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Strong economic growth should lead to higher demand for electricity. The Mnazi bay partners supply gas to local power station at a high price 5.36 USD/mmbtu. "THE Gross Domestic Product (GDP) in the south eastern zone grew by 16.3 per cent thanks to good performance in agriculture and manufacturing sectors. The GDP for Ruvuma, Mtwara, Lindi and Coast regions measured at current price, climbed to 10.75tri/-in 2016 from 9.24tri/- in 2015, according to a Bank of Tanzania report" From WRL's Q3 report "On a much smaller scale, Mnazi Bay gas is sold directly to TANESCO for electrical power generation at a 18MW power plant at Mtwara. The power station provides electricity to the isolated grid serving the region and includes the towns of Mtwara, Madimba, Lindi, Msassi and Newala. Gas quantities of between 2 and 2.5 MMscf/d are being supplied to the power plant through an 8-inch pipeline which is owned by the Mnazi Bay joint venture. "
Very good news! So we should now finally reach a cash flow of ca. $3.5 mln per month, as the company promised us in.... eh..... Q3 2015.... http://www.wentworthresources.com/pdf/Wentworth-Corporate-Presentation-September-2015-FINAL.pdf (See slide 6)
The plant is currently processing 80mmscf a day, which is almost one-third of installed capacity since gas demand is still low. The plant Head of Operations and Maintenance, Mr Lucas Nkilila, said the gas processed is transported to Dar for power generation at Kinyerezi where 400MW is produced from Madimba�s plant. �This plant is under Gasco, [a TPDC subsidiary], overseeing gas supply. The gas processed is drawn from four wells at Mnazi Bay,� Mr Nkilila said. https://www.dailynews.co.tz/index.php/business/55874-tpdc-gas-plant-keen-on-safety-measures
Maybe HY, could of course depend a lot on the Government? Is the situation similar to Tanzania in that respect..........slow?
Yes I agree, news regarding the farmout process could be an important trigger for the valuation, but I would have hoped for news already by now. The longer it takes, the larger risk for a negative outcome, I fear. However, the shareprice does not reflect any expectations at least, so I would not expect any major negative reaction if the farmout process does not materialize.
I agree HY, still surprised @ the 80 BCF figure, but will save that for the Aminex board. The other key ingredient here is the farmout process, I know Malcy hinted last year at the surprise @ some of the people in the data room. A key piece of news for WRL and we must be approaching some information on this soon?
I would say that depends on what parameters you are focusing on. If it is contingent resources/market cap, you are probably right. WRL's most valuable assets are the producing Mnazi Bay gas assets that are regarded as reserves. It could take some time and additional investment before the Ntory contingent resources become producing reserves. It also strikes me that what is classified as contingent resources varies a lot in quality and accuarcy. I would regard the 80 BCF based to the 3 NT wells (nr 3 to be drilled) as very much more valuable than other contingent resources mainly based on seismic. But when just comparing the total number of contingent resources this difference in verified resources from drilling is not taken into account. I would also put some prospective value into the Tembo license. Hopefully WRL will be carried for a drill in the start of 2H 2018. In a presentation from September 2017, It says "The prospective resource estimate for the Tembo Structure alone is 1.7 Tcf of gas or 219 million barrels of oil (unrisked P50)"
Conclusion, solo is massively undervalued compared with either AEX or WRL ;-P
The 2486 figure is totally un-risked. This risked figure is 501. "To account for geologic risk, the Geological Probability of Success (GPoS) for the prospects is estimated by RPS to be 17% for Nanguruwe, 17% for Nanguruwe West, 15% for Nanguruwe North, 17% for Mwambo and 23% for OSX -1 and OSX -2." "The first consolidation shown is the stochastic distribution of resources assuming all prospects are successful. The probability of this occurring is extremely low (<<1%)" From page ix http://www.wentworthresources.com/pdf/Tanzania-Mozambique-Public-Domain.pdf I am confident in saying the GPoS for the AEX prospects is higher given we are targeting the same structure. Would been good to get some 3D though.
The website figure for WRL inculdes OSX-1 OSX-2 offshore. I can't seen any mention of them in the latest CPRs.
@mick2020 I am trying to square the figures between PMean GIIP Website == 2486 http://www.wentworthresources.com/tanzania.php PMean GIIP from 2018 CPR == 773 http://www.wentworthresources.com/pdf/Mnazi_Bay_Resource_Evaluation_(Wentworth)_Final_v2_2018-01-11(s).pdf PMean GIIP from 2013 Table 4-11 == 1112 http://www.wentworthresources.com/pdf/Tanzania-Mozambique-Public-Domain.pdf What am I missing/misunderstanding?
hex314 OK, thanks.
"Do you know why it was not regarded as reserves" Was missing a final signature. TPDC have not formally declared commercial operations for KN. I think that was the one thing outstanding.
That is mostly correct. The two AEX wells drilled so far have only just touched the thin edges of the structure[s]. For wentworth over half of their 2C is undeveloped. http://www.wentworthresources.com/pdf/Mnazi_Bay_Resource_Evaluation_(Wentworth)_Final_v2_2018-01-11(s).pdf WRL is a far more mature field that is in production.
I thought the 28 BCF at KN was regarded as reserves, as AEX had a buyer for the gas and it was sold with a profit. Do you know why it was not regarded as reserves, or was it just because the CPR before was from 2015, and at that time production had not started at KN1?
hex314, I was only making a remark that you were comparing reserves with resources, and I you would compare reserves with reserves the comparison would be very much different. But you correctly stated that you were comparing reserves with resources. I have very limited knowledge when it comes to geology and what could be regarded as contingent resources. But what I find strange from Aminex CPR from today is that 80.6 BCF of contingent resources relates to three wells of which two only have been drilled so far and 682.2 BCF is only based on seismic, is that correct? I think the 80.6 BCF should be of " higher quality" as it is partly based on discoveries from two wells. Ntorya 2C gross Contingent Resources: increased to 762.8 BCF after the results of the Ntorya-2 well (approximately 11 times increase from 2015 CPR). This comprises 80.6 BCF of Contingent Resources �Development Pending� from a three well development and 682.2 BCF of Contingent Resources �Development Unclarified�
So when I post about comparing Mnazi Bay with Ntorya. You start talking about KN. KN is a very small field and mostly irrelevant to the market cap of AEX and solo. yes I am comparing 2P Reserves and 2C Resources. I stated such. We need a route to market and a deal with tpdc to turn those into 2P->2C If you want to compare GIIP figures. Mnazi Bay: 1.5 Tcf (IIRC) Ntorya 1.870 Tcf WRL GIIP share = 0.5tcf Solo = 0.46tcf AEX GIIP share = 1.4tcf I wasn't talking about Killiwani North. But if you want the figures from todays RNS were Killiwani North: Field Pmean GIIP of 30.8 BCF KN-1: 2P 1.94 BCF from http://admin.aminex-plc.com/uploadfiles/Corporate%20Presentation.pdf Previously they had stated "28 BCF gross best estimate Contingent Resource to the Kiliwani North field." form http://admin.aminex-plc.com/uploadfiles/aminex_ra2016_web.pdf
hex 314, I think you are comparing reserves with resources. Aminex CPR from today actually includes reserves, 1.94 BCF at Killiwani North. I think that is a reduction from 28BCF stated before. The decrease of these reserves are actually ggod news for the Mnazi bay partners, as they are providing the gas that KN1 is uanable to provide. This is from today's PR. "The Kiliwani North structure has Pmean GIIP of 30.8 BCF according to RPS. Approximately 6.4 BCF has been produced from the Kiliwani North-1 well. RPS estimates 2P Reserves ascribed to the well, after compression is installed, to be 1.94 BCF"
Hex, You are comparing 2P reserves with 2C prospective resources..... not quite the same... You can find the Mnazi Bay prospective resources here:http://www.wentworthresources.com/tanzania.php Mnazi Bay (100%, mean resources): 1.596 Tcf
Field comparison: Mnazi Bay 2P 552 BCF Ntorya 2C 762.8 BCF Share comparison: WRL 2P 176.4 BCF gross, 115.1 BCF net Solo 2C 25% ~190.5 BCF AEX 2C 75% ~571 BCF Market caps: WRL �50m AEX �110m Solo �17.5m Lots of caveats. Ntorya is not in production, Mnazi is. We ignore the other assets of the companies Kiliwani North, Nyuni, Tembo, Helium1, HH. To get to the full Ntorya field development 8 wells are needed, 2 drilled. IIRC WRL need a few more wells also, but they start from a higher number 5.
MaureletProm relased their Q4 numbers today, which is old news for WRL's, but still: "In Tanzania, demand for gas from the national company, TPDC, rose steadily in 2017 to reach average production of 62.2 MMcf/d at 100% in Q4 2017. This demand, which is linked to industrial gas consumption in Dar Es Salam, is expected to increase further in 2018."
The Company is pleased to inform shareholders that payments have been received during January from Tanzania Petroleum Development Corporation ("TPDC") and Tanzania Electric Supply Company Limited ("Tanesco") totalling $1.82 million net to Wentworth for gas sales during 2017. As expected, TPDC and Tanesco continue to settle invoices on a regular monthly basis thereby allowing the Company to continue to strengthen its' current financial position. In order to provide consistent updates to the market, the Company will release monthly updates at the beginning of each month detailing payments received for gas sales in the prior month.
Thanks Alph, Katherine told me the same: "Given that we receive a number of payments throughout each month, the Company has taken the view that, going forwards, it will be more consistent to announce at the beginning of each month (within the first week) the total cash receipts received during the prior month. This will enable us to capture all payments received in each month. In light of this, we will be announcing next week all cash receipts received during January"