My synopsis21 Apr 2023 18:58
As stated previously we are not in phase 2 currently. The majors have signalled that they want to move to phase 2. They have paid the money and in effect nothing will really transpire until the end of negotiation one way or another. Omi and majors are in a negotiation phase thrashing out the details of what phase 2/3 will entail. A new company has to be formed and once that is formed then officially phase 2 is on. TP suggested that this was likely to conclude Q3.
This means currently there is no criteria for 4 million to be spent by September 2023. The details of the "new" agreement and "new company" formation will be made public when it is good and ready.
From what I can gather the majors wanted to change the terms of the original agreement. The details or terms of the changes I do not know. This is up for debate. Something that Omi were not happy with, or if the original agreement is to be changed then Omi obviously would want something in return. We can all speculate what these changes may or may not be.
Omi on the face of it are probably pushing to get everything resolved but at the same time I don't believe the majors are in any rush either. An impasse no doubt. One where one of the players will have to cede or come to an amicable agreement. Most likely this will be Omi at some point for obvious reasons. Clearly this has not been achieved yet. I doubt we will be seeing much engagement from Omi to the market until you see that Colombia update.
Now the terms that will be agreed in time (I expect) may be poorer or more advantageous to Omi. Who actually knows...but one thing I am categorically certain of is there will be fundamental changes. This could be timeframe of phases, exploration budgets, updates to market protocol etc.
Omi are working on El pantano and were working to a field works program there. They were trying to complete whatever was contained in the program before the winter season at Patagonia. I suspect, but might be wrong that they are holding off updating the market of these works, whilst negotiations continue. Main reason being that everyman and their dog wants a Colombia update.
I do believe that the negotiation will end and phase 2 will be entered eventually but I don't know when and I don't know what the terms will be. Clearly the majors have seen enough to continue the relationship from historic drilling, drilling results they've conducted and the sampling programs that have been undertaken.
I do have reservations the longer the negotiation takes, the more Omi's cash balance dwindles. The perverse side of me thinks this may be by design with the majors doing enough to keep the project in their sights, but not doing enough to let Omi's share price get too big for it's boots. Clearly in the event that they may wish to bid for Anza in future.
Sign In
Follow the stocks
