Member Info for Brasso3

There is no cash in Argentina to repatriate!

over reaction?

The total debt is now $34m and they cannot move $ out of Argentina! We are now dependent on oil prices staying above $80/ barrel.

It is not clear what amounts we have at each rate but lets assume we have fully utilized the $4m at 10.5%.

$4m at 14.05% = $0.56m
$7m at 16.05% = $1.12m

Total interest payment are $1.7m per year. The US is targeting another 0.75% increase in rates next month so Libor likely to go up also.

The US 6 month Libor rate is now at 3.55%. Our borrowing costs on the IYA loan are now at 14.05% - 16.05%!

Extract from the 2021 annual report:-

IYA loan facility

The Company has made use of an unsecured revolving loan facility made available by IYA Global Limited, a subsidiary of PLLG Investments Limited which is beneficially owned by the Company’s Executive Chairman and its largest shareholder, Peter Levine. This facility is subordinated to the Company’s external bank facility.

The total amount committed under the IYA loan facility is US$20.5 million with US$16.5 million at a 10.5% interest rate and additional borrowings of US$4.0 million at 12.5% plus 6-month Libor in line with previous bank borrowing. The facility is repayable in December 2024.

Quite a way below expections then! No wonder they were keeping quiet. They are only announcing this now as they will be forced to release Argentina figures next month due to the bond committments.

'The three new wells at the Puesto Guardian Concession, Salta Province, Argentina are all on stream and each producing in the range of 125-185 barrels of oil per day.'

22nd Sept 2021 RNS:-

'Each well is estimated to cost US$3.5 million and have a drilling time of 45 days with a mean success case initial projected oil production of 40 m(3) /d (250 bopd).'

23rd May 2019

In Paraguay, the farm-out process continues whilst preparations are underway in any event to enable drilling operations to commence at Delray Main in late Q4 2019 or Q1 2020

30th September 2019

It remains the intention that exploration drilling will commence in 2020.

22nd June 2020

The planned drilling in Paraguay scheduled for 2020 has been deferred into 2021.

26th August 2020

There is of course no guarantee that such discussions will result in mutually agreeable definitive agreements being signed but, in the event they do so proceed positively, it is currently anticipated that definitive agreements would be concluded before the end of this current year with commencement of drilling during 2021

26th October 2020

Farm out discussions in relation to the Pirity Concession, Paraguay are continuing with a national oil company with a view to drilling an exploration well at the Delray complex of prospects next year.

22nd February 2021

Paraguay farm-in discussions ongoing, targeting completion during H1. Initial well planning to drill the high impact Delray complex exploration well within next 12 months

24th August 2021

Drilling is expected to commence in the first half of 2022 at the high impact Delray complex of prospects internally estimated to contain 230 MMbo of unrisked oil in place.

So they generated $34m in revenue in 2021 but still needed an additional $13m in debt to cover CAPEX.

They raised $9m in 2021 and $4m in 2022 through bonds. The 3 well drilling programme in Argentina was supposed to cost $10.5m. It does not add up I am afraid. So where is all the cashflow from 2021 FY and 2022 H1?

If PPC is profitable why has total debt increased to $33m?

Consolidation then placings...

Someone else on ADVFN usually posts them. I will copy and paste them here when available.

No chance of getting an RNS on this until mid August!

The figures will be available on the Argentine government website in about 2 weeks time.

The problem is not Atome and our interest.

The problem is we have to keep investing large sums in Argentina to keep production in the 2500 - 3000 BOEPD range and do not get exposure to market oil prices.

A better strategy would be to announce a debt reduction plan to pay off the high interest IYA loan ($11m at 12.5%). PL is taking $1.8m a year off PPC in loan repayments and a salary and the market cap of the company is around $40m.

20th April 2022 RNS:-

'A further independent sub-surface study commissioned by President in March 2022 placed a 17% chance of success on the Tapir prospect. Of course this means also a high chance of failure and this correctly reflects the grounded attitude which investors must adopt in relation to exploration.'

Thanks to Piperpeter on ADVFN:-

REPORTE DE PRODUCCION.
PRESIDENT PETROLEUM S.A.
NEQUINA + NOROESTE.

Febrero '22......Petroleo 6.695,529 [m3]
Marzo '22........Petroleo 6.703,412 [m3]
Abril '22........Petroleo 6.503,667 [m3]
Mayo '22.........Petroleo 6.634,636 [m3]

Febrero '22......Gas 3.527,889 [Miles de m3]
Marzo '22........Gas 3.530,081 [Miles de m3]
Abril '22........Gas 3.432,339 [Miles de m3]
Mayo '22.........Gas 3.401,796 [Miles de m3]

I wonder where the share price would be today if we had of just paid off the IYA loan instead of spending $12m+ on these 3 Argentine wells?

Darian

I was responding to a post from Drichi:-

'Market cap should be at least $100M I reckon which = 8p a share. So hey even a $50M market cap would male the SP 4p (which is a very low valuation by most multiples of EBITDA)'

Drichi

A market cap of $100m (£80m) would be a share price of 3.8p. Sorry to be a killjoy but I like to be accurate!

£80m / 2,058,000,000 = 3.8p

Some new posts on the Twitter feed.

A poster on ADVFN has stated they sold a holding of 3m in chunks of mostly 250k.