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They convert at 80% of 92.5% of the VWAP (or 80% of the lowest daily VWAP if that’s higher). So, at the moment, the lowest daily is about 0.50p and 92.5% of the ten day average is about 0.53p. So it’s 80% of the higher of those two options, around 0.42p

“ The 🚀🚀🚀🚀 willl come eventually. Just hold on for the ride!”

It’s an investment not a fairground ride.

Conversion formula around 0.42p after today (using discounted VWAP of 0.53p versus lowest single day of 0.5p). The first conversion was called when the VWAP fell below the lowest day, but obviously not a prediction.

Like any AIM share, new buyers will turn up if/when they think there’s a rise coming. ‘Mainstream investors’ rarely buy pre revenue AIM shares, speculators do, and they’ll probably provide the liquidity that the CLN holders need to exit, and MREX will probably help them manage that in an orderly way. There’ll be winners and losers but the company will hopefully make it into commercial production with minimal debt outstanding.

Good luck, hope that works out for you. Liquidity rather than price is probably the thing to watch with the CLNs. For example, the retail opportunity at 0.54p was pitched below market price but it generated a good bit of liquidity at 10% or more above the 0.5p CLN conversion price, so they were able to move most of their first tranche shares into that (although I think they might have fallen slightly short of washing the whole 200 million). Similarly if there are speculative liquidity surges going into the project production / appraisal operations there should be further opportunities to profit from further discount conversion (the price doesn't have to go up to make it worthwhile, as long as there are enough buyers).

Probabilities. In similar AIM-style CLN structures, 20–40% are converted in the first 3 months, and 30–50% are converted in months 4-8. These are much higher odds than those of you getting hit by a bus, I hope. But yes, the chances of conversion are also generally higher when there are price spikes driven by speculation or news.

Folio - the trades are literally labelled as delayed trades 'previously reported as SI'. They show as unknown 'buy/sell' on LSE because they're delayed not because they're mid price.

"I could get hit by a bus this afternoon but in my opinion that's as unlikely as any second tranche while at these levels and prior to plenty of positive news flow."

I think you might need to revise your probability theory.

If there was a second tranche conversion the price would be now somewhere around 0.43p

Yes, they’re using a different tactic today to mask the block being traded. These string of ‘unknown’ trades are all delayed reporting of trades originally marked as systematic internalisers (SI), which might be used to allow a large institutional trade to be executed without market disruption. It may imply a regulatory reporting delay. This will be result of crossing more CLN conversions off book, but could well be clearing the first tranche rather than new demand. Basically, manipulation to maintain an orderly market, not necessarily a bad thing. They do count towards VWAP but only when reported (today).

Remember the CPR is based on desk research using info supplied by the company. The timeline is likely from the feasibility study prepared April-September last year. I wouldn’t expect a start on the early production system wells until after the results of the appraisal operations in Q4 (notably because they would require additional funding).

Exploration is difficulty, expensive and risk. AIM is full of pre and early revenue companies that rely on capital raises. The only reason for companies to list on AIM is to access market capital that is not available from any other source, because it’s too early of too risky or too niche. Share prices are also more volatile and sentiment or news driven driven than on main markets. There can be sudden rises and often long slow declines. AIM companies often appear closer to revenue than they turn out to be, due to unforeseen delays, overspend or just optimistic market sentiment. HE1 is not untypical. They gave a good story and good prospects, and they’re very close to potential revenue in Colorado.

According to the RNS…

“…an investment agreement (the "Investment Agreement") with three institutional investors (the "Investors") that has been arranged by Marex Financial…”

The short term debt funds will want to derisk and turnaround their cash advance rather than accumulate. They’ll likely transfer converted shares to equity funds, which may be affiliates. The equity funds will want flexibility to drip shares back into the market, or hold to sell on opportunistic news price rises, or to accumulate towards significant shareholder influence. The first and second would be much more likely on AIM than the third, although it’s plausible.

Surely the CLN debt structure is the most important consideration for the market at the present time, and therefore not at all boring. I’m not sure what block busting news we’re expecting but looking forward to details of roadmap to Galactica production and Rukwa flow testing in Q4.

NHE are launching another exploration programme, still targeting shallow free gas traps (if there are any), which they have not discovered yet. It’s a different kind of play and would involve a different kind of processing if they discovered any gas.

The CLN conversion factor uses the higher of (a) 92.5% of the 10 day VWAP, or (b) the lowest single day VWAP. Currently that would be (a) around 0.57p. Then the discounted conversion price would be 80% of that, around 0.46p at the moment.

The 100m + 50m + 25m + remainder blocks most likely represent transfers of the first tranche CLN conversions (just under 200m shares) between the debt funds (the MREX ‘investors’) and their equity fund affiliates. The equity funds drip those shares back into the market or hold them opportunistically to sell into news driven price rises. When they’re settled they’ll call in the second tranche of CLNs, and so on.

Note that the market price dipped to match the conversion price formula (currently around 0.47p).

Are you guys buying more shares every day?