Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Maldini, the two are very different: The BOOT & FEED are proposed to be financed by the Spanish consortium & all those costs to be repaid from a very lucrative deal that should see the consortium handsomely rewarded - & rightly so. But if we continued with our 47.5% equity our share of the drilling costs would be prohibitive & raising cash on the open market at our diminished value would not have been possible. We maybe should have farmed down much earlier - post TE8? But its the same old story...keep going whilst your star is riding high. Maybe we should have learned from the old maxim of repairing the roof whilst the sun shines...raising money when your value is high - but you will always get arguments against & this is pure hindsight...if it wasn't we would all be AIM millionaires!!!!
Partridge, I absolutely agree...the last thing we want to see is production revenues going anywhere other than into projects that compensate beleaguered shareholders: this means pumping money into exploration wells; very low HQ costs & restricted G&A...including wages. I'm all for production/exploration bonuses but let's keep the costs to a minimum for now & see how we can proceed. This deal can work if we work towards it. The main thing to bear in mind is, as private shareholders, we do not accept any form of further capital raise through share dilution...this deal seems to offer just that. I would not tolerate any further call on shareholders that dilution route but I will support a farming down of our equity position in East Morocco. In hindsight, 47.5% equity was way too ambitious & something of a 'pipe' dream (pun intended). We never could have supported our 47.5% equity position in the event of actually having to stump up costs for further drilling or going 'long' to 1st gas. This deal, though maybe less sexy, does at least mean we are fully funded for production & hopefully, plenty of exploration...the Tendrara Basin has still to be unlocked & there seems to be confidence that we can do it...
Let's see what we have to vote on first at the EGM...............
I don't understand why folk would want to draw a dividend on the cash amount we receive on farming down 51 % of our equity. I do understand we would all like to see some profit but surely that money would be far better employed as CAPEX for our drill program. Once we get to 1st or 2nd year revenue then maybe a dividend should be paid. But let's retain as much cash as we can to drill the faark out of the Tendrara Basin!
Testpack, dont flatter yourself...you are deluded if you think they weren't just telling you what you wanted to hear. Your scenario would never happen because IMV, this deal suits the Moroccans & our major shareholders. Besides, who on earth would finance Sound Energy to the tune of $200 million or more..........this deal will go through & we just have to hope that we can retain that 9% & that exploration is able to run in tandem with production. This deal can work if we shareholders are thrown a bone or two........
I wonder if they can work 2 rigs - one for production & the other for exploration - simultaneously. Some questioners have attempted to ask when exploration could take place but regrettably, there was no useful expansion on this very important shareholder concern. We are advised that first gas could be year-end 2021 but somewhere in that timeframe, I am sure we would want to see AT LEAST one exploration well! However, I do hope they do not go down the route of paying a dividend too soon as this could compromise our ability to strike more gas - because as beleaguered shareholders that's what it is all about if we stand any chance at recouping real money!
Zig, Mohamed is acting CEO & James is no longer on the Board! This is effective right now. The 'Nominations Committee' will confirm Mohamed as permanent CEO in due course. The Arabs have a short but sweet saying: "It is written"...I believe the fate of Tendrara is/was written a while back & Mohamed Seghiri is the Prophet to take us out of the wilderness...but who knows!
Pontcanna, James is not "at the helm". He wont be taking part in the FSC - that will be down to new CEO Mohamed Seghiri & Brian M. James won't answer any questions because he is no longer on the Board but he may be abroad.
Gregory, you think I played a blinder - yet here I am holding all my shares - contrary to what Jones alleges, which is totally misguided. My interests are just as aligned as every shareholder invested in Sound.
BTW, good advise StMary...anyone not interested in what I have to say can filter away..............please do!
Lyndon, I don't know but it has been suggested here that it is not. I am very busy at the moment because I am getting things sorted for my annual pilgrimage to Dartmoor & the FSC is low on my priorities...I even have an appointment with a Private specialist at the same time in my local Hospital so will have to catch up later. Although there are zillions of things to do before one can finally get away I still want to make time to see the films 'The King', 'Ford Versus Ferrari' & 'The Good Liar'...if I can see all three this week & still remain sane when I finally drive off to Devon it will be a result! BTW, I think the FSC is a good thing but I would not be surprised if JP is not involved - he is no longer CEO - Mohamed Seghiri is!
Lyndon, if there are still problems with the FSC app I would suggest testpack emailing Sara. But I now want to read an explanation of the merits- or not - of testpack's suggestions. I will post this as a question but not on my behalf, as I consider it half- assed, dimm witted & not anything I want to be associated with!
Testpack, I fully expect you to ask James, or whoever, at the FSC, why they did not retain 47.5% & go down your route of financing first production & multiple exploration wells. I am almost tempted fo ask on your behalf! The amount of CAPEX needed to raise without releasing equity is staggering...but I now need to hear it from the horses mouth...so you can be reassured. But be assured, I will laugh when the answer is given...like a Cadburys Smash robot!
Trellis, I understand the RNS in terms of the finance/equity swap...what needs clarifying is who will be 'operator'; who are the private equity investors & what is specifically covered by the whole deal - inclusive of the contencious 9%? What are the envisaged timelines re production & exploration drills & who sits on the 'Nomminations Comittee' that will ultimately decide who our next CEO is? No doubt there are so many more questions......
Think about it - what do you think the alternative is Lyndon? A very low-ball offer - versus the powerful forces behind the scenes that want to control Moroccan hydrocarbon interests? The 'Horst' alone could represent 60% annual Moroccan gas production. I feel there are far bigger forces at work that are not necessarily unaligned to our interests. Tendrara was always way too big a project for an AIM minnow trying to support a 47.5% equity position. The new equity deal fairly represents what a very small-cap company could have hoped to have ultimately achieved in the first place. Maybe it was too good to be true & maybe we were a litle too ambitious & possibly a little too naieve - but this deal brings the stark reality of junior AIM explorers into sharp focus & realism. I get it...but I also get that others don't get it........................
Testpack, if you truly believe I am a paid company ramper you are not only misguided - you are conspiracy fantasist with stalker tendencies! Ever since I invested in Sound a decade ago I have tried to be as involved as I possibly could. Initially, this meant contacting previous incumbent CEO, Gerry Orbell...but since that October 2012 coup, I decided to strike up a relationship with the new CEO, James Parsons. I feel after all these years I have got to know him & I can attest that much that has been written about him recently is either untrue or not representative of the man I know & what he has tried to achieve with Sound Energy. I truly believe he tried his very best to build a successful company & put his heart & soul into it! There is no other 'side' to what he attempted to do, with shareholder interest uppermost in his heart. He spent 8 years trying to build a company - & when Italian bureaucracy seemed to be strangling those ambitions he was fortunate enough to be able to jettison that strategy in favour of something much more promising - East Morocco. But as O&G investors know from bitter experience, the odds of success are stacked against success. Yet after the success of the Horst production concession, three unuseful wells followed: a sale of the assets was, as promised, undertaken & we are now about to be asked to scrutinise & then vote on the result of that sale process. But James has stood down because of the violent threats meted out to his family & I can fully understand that. Besides, he always guided he would hand over leadership post the 'LE' process. Many folk here are nursing big losses/paper losses but there was no malice of intent to deceive & I feel the company are trying all they can redress our bad luck & give investors a chance to ultimately recoup some/all of their losses. This deal should see Sound Energy fully funded with no chance of future dilution but with excellent partners & a new CEO who is perfectly aligned & by nature of his Moroccan birth - a perfect stakeholder! I look forward to scrutinising the details of the deal when it is published.