :)
Fascinating, thank you TIL. It’s really intriguing from a SAVE perspective! As perhaps one of the second hydrocarbon deals contemplated by the company and referred to last year, I would guess it could be well worth exploring. Economics need to be right of course and one would imagine the financing by way of a PXF etc would have to involve a 3rd party trader (such as has been previously postulated in articles). Which might mean some greater sharing of the economics. We’ll see.
I am hoping SS financing would by now just be required to be a short term - say 12 month - PXF. Which I would hope would be provided by the vendor, to ensure low cost for SAVE & with the financier having solid knowledge of asset & hence relatively sympathetic on terms. With built in grace periods etc. we’ll see.
Just re-reading the RNSs and the evolution in wording of each RNS on the extensions particularly since June last year on SS - to me the wording slight changes in vocabulary gives the potential hint that we might expect a formal notification either way sooner than the deadline - ie either extension or Admission Doc - end Feb or March. We’ll see - maybe I’m reading too much in!
Https://www.energyvoice.com/oilandgas/africa/547530/exxon-mobil-to-exit-equatorial-guinea-after-nearly-three-decades/
We know that Equatorial Guinea is still looking for a partner to continue running the fields so probably even though exxon is handing over to them they don't have the operatorship experience or capability to run assets
https://www.africaintelligence.com/central-africa/2024/02/08/teodorin-obiang-offers-zafiro-and-fortuna-fields-to-eni,110157308-bre
Seems like buyers already in place for total energies
https://www.upstreamonline.com/production/totalenergies-heading-for-the-door-pouyanne-says-niger-delta-oil-exit-deal-soon-/2-1-1595568
Https://www.union.sonapresse.com/gabon-economie/rachat-des-actifs-dassala-gabon-la-goc-fait-valoir-sa-preemption-27227
ONE month and a half after the instructions of the President of the Republic, Brice Clotaire Oligui Nguema, concerning the
purchase of Assala assets, Gabon confirms having received several offers from large companies and reassures public opinion
of its ability to raise funds as part of this operation. Indeed, while rumors were circulating relating to
an alleged inability of the State to raise the funds necessary to exercise pre-emption for the repurchase of Assala,
as announced by the Head of State in his speech to the Nation, the Director General of Hydrocarbons, Ernest
Ndong Nguema, brushed aside this information.
"I would like to remind you that the pre-emption process as defined in the law, that is to say the Code of
hydrocarbons, provides that in the event of transfer or assignment of rights, the State has 60 days to make
pre-emption. In the event that the State does not exercise its right of pre-emption, the national operator (GOC) has at its discretion
45-day turn to pre-empt. The GOC exercised this right of pre-emption on November 25, 2023, therefore before
the expiration of the deadline which was December 3, 2023. This was the only deadline that had to be respected,” he declared.
And to continue: “The sellers and the GOC are now engaged in a negotiation which should lead to the
signature of a new deed of transfer, which defines the deadlines for the payment and effective transfer of the asset.
Concerning the State's capacity to raise the funds to make this acquisition a reality, I would again like to reassure
public opinion. Several opportunities and financing mechanisms are available to us. Our attention is focused
therefore on the assurance that we select the best option from the point of view of the interests of the State ".
Total looking to exit Nigeria onshore as well, same operating assets as shell sale of 30% stake for $2.4bn to local independents announced weeks ago. Total has 10% stake in these assests so simple maths would suggest Total stake is worth circa $800 million. I wonder whether we would be interested in these.............................
https://www.reuters.com/business/energy/totalenergies-looks-exit-nigerian-onshore-oil-following-shell-2024-02-08/
Listened to that again as wasn’t really concentrating the first time, I’ve never been very good at multi-tasking ha ha ha
On a serious note:-
Why did they chat about SAVE first with all the other companies they could have discussed?
He kept on so strongly about companies paying dividends but we don’t pay one (YEY)!
He seemed super-certain that we would be paying a divi in the next year or so!
He said up front on the interview he expected the deal to close in the next few weeks!
PM are our 4th largest II with 92m shares (7%) and will be far more up to speed than us.
All in all, the fact that AIM have allowed a further 2 months extension (after the very tight 5 week extension including the Christmas break) along with the points above make me feel a bit more confident about the SS deal completing. FWIW I now think we have a better than average chance of success here. That said, it’s all down to in-country approvals IMO. If we can get those sign offs, I definitely believe AK will deliver on the rest of the stuff including finance - i f we end up needing to borrow any.
Not getting too excited yet though and even if we complete, we still have the risk of the war in Sudan going on along the export pipeline route.
GLA and I genuinely wish all the best of luck, especially those of us who originally bought in when we only held 2 PSC’s in Niger. How things have changes since IPO back in 2014. And thinking about it, it’s amazing that we have not yet drilled on of our own wells and sold a single barrel of oil!!!
We know we have to get another RNS by 2/4/24 (7 weeks on Tuesday) at the latest but how many, and on what subjects will we receive before then? Who knows we may even see the AD and admission before April…
Thankyou for posting the Gervais Williams IC podcast were he explains the pros and cons.
No idea what is going on with this one .
Might not be as bad news as first thought .
AIM not the place to be this last year.
6/6/22..5 year high *40.2p
Have on 3 accs.
12/1/22 ( D ) Sold a few @ 25 to 27.5p but just the ones bought in top ups under 15p .
Buys and Sells.
1st buy on ( D) 16/4/19 paid 22.5p
Have some ( Wi ) were I noticed suspension .
Have largest holding in ( T )
24/6/20 low 6.8p that did not look a good move.
12/7/19 Bought at 12.5p twice as many as ( D )
Don't think a brown field assets will be of interest to any oil major let alone a major like ENI, so they are clearly targeting the wrong companies.
Looks like Equatorial Guinea is still trying to find some buyers for Zafiro and another field.
https://www.africaintelligence.com/central-africa/2024/02/08/teodorin-obiang-offers-zafiro-and-fortuna-fields-to-eni,110157308-bre
Does this mean we will have another big dent in profit? Appreciate your comments.
You never know, Til :-)
https://www.sudanspost.com/world-bank-pledges-to-back-south-sudans-financial-reforms/
Interesting interview for IC, one thing I did pick up if the mention of credit guarantee of the accugas asset and if Savannah can get a similar credit guarantee on south sudan than it would be a great deal, could world bank provide a credit guarantee for this purchase as part of it's development goals for the country and seen as the country is heavily reliant on oil revenues to fund national budget ?
OB - thanks for the link. Just goes to show that PM (and I assume other II’s) are in this predominantly for the potential field more than for the potential capital growth. And specifically around the Nigerian asset. When speaking about the SS deal he says something like:-
“Frankly I don’t mind if it completes or not”
I find this comment a bit defensive to be honest but it does underpin the strong views on here of Z, PF, K and TIL (amongst others) that Accugas is very much the engine / jewel in the crown at the moment and even the Nigerian assets alone will be throwing of more cash that we could have ever hoped for only 2/3 years ago.
Scotpak - what are your latest views on the fx movements of the Naira and the possible effects on our debt refinance package? Could it be that if SAVE are so confident of SS closing that we do not conduct a long term debt refinance package for Accugas and simply aim to pay it off from the FCF thrown off by the Petronas RTO deal?
Oilbagger - the link is much appreciated, thank you. He sounded very optimistic about SS at the start of the section on SAVE, in a somewhat unguarded manner perhaps? Slightly ‘walked it back’ later in the interview, but great colour!
SAVE is mentioned by Gervais Williams of Premier Milton Group just before 7 minutes. Interesting to see II view on SAVE. Good risk/reward and expects to pay dividend longer term. Part of larger portfolio so obviously not material to them. Slight write down of SAVE in his fund due to fund processes/ (evaluates on news)/drop on oil price but as we all know all depends on any deals done. It didn't help that the interviewer got the name wrong and called it Savannah Resources. Anyway, worth a few minutes listening to it.
https://www.investorschronicle.co.uk/podcasts/2024/02/06/i-always-feel-it-is-a-bit-disappointing-to-buyback-shares-gervais-williams-of-premier-miton-group/
BTW although I don't post often I read the board frequently and thus appreciate the insights/analysis from the core contributors.
Gas shortage supply to Akwa Ibom Power plant, we supply 20 mmscfd which ended December 2023, Can we materially increase our supply with a new gas contract and significant volume or is there a constraint until CPF is completed. Definitely an opportunity here to increase volume significantly.
https://leadership.ng/power-grid-restored-as-tcn-blames-collapse-on-gas-shortage/
https://tdpelmedia.com/power-grid-restored-as-tcn-blames-collapse-on-gas-shortage/
GSA to supply 20 MMscfpd of gas to Ibom Power Company Limited, operator of the Ibom power station, for a ten-year period which ends in December 2023 with a take-or-pay commitment of 80% of the contracted volume. The GSA is expected to be renewed and discussions are ongoing. The Ibom power station has a current installed capacity of 191 MW and is owned by the Akwa Ibom State of Nigeria.