Member Info for BlackSwan

QF - I agree fully with all the points you have made in your latest posting - given what has been going on these last years in Nigeria the results that we see today another suspension were inevitable. I intend to retain now my much-reduced holding in SLE and just hope the baby doesn't drown in the now much muddied bathwater that is Nigeria.

CJ - thanks for the details.

Time scales: It would seem the new incoming President is serious to reorganise the oil industries and not before time as Nigeria titters on possible bankruptcy - Sle is in the game as we all well aware of that is if we can financially stay the pace?

Extracts:

"They proposed that the government should work towards achieving some milestones within the first 100 days ending August 2023".

"It proposed that the government should work to raise Nigeria’s oil and gas production to 1.8 million barrels per day (mbpd) and 3.5 billion cubic feet (bcf) in the next 18 months ending December 2024."

The council also advised Tinubu’s government to achieve a daily crude oil production target of 2.5 million barrels per day and 5 billion cubic feet (bcf) of gas daily by May 2027.

“Bring Greenfield Projects to FID to grow production, such projects included deepwater oil and NAG (Non-associated gas) projects, develop offshore gas hub, and FLNGs (Floating LNGs).”

"The council further proposed that the government should work towards growing the country’s oil and gas production capacity to 4 million barrels per day (bpd) and 12bcf/d to domestic and export by 2030 and 25-30GW of power generation by 2030"

"The report further recommended that “within the first 100 days, constitute a team to evaluate portfolios of upstream, midstream and downstream."

“Decision analysis to carry out a high-level valuation and establish the range of consideration, commence preliminary engagements with potential buyers and financiers"

“In the first 18 months, with assets up to $4.5 billion, the government should appoint an external investment banker, legal advisor and financial advisor to identify and test transaction principles with key buyers.

“They should establish the transaction process and execution timeframe and assess market conditions for the transaction,” the report explained."

Sam - Good find - a lot to digest in your last post of extract from This Day Live Newspaper Nigeria.

https://www.thisdaylive.com/index.php/2023/06/11/tinubus-policy-advisory-council-proposes-sale-of-nnpcs-stakes-in-oil-and-gas-assets

Alari/Sam245 - Yes, I always have been invested even from Poland - I like to think that the difference between your comments and mine is that I post, without abuse, what I can glean from the current circumstances and poor company reports as to what is actually going on and then let other investors decide for themselves what is happening down in Nigeria - the oil is there that we all know but what Fanning and Jite thought would be an easy ride to wealth isn't turning out to be in any way easy!!!!!

If Eroton did manage in some way to load Eli Akaso with significant volumes of Oil, as we now know Eroton in fact did hire barges as has recently been reported in the local press, as having been unpaid by Eroton, the question arises where is that oil now? World Shipping positioning reports from last year indicated that ELI spent some time anchored off Togo in the area of Lome a well-known location for "out of the ordinary" ship to ship oil transfers at the time I wondered why Eli spent some time or even was ever in just such a place - just saying?

It seems OML18 ownership/operation is due for to morph into something we won't even recognize but to quote OF at least we own 10% of OML18 and of course we have Eli either way we should be able to survive?

https://punchng.com/nnpcl-takes-over-oml-18-as-efcc-investigates-eroton/

https://punchng.com/capital-market-operators-call-for-nnpcl-listing/

It seems Eroton is straddle with over US 80 mio of debt.

" Although there had been issues with the NCTL pipeline, Eroton is said to owe both Shell and Aiteo over $80m in outstanding levies and all the barge operators it had hired to evacuate the crude".

CJ : Further to your last comment -

https://punchng.com/stock-investors-demand-reform-as-capital-flight-persists/

Extract from the Punch article :

"Uwaleke, who is also the president of the Association of Capital Market Academics of Nigeria, added that the Buhari administration can also boost activity in the capital market by implementing the privatisation of government enterprises such as the NNPC Ltd through the Nigerian Exchange".

CJ- you are correct the government is "pushing" NNPC in the direction of being listed on the Nigerian stock exchange with all the benefits of disclosure and open financial reporting - the new trend on Nigeria to draw into the economy more overseas investment.

Alaric - yes, Sahara reporters says it all even if today it is old news.

NNPC have always been our nemesis - they controlled the cash flows to such an extent that there was none left over for minor shareholders such as SLE even in the "good days" i.e. the period when the "old school/guard" whatever you want to call them considered they could do whatever they personally wanted to do and get away with it including Eroton's Jite. This maybe about to be change after Buhari's drive to privatise the oil companies and make their behaviour more visible and responsible to a shareholder base than they ever have been in the past. Originally OF was attracted to Jite's local power and opportunistic ability for arranging things in Nigeria where I would suggest that the game plan was for SLE to become a major Nigerian oil producer financed through the London market with Jite/OF/Tosca being at the top of the tree. The Seplat company based in Nigeria/UK was just such a business model that OF wanted to emulate and although they were successful initially are currently undergoing a difficult time (the English CEO had his work visa withdrawn and now operates out of UK). Whether all OF/Tosca plans/machinations become a reality remains to be seen now that current bank balances are getting depleted- as they say watch this space. ??

CJ - I agree with your last post and the subject is clearly presented - misrepresentation of the actual situation SLE finds itself now completely bogged down in. I have still retained my shareholding in SLE since way back from the Polish days although one way and another it is now much reduced in size and of course in value although I did top up an incremental amount recently - a wild gamble you might say however if this OML18 ever gets around to producing oil again one way or another the share value could increase considerable.

Alaric Extract from your post of 19 May 2320hrs - Quote - "BS, i did a lot of project finance in my professional career and the one constant i learned about it was that lying rarely paid off. more for you to chew on. don't get indigestion now". end of quote.

Nevertheless Alaric, having said all that we look forward to welcoming you and your troll back - one has to say you kept us all amused if not misled by your postings while we have been patiently waiting for Afrex to come up with the bank loan to Eroton, presumably the "loan agreement" will now be invalid since Eroton has lost its status in the JV agreement as official operator of OML18 - back to square one then, is it? The loan OF could draw on OF for 50 mio isn't going to cut it given Eroton's massive deficit, it could go towards to completing the FSO and ELI pipeline but why should OF or anyone else commit until the JV agreement is sorted out.

CJ - that is exactly what happened - Alaric dismissed the fertilizer issue with disdain when fact after Notore overhaul and maintenance it was a revenue earner for Sale.

CJ - that is exactly what happened - Alaric dismissed the fertilizer issue with disdain when fact after Notore overhaul and maintenance it was a revenue earner for Sale.

Afamefuna - Sorry about that my browser is slow loading and jumping about all over the place.

Yes, interesting case doesn't come as a complete surprise - in fact for a long time now I have wondered what was going on down in Nigeria with all the loans/cash floating around and of course the bank in Mauritius - still you would think OF last year's salary of over UKP 1.0 Mio adequately compensated him for all the hard work he has been involved in while setting this current enterprise up in Nigeria.

Afamefu

Alaric - Thanks for sharing your in-depth education and knowledge you received from the study of such academic works as the handbook "Law for Dummies". Did you perchance further pursue your higher education with the book "Project Financing for Dummies" In the case that you did could you answer the second question of my last post, where are we to obtain financing to recommence the operation of OML18 as such entities as the Afrex Bank or any other financial institution for that matter has shown little interested to date in financing us, the capital sum would have to, of course, include the amount to pay off Eroton's outstanding debts which I understand are in the region of Naira 24 mio?

It's a "slam dunk" that the JOA (Joint operating agreement) for what it is worth has to be followed in the Nigerian courts against Eroton's removal - which is presumable where we are today. The problem remains where is the money to commence barging oil from the mystery mother ship to Eli and to reopen the wells so that OML18 can start producing oil again. I suppose if Eli is in reality ready to receive oil SLE could go touting for business from other Delta oil producers who may want to use ELI's as a storage/export facility which could generate some income directly for SLE.

Quote from Punch newspaper 7 March 2023.

https://punchng.com/oml-18-nnpcl-jv-partner-sack-eroton-as-operator/

The "mother ship" might not be as full of oil as we think - it looks as though all oil production ceased when Eroton could not evacuate the oil to either Eli or a mother ship and it was this which eventually formed the basis of the dispute between members of the joint venture that ultimately led to their attempt remove Eroton as operator of OML18.

Barging operations did not take place because Eroton did not have the funds to do this and/or JV members refused financing for the barging operations.

Quote from Punch newspaper 7 March 2023.

" From 2016 to date, OML 18’s net crude oil production has significantly fallen from approximately 30,000bpd to zero production, despite consistent compliance to the joint venture’s funding obligations by the JV partners over the same period,” NNPCL stated. It continued, “In recognition of the impact of the challenges in crude evacuation via the Nembe Creek Trunk Line, the operator proposed, and partners approved an Alternative Crude Oil Evacuation Process by barging. Eroton is unable to execute this alternative, leading to the current zero production status of the asset."