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@Joshwaa
No offence intended, very tongue in cheek - no value added from my side at all! I appreciate the effort you and others put in to taking this share seriously and sharing insights with us, whatever we do with them.
In a nutshell: "I might hang on to these for posterity since though they're likely to be wrong, one of them might well turn out to be quite right!"
Sorry, couldn't resist!!
Thanks for these dai - great old school montage and deep voice over baritone!
Cleared up a lot for me... Not sure what I was expecting wrt wireline logging (someone shouting down the well hole and listening for changes in echo!) but really interesting all the different tests -- robust approach it seems.
Would be really cool if we get some visual of the well log graph at some point - perhaps once the entire first well is drilled. That'll be fodder for days for this BB.
In the meantime I'll be dreaming of a neutron and density porosity graph crossover!
Yeah, that's a pretty substantial amount outstanding, but on the plus side that's some juicy positive cashflow to fund ongoing exploration should they be exercised. Silver lining and all that
Just noting the benchmark discount rate used in Hannam reports is around 12% for their NAV estimates.Their sensitivity analysis (though I think they forgot to update it in the latest June update) shows what looks to me like quite a large deviation between e.g. 8% discount unrisked 166p/share and 12% discount unrisked 128p/share, almost 30% higher. This obviously makes sense given the project's expected to be a real cashflow generator for a long time and short term construction costs aren't such a cash concern.
My question for those who've been in the game, wouldn't we likely see a reduction in the benchmark rate used once the project moves beyond the appraisal and into the feasibility stage? This movement would imply that not only is the project de-risked (so we can use unrisked NAV), but the valuations would also be higher just by fact of using a lower discount rate.
My personal discount rate is lower than 12% (!) but obviously what matters is the market and what it feels the share price should reflect re discount rate. There're obviously larger market forces in the coming years which will make a difference (e.g. if money supply tightens, benchmark interest rates rise generally, etc.) but I'm hoping that once appraisal confirms what we hope is down there, Hannam (and everyone else) will be a little more generous in their analysis - and perhaps we'll see even more upside than expected! That being said, perhaps the risk premium given the project is based in Tanzania will likely mean it stays the way it is.
Just filter :) life becomes a breeze!
@dai, cracking responses to the few I've asked! Grateful to those who have the knowledge and energy to respond.
*wireline info of the lake bed formation depth
skittish, thanks for the comprehensive insight and again superb!
: 'the key thing is that the seepage is into the soil and not along a fault line, so it can only be coming from a trapped reservoir'
caveats noted, cautiously excited for the wireline info.
Thanks skittish, great post to keep me learning.
Follow up question on this: we've seen here in the prospectus and in the proactive interview today that microseepage / helium show is evidence of trap and seal. My question is whether it's possible to have microseepage, or microseepage with such high helium concentrations, WITHOUT a trap and seal? Obviously the seepage doesn't guarantee anything, but are there other geological formations which could explain this?
As always, grateful to those in the know.
Thanks dbd, this is really helpful. Every day's a school day!
Follow on question: would HE1 be measuring porosity and permeability using the wireline or from an analysis of rock and material that's brought to the surface through drilling, or both?
Again, appreciate the insight!
ST and WW
Very kind and super helpful, thank you! Will read up.
Hi all
First time poster, but have followed this BB for months, have a decent HE1 holding here. I've immensely appreciated the technical insights several of you have provided - thank you on behalf of all avid watchers!
I have what I hope isn't a question with an obvious answer: if there is a trap and seal and confirmed with pay zone, does this mean that there is literally a hollow space filled with helium sealed in, or rather it's likely that the rock and material below the seal is porous and contains a high concentration of helium? I'm struggling to visualise what to expect, though perhaps it's the thought of balloons that's filling me with excitement! And does the wireline logging merely test for the level of porosity (or actual technical term) and, combined with a flow test, this confirms the payzone?
Thanks in advance.