Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Sparrow. Posters on there seem upbeat but I'm not sure what it is they are so upbeat about. Roy has been in charge for almost a year now and in that time gas sales equivalent have been pretty static at 4.6 to 5.1 per day. Just prior to Roy coming on board, condensate sales were 5548 pq and are now only a third of that. So the business has stagnated for 12 months and the only crumb of comfort is the hope that 2 or 3 existing customers out of over 30 will take extra gas amounting to 1.4 mscuffs some time later in the year.
We are therefore almost totally reliant on one of several big announcements that may or may not happen. Roy has mentioned during updates, the importance of growing organically but has so far failed abysmally to achieve that.
Some worthwhile posts on the other board today.
A fairly ordinary article until you get to the last line:
'...To mitigate the multiple power cuts, many households are being seduced by the adoption of solar kit solutions and companies are opening up to the possibility of offering solutions from the company Gaz du Cameroon.'
https://www.energymixreport.com/cameroon-energy-firm-eneo-to-generate-promised-cash-to-carry-out-future-borrowings/
Page 7
Prometal to commission the most modern iron processing plant in Sub-Saharan Africa
in H2-2021, in Cameroon
In late 2018, Prometal (leader of the
concrete iron and ferrous products
market in Cameroon) launched the
construction of Prometal 4, an iron
processing plant. At the time, the
company presented Prometal 4 as
the most modern iron processing
plant, with the most diversified range
of products, in Sub-Saharan Africa.
Based in the industrial zone of Bassa
(Douala), “the plant will be the only
rolling mill (a factory or machine
for rolling steel or other metal into
sheets) of this type in Sub-Saharan
Africa,” a source close to the case
indicates.
The plant to be supplied by German
metallurgical plant supplier SMS
Group (which is thus carrying out its
first contract in Sub-Saharan Africa)
will be delivered in Q1-2021. It will
then be commissioned in H2-2021,
after a trial and run-in period.
Prometal 4 is the result of a XAF40
billion investment supported by four
local banks. According to an internal
source at Prometal, it will increase
the company’s yearly production
from 200,000 to 300,000 tons. It
will also allow Prometal to market
products (such as beams, angle
irons, smooth bars, and screws as
well as flat bars and wire rods, which
are intermediate products used to
manufacture nails) that are currently
imported by African countries. more........
https://www.businessincameroon.com/images/stories/bc96.jpg
Agree, Jed/3CB - it read very much as Foo's last throw of the dice. He had to go.
CNG could always be a small part of the sales mix - but in itself it was never enough to keep the lights on.
However, as we've done the initial planning, and formed a partnership, I think it might be easy for Roy to pick up where Foo left off on CNG. Though clearly Roy has far bigger fish to fry before using much time on this. Nonetheless, the CNG RNS pushed SAVE's sp up by 5-10% - so a similar agreement here would not to be sniffed at.
Sorry sparrow but I agree with Jed. Foo had a long history of coming up with hair brained ideas which seemed almost to be calculated to buoy the share price pending the next inevitable placing to keep vog on the road.
The fact is, you can have all the gas in the world, and it may well be cheaper and cleaner, but trouble is no-one wants to pay for it.
Yes Foo proposed Energy wells and CNG agreement with a Turkish Company that have all gone by the wayside, all these possible move forward moves that have all turned out to hve bitten the dust.
The new BOD's don't have anywhere to go now do they.
They might as well invest in electric turbines.
This was also proposed in that Oct 2018 RNS (after which Foo got the order of the boot):
A new business concept: The Energy Well
The term Energy Well is derived from the timeless tradition of villagers drawing from local water wells. VOG has taken this tradition and adapted it for the purposes of energy supply.
Seventy four percent of the Cameroon population has access to the National Grid and 86% of the population lives within 15km of the power network. However, household electrification stands at only 23%. There are approximately 8 million rural Cameroonians who have no access to grid electricity. This situation is replicated in many African nations where less than 10% of the rural population has access to reliable grid electricity.
The average rural household in Cameroon requires about 1kWh of energy per day.
VOG believes CNG is the bridge between renewable energy and traditional hydrocarbons and that its Energy Well system can provide a seamless, clean and reliable energy solution to regions that are currently poorly served.
CNG produced by GDC would be trucked to cell towers, or other locations where electricity is generated, to power the cell tower and create energy to store in large onsite batteries or for distribution to local mini or micro grids. Villagers can collect or have delivered smaller rechargeable batteries to use them in their homes as standalone energy banks or to augment solar or wind power if available, to meet their domestic power consumption needs. Consumers would pay upon receipt for battery rental or CNG bottles via mobile phone Apps.
Underpinning the Energy Well concept is VOG's ability to monitor, manage and immediately monetise energy, be it in the form of compressed natural gas in transit or the electricity stored in batteries throughout the supply chain. GDC has teamed up with leading edge US company Blocksyte Inc on development of the Blockchain elements of Energy Wells. The Company is working with Blocksyte, Altaaqa and others to start limited field tests this year on the key components of the business.
Any potential in developing this concept?
CNG Development
On 26 June 2018 the Company announced an agreement to partner with Naturelgaz Sanayi ve Ticaret A.S.("Naturelgaz") on CNG projects. Naturelgaz is Europe's largest CNG supplier and distributor and brings valuable expertise within this field to support GDC. The project will allow GDC to reach to reach larger customers beyond the pipeline infrastructure and aims to replace diesel and heavy fuel oils in a variety of applications. In 2017, Naturelgaz produced and sold over 5.2bcf of CNG in Turkey.
GDC and Naturelgaz have completed positive feasibility and marketing studies on the CNG project in Cameroon. CNG, which is a cleaner fuel at a competitive price competes with liquid fuels such as fuel oil, LPG or diesel. Marketing studies by GDC/Naturelgaz have concluded that five types of customers would use CNG in Cameroon; thermal, off-grid power generation, commercial trucking, public transportation, and domestic transportation. The studies indicate the near-term potential of the CNG market, within a 60 km radius of the Logbaba facilities, is 2mmscf/d thermal and 2mmscf/d industrial power. The pricing of CNG will be benchmarked against competing liquid fuels. To date, 20 customers have expressed interest in CNG within a 60 km radius of Douala.
The partnership will provide CNG infrastructure for customers in and around Douala, with the intention of rolling the concept out further in the longer term. GDC will supply natural gas, land space and support services to the CNG production facilities, whilst Naturelgaz will design, build and operate the CNG production, distribution and offloading facilities. Negotiations on the commercial structure of this initiative are ongoing and expected to be concluded during Q4 2018.
However, end of 2018 FOO was out on his ear - and the idea of CNG was quietly dropped?
Will Roy Kelly reinstate such a project soon (given how SAVE are advancing with it in Nigeria)?
Seems to have potential?
RNS SAVE 05/02/21 - https://irpages2.equitystory.com/websites/rns_news/English/1100/news-tool---rns---eqs-group.html?article=31626339&company=savannahpetroleum
....Mulak is a member of the Mansour Group, the leading Egyptian multinational conglomerate with operations in more than 100 countries and annual revenues exceeding US$7.5 billion. The agreement for the supply of gas to Mulak's Compressed Natural Gas ("CNG") Nigerian project represents Savannah's first Gas-to-CNG sales agreement. Mulak initially plans to distribute CNG to its industrial customers in Rivers State with the CNG to be substituted for diesel in generators supplied by the Mantrac Group, also a member of the Mansour Group and one of the world's largest dealers in Caterpillar machinery, power systems and equipment. Mulak is in a unique position to exploit the synergies with Mantrac's business in Nigeria through the conversion of Mantrac's existing customer base of approximately 400MW of diesel-fuelled generators to CNG-fuelled generators. This is expected to provide Mantrac customers with up to a 40% saving in energy costs and a 30% reduction in their carbon footprint.1 Sales under the GSA are expected to commence in 2022 and, following the initial two-year period, Mulak has indicated that it is seeking to expand its CNG sales on a pan-Nigeria basis to Mantrac customers....
It seems our equivalent of Mansour in Cameroon is the Zahid Group https://www.zahid.com/businesses/
with its subsidiary Altaaqa Global Energy http://altaaqaglobal.com/about-us-2/
A gas-to-CNG project was under consideration by VOG six years back:
https://www.businessincameroon.com/energy/0804-4767-cameroon-victoria-oil-and-gas-to-produce-compressed-natural-gas
In 2018 we partnered with Naturelgaz A Turkish Company):
https://www.sharecast.com/news/small-caps-news/victoria-oil-and-gas-partners-with-naturelgaz-in-compressed-natural-gas-project--3366793.html
https://polaris.brighterir.com/public/victoria_oil_gas_plc/news/rns/story/rmy7e8r
In RNS of Oct 2018 we learnt:
CNG Development
On 26 June 2018 the Company announced an agreement to partner with Naturelgaz Sanayi ve Ticaret A.S.("Naturelgaz") on CNG projects. Naturelgaz is Europe's largest CNG supplier and distributor and brings valuable expertise within this field to support GDC. The project will allow GDC to reach to reach larger customers beyond the pipeline infrastructure and aims to replace diesel and heavy fuel oils in a variety of applications. In 2017, Naturelgaz produced and sold over 5.2bcf of CNG in Turkey.
GDC and Naturelgaz have completed positive feasibility and marketing studies on the CNG project in Cameroon. CNG, which is a cleaner fuel at a competitive price competes with liquid fuels such as fuel oil, LPG or diesel. Marketing studies by GDC/Naturelgaz have concluded that five types of customers would use CNG in Cameroon....
From 2017:
https://www.diageo.com/en/our-business/where-we-operate/africa/guinness-cameroun/
AKSA dont think so obviously
from below
Investor presentation Feb 2021:
https://aksainvestorrelations.com/media/7734/investor-presentation-feb21.pdf
Note: Kongo operations Jan 2021:
On 21 January 2021, Aksa Enerji Üretim A.S.’s 100% subsidiary Aksa
Energy Company Congo has signed a concession agreement with
Republic of Congo about obtaining operating rights of a 50 MW
natural gas power plant in the city of Pointe-Noire
• Existing installed capacity of 50 MW planned to be increased to
100 MW with additional investment
• Natural gas is expected to be supplied from Congo’s local gas
reserves
• Electricity generated is expected to be exported to Democratic
Republic of Congo via existing transmission lines
We in the developed world are moving away from gas and moving to eletricity in an atempt to go green, infact as we all know GB will be banning all Gas central heating in new homes in about 10 years time.
Cameroon has already identified electricity as the new / main aim for developement with all it's backing for eletric power stations and don't seem to be bothered about gas supply to industry or domestic use. So after all the spend by vog in the past ( some £250m ) to lay pipelines etc is it just bad money down the drain as they move more to eletric power.
It does look like vog will now never make a profit or a return for it's shareholders, so can the sp hold up?
(Business in Cameroon) - On February 8, 2021, districts of Yaoundé, the Cameroonian capital, were again briefly plunged into darkness. Although it recalls the ordeal that some populations of the capital have been going through since the end of January 2021, this brief interruption in the distribution of electrical energy was the result either of minor incidents on the network, or of scheduled work on the distribution network, we learn from good sources.
Nothing to do with the ordeal experienced by the populations connected to the southern interconnected network (RIS, Center, South, Littoral, West, South-West and North-West), on January 25 and 28, 2021. Indeed, during these two days, we learn from good sources, Cameroon experienced two collapses of its electricity network, due to events on the transport network, in particular on the Songloulou-Logbaba and Songloulou-Mangombe lines. These incidents caused major disruptions in the distribution of electricity throughout the RIS.
"? The origin of these incidents has still not been identified by the teams of the transmission system operator," reveals an authorized source, who confides that following the network collapse of January 25, 2021, a meeting was summoned urgently on January 27, 2021, by the Minister of Water and Energy, Gaston Eloundou Essomba. "? But the next day, a new major incident occurred on the same lines,? " continues the same source.
These repeated incidents reveal the level of fragility of the electricity transmission network in Cameroon, the maintenance of which is questionable and could cause many damages to electricity consumers in the days to come, confesses an internal source at the National company for the transport of electricity (Sonatrel).
As a reminder, created in 2015, Sonatrel, a company 100% controlled by the Cameroonian State, has been managing the electricity transmission network in the country since 2018. This State company inherited dilapidated installations, which make officially lose at least 6.5% of national electricity production. According to World Bank estimates, the financing needs for the improvement works of the electric energy transport network in Cameroon are estimated at around CFAF 850 ??billion.
https://www.investiraucameroun.com/energie/0902-15945-en-fin-janvier-2021-le-cameroun-a-connu-deux-effondrements-du-reseau-de-transport-provoquant-des-coupures-d-electricite
Energy
ENEO posts XAF155 bln of debt to
Independent power producers and fuel
suppliers at end-2019
In its recently published 2019 annual
report, Eneo indicates that during
the 2019 financial year, it experienced an «unprecedented deterioration of its financial situation.”
These financial difficulties resulted in
the accumulation of its debts owed
to the independent power producers
it is partnered with as well as companies that supply fuel for thermal
power plants. According to official
information, the overall debt to the
suppliers, at the end of 2019, was
XAF155 billion. Let’s note that because of the supplier debts, Eneo was
sued by state-owned oil distributor
Tradex, which was claiming about
XAF52.7 billion of unpaid debts.
Eneo explains that in 2019, its financial problems were mainly caused
by the non-payment of bills owed
by some large clients, including the
state and its agencies.
Officially, the volume of debts owed
by these large clients was over
XAF180 billion on December 31,
2019. It includes XAF63 billion owed
by the state and its agencies. But, in
2020, the company’s financial situation improved substantially.
Indeed, during an interview with
Business In Cameroon, Eric Mansuy
(Eneo’s MD) revealed that in June
2020, the government paid over
XAF45 billion to partially settled its
debts to ENEO. That amount “helped
launch the restoration of trust in the
sector, as the sums thus raised were
used to clear part of the debts owed by
major players in the sectors (Sonara,
Globeleq Cameroon, SonatreL, EDC,
etc.) (…) Also, other operators have
agreed to negotiate moratoria or new
schedules for the settlement of their
debts,» he added.
According to the executive, thanks
to the funds released by the government, Eneo was not only able to pay
its suppliers, but it was also able to
calmly plan a XAF100 billion bank
loan to settle its medium-term debt
and fund additional investments.
Authorized in early 2020 by the board
of directors, this fundraising operation has surely been carried out but
the results are not yet available.
From Business in Cameroon
In the presentation on the aksa website from last September, both Cameroon and Congo were listed as potential projects, on page 26. If they have just signed off on the Congo project, could that potentially mean their resources will be tied up for a while, so Cameroon may be on the back burner for now?
Investor presentation Feb 2021:
https://aksainvestorrelations.com/media/7734/investor-presentation-feb21.pdf
Note: Kongo operations Jan 2021:
On 21 January 2021, Aksa Enerji Üretim A.S.’s 100% subsidiary Aksa
Energy Company Congo has signed a concession agreement with
Republic of Congo about obtaining operating rights of a 50 MW
natural gas power plant in the city of Pointe-Noire
• Existing installed capacity of 50 MW planned to be increased to
100 MW with additional investment
• Natural gas is expected to be supplied from Congo’s local gas
reserves
• Electricity generated is expected to be exported to Democratic
Republic of Congo via existing transmission lines
Cameroon can't be far behind?
https://www.marketscreener.com/quote/stock/AKSA-ENERJI-URETIM-AS-6914251/news/Aksa-Enerji-Uretim-Cameroon-and-Congo-Update-31589251/
.....this step is part of Aksa Enerji's strategy for strengthening of its position on the African market... and established local companies in 2019 to develop projects in Cameroon .
https://seenews.com/news/turkeys-aksa-enerji-to-increase-mali-power-plant-installed-capacity-to-50mw-729594
Arbitration to Resolve Energy Disputes, Grow Investor Confidence
By Charné Hundermark, Southern and East Africa Editor on February 5, 2021
Considered to be one of the final energy frontiers, Africa holds abundant natural resources that offer the ability to drive long-term, sustainable socioeconomic success for the host country and sizable returns for investors. Yet as the sector grows more complex, large-scale projects gain traction and competition amplifies, energy investments can face disputes, especially during COVID-19, which has challenged contract sanctity and the associated structures in place to ensure market stability. Süleyman Bosça, President of the Energy Disputes Arbitration Center (EDAC), speaks to Africa Oil & Power about the role that arbitration centers can play in building back investor confidence in the African energy market.
Restoring Investor Confidence
One of the main challenges for Africa’s energy sector is the establishment of a business-friendly environment, in which investors are assured of regulatory certainty and balanced contractual terms. Despite robust investment opportunities, several African markets present elevated risk profiles, in which a lack of transparency and a high level of government bureaucracy can deter investment. Additionally, ineffective legislation is a challenge in which frontier markets, often with outdated or redundant energy regulations, present a high-risk and difficult-to-navigate environment.
https://www.africaoilandpower.com/2021/02/05/arbitration-to-resolve-energy-disputes-grow-investor-confidence/
BGFIBank Cameroon, the BGFIBank Group has just approved the granting of FCFA 23 billion in funding to ENEO Cameroon, as part of the raising of 100 billion CFA francs for the purpose of accelerating the transformation of the electric service in Cameroon.
So if the money is there now, just how long will it be before vog get their money owed to them. 3 months , 6 months, 12 months? ENEO now has nowhere to hide. !!!!!
Happysparrow,
Thank you so much for taking the trouble to fully acquaint me with what is and has been transpiring. I guess what was once a main event has become more of a side show now..................possibly the grandchildren may benefit at some point - thanks again
Can anyone explain please the multitude of small buy transactions showing today ?
Anthony, some wider background: - as mentioned in my post on ENEO, these 3 power suppliers will not operate in Cameroon and supply ENEO if they do not believe ENEO will pay them on time, or at all. Hence, the refinancing of ENEO recently is very important - and too, I would expect an ENEO settlement with Altaaqa/VOG on repaying monies soon, before go ahead for any of the 3 power projects - otherwise no one will have the confidence to invest in Cameroon/Eneo (Of course, ENEO would be much more capable of meeting its debts if $700m hadn't been extracted by Presidential decree from SNH in 2018/2019, in what many regard as a 'slush fund' ! Pressure is being put on the Government to reform by the international lending authorities for the reconstruction of Cameroon.)
anthony - VOG entered into a MOU with AKSA about this time last year (see RNS). AKSA is to build a power station near Douala. VOG will carry the Etinde gas to this power station (and too, probably supply from Matanda/Logbaba as well). Etinde FID is this year - if they wish to supply Cameroon, they will need to supply a power plant at Limbe (350MW) or Douala (150MW), preferably both. So both VOG and BLVN are very much waiting on the government to reach an agreement to build a power plant at Limbe (+ too, a fertliser factory?), or at Douala by AKSA. A third possibility that has just arisen is for a 300MW power ship to moor up in Douala Port (see my Karpowership posts last week). If BLVN are to achieve FID by end of 2021, as expected, then I expect the go ahead for one of these 3 power projects to be signed off in the next 6 months. Too, a possibility that Lukoil will buy out both BLVN and VOG once FID is done.
Hope that is of help.