Member Info for cautionyourblast

First of all, like everyone else here, I'm delighted.

The notes 6-10 of the Exxon financials on pages 42-43 give a flavour of what contribution is added on day one (before workovers). Even at current crude prices (12m lows), revenue for a year should about equal or exceed the 2021 numbers. Costs look alarming at first blush, but there's a big chunk for writing down of assets and also deferred tax (due to difference between tax book value and accounting book value). There's also the sharing of costs with Petronas and the SOEs (JV cutbacks). Leaving out the tax mess, I reckon net O&M, staff costs and other admin total about USD110m and then interest expense on the loan will probably be about another 15-20m. This looks good in the context of a healthy oil price (the OPEC put) and field ripe for workover and infill drills.

They disclose that production rates in 2022 are similar to 2021 and also that Petronas is,still on and expected to close in H1 2023.

Some big assumptions go in to all this, but if Doba prices hold up, you could see the 170m debt going to zero in the 24 months implied in the docs.

Hoping for a move to 33p ish on Monday (pure guess) and steady consolidation from there.

Best wishes, everyone.

One pound and a pile of dividends.
Yeah, mister White, yeah science!

Buy the periodic table.

Ten business days from the. RNS seems to take us to the eve of the long-stop date.

Under ICSID convention, the award in arbitration is binding upon the parties and rules state they can't go elsewhere to appeal. This would suggest we are in the last season of this soap opera. In Cameroon at least. That said, the arbitration could take some months.

A bit annoying. It rather means that the asset may become "free" by the time various exit squabbles are settled. Quite how that would affect the commercial dynamic, I don't know.

It's a bit of a rum do, tbh.

Trading Economics, not Capital Economics.

Well I certainly hope I'm incorrect, Zen!
If I am, I can wholly blame Capital Economics...

I'd predict, that come the longstop date (which I understand from other posters here to be 13 December), we either get operatorship or things are at least made clearer.

...and SAVE announced the deal at the start of June 2021 when shares were suspended.

I'm guessing not a lot of production has happened since. But I also assume the midstream revenues remain as other punters want to use the pipeline to Kribi.

Entirely possible that I'm reading too much into this, but Doba Oil Project gross production (the thing that Exxon operate that we're trying to buy) was advertised at 33.7kboepd in 2020 per the 13 Dec 2021 RNS. Drop in national production per the Capital Economics data between June and July 2021: about 30kboepd or so.

Of course, this is all conjecture. But we've collectively dinged every other topic to death.

Morning all.

https://tradingeconomics.com/chad/crude-oil-production

If this doesn't make Deby keen to get on with the transfer to SAVE to increase oil revenues to the Chadian treasury, I don't know what will.

https://www.reuters.com/world/africa/junta-set-stay-power-after-chad-delays-elections-by-two-years-2022-10-02/

Get ready for the bulletin board to be inundated with numpties once the deal closes.

Thanks very much, MT. Given operational gearing, its not difficult to see upstream cashflows being 50% higher (or more) on the basis of these prices. Of course, that assumes the nodding donkeys have been nodding since Jan 2021; komakino's post obviously highlights the issues well.

Chad government to Exxon: "We're done when I say 'we're done'".

I've been back to the 13 Dec RNSs on this and revisited the maths.

Gross consideration is usd676m in total.

Exxon had oil cashflows and pipeline divs totalling 358.9m for the 42 months to 30 June 2021; Petronas 335.4m.

Assume the deal closes 31 Oct 22 and is effective 1 Jan 21: 22 months. Outrageously conservatively, assume the average realised oil price for that 22 months is the same as the earlier 42m period. Assume Exxon produces the same daily quantity and ships the same through the pipeline for third parties (could be less, in fairness; what's in it for them?)

That gives me an adjustment to the consideration of usd363.7m, thus reducing the consideration to usd312.3m.

If you were to increase the cash flow from oil sales by 50% then consideration goes down to usd172.8m.

And, as StreetsOfGold has pointed out, Doba has realised a decent premium to Brent in the last couple of years.

Btw, in FY2020 Exxon's realised oil price was usd35.3/bbl, Petronas usd44.8/bbl. Obviously it would've been higher on average in 2018 and 19, but the average price since 1 Jan 2021 has obviously been a lot higher than the 42 month period for which cash flows are quoted.

I could make this a much longer post, but just wanted to give a sense of what may be coming. Perhaps others will come up with different conclusions.

Huge assumptions in all this, no accounting for service and maintenance, capex, tax, o&a, etc. Amd i dont know the detail of the SPA, of course. But you get the idea....

Best wishes to nearly everyone

Nigeria production v encouraging.
CC deal still live: good
Accugas refi and Niger detail still pending: not so good.

A bit more news in the seemingly endless Chadian version of Game of Thrones.

https://www.msn.com/en-us/news/world/chad-fm-resigns-citing-disagreements-with-ruling-military-gov-e2-80-99t/ar-AA120FsQ

I've read everyone's recent posts with interest, for which thank you.

I haven't sold down any of my position and do not intend to do so absent news.

The Chad deal is in everyone's best interests. Exxon want out: you can hardly see the head of Exxon Africa knocking on the boardroom door in Houston and saying that, for whatever reason, they have to keep ownership; one would imagine a frank Texan conversation would ensue.

Chad must want the deal, they need the revenue and the prospect of increased revenue, more jobs too...and that's before the renewables deal that comes with the same well-funded developer. We clearly still want it to happen. Maybe the employees don't want it to happen at the moment, but there's often resistance to such change and how much leverage do they really have.

I suppose the removal of Deby would throw it into serious doubt but, even then, is Exxon just being forced to plough on? Deby obviously isn't in the position to sign off just yet. I wonder if it has been mentioned in the plenary. I'm sure other players (jouers?) would love to gazump, but I can't se that happening at this stage.

Just some thoughts, perhaps I'm being too simplistic / Walter Mitty-ish.

Best wishes

Whoever is in charge needs money and is unlikely to sequester the asset since they got to finance and staff the thing with people who know what they're doing.

https://www.thisdaylive.com/index.php/2022/09/14/nnpcl-set-to-sign-7000km-gas-pipeline-contract-with-morocco-west-african-countries/

SAVE posted this on its LinkedIn account. Whilst it's interesting, any potential impact for the company is surely in the long-term and highly contingent on all kinds of other matters. The posting of it might suggest that there's no material company-specific news in the nearish future, but I'm probably reading too much into it. Some clarity will surely be revealed on 30 September, particularly on Niger. I don't expect anything new on Chad by then.

https://www.voaafrique.com/a/tchad-le-dialogue-de-r%C3%A9conciliation-nationale-prolong%C3%A9-de-10-jours/6733587.html

The national reconciliation dialogue launched two weeks ago by the military junta in Chad and supposed to end on September 20 has been extended by at least 10 days due to numerous interruptions, according to the agenda adopted on Tuesday.

The young General Mahamat Idriss Déby Itno, self-proclaimed Head of State at the head of a Military Council of 15 generals in April 2021 on the death of his father, President Idriss Déby Itno, immediately promised an inclusive and sovereign National Dialogue (DNIS) to lead to "free and democratic" elections at the end of an 18-month "transition" renewable once.

The national dialogue encounters difficulties in Chad

Postponed several times, the latter opened on August 20 in N'Djamena despite the boycott of the majority of the opposition and two of the most powerful armed rebel movements. Plagued by numerous interruptions, it still has not begun its substantive work. A new agenda submitted by the Presidium, the body responsible for directing the work of the DNIS between the civil and armed opposition and the junta, was adopted by the Plenary Assembly of some 1,400 delegates supposed to represent all of Chadian society.

“Given the number of themes and the plenary debates which may go beyond the forecasts, we cannot keep the date of September 20,” spokesman for the Presidium Limane Mahamat told AFP. “We rolled out an agenda with the different stages taking into account the suggestions of the room, which gives us, for information, a closing date of September 30,” said Mr. Mahamat.

From penknife strokes to promises

At the end of this definitive agenda, the work in committees which will notably have as themes social issues, peace and national reconciliation, or even fundamental freedoms, should begin by Thursday. In addition to the vast majority of the political opposition, many civil society organizations and professional orders boycotted the dialogue or withdrew from it shortly after its opening.

Propelled to power after the death of his father killed while going to the front against rebels on April 20, 2021, General Mahamat Déby had dissolved Parliament, dismissed the government, repealed the Constitution, immediately promising to return power to civilians in "free and democratic" elections after a national reconciliation dialogue including "all" the opposition and "all" armed groups. And to which he had promised not to appear.

But in June 2021, he took a first stab at his promises by considering an 18-month extension of the transition and handing over his "destiny" to "God" for a possible presidential candidacy. Since its independence from France in 1960, Chad's history has been paved with coups and rebel offensives.

I was quoted twice in the 2020 report from Stuart Murray which used a lot of comments from here. Since TigerByTheTail sadly disappeared, quality posts on this bulletin board have been far fewer so there's less quality feedback for the management team to consider which is a pity.