JV Partner AGM, thanks to Crusty2 Jun 2022 12:30
Morning all,
Yes I did attend the AGM yesterday; one of only 6 shareholders to attend - what a disgrace :-(
Well, perhaps I can answer this and some other questions as part of a summary. Please look at yesterday's presentation for reference.
- The 3D seismics have not yet started but are "imminent" - (brave last words eh?!)
- The Board are extremely optimistic about the possible results and have suggested that they believe they will act as a sp catalyst
- The positive expectations for the seismics and the "pipeline" of activity over the next 2 years until Q4 2024 was what enabled the board to raise £4 at the last capital raise.
- The timescales for production in Q4 2024 are easily achievable and are likely include two new drills after CH1 and before production.
- It is expected that NT2 will be brought back on stream through re-entry, though maybe not NT1. (NT2 has considerable upside potential, NT1 not so.)
- Negotiation of GSA planned for completion by Q3 2023, though any timeframe difficult to predict with great accuracy
- The outcome of the GSA discussion will determine such things as whether the gas will be bought "at wellhead" or whether we pipe it to Mtwara and / or sell it direct to market; this discussion will determine the price and who will be buidling the "pipeline"
- If we sell gas "at wellhead" then we will be reliant on TPDC for pipeline build cost and the timing thereof
- The Board would like to be able to sell gas direct to maret (e.g. Dangote etc) but cannot dictate this - it will be GSA dependent
- Good news is that they expect to get a lot of "condensate" from existing and any future drills; this would necessitate them building facilities "in situ" to be able to capture and collect this condensate but this is extremely profitable and they would expect to be able to sell it to anyone.
- It is anticipated that all onshore gas will be used for domestic market as there are no LPG faciliaties due anytime soon - the closest option is to piggy back on the LPG facilities in Mozambique (when they are clomplete) but that would require piping the gas to Mozambique and not something that is likely to happen in the short term
All of the above very good news but here are some realities.
- There is NO CHANCE of remediating KN1 (no ****3 sherlock) - the compartment that they have drilled has little remaining gas and no pressure; this will NOT be resolved by re-perforation and compression
- Because of the above they have no chance of getting a JV partner!
- The seismics that they receive from the ORCA tie up are very valuable ($2m) and are expected to prove where they should next be drilling - i.e. a spur from KN1 or a brand new wellor perhaps both.
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