Member Info for 44RJ

Just to add to that, as ARA are now in the frame for our 25% then that suggests that we are more likely to end up with the total $16M in the fullness of time.

Fully agree with that Steve.

I've been trying to work out what our SP will be when/if this "deal" goes through. Is 0.5p likely? Could it hit 1p? Or will it languish where it is due to all of the negativity surrounding it.

We've not said much about the latest RNS, i.e., TPDC's withdrawal from enacting its pre-emption rights for SCIR's 25% of Ruvuma. I was surprised when this was announced, but on reflection perhaps it’s not so unexpected. Initially I feared that the TPDC had seen something in a data room that it did not like, but I doubt that is the case. TPDC no doubt has back-in rights options that it can use when the project matures which would be more attractive (cheaper) than funding development costs from where the project stands today. Also, perhaps enacting the pre-emption rights was just a knee jerk reaction to buy time to make an informed decision? Why not do it - it is free to do after all and could have flushed out a quid pro quo from another interested party (a bit cynical perhaps on my part!).
Whether ARA pick up the 25% will be a stronger indicator of the project financials. As operator, ARA (or I should really say APT) are close to all the project data (seismic, drilling info etc), so I suppose its acquisition of SCIR's 25% would be another massive green light for the project in general. It will be interesting to see what transpires. Would it be a good thing for AEX holders? I'm not sure as there will be less voices at the table to challenge ARA on decisions, but it would certainly firm up the anticipation for the drill in November.
On the flip side, what if ARA decides to pull out of its pre-emption rights. What would that say? Presumably that would be a gift for Wentworth. I must say though that I’m a bit miffed with Wentworth for squeezing this low-ball deal, so I do hope that WEN doesn’t end up with our 25% as a punishment!
All interesting stuff but doesn’t detract from the fact that our BoD has let us down badly on this one. Eleven years of my unwavering support has resulted in no Ruvuma and an SP of 0.25p and several tens of thousands of pounds effectively lost with little chance of recovery. Pathetic and shameful performance.

Hi Steve, I don't think the board ever had an appetite to fund the drill, despite the several RNS statements alluding to the contrary. Personally, I stayed invested here based upon those words (more fool me); the smart money jumped ship to Aminex well beforehand. This whole debacle has taught me a good lesson not to put too much faith into the wording found within RNS in general. When I look back at those words they were probably just loose enough for the BoD to get away with it. It seems the text in an RNS can be very "aspirational" and will not have to demonstrably backed up by robust and transparent supporting evidence.

The question I ask myself now is what would the outcome have been if Neil Ritson was still in charge. The man had his weaknesses (don't we all!) but I reckon he would have fought harder to hang on to Ruvuma, but we would need a crystal ball to know for sure. As you said, it was Neil Ritson and Solo that effectively discovered this natural gas field and now are walking away with a paltry $3M for it. Very sad and could have been avoided by our leadership team if they had hung on to some cash and postponed the renewable energy strategy until a more appropriate time.

Anyway, I'm rambling now so best pour myself a beer or something....

Business is business Steve. If ARA has the contractual right to purchase our 25% in staged payments then I see no reason why it would stump up the whole $16m in one go. Its a terrible situation, but let's not forgot who masterminded this dreadful deal; our illustrious BoD. Not ARA.
I completely agree that we deserve better that this, but we don't have a leg to stand on with regards to renegotiation. I would be genuinely amazed if ARA give us the full $16m in upfront charity.

Quite right mrc, that is a risk that we have zero control over. Would be very underhand though, however it does remain a risk and we need the BoD to issue an update RNS pronto. As an Aminex shareholder that scenario would lessen the blow for me as AEX would end up with 31.25% of Ruvuma. However, I realise that not all of us SCIR LTH have AEX shares too which would be a disaster for them, and so this is a scenario that needs to be avoided.

I share MRC's concerns here to be honest. There is nothing we've seen so far via RNS to categorically state the length of time that the pre-emption purchaser (TPDC in this case) is given to progress or withdraw from opting in. If the contract is badly worded there may even not be a backstop date at all for this scenario (although I doubt that as corporate lawyers are pretty good at weeding out such issues).
That said, I can't see why TPDC would "drag its heels"; if it did, and SCIR defaulted on a Ruvuma cash call, then the TPDC would end up with nothing and SCIR's 25% would revert to Aminex and ARA.
An update or clarification on this issue would be welcomed from the board.

I see Aminex are flying - that could have been us, but hey ho - our BoD apparently knows what its doing....

little_me - "When are their plans going to provide value to share holders?"

It depends when you bought this share. In my view the board totally lost sight of the fact that many LTHs (I suspect) require a SP of, say, 4p to 6p just to break even. Past leadership performance and the future plans doesn't suggest to me that a break even sp will be anytime soon for most of us, if ever.
The most likely way to provide meaningful value to shareholders would have been to hang around for the CH1 drill. However they blew it by selling the Ruvuma asset for essentially $3M. Basically, I doubt they can provide value to us at all, certainly not a the levels that we require and probably never with the AD strategy. Therefore, I see their positions as untenable really. Tom Reynolds can talk a slick game but has a track record of delivering absolutely nothing, other than a microscopic share price that is. Fail.

Well, it looks like they've won... Markettimer's banning has absolutely killed off any challenging and stimulating discussions regarding the direction of travel of Scirocco Energy Plc. Yep, great way to entice new investment...

There must be some mistake. Markettimer didn't say anything particularly controversial. Plus, all the information he quoted was in the public domain. What on earth's going on?

Markettimer's been banned? Why?

Agree Highlandmatt. I think it was included to head off any possible "we should have completed the One Dyas transaction" comments from shareholders. On reflection it would have solved a lot of problems had SCIR completed the acquisition, but it was the correct decision at the time. Cost us a lot of cash though to pull out.

"Slide 6 annoyed me with regards to the risk and dilution moving forward with Ruvuma. They do a scenario with CH-1 as a NO discovery. Which is completely incorrect. CH1 is an appraisal well with an additional exploration at the lower Jurassic layers. It is the most conservative analysis."

Me too Aimster. We all know that there is risk in drilling anything, be it a traditional gas well, a road tunnel, or even dentistry! The very fact that we all pressed the "buy" button for these shares yonks ago suggest that we have all understood the drilling risks and are willing to take the chance for the potential rewards on offer. As the project has matured those risks have reduced accordingly as we are now in the appraisal phase. To my mind its disingenuous for the BoD to recommend the sale of the flagship asset due to a remote downside case. It smack of scaremongering to push through another agenda in my view.

"yet they subscribed for shares in HE1 which was very high risk?"

Markettimer - the Helium One shares were a legacy asset from the previous BoD, which was a private company at that stage. The current board were in place when Helium One conducted a reverse take over of Attis Oil and Gas. SCIR's original investment was therefore converted into shares in the HE1 Plc. It wasn't a traditional purchase of high risk shares. The whole thing was spearheaded by our previous CEO, Neil Ritson. To be fair, our current board flogged most of the HE1 shares at a reasonable price last year when there was lots of excitement about a potential helium discovery. SCIR still holds some HE1 shares which I believe to be in the order of $500k (may be slightly inaccurate - take with a pinch of salt).

Markettimer, its an interesting argument and its worth confirmation, but ultimately I don't think that it is going to be enough to stop the disposal. The wording of the resolution on the proxy form was as follows:

"THAT the proposed disposal of the Ruvuma Asset be approved - FOR / AGAINST / WITHHELD"

So the vote was regarding the sale, not the recipient of the asset. Worth a shot though...

Absolutely correct Markettimer, we all do need to post with more professionalism, respect and courtesy - definitely myself included. However, the tone of posts would be a lot more polite if the company was performing well, which it most certainly is not. Add to this the bewildering drainage of funds over the past 4 years, premature progression of the renewable energy strategy and self-inflicted poor negotiating position regarding the flagship Ruvuma asset and you can soon see why LTHs "wouldn't mind giving them a bloody nose". Personally, I think the currently leadership team has had a 4 year chance (more than enough) to provide us with investment growth, but they have failed catastrophically. To me this suggests that we need to have them removed and replaced with a team more aligned to the wishes of the LTHs. Have you seen anyone on this board that supports the sale of Ruvuma on these terms? I haven't (maybe I'm wrong). In any case, the BoD really misread the room on what we want and that says it all really.

"I wonder what the directors next move will be."

I know what I would do Steve if I was CEO. I'd pull out of this unpopular deal, put the AD strategy on ice, win back the hearts and minds of the long term shareholders with a Tanz based strategy, and meet the cash calls for Ntorya by hook or by crook!

Hi Highladmatt - yes I think we can now close the file on that question regarding the loan facility. Tom's explanation confirmed that any loan amounts drawn down will be written off at Completion. However I still think the RNS wording is completely ambiguous (see below):

"Subject to Completion occurring, the Facility is repayable by Scirocco upon Completion by way of a corresponding reduction to the consideration payable under the Asset Purchase Agreement"

But no, I have no idea about how much SCIR has pumped into the project since 1st Jan 2022.

Thanks Aimster. I'm just trying to understand what games can be played here at SCIR's expense - for example, could TPDC/ARA drag this out until after the results of CH1 before making an investment decision? It sounds like a ridiculous scenario, but I'm a bit concerned that no backstop dates have been communicated regarding the pre-emption discussions. Plus I don't trust anyone at the moment.
I guess in that situation SCIR could just pull the plug on the deal remain in the JV.
This is such a mess...

Can anyone recall anything said about the duration of the pre-emption rights discussions? In other words, how long can the TPDC / ARA string us along until making an investment decision? I missed the first few minutes of the presentation.