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There 's no doubt about it, I would consider this an absolute bargain at this price. i'll be adding more when I can
Most of the chat is in the telegram group mate
#EME operational update from Gaz with Pro Active
https://youtu.be/NWGVYoECnvc
what are you talking about Gaz Bisht has over £2.5m of his own money invested here, money that he has chosen to invest on the back of the technical data that he has seen and TK has 88m shares. That's a pretty big commitment and more than most AIM companies
Not at all ART, nothing really new to discuss at the moment. Most Shareholder are probably busy working out how they are going to be spending their new found wealth :-) Still holding tight, and very much looking forward to the coming weeks months
Its really hard to say, so many companies especially on AIM that are undervalued in the current market and very seldom do companies ever meet broker note values , however taking that into account I'd still expect 20-30p (conservatively) pre drill. If we get news on value on Duyung then possibly 40p.
If we hit gold then just think of a number and triple it
All guess work of course
One thing to consider is that duyung could potentially be worth the current mcap of the company. This makes the risk / reward very attractive to new investors. You could almost consider china as a 'free bet'
Sorry that wasn't the best choice of words. You are correct I meant it will be a brilliant deal, with the price of natural gas nearly tripling in the last 6 months. Id imagine the potential value of Duyung will be huge and much better than previously expected
Just a wee summary in simple terms on what’s currently going on with EME and what to expect in the coming weeks and months.
In July EME raised £5m in a placing to secure a drill rig for the Jade prospect, the first of 3 targeting 1 bln bbls in Block 29/11 offshore China, drilling will commence around the 15th Dec
The cost of the drill is £10m, the Subscription was at 6p with ½ ‘placing warrants’ at 12p that expire in 12 months, if exercised within 3 months subscribers would then receive additional ‘substitute warrants’ at 12p with a 15month expiry plus a ‘bonus warrant’ at 18p with a 24 month expiry.
If all warrant holders had exercised their ‘placing warrants’ at 12p that would have raised enough funds to cover the balance of the drilling costs. This didn’t happen and Tom Kelly has now put a 3 week extension period until 12 NOV.
What is Duyung and what’s happening there?
EME have an 8.5% share of a gas find offshore Indonesia that has been drilled, proven and is now being prepared for development. It is expected that news on a GSA (Gas Sale Agreement) is due to drop at any time, this will give a true value to EME’s share of the asset and would most probably trigger an immediate rerate.
Many people including myself believe the extension of warrants was to catch this news/rerate and trigger warrant holders to exercise.
In the current market I would expect the GSA to be outstanding, EME may decide to develop the asset, sell part or all of its share, this could very possibly result in a dividend to shareholders or funds may be used to drill the 'Topaz' the 2nd prospect in block 29/11 china.
What if this news doesn’t drop?
I’m absolutely certain that Tom will have multiple back up plans to cover the balance of funding for the drill, this may be a JV or a placing or it may be a combination of both. One thing to keep in mind is that Tom has 88m shares and Gaz has 32m so we can rest assured that however it looks it will be the best deal possible for shareholders.
should certainly be a very interesting couple of months
Nice to see some good discussion and activity returning to this board, the story is getting out there now, volume is returning to the markets after a quiet few months retired.
I think once the uncertainty of the balance of funding for the china drill is cleared up then we are in for a serious rerate, then there's the GSA news for Duyung which could drop at any minute. This share should never have been in single figures however I don't think we are going to be here for much longer.
Good luck all
Just to clarify the make up of the complex placing warrant scheme as per the RNS 9th July
The Subscription was at 6p with ½ ‘placing warrants’ at 12p that expire in 12 months, if exercised within 3 months subscribers would then receive additional ‘substitute warrants’ at 12p with a 15month expiry plus a ‘bonus warrant’ at 18p with a 24 month expiry.
So exercising say 200k of the 12p 'placing' warrants before 22nd Oct gives warrant holders an additional 200k 'substitute' warrants with a 15month expiry and 200k 'bonus' warrants with a 24month expiry
Hope that helps
Great post Paul
With regards to funding the balance of the drill it’s impossible to say how it will pan out, if all warrant holders exercise then that would just cover it, however I strongly doubt he will be relying on this.
As an example, if 50% of warrants are exercised then there would be a shortfall of around £2.5m, As you say I'm sure Tom will have something else up his sleeve to cover the balance.
I’d prefer a JV but a small placing couldn’t be ruled out, which I also have no issue with.
The question is how does he play it, if he has funding sorted then he could put out an RNS stating that if there’s a shortfall in warrant take up then the balance will be covered by whatever means. This would encourage more warrant holders to exercise. Or he waits until the 22nt Oct to see how many warrants are exercised then states how the shortfall will be covered.
The GCOS for jade is 41% as per Cenkos broker note, however the probability I would believe to be much higher.
This is currently a great entry point for new investors as I’m pretty sure that once the uncertainty around the balance of funding is cleared up this will rerate somewhat.
For the record I’ve just sent in the paperwork to exercise my warrants – I have faith
Hallowed, Are you a shareholder, or considering investing once the uncertainty around the balance of funding is cleared up?
I can understand new investors wanting this cleared up before investing, I'm certain that it will be cleared up in the next couple of weeks however the SP will obviously be considerably higher at this point. Good luck
Spud, you have just had it mansplaned to you about the additional replacement & bonus warrants and yet you are still asking why warrant holders wouldn't just buy twice the number of shares at 6p when the share price is currently 8p.
Sounds like you're the one that shouldn't be investing anywhere