Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
It was a related party to Colm which I do view as positive. Maybe his mum, younger brother or girlfriend's parents. If this wasn't going to go commercial I'm sure he would have quietly told them not to buy!
I'm with you on this one. TG has form with his last two companies and that to me is the most positive factor. They have been working on this since 2008 and I'd imagine they get rather annoyed at various shareholders wanting that immediate high price! In early 2021 they will look to sell to a major O&G or power company and that's when we all cash in our shares. I too would like a higher share price at the mo as I have both shares and a spread bet going. Both are underwater, but I'll HODL. As we keep saying it's the flow rates that will trigger the rest. So, flow rates, PPA and then funding. After that we'll keep getting updates from new wells and these will enable people to put a value on the company. Once at 10MW and selling electricity - the big fish will come looking to buy. I'm a hold. Even if L3 and L4 don't produce I'll still hold and add another year to when I'm able to cash in. Hell I've been holding gold since 2010 which has traded sideways for almost a decade. But in the last 3 months it's been on an absolute tear! Now at all time highs in sterling.
Anyone know what happened to the flow rates detailed below? This is a report from Jan 2015. Has this been put on hold pending the PPA? This would be enough to run 2Mw. From the worldcoal.com web site:
"Coalbed methane (CBM) exploration company, Tlou Energy, has achieved peak flow rates of 395 000 ft3 of gas per day during production testing of its CBM Selemo Pilot in Botswana.
Notably, the results to date indicate that the economic threshold for a potential development has been met when all key factors are taken into consideration.
In November 2014, the company started to flow gas from Selemo with the rate building as the well bore environment was gradually brought into equilibrium with atmospheric conditions.
The Selemo Pilot is the first in Botswana to flow CBM at these rates."
TG's interest is ultimately to sell the company. The share price will start to reflect that at some point. I don't think he has any interest in changing his strategy to give a short term boost to the share price, as he'll be sacrificing strategic victory for tactical ones. I would love to be seeing the price tick up right now, but it won't until we get the gas flow rates and PPA agreement signed.
So I just revisited the Proactive Investor interview with Colm. Regarding the gas flows he used the phrases:
'going really, really well'
'progress, extremely happy with'
and in terms of announcement of flow rates he said:
'very soon'
'real soon'
I'd be surprised and disappointed if these announcements take months and if they turn out to be duds.
I know what you mean. I should be viewing this as the last opportunity to buy at these prices, but emotionally it worrying to simply see the price fall over the past 2-3 weeks. There is an old saying 'the stock market is the only shop, when there is a sale on, all the customers run out of the door'.
Holding shares it's no real issue as one just needs to sit tight. Trading say through IG is more fraught especially if you have a stop above zero! Personally I've done a bit of both - ISA is maxed out so I've put a small amount into IG. Didn't expect these past two weeks though. Thought the price would tick up if anything. I suppose there is zero interest except for us die hards, with the final weak hands being shaken out by the lowering price. I've noticed that Tlou tweets get between 20-40 retweets and maybe 2 or 3 comments. That's extremely low interest bearing in mind what a compelling story they are.
I'd say the recent interview where Colm said they were very happy with the flow rates which they would be in a position to announce very soon (prob not exact words but close) is to me as strong a hint they can give the market that the rates will be good. I'd say that is the only missing piece of the puzzle regarding their route to market, as the rest is pretty straight forward. I'd say that like crypto, this one is a HODL. :-)
Good find, thanks for that. So flow rates to be announced 'real soon', tender finalised soon - I guess it's at Bots govt pace -, and funding before year end but hopefully sooner. Very interested banks. Also interesting that they now only need $10m not $15m for the 2mw project. All good news, and my guess is they will start to generate power maybe Q2 next year. That's when things will get really interesting.
Sky is the limit in my view. I'd say that good gas flow rates and the govt contract could take the SP to the high teens or low 20. Connected to the grid, with decades of gas (Tony mentioned that on a recent podcast) then it would look like a takeover bid. TG sold Arrow Energy for 3.5bn, Sunshine Gas for just over 1bn. So this could easily be above £1 in 18 months or so, if some of the majors are sniffing around.
@pickwick:
Women are mysteries no more!
https://therationalmale.com/the-best-of-rational-male-year-one/
So I was looking at the price drift down last week, and found it odd that there were far more buyers than sellers. Maybe something to do with the market makers? Anyway I decided over the weekend to look at where are are right now with Tlou and what is the path to Tlou being a major producer. I went back through the RNS, some podcasts and analysis documents. Most of you will already know this stuff but I wanted to put it into chronological order if only for my own clarity:
So current situation is:
They have won the tender for up to 10MW of power, most likely starting with 2MW (20th May). Final details of the tender are still being negotiated. Details TBC. Plan is for Tlou to start small and only commit to selling up to 10MW at the agreed price. Cash generated from power can fund expansion. This is one route (favoured) into the Southern African Power Pool, as they have also applied as an independent supplier. I assume the latter route is the plan B.
19 June, Lesidi 3 reached CDP. 10 July Lesidi 4 reached CDP. So my assumption is that gas flow rate for L3 will be published approximately 3 weeks before L4.
Tlou is fully funded until mid-2020.
Tlou is fully funded to explore their 9,300 sq km of concessions.
To build the power line they need $15m, which they will not do from share dilution. TG mentioned the Botswanan Development Corporation. I'd say that is the logical route as they can get a govt loan to cover $15m. Assuming that this loan will be dependent on final tender award and flow rates. Environmental impact statement has been approved but they still need full environmental approval (which includes landowner approval) to build the power line.
So we await:
L3 gas flow - TG mentioned commercial flow rates in coming months, although it possible we may get something such as 2P/3P estimates sooner.
L4 gas flow - see above.
Tender/Contract details - any day now.
Funding for power line
- a break as this now all gets built, but with concurrent exploration taking place.
Powerline up and 2MW produced and sold
Expansion to 10MW.
At that point TG said they would look for a partner, which might really be a buyer.
Critical are the L3/L4 flow rates, which has been described as the critical risk. But he also said that they should have decades of gas flow.
Last notes. They managed to get power from gas in Lesidi in 2017 and, L3 and L4 were picked as the geo surveys suggested they would have a high chance of containing gas. Dewatering took longer than expected which suggests that the coal has more fissures than predicted which is positive for gas flow. Short term recent gas flow in L3/L4 (not sure which or both) tested positive.
In view of the above, although there is no certainty in this world I'd say this has a v high chance of success. I'd say if L3/L4 proved to be dire, the company could still recover but the share price would take a battering it may take 2 years to get your money back and they would have to fund via dilut
Maybe that's why it was taking so long. Could be the regulatory body was holding things up/looking for a bung to approve the procurement process. In the end the gov gets annoyed waiting so long for the announcement. I know for UN procurement, all awards have to pass a regulatory body before contracts are signed. Maybe these guys were a spanner in the works?
Great news, thanks for the update. Looks like both will win something as per a lot of previous discussions. Just checked the ASX but no trading yet. Be interesting to see what this does to the price. I'd expect a rise tomorrow, then another once the deal is announced, then another for the flow rates (once announced). Although I'm really stating the obvious. Lots of waiting about to pay off.