Member Info for ART123

All in all this is a bit of a c*ck up now. My reflections are as follows:

The market and share holders were quite happy that CUDA was due to be paid for by the arranged bridging loan and just prior to completion the share price was around the 21p mark. Then at the 11th hour the COPL management announced the alternative Bond deal, which immediately did not go down too well with the market and the shareholders.

Bonds are okay and should not be confused with Loan Notes. Bonds are always repaid in cash and do not get converted into shares - that is unless repayment is defaulted. On default of repayment the bonds will be converted into shares and this will quite often lead to mass dilution of shareholder value, though with these bonds being of quite a smallish amount - $100M is usually a quite normal size - then dilution might not be terminal. If it is then often the bondholders will end up with 90% - 98% of the shares in issue and the existing share holders will end up with virtually nothing.

Obviously to avoid such problems COPL will need to repay the bonds, which can be redeemed at any date up to maturity. Whether they can do this with the RBL facility I don't know but they will certainly need to increase revenue, reduce spending and be sensible - ie. no further acquisitions.

So if bonds are generally okay and do not convert into shares except in the event of default of cash repayment then what is currently keeping the share price down to such a ridiculously low level?

I think the answer may lay in the warrants that were issued to the bondholders.

"Warrants expiring 30 months from the Issue Date shall be issued to the Bondholders, providing for the right to acquire an aggregate number of 54,792,590 COPL common shares. Each Warrant is exercisable at 16.75p."

I have never even come across warrants being issued to bondholders, and certainly not in the vast quantities that are seen here. I thought this was strange at the time. To get these warrants the bondholders will have to buy them at 16.75p and to exercise the whole amount will add revenue to COPL of over £11 Million ( almost enough to pay off one of the 2 bonds in itself!). But at the same time that is 54 Million new shares in issue which is a 20% dilution of current shares in issue.

My only explanation for the share price is that these warrants are being forward sold now and are counteracting what would be a rising share price. As the warrants are exercisable at 16.75p to be selling them at 17.5p/18p is clearly a profit, if not a big one and will ease any worries that the bondholders may have if SP goes any lower.

These are just my thoughts.

Meanwhile I think we will hear pretty soon about increases to production. 2720 bopd was a previous high and now COPL need to get back to increasing production and maintaining the higher production levels. I feel they can also push production into the 3000/5000 bopd range quite easily now the CUDA business is sorted.

ATB

For those who are new here, and maybe a little more over-enthusiastic than necessary, ORCP raised £800K only 4 months ago "to support Green Hydrogen Project Development".

Funnily enough that was at a higher price than today's raise - at 0.325p. Oh dear, the project is losing value already!!!

So what happened to this anyway - or has fertiliser gone out of fashion. Let's face it the management here are a bunch of cranks:

16 December 2019
Oracle Power PLC
("Oracle", the "Company" or the "Group")

Joint Development Agreement Signed with the Private Office H.H. Sheikh Ahmed Dalmook Al Maktoum and China National Coal Development Company

Oracle Power PLC (AIM:ORCP), the UK energy developer of a combined lignite coal mine and mine mouth power plant located in Block VI of the Thar desert in the south-east of the Sindh Province of ****stan (the "Project") on Sunday 15 December 2019 entered into a Joint Development Agreement ("JDA") with the Private Office of H.H. Sheikh Ahmed Dalmook Juma Al Maktoum ("Private Office") and China National Coal Development Company Limited ("CNCDCL"), a subsidiary of China National Coal Group Corporation (collectively with Oracle, "the Parties").

This JDA follows on from the Company's announcement of 19 November 2019 detailing that the Company's flagship Thar Block VI has been included in a proposed new initiative between the governments of ****stan and China with respect to gasification of coal into fertiliser. The Project is also enshrined within the intra-government initiatives under the China-****stan Economic Corridor ("CPEC"). This new initiative runs in parallel to the Company's remaining long-term plan to construct and operate a mine-mouth power plant on Thar Block VI, also included as a "Priority Project" within the CPEC. The Company believes this JDA supersedes and replaces the previous Memorandum of Understanding (dated 19 December 2018 and subsequently amended: www.londonstockexchange.com/exchange/news/market-news/market-news-detail/ORCP/14016881.html) and provides for an all-encompassing development scenario for both aspects of the aforementioned projects.

The JDA foresees the creation of a Special Purpose Vehicle to develop and undertake both projects. It is envisaged that the Project will be funded on a 75% debt and 25% equity basis, with the proposed ownership as follows:
CNCDCL 73%
Private Office 15%
Oracle 12%

Incompetent trader - no, I don't think so.

I bought in for the 2 gold projects which looked good prospects at the time and seemed a positive move to diversify away from the string of failed coal projects in ****stan. Unfortunately they haven't quite worked out - at least not share price wise. One is deemed a fail while the other has been assigned "an Exploration Target based on historical results and the results of the recent seven drill holes which indicates 200-250Mt at 0.4-0.6g/t Au for 2.5 to 4.8Moz Gold". This looks okay and word is that they are looking for a JV partner to pay for the drilling to take this further in exchange for a chunky percentage. This might still be enough to see me get my money back.

As for Green Hydrogen - dream on - that looks to be another failed project. All talk, lots of spends but no action - and if it did ever happen it looks to be a very small project which will not be a great financial success.

Spiked or whatever - but I see no future here and as soon as I can get my money back I am gone. Absolute tosh. Coal to fertiliser indeed - and that Joint Development Agreement was signed nearly three years ago and no progress has been made since. In fact it hasn't been mentioned since. And the Great Sheik was in on that as well - https://www.investegate.co.uk/oracle-power-plc--orcp-/rns/joint-development-agreement-signed/201912160700099096W/

I suppose the only surprise here is that the Great Sheik hasn't seized the opportunity to double his money by selling his whole stake and buggering off. Maybe he is just waiting for a better opportunity to get a better price so he can also recoup the funds he seems to be throwing away on this Green Hydrogen nonsense.

So far that's £1.3M ORCP have raised for this Hydrogen project and they only have to fund their 30% interest. That makes this look like a very expensive divergence into green energy.

The only project worth pursuing at the moment is the coal joint venture but that has been out of fashion for years and besides Naheed Memon is completely the wrong person for that as she is all about green energy.

Yes, I agree, of course the Sheik should have bought in at a substantial premium when he first took his stake in ORCP.

Washers, you are welcome to your 16 million shares here and good luck to you. I think you might need it. I have 1 million bought about a year ago at 0.5875p and I have been trying to get rid of them at cost price ever since with no success. I actually bought in for the 2 gold prospects though the share price has done nothing but tank ever since.

I honestly haven't got a clue what the f*ck this green hydrogen project is all about and I don't really care and no doubt it will go the way of the other projects here.

I haven't quite given up on getting my cash back here, but then nor have I seen any reason to buy more to average down since my original purchase.

Reading this article it becomes clear that the priority project is still the Thar mine-to-mouth power plant. Unfortunately that was more or less forgotten about 5 or 6 years ago, probably under pressure from the climate change lobbyists.

The last time the share price rose of any note to 1.5p+ at the end of 2019 it was due to talk of a coal to fertiliser project, which similarly seemed to suffer from the usual Oracle all talk and LOI's but no action syndrone.

Now years later with energy and particularly elecricity prices spiralling upwards out of control it is still the originally planned power project which is still the priority but which is still sadly missing having not even reached the planning stage.

Unfortunately all the Sheiks in the world and all the green hydrogen projects still won't alter the fact that it is still the coal to electricity project that Oracle should have concentrated on and got up and running.

There you go - the share price is up 0.28% already!!!!!

Great news. If this doesn't get the share price moving upwards then nothing will.

Production now needs to get up and past the previous high of 2720 bopd and over 3000 and up to 5000 bopd. What are the figures on 3000 bopd and 5000 bopd anyone?

It is the Barron Flats Shannon Unit (miscible flood): (85% Working Interest) that has the most potential to rapidly increase production here to get this share price moving upwards. A 2 or 3 times increase from current production levels could easily see the share price back into the 30p's or higher even without the massive oil discovery.

From the recent RNS:

"At the time the Atomic transaction completed, the assets produced 1,100 barrels of light oil. After the implementation of a works programme by COPL, the asset has since then far exceeded original expectations and current production (gross) of approximately 1,600 barrels a day is restricted due to ongoing facility constraints. The Company is commencing its production optimization program which will unlock the current production restrictions increasing production in the short term, and in the future, through well optimization strategies, staged facility upgrades and additional development drilling."

2720 bopd was about the peak so far and in fairness the management were unable to tackle the problem until the CUDA business was sorted. Now that is finalised and the company also have funds to work with I can see the early targets of 5000 bopd becoming a reality quite quickly.

It shouldn't be long before we get an increased production RNS from the Barron Flats Shannon Unit. The management have had plenty of time to work through the issues while waiting for the CUDA completion and they also have plenty of funds to get this production rising very quickly. I can see production doubling or trebling in no time at all.

Previously we have had RNS's re large increases in production in the space of a week and that is most likely again here now and very soon.

Maybe the management should put Canada on suspension awaiting the imminent release of the CPR as price-sensitive info as companies usually do on the ASX.

It would be great if this did get leaked - the share price would start to rise on some big buys and the herd would realise that things are about to happen and jump in and the FOMO would kick in and suddenly the share price is up by 25% - and prior to the CPR would be a good thing and a springboard to a decent rise.

"Current Oil Production at August 31st is 2,720 bbl./d (gross), 1,604bbl./d (net) a 24% increase from the operations update on August 17th, and an increase of 123% from 1,220bbl/d (gross), 706 bbl./d (net) at April 1st"

A few announcements like this, with COPL now holding an 85% interest, will soon get the share price moving upwards.

From the last RNS dated 6th July:

"The optimization and associated increase in oil production is expected to occur from August 2022 with a ramp up in activity at the Barron Flats Shannon Unit involving well optimization, selective gas flaring for short term pressure reduction, staged facilities upgrades and ultimately additional development drilling."

From RNS dated 1st September 2021:

"Operating Highlights at August 31, 2021 from the August 17, 2021 Update

· COPL's Wyoming assets continue to perform significantly ahead of expectation
o Current Oil Production at August 31st is 2,720 bbl./d (gross), 1,604bbl./d (net) a 24% increase from the operations update on August 17th, and an increase of 123% from 1,220bbl/d (gross), 706 bbl./d (net) at April 1st
o Successful recompletion of the 3rd marginal/shut-in oil well of 12 at Cole Creek
· Strong outlook for COPL year end
o Oil production at the Barron Flats Shannon Unit will continue to increase due to strong gas injection response
o Oil production at the Cole Creek Unit will continue to increase through the recompletion of marginal and shut-in wells"

Now is the time to continue this increase in production which has been obstructed and delayed due to the CUDA business.

The sooner this is upped to 3000 - 5000 bopd the better. It doesn't even need the new discovery to add considerable value here. Production was already hitting 2720 bopd last year before the CUDA problems so it won't take much to get back there and above 3000 bopd that is for sure.

If anyone knows the figures and costs what would the revenue be on say 3000 bopd and 5000 bopd.

Cheers