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Thanks Rocky for keeping up the relationship with IR and for going out of your way to provide updates for us all.
My take from your update and a key one for me is the accugas debt restructuring it seems like the paper work is being drawn up which is a good sign, and let’s hope it completes in the next few weeks
Thanks Rocky much appreciated.
PART 2
5 - how are the 4 x ICC cases going and with all the changes going on in Chad (energy minister being sacked due to trying to nationalise Doba), are we talking directly to the Chad Government and trying to reach out of court settlements? I guess with the TOTCO/COTCO revenues being frozen that it's it hitting Government finances quite hard.
We will provide further updates as appropriate in relation to the progress of these matters.
6 - will the company be releasing a Q3 operations / finance update and if so when will this be issued?
We do not typically provide a Q3 update but we will of course update the market on any material news.
7 - if all customers took their full take or pay quotas from Accugas, would we be at full capacity or do we still have spare capacity to add new customers prior to the compression project being completed?
The nameplate capacity of Accugas’ central processing facility is 200 MMscfpd, although it can process up to 240 MMscfpd. Our current take or pay customers amount to 175 MMscfpd, while our interruptible customers account for up to an additional 91 MMscfpd. The volumes supplied on a daily basis to customers vary based on a number of factors. We also distribute third-party gas, via our 260 km pipeline network, to our customers, following the ten-year agreement signed with Amalgamated Oil Company Nigeria Limited (“AMOCON”) earlier this year for the supply of up to 20 MMscfpd. There may be further opportunities for us to commercialise other stranded gas resources in South East Nigeria in this way, which represents a potentially significant opportunity for Accugas.
Nothing for us to get too excited about really but it’s good to stay in touch with IR every now and again.
1 - are Savannah still on track for the South Sudan deal and expecting to issue an Admission Document on or by 15/12/23? What are the work streams that are still being worked on?
We continue to progress the various workstreams for the publication of the Admission Document and will communicate with the market in due course.
2 - as we issued a term-sheet to a consortium of lenders quite some time ago, I'd have expected this to have completed by now. Where are we with the Accugas debt re-finance and is it still expected to close in Q4/23?
The documentation is being finalised and we continue to anticipate this will be completed in Q4 2023.
3 - as part of the companies FY23 objectives, one was stated to be 'close at least one more hydrocarbon M&A deal in addition to South Sudan. Is this still expected to happen before the end of this calendar and how many deals are we working on?
As you can appreciate, any material announcements must made to the market as a whole. A key pillar of our strategy, as set out in our Annual Report and Accounts 2022, is to deliver value accretive inorganic growth and, as such, our business development teams review numerous opportunities each year.
4 - how are things going on with well testing in Niger and has the new $4bn pipeline been completed and commissioned?
As detailed in our recent 2023 Half Year Results announcement, Savannah remains committed to the 35 MMstb (Gross 2C Resources) R3 East oil development in South East Niger. As previously announced, the intention was to carry out a well test programme on our principal discoveries in Q4 2023. However, following political events earlier this year, this timeline has been subject to further revision due to restrictions imposed by the Economic Community of West African States on Niger, which has resulted in the continued closure of the border between Benin and Niger. This has created logistical challenges for companies operating in Niger and, specifically for Savannah, in relation to the importation of the necessary equipment to complete our planned well test programme.
With regard to the Niger Benin pipeline, we understand that the pipeline is almost complete and note that an inauguration ceremony was held on 1 November 2023 but the Niger authorities.
Good Spot Komakino that clears that up I guess he will be sitting on his hands the past few months or perhaps re-deployed...........
TiL, if you do a Google search on Quentin Soulat, the LinkedIn link against his name states 'Chad · Head of Site · Savannah Energy'.
His LinkedIn page states he started in March 2023 so it could have just been unfortunate timing that the assess were Nationalised at the end of March. He's probably been twiddling his thumbs for 9 months!
New Investor relations and communications consultant with M&A experience (maternity cover)
https://www.linkedin.com/in/dhruv-drew-soni-61a895114/
New HR change management consultant on Contract
https://www.linkedin.com/in/amaan-javed-132a5583/
Last but not least this one seems interesting Head of Site @ Savannah Energy started March 2023 so probably not related to Chad acquisition.........
Interesting job description :
- Operational transition of an asset operation from a major company to Savannah.
- Implementation of a new operation philosophy: HR organisation on site, new maintenance strategy and new production/budget objectives.
- Optimisation of operations and costs: Opex management and contract renewals.
- Planification for the next years of improvement/debottlenecking projects : Review of business case and Capex, planification, necessary resources and management of contractors.- Operational transition of an asset operation from a major company to Savannah. - Implementation of a new operation philosophy: HR organisation on site, new maintenance strategy and new production/budget objectives. - Optimisation of operations and costs: Opex management and contract renewals. - Planification for the next years of improvement/debottlenecking projects : Review of business case and Capex, planification, necessary resources and management of contractors.
Skills: Troubleshooting · Opportunity Identification · Management · Site Specific · Budgeting · Performance Motivation · Manufacturing Operations Management · Manufacturing Process Improvement · Production Operations · Safety Management Systems
https://www.linkedin.com/in/quentin-soulat/
"Operational transition of an asset operation from a major company to Savannah." seems like an interesting terminology could it relate to South Sudan or another acquisition who knows or might not mean anything..............
And this just goes to show the size of our renewable projects in Niger. The note below is singing from the hill tops about 30MW of renewables and we have 15 x that signed with our 450MW of renewable projects in Niger. Exactly where we are at with those is debatable but hopefully we’ll get an update on all this stuff before YE. I did not hear from IR last wee as I was promised and sent a nice reminder note on Friday. I’ll post on here as soon as, if and when I get a reply.
Less than 3 weeks to 15th December so at least we have to get some sort on RNS by that date at the very latest and hopefully before. Still wanting to see debt re-structure first as a matter of urgency now.
As ever GLA
Niger has started running its biggest solar power plant, filling in the shortage brought about by a cut in imported power supply from neighbouring Nigeria in July.
Nigeria - which accounted for 70% of Niger's power - cut its electricity supply in August after neighbouring countries imposed sanctions on Nigerien military leaders who overthrew elected President Mohamed Bazoum.
Most of Niger has since then suffered frequent blackouts.
Energy Minister Mahaman Moustapha Barke said on Sunday that quality of electricity supply had improved in the capital and other towns following the coming online of the solar plant.
The French embassy in Mali has said it notes the "operational launch" of the plant but warns that it faces operational risks as it “could not be finalised under the conditions initially planned”.
The plant, built by a French consortium, was initiated in 2018 and inaugurated on 5 July this year. French relations with the Nigerien junta have soured since the coup.
The plant has over 55,000 solar panels and can generate 30 megawatts of electricity.
It had been due to begin operations in August but that was delayed following the 26 July coup that overthrew Mr Bazoum and many of the technical operators left.
Mr Barke, the junta's energy minister, on Sunday said the plant’s coming into operation had been made possible by the technical workers who remained.
Meanwhile, in New York...
https://jusmundi.com/en/document/decision/en-savannah-midstream-investment-limited-v-republic-of-chad-sht-overseas-petroleum-limited-sht-doba-pipeline-investment-inc-societe-nationale-des-hydrocarbures-snh-and-cameroon-oil-transportation-company-cotco-s-a-order-of-the-united-states-district-court-for-the-southern-district-of-new-york-friday-15th-september-2023#decision_54621
I'm not sure if someone else posted this. Looks like the freeze on anyone moving the $151m was approved by the court of 15 Sep but Citi sent notice of appeal 18 Sep and that's the latest. Assuming SMIL wins, it just means that the funds sit there until the Paris proceedings are concluded (I think).
This company would make a blockbuster movie.
Thanks, N2M; kind of you!
Ditto.. and extremely well written imho.. much appreciated cautionyourblast !
Totally agree
Dear Board of Directors
We are now three weeks away from your putative deadline for closing the South Sudan acquisition from Petronas. I note that this is just over a year after the RNS announcing the deal in the first place (12 December 2022) and that, unlike your earlier announced deadline intentions, that it isn't at month-end. My hunch is that there may be a twelve month (or just over) long-stop date from the original announcement to get the deal over the line and that's why what was advertised was 15th December rather than 31st: this is pure speculation on my part.
Given recent apparent political instability in South Sudan, I am expecting that the deal will not be concluded by 15 December. No matter what pressure you may be getting from institutional investors, regulators, the nomad or others to abandon the deal and relist, please continue with the suspension and continue to work on the deal if there is a reasonable chance of successful conclusion. By the way, I am not accusing any of these parties of applying pressure, just assuming that it may be there from some parties.
A good number of your shareholders understand that the complexities and parties here are multiple: Malaysia, Indian, Chinese SOEs; South Sudan government; Sudan wartime government (for distribution); changing faces in negotiations; extension of drilling licences; capex plans to renegotiate; financing; and so many other things that I for one will be ignorant about.
So if the deal still has legs and parties are amenable (or legally obligated) to continue working on the deal, please do keep going. Savannah, given where it is working and what it is working on, is a marathon not a sprint.
Best wishes to all the team in all locations.
12/12/22 - "Full details on the conditions to completion of the Transaction will be set out in the AIM Admission Document."
The adm doc was to come in H1 so we would have been able to see surely what the completion conditions were.
Given that the adm doc is now 15th Dec or before which is 3 weeks or under- are the completion details going to be relevant this far on ? Have they been dealt with by now ?
As reagrds the flagged expected announcement of at least one further hydrocarbon deal this year - Petronas had invited bids for it's Chad, South Sudan, Gabon, The Gambia and Senegal assets valued at up to $3b so given we did not get Chad, is there any possibility that we could be looking at something else from them.
$1250m of that was for S.Sudan and $278m for Chad. That leaves about $1.5b for the rest of the $3b worth of assets that was reported for sale.
Petronas Chad at $278m had approx 11,000 bopd + 48 mmbo 2P + 38 mmbo 2C + the pipeline interest that generated $64m revenue giving $25m FCF.
Good to give the PR guys something to do as they presumably had a fairly cushy ride while the shares are suspended - and the Investor Relations part is virtually cut off. For my part I just want to get the shares trading again. If they tumble on the back on no news so be it, as they'll realign if/when the deal is done/not done - and the company will be more inclined to give operations updates on existing operations which have been scant to say the least.
Nice one RR, it's appreciated,
Looks forward to seeing any replies...
Thanks
I sent in 7 questions earlier in the week to Sally. Whilst we know we will not learn anything material in the replies, it’’s very encouraging that Sally replied late yesterday to acknowledge my email and is hoping to get something back to me next week.
1 - are Savannah still on track for the South Sudan deal and expecting to issue an Admission Document on or by 15/
12/23? What are the work streams that are still being worked on?
2 - as we issued a term-sheet to a consortium of lenders quite some time ago, I'd have expected this to have completed by now. Where are we with the Accugas debt re-finance and is it still expected to close in Q4/23?
3 - as part of the companies FY23 objectives, one was stated to be 'close at least one more hydrocarbon M&A deal in addition to South Sudan’. Is this still expected to happen before the end of this calendar and how many deals are we working on?
4 - how are things going on with well testing in Niger and has the new $4bn pipeline been completed and commissioned?
5 - how are the 4 x ICC cases going and with all the changes going on in Chad (energy minister being sacked due to trying to nationalise Doba), are we talking directly to the Chad Government and trying to reach out of court settlements? I guess with the TOTCO/COTCO revenues being frozen that it's it hitting Government finances quite hard.
6 - will the company be releasing a Q3 operations / finance update and if so when will this be issued?
7 - if all customers took their full take or pay quotas from Accugas, would we be at full capacity or do we still have spare capacity to add new customers prior to the compression project being completed?
Accugas Awards Scholarships to 50 University Students from Akwa Ibom.
https://metrowatchonline.com/accugas-awards-scholarships-to-50-university-students-from-akwa-ibom-metrowatch/?amp=1
Would very much rather the President announced ‘deal with Savannah is to complete in due course’! Anyway is it looking likely we’ll see SS completion, another big deal signed and refinancing by 15 Dec? These three aren’t interdependent and so far no news on any.
Kelboy: you wrote what I was thinking, only more eloquently! The global witness "governance" team look exactly how you'd expect them to look...and one of them is a BBC person (aka the paramilitary wing of The Guardian).
It would be hard to find a more bent article than the Global Witness article. The country has virtually no other form of income but oil and this has been written by some bed-wetters interested in virtue signalling. They choose to have a go at some banks and oil companies without asking whether it is the responsibility of the government how the money is spent. I'm sure it could be spent better but if there is no revenue it will never be any better than a subsistence economy. Apiece that ignores all reality and goes on at such length is a waste of everybody's time.
Another interesting article, talks about oil reform
https://www.theeastafrican.co.ke/tea/business/juba-dollar-restrictions-to-stay-as-pressure-mounts-for-reforms-4430294
Interesting article.
https://www.globalwitness.org/en/campaigns/holding-corporates-account/fuel-fire-eu-banks-and-investors-tied-violence-south-sudan/
Https://twitter.com/PatrickHeinisc1/status/1724540011188502661
Good morning.