Member Info for CF73

This is definitely the right time to be buying/ adding, on a dip, just ahead of a news rich period...

Looking forward to the upcoming days and weeks as lots of BIG news due!

What baffles me is that I had ZM down as reliable and trustworthy, certainly as far as AIM standards go (I think you have thought similar Phil). I also cannot see how FRR could have resisted Georgian authority barrage without ZM, inclusive of all those appeareances in the media, requiring ZM with his vested interests, his language skills and his understanding of the political terrain. So these recent actions, on boths sides (perhas insitgated by one, to begin with), don't make sense --- but then again, with FRR, what has :D

Good posts Chris, measured, balanced, while demonstrating the prospects and massive upside from here.

I also get GGGs point. In the past, whenever we have seemed to be appraoching a watershed moment, we either get limted 'half-measure' news - to use GGGs words, or indeed, outright bad news. In each of those moments, the market had taken notice in the build up, with decent buying pressure, only to be thwarted by poor-to-bad news. The SP should be double digits by now but is not for likely that very reason.

This said, I am more confident than I have ever been. Clearly a lot going on behind the scenes. Indeed, never before had Hanno discussed the possibility of the sale of part or all of our 40% stake. This is really big, and would not have been mentioned if it were not a real possibility. So is a massive sign!

Historic Costs out is a big sign, too, and even more so the holding back of the confirmation of the full amount, seemingly ultimately linked to various other projects values, in some respect or other. A great sign, here, showing things building very well.

For what it is worth, I agree that double digits are on their way and very soon, with the rest of the year likely to be extremely good for those holding.

Good luck all!

Indeed Lancaster. Indeed, the coalmine adjacent to our power station also, critically (and which will be also what you mean), supplies our power station, ensuring the cheapest, most reliable supply of coal/ fuel, ensuring in turn the best possible margins for the entire project.

Remember that Germany, Norway and World Bank are paying $127m to fund the Moz-Malawi Interconnector Line, linking Tete (where our proect is) to Malawi - where Moz plans to install 300MW Tete coal-derived power by 2023, another 300MW by 2026, 300MW more in 2034 and then the final 300MW by 2038 (where we are the only coal fired power project in sight).

Cannot see how VALE's move has any implications for us, as our conversations and parnership working processes are live and have been moving forward progressively and productivey, with the support of all major relevant parties (from EDM to CMEC to World Bank etc.) -- all knowing fully well it is coal we are working with. The only limiting issue has been that it being coal, has meant it has generally been a harder sell to the market (hence why we not above 10p already, in my view).

GGG, thanks for the response. There's always a great deal of thoughtfulness in your posts, even when in disagreement - is appreciated!

As you rightly point out, company is on record saying they could, at some point, sell some or all of their 40% stake. This is very likely. A few of us feel very possible they could relieve themselves of the full 40% - I certainly think it is very possible.

If an outright sale were to happen, what do you think could be the final sale price - i.e. price per share?

If NATO membership happens, then there's clearly a joined coordinated political effort that must surely involve situations like FRRs (and we know they do), including collaborative working between Georgia and the Western energy and corporate interests. The short of it is, if Georgia join NATO, then the question of the PSA may in turn be resolved fairly easily (as in our PSA issue is part of the broader matter of Western interests in Georgia)...

GGG, you are absoluetly right to mention that apart from Historic Costs, the rest is potential. I was just trying to give a sense of the proportions here.

I have always that the company help us with two key things;

1. Determining/ Understanding Value

2. Conveying certainties

--------
Regarding No.1
For quite some time, has been difficult to get a sense of the growing and overall potential value. Few numbers have been in the public domain. Even at the Binding JDA signing stage. when we thought the/ some numbers would be presented, they were missing and the SP tanked. With Historic Costs (HC), we finally have some of that and has been very helpful. Indeed, with HC, it has finally been possible to get a solid foundation under the SP. More to come...

Regarding No.2
Using various bits of offical news and research, we can work out that the project extremely certain. Just that, according to due process, Moz/ EDM, NCCL and CMEC cannot just come out to tell us is a done deal. But there is no way NCCL and especially CMEC would have contributed so much unless they had bagged the project. As it is, we learn that 'that all other power projects have fallen away' and that NCCLs tranmission study has substantially informed the Moz-Malawi Interconnector Line/ Transmission Infrastructure (why would NCCL spend its own money on that Study unless the Moz-Malawi Interconnector Line would benefit the company?!)

So, just from that, we know no other projects in the area; and that we have had a direct role in the development of power infrastucture lcoally, regionally and internationally, connecting Tete; from where, we know from the Miz Power Plan, they expect to achieve a total 1200MW of coal-based power by 2038, with 300MW coming on line 2023, 300MW more 2026; and then 300MW more by 2034 and another 300MW by 2038.

So, yes, there is a hell of a lot we can learn from what is out there, to give us a) values, and b) get an idea of project certainty.

For, project, sold completely, is worth 40p minimum; and that the project is close to 100% certain (given that Norway, Germany and World Bank have just pad for that infrastructure).

This is why folks should be buying now (especially now with HC numbers on the table). You wait for Tariff approval or PPA, and most of the upside is gone.

Historic Costs c.$26.7m, from RNS

"Ncondezi has been able to demonstrate US$26.7m of historical expenditure on the Project."

Then add

- Subscription Fees
- Developnent Fees
- Our 40% stake
- GridX

We should already be 10p +

Key news due, and any time now. Should nudge the stock's share price nearer to double digits.

GGG, yes, there has been slippage. But not to the extent of 12months. Going by Historical Costs (HC) they were perhaps 6months overdue. HC were due Q2 2020, and would say end-of-Q2 was realistic, and we got update end-of-2021, and eventual release of news at the very beginning of 2021.
Worthwhile revisiting the Jan 4 2021 RNS, where CEO Hanno says,
“With this work now complete, the Company can focus its resources on the tariff approval process with EDM and finalising the EPC contracts with CMEC early in the new year.”
https://www.investegate.co.uk/ncondezi-energy-ltd--nccl-/rns/us-21m-historical-costs-agreed--in-principle-/202101040700093202K/
There is a lot of major news to come near term. Going by my assumption, based on the HC slippage, we could be seeing FC much sooner than you think!
-------------------

GGG, am posting the timetable (from the April 2020 RNS) below.

https://www.investegate.co.uk/ncondezi-energy-ltd--nccl-/rns/ncondezi-project-timetable-update/202004150700066535J/

Highlights:

Updated Project timetable agreed by Ncondezi and its partners following submission of updated tariff proposal to Electricidade de Moçambique ("EDM")

Key target milestones for Q2 2020:

o Tariff negotiation concluded with EDM

o Shareholders agreement term sheet concluded

o Engineering, Procurement and Construction ("EPC") contract in agreed form

o Ncondezi historical costs audit completed



Key target milestones for H2 2020:

o Power Purchase Agreement ("PPA") in agreed form with EDM

o Power Concession Agreement ("PCA") in agreed form with Ministry of Mineral Resources and Energy ("MIREME")

o Shareholder agreement entered into

· Project Financial Close is targeted for H1 2021

Thanks for confirming that AlexE.

The 'Integrated Master PlanMozambique Power System DevelopmentFinal Report', Feb 2018, shows that a 300MW Unit is expected to come on line in/ by 2023. And then another Tete Coal-based 300MW in 2026. Then a further 600MW from Tete-Coal-based by 2038. That's a total of 1200MW of power Tete-Coal-derived power by 2038, with 300MW in place at 2023 and another 300MW by 2026 (where all other possible projects have fallen, leaving NCCL/ Ncondezi)

With power arriving into the Grid from our project by 2023, and we already into 2021, cannot see how FC can be end-of-H1 2022. Building cannot start until FC achieved. Surely not possible to build a 300MW plant in time for 2023, starting so late.

2021 is the defining year for company and LTHs, with lots of news near term.

The current SP does not reflect current value of the opportunity, with all the progress made, and the news out. There are no other projects in sight but NCCL, where they have started buiding the tranmission infrasructure, where CMEC and international donor agencies and banks are all involved -- what does that tell you?!

In terms of an end sale price, depends on what the exact terms are, but an outright sale nets minimum 40p per share in my view (and CEO Hanno is on record saying recently that a sale of some or all of our 40% stake might happen at some point). Could well be more, however.

It should have read:

'...where our - NCCLs - transmission study informed that programme' (i.e. programme to establish that transmission infrastructure/ Interconnector Line).

That piece of detail is telling.

The Ncondezi Coal2Power Project isn't simply a matter of Moz and China; lets remember that Norway, Germany and the World Bank have coughed up $124m for the Interconnector Line/ Transmission infrastructure connecting Tete (where our project is - remembering there are no other projects in sight), where our - NCCLs - transmission study informed that report.

I woud guess, confidently, that Norwya, Germay and World Bank wouldn't investing with cast iron assurances that there would be power running through those lines, where WE are the only party in town. SO, for me, no question this happening.

Just a matter of how much.

If a sale, for the lot, then 40p is perfectly reasonable. That equates to £146m - where we already have

+ c.$21m + $5.6m in historic costs accounted for;
+ Subscription Fee
+ Developers Fee
+ Our 40% Stake

That should come to quite an amount!

On possible future SP/ valuation of the company, worth remembering,

a) Historic costs alone $21m + $5.6m.

Then

b) Subscription Free

And,

c) Developers Fee

Then add,
d) Our 300MW the doorway to a total 1200MW!! (in the Moz Power Plan, 1200MW of power from [our]Tete derived coal

e) our 40% Stake, in this!

f) GridX (the right direction, given energy production/ security trajectory and attached, very favourable, investment climate)

Remembering, too, share options exercise prices of 7.5p.

Points to higher ultimate SPs than 10p.

Even 20p – i.e., £70m market cap (compare to historic costs total of $26.6m) – doesn’t cover it, when all of it is in.

We know that has been said by NCCL/ CEO, that our 40% stake or some part of it could be sold on. I think outright sale is compelling, given possibilities for a massive payday special dividend, with enough left over to more than adequately fund GridX going forward.

Have said before, I see 40p easily possible, with a sale.

Agreed Caterham.

I would add that this goes beyond simply Moz, NCCL and China. Worth remembering that German, Norway and World Bank paid for the transmission infrastructure linking our project [area] with, especially, Malawi (and the Southern African Power Pool). Their coughing up the capital would have been based on a number of assumptions, all of which closer to guarantees, requiring Moz to enable the appropriate power projects to take place (these power projects ultmately supplying the power expected to be transported by the Moz-Malawi interconnector etc.). In other words, you wouldn't pay for the infrastructure unless you were guaranteed (by Moz) that there would be power running through it. Moz are fully on board and under pressure from a range of international parties, including donors.

Next month to three is going to be really interesting! Take your positions...

GGG, thanks for the response, good post.

You say:

------------

"I'm not sure what 10% is worth but a very old broker report put it at $60m from memory. So giving up 20% of the project could raise in total $150-200m alongside costs and fees. I'm hoping they sell the whole thing."

------------

On "20% of the project could raise in total $150-200m alongside costs and fees." -- this is the kind of figure I have in my mind, though I had '$150-200m' as the total sale price. Caterham looked at scenarios and value, which I thought was interesting.

I don't see NCCL keeping the complete 40%. But exactly how much of it remains to be seen. I do think the prospect of a mega payday special dividend for investors and the opportunity to invest in and scale up GridX, make a compelling case for a complete sale. In the event of a total sale, I see that in the order of 40p to 50p per share (we may have 300MW on the table, but the project clearly opens rights/ doors to the further 1200MW coming out of Tete Coal, as per Moz Power Plan, where there is just us and no compeition in sight).

You also make a valid point about the spin off of GridX, enabling an uncuttered, easy sale of the Coal2Power project.

This will be a defining year for company and LTHs. Good luck all!

Was posted here, just before Christmas, that Hanno had said (in an investor call) that there was possibility to sell some if not all of NCCLs 40% stake. Am guessing this may be preferred option as it generates masses of capital, enough for a windfall special dividend (which many LTHs would welcome), whilst leaving an enormous amount for investing in the GridX project.

From Jan 4 2021 RNS:

"As the Project power tariff is currently being negotiated with EDM, both parties have agreed to finalise the historical development costs once negotiations with EDM have been completed, as this will also have an impact on CMEC's subscription price to be agreed for the 60% share in the Project and the Project developers' fee."

I was trying to work out if the Subscription Price and the Developers' Fee were impacted more directly by those tariff discussions with EDM or by the finalised approved Historical Costs (or some intricate combination of both?). Does seem though, by that paragraph from the RNS, they may already have 'indicative' framework/ formula for working out the final prices, where things are kicked off once negotiations with EDM are concluded.

Whatever way, selling our stake, plus historic costs, subscription costs and developers fee, amounts to quite a significant amount and believe is a genuine possibility based on what we know already (i.e. Hanno saying some or all of that NCCL 40% stake could be sold at some stage).

Anyway, good luck all.

No more massively dilutive fundraises possible as we have hit the share ceiling.