Member Info for CF73

In Cape Town, both H.E. Minister Max Tonela and ENH will promote Mozambique’s emerging Liquified Natural Gas (LNG) sector, emphasizing projects such as TotalEnergies offshore area 1 development in the Rovuma Basin – whereby Total managed to secure the largest private debt-raise in African history, securing approximately $15 billion in financing –, ExxonMobil’s Rovuma LNG Liquefaction plant in offshore area 4 of the Rovuma Basin, and the $8.6 billion Coral South Floating LNG project. With capacity pegged at 13 million tons, 15-16 million tons, and 3.4 million tons of LNG per year, respectively, these projects have positioned the country as a globally competitive natural gas giant, and the Minister and ENH will emphasize this to global stakeholders.

“Mozambique represents one of the leading natural gas destinations worldwide. Despite delays and project uncertainty, the country is committed to scaling up security, driving foreign investment, and accelerating both project and socio-economic growth. With the Minister leading a delegation to Cape Town in November, including the state-owned ENH, Mozambique will be showcased to the world, and the country will take up its rightful place as a globally competitive gas producer,” stated NJ Ayuk, Executive Chairman of the African Energy Chamber (AEC).

Meanwhile, Mozambique has all the ingredients to become a regional energy producer and distributor, with major pipeline and power projects enabling the transportation of critical natural gas and electricity to neighboring countries such as Zimbabwe, South Africa, and Zambia. The country’s significant resources are critical for rising regional demand, regarding both petroleum and gas-to-power. Pipeline projects such as the 865km Republic of Mozambique Pipeline Company Project– linking Mozambique’s Pande and Temane fields to Sasol’s operations in South Africa – and the South African Power Pool have enabled the country to become a regional gas hub. With the implementation of the African Continental Free Trade Agreement in January 2021, the country is able, now more than ever, to accelerate regional gas trade, serving as a trend for other emerging natural gas producers in Africa.

By bringing the Mozambican energy industry to Cape Town in November, both the Minister and ENH will showcase the country’s current and upcoming projects, promote its role as a regional natural gas producer and distributor, and emphasize effective strategies for the safe and efficient resumption of project activities in Mozambique.

AEW 2021, in partnership with South Africa’s Department of Mineral Resources and Energy DMRE, is the AEC’s annual conference, exhibition and networking event. AEW 2021 unites African energy stakeholders with investors and international partners to drive industry growth and development and promote Africa as the destination for energy investments.
Distributed by APO Group on behalf of African Energy Chamber.

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Mozambique has been identified as one of the most promising energy sectors globally, with lucrative natural gas reserves positioning the east-African country as a globally competitive investment destination. With Africa’s premier energy event taking place on the 9th-12th of November 2021, Mozambique is committed to promoting its resources, securing further investment, and accelerating regional economic growth, and will join the east-African producers in Cape Town at African Energy Week (AEW) 2021.

H.E. Ernesto Max Elias Tonela, Mozambique Minister of Mineral Resources and Energy (MIREME), will led the Mozambican industry delegation to Cape Town, promoting the role of the state-owned Empresa Nacional de Hidrocarbonetos (ENH), as well the country’s significant projects, abundant investment opportunities, and strategic position within the southern-African regional trade network.

Mozambique rapidly emerged as a competitive investment destination, with its significant energy reserves, prime geographical and demand placement, and market-driven approach to energy sector development. With over 100 trillion cubic feet of natural gas reserves, the largest untapped coal reserves worldwide, and one of the largest hydroelectric facilities in Africa, the country has positioned itself as both a hydrocarbon and renewable energy leader. Despite development delays caused by the COVID-19 pandemic and political insurgency in the northern province of the country, H.E. Minister Max Tonela’s is committed to accelerating energy sector growth through ensured operational security, public-private sector collaboration, and regional support.

ENH, as the state-owned entity responsible for researching, prospecting, producing and marketing petroleum products in Mozambique, has been an instrumental organization in the country’s energy transformation. Representing the state in petroleum operations, and with a core mission to add value to natural resources through commercial participation, ENH has positioned itself as both a leading African state company, and key driver in Mozambique’s energy growth.

In addition to a proactive and committed state-owned company, global energy majors are working collaboratively with government to drive Mozambique’s energy sector growth, and the country is well on its way to lead Africa in the move towards natural gas. Participating companies in Mozambique include TotalEnergies, ExxonMobil, Anadarko Petroleum, Sasol, Chevron, BP, Petronas and China’s CNPC. By focusing on public-private partnerships and sector integration, both the Ministry and ENH will emphasize the value of collaboration in enhancing energy sector growth.

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Have said it myself, that this is in reality a PR stunt. They are/ were buying time. China remain on whatever course they were on before.

Cheap as chips right now!

Powerchina still there. China will not want to walk away from 6, 000MW and a high quality coal deposit feeding the plant at minimal cost/ overheads.

Good RNS. Is all they could say at this point. But those of us who said from the beginning, that those comments were not as yet policy, let alone practical implications for what is happening right now.

If Bangla give go ahead, then no way China turngin down 6, 000MW and a high coal deposit. And I reckon conversations with Powerchina progressing well.

Upside from this point is at the level of multi-bags. Downside minimal now.

Would be interestng to know what CMEC and PowerChina (as directly representing the Chinese state) are saying to their respective partners (i.e. NCCL, GCM etc). I know that NCCLs PR have told NCCL LTHs the following:

"...we were aware this move by China was on the cards. We have been and remain in close communication with CMEC and our understanding is China will not take on any new projects but will continue with those that are advanced."

NCCL is very advanced. I would also not class GCMs project as new.

Also, NCCL PR have also forwarded the following, which appeared in a formal, susbcription based publication:

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"...we were aware this move by China was on the cards. We have been and remain in close communication with CMEC and our understanding is China will not take on any new projects but will continue with those that are advanced."

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President’s Xi’s comments were (as one of the news article’s carrying the story pointed out), ‘vague’ i.e. “The move would take away the largest remaining source of money for international coal projects. But details, including when money will stop flowing, are vague.”
https://gizmodo.com/chinas-xi-jinping-says-country-will-stop-financing-coal-1847718585

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Am holding NCCL, which took a hit too, following Xi's 'vague' comments (more PR than substance).

10. Am going back to what CMEC said recently; “Following the recent positive progress with all parties, CMEC is pleased to have signed the power plant EPC contract as committed this quarter. This is an important milestone for the Project and CMEC is committed to working with Ncondezi to deliver the Project in the near future.”

Note – “…all parties”.

This has to include the Moz state and EDM. And off the back of this, CMEC are saying,

“…CMEC [i.e. the Chinese state] is committed to working with Ncondezi to deliver the Project in the near future.”

Some thoughts (some of which I’ve said already):

1. World Bank have progressed with awarding infrastructure contracts, that connect to a power source in Tete, which in turn is expected to carry power out regionally, on to Malawi. There were two parts to the contract (though same bidder awarded both); one part for the Mozambican side: the other part for the Malawi side (now awaiting news of contract award for the substation)

2. There are no other advanced projects in Tete but NCCLs. If no project happening in Tete, then why go as far as awarding contracts to build the infrastructure?

3. CMEC, our global Chinese partner, have only just signed the EPC with NCCL

4. CMEC are essentially representing the Chinese state. When CMEC says we can go ahead and sign the EPC, is because the Chinese state has said, we can go ahead and sign the EPC.

5. CMEC have only just said, "Following the recent positive progress with all parties, CMEC is pleased to have signed the power plant EPC contract as committed this quarter. This is an important milestone for the Project and CMEC is committed to working with Ncondezi to deliver the Project in the near future."
https://www.investegate.co.uk/ncondezi-energy-ltd--nccl-/rns/power-plant-epc-contract-signed/202109090700021851L/

6. President’s Xi’s comments were (as one of the news article’s carrying the story pointed out), ‘vague’ i.e. “The move would take away the largest remaining source of money for international coal projects. But details, including when money will stop flowing, are vague.”
https://gizmodo.com/chinas-xi-jinping-says-country-will-stop-financing-coal-1847718585

7. Elizabeth, NCCL PR, said the following; “The company was fully aware this was on the cards. We have very good communication with CMEC and it is why it has been so important to demonstrate the project is an advanced stage project. Our understanding is that China will not take on any new projects but it will continue with those at an advanced stage like ours.”

Having very good comms with CMEC is to have very good comms with the Chinese State. Dealing with CMEC on a project this big is to be dealing with China directly, IMO.

8. Scott Fletcher’s talk of ‘binary bet’, I don’t buy it. For me, those comments are designed to take the heat off the company.

9. Genuine, material progress, as listed above, shows that parties are pressing forward with the full confident expectation that the project will happen. Otherwise, a) why would be the World Bank – with all their scrutiny – award contracts to build infrastructure if Moz can pull out at the last minute? And b) why would CMEC – representing the Chinese state – go and sign the EPC if, again, Moz can pull out at any time they choose?

[Continued...]

Company PR has exlained that this large trade is a committed holder, re-organising their portfolio - that they are not a seller.

My guess too, the last of the Placing Shares. Agree though, how can they get rid of that many Placing shares when demand for shares is limited in comparison to selling pressure?!

The thing is, unlike most AIM frauds, NCCL has massive backers and parties involved, from AFC (largest African infrastructure investor in Africa) and Polenergia (largest private energy company in Poland) to working with CMEC/ Chinese State (and am guessing, GE). Not to mention some major HNWIs like Scott Fletcher. Not forgetting, WORLD BANK overseeing the building of our infrastructure (with contracts being awarded as we type!)

More than any other time, if the project was under material threat (resulting from this statement), am sure it would've been difficult for the NOMAD not to force NCCL to issue an RNS.

I would buy but no filthy lucre.

As it is, no RNS means that earlier positions/ news on good progess (EPC) must still hold true and demonstrably so (for the NONAD).

Really sorry to hear you have sold up at a loss, GGG. Too many good folks been hammered here. But I still remain convinced the project is going ahead, looking at specific news from NCCL and CMECs comments, as well as World Bank proceeding with the infrastructure contracts. Still though, company could do with reassuring LTHs, especially after their commitment over the years.

Glen, that quote is from company PR person via a Twitter Group.

If you are on Twitter, we could invite you to the join the group...

Remember these comments from CMEC in that RNS:

"Following the recent positive progress with all parties, CMEC is pleased to have signed the power plant EPC contract as committed this quarter. This is an important milestone for the Project and CMEC is committed to working with Ncondezi to deliver the Project in the near future."

https://www.investegate.co.uk/ncondezi-energy-ltd--nccl-/rns/power-plant-epc-contract-signed/202109090700021851L/

10p SP buyout price equates to £40m. CMEC can afford twice without flinching (got to remember that we are coal mine - with billions of tons of high grade coal - and a power plant). So how much (i.e. price) is actually being discussed?

Hanno has rarely paid attention to the SP and to maintaining shareholder value.

After years of missed deadlines – with shocks along the way (i.e. GE), we then have that very long period of silence.

Then EPC lands, only for nasty placing the following day. All of those placing shares not yet sold and then also have to be churned.

Now this general comment from China’s Xi.

Is now fortunate that we are cashed up, with £600, 000 in the bank from that ludicrous Placing. With, by now, our operational costs reduced (most of the work is done), we can stick it out.

Whatever the current SP, feel nothing has changed in terms of prospects for NCCL. Just a case of the final buyout price.

My views, in short,

- SP performance chronic
- NCCL/ Hanno performance tragic

However,

- Xi’s comments are ‘vague’/ general. This is a future looking statement, not impacting on existing, advanced projects.
- NCCL literally only just signed the EPC, with Chinese state would have had to have OK’d

That said,

- ‘Market’/ MMs, need and invite volatility
- In light of general concerns with coal and failure of Hanno and Co. to repent a strong enough narrative around progress and events, NCCL has remained open to volatility and attack.
- Market/ MMs have taken advantage, following some initial spooked sellers.

For me,

- We remain on track just as we were before;
- EPC signing recent and a much more specific, truer reading of the situation
- CMECs comments about ‘near future’ emphatic and more accurate taking into account our project situation than Xi’s rather more general (‘vague’) comment.

Finally, NCCL PR has commented (which I believe are an accurate assessment/ representation of the situation):

“The company was fully aware this was on the cards. We have very good communication with cmec and it is why it has been so important to demonstrate the project is an advanced stage project. Our understanding is that China will not take on any new projects but it will continue with those at an advanced stage like ours.”