Member Info for DRB83

Steve, my and survivor have history so he'll understand it's just swings and roundabouts. JDW is a study case for me. I've done the analysis on the accounts and believe it is in a really difficult stage with current macros being against it for the last 3 years. I'm watching and monitoring to see how it unfolds but Survivor gives as good as he gets on other shares so he'll be fine.

A bold statement calamari, I'm sure you will have done the maths to support your zero cash left theory. Are you able to share the intricacies of it please.

To be fair EA, I went to great length to support my calculations and opinions. This allows you to pick them to pieces and return with your own thoughts and arguments.

Again, these calculations are just to show that the 2nd compressor is definitely needed imo. I believe/hope GL will be right and we'll have it by the end of the year but there are few dead certs on AIM so we have to be mindful of that.

Not too concerned with the sidetrack although it would be a huge bonus if we get it.

Thanks for the update Phil. No not come across EA until now. I've met many similar personalities though.

EA, I believe the 2nd compressor will be in place by 1st Jan and we'll be flowing at between 7-9mscf/D so I'm not expecting cash flow to be a problem.

I have said this many times.

Yanis, I do appreciate that my attitude was condescending towards a few posters in here and I can say that what I returned was a reflection of what I received but it's certainly not how I conduct myself during normal debates.

I have no agenda here. I am invested as most others. I will continue to challenge anyone posting anything I don't agree with whether they are deemed pro Angus or against Angs although I will aim to keep it more professional for sure

My only debate with you was that 5.5 wouldn't cut it as we approached Q1 and that we would for sure need the 2nd compressor to be comfortable. That was my point. We still seem to disagree on this point.

I've never disagreed with you on what the 2nd compressor or sidetrack will bring if/when they are brought on line. That is indisputable.

We know the hedge averages 5.24 in Q4 so anything less than that means no unhedged revenue. If we get 5.5 so an unhedged amount of 0.26 that's 24mscf unhedged for Q4 or 259k therms. At £2.50 thats £650k unhedged revenue and £2.75m hedged revenue. Total £3.4m.

I'm not sure on the current cash position but I do know that 17p/t is the op cost so for the 5.5m therms we generate in Q4 there's almost £1m in cost. I'll ignore admin and oil and condensate will cover those as per GL. So £3.4m rev minus £1m cost is £2.4m ontop of our cash position at 30 SEP. Don't know this but appreciate we have to pay £1.5m back for the loan. We also have the cost to install the 2nd compressor and the sidetrack so I'm assuming we won't be flooded with cash come 1st Jan23.

In Jan23 we hedge 5.19mscf/D. So running at 5 will clearly leave us needing to find cash from our Jan 1st cash pile. If we run at 5.5 then great but again the unhedged amount is just 0.31 so 104k therms at £3 gives us £312k unhedged revenue + £910k hedged so call it £1.2m revenue. Op cost will be about £310k so Jan profit of £900k. I don't know the terms of the deferred hedge from Jul/August but as you say it's worth c £8.4m or £2.8m per month. So again, the shortfall for Jan is £1.9m which we have to find from our Jan 1st cash balance.

There's likely to be a 25% windfall tax bill to pay probably some time in Q1 that will need to be paid too.

In Feb, we need to hedge 5.75 so at 5.5 that's a shortfall of 0.25 or 76k therms at £3 is £228k. The hedge will generate 1.7m therms or £900k revenue. So £670k net revenue. £300k op costs leaves us with £370k profit. Again we'll have to dip into our Jan 1st cash pile to cover the £2.8m deferred amount from Jul/Aug. Now I don't know how much the Jan 1st cash pile is but to cover just Jan and Feb alone you'll need at least £1.9m for Jan, £2.4m for Feb and probably £1.9m for March + any tax payment. So £6.2m cash required on 1st Jan to cover Q1. Obviously, we'll need more than that as a buffer say £1.5m so that £7.7m.

Q4 will only generate £2.4m exc any capex costs so I genuinely think 5-5.5 just isn't enough. Apologies for the lengthy post.

You seem bored this morning Yanis. Your payroll comment seems a little strange and clearly designed to reignite old arguments. I'm sure the BB will appreciate that very much.

It's good that you have moved on from the 5.5 saga and now going with the 10.5. imo you are flirting with ramping here as you seem to think the sidetrack is a dead cert. Been in too many shares to know very little is dead cert. Didn't even GL offer a word of caution around the sidetrack "even if it's a dud". It's worth sharing your views on what the numbers look like at 10.5 but you should always caveat them with a more prudent tone in case things don't pan out the way we hope.

You are obviously held in high esteem here and lots of holders hang on every word you say. You've built yourself into a high level of responsibility and it's important you treat that responsibly. Just my opinion and I'm sure you'll ignore every word of it.

When we start seeing the top number decline then you'll have a fair point but whilst revenue is increasing especially in such large % then imo it can't be deemed a failure. To be fair to GB, he's been rapidly growing the business through some serious headwinds so hats off to him for that.

A good reminder Louis. Now the cash is worth £53m and next week could be worth £45m, all whilst DA and JM sit polishing each others ..........

Some people were expecting 10mscf per compressor. GL mentioned a couple of interviews back that 5-6mscf is the range they are working to. In his last interview he confirmed this again and clearly states with 2 compressors and 3 wells we can get 10-12mscf. That for Angs is huge and this is what we should be basing our expectations on when the time comes.

For now it's 5-6mscf.
Jan23 with 2 compressors and 2 wells 7-9
Jan23 with 2 compressors and 3 wells 10-12

Over to GL to make it happen.

LL, net debt is not total liabilities as far as I'm aware. In there you'll have all sorts of accruals, leases and trade creditors.etc. Net debt is cash & cash equivalents minus short term and long term loans. I believe so anyway.

Donald Tramp talking as if she knows what she's talking about. Just nice round numbers. It means nothing. She'll either be right or wrong. It's a game of black or red.

Herbert, definitely a sensible price is 4-5p in 6-12 months. We are aligned with our expectations.

Hits, yes appreciate they have costs to settle over the next few years but one of my forecasts include the 2nd compressor which could quite easily generate £40m profit in the first year. That more than covers the costs you elude to and generates a profit.

Question for all. Are there any risks associated with installing the 2nd compressor or is it just a case of when not if?

WG, from your post

I suggest you have a listen to the investor one2one presentation where GL himself says they will take a couple of months break to drill the sidetrack.

I have not listened to it but I'm assuming plans have changed as a couple of months break now would kill the hedge. GL has committed to commencing the sidetrack in the coming weeks so I'm not convinced that a 2 month break is required.

Worse case if it was would be flexing the Q4 hedge and moving some out to H2. Mercuria may accept this as gas prices are dropping currently and Mercuria will likely benefit from higher gas prices in H2.

Then you'd have £3m costs for the sidetrack and £400k admin costs for the business. £3.5m costs with no revenue. GL has not mentioned anything about this recently so if he hit us with anything like that now then that would be the ultimate cheap shot and career suicide imo. Is it worth it for GL. Not with how bullish he is being recently.

Too close for comfort Howey imo. Q4 average is 5.24 ish. GL did say they will be creeping it up towards 6. We need at least 5.5 I'd say on average across Q4 just so we can have a little safety net on the hedge and start building a cash pile.

Did you manage to recalculate H1 with the deferred amounts?

WG, agree that Mercuria will take what they are contractually obliged to. The flex from Jul/Aug would have cost Angs something for sure. I doubt it would be £10m at this point.

The main point is that with the 2nd compressor inbound then both Mercuria and Angs are onto a winner imo.

Angs have an obligation to deliver to Mercuria and Mercuria need Angs to deliver it or they risk losing tens if not hundreds of millions. We're both on the same team working towards the same goals so at this stage I don't have any concerns as to whether the hedge will be met or how.

BV, new investors won't know what you've debated with WG over the past 5 years so unfortunately it's best to either ignore it or hit it head on with reasoned argument. The belittling and name calling just distracts from the facts and sensible opinions. You're obviously free to do as you wish.

WG,

With regards to my “fair to say” comment. A contract was in place and would need to be fulfilled for the amount agreed….. end off!!

Not entirely true. Mercuria have already shown they are willing to flex. They could have held firm and demanded the Swap value in July and gone legal on us but where would that have got them. It would have probably finished Angs and Mercuria would have got what a few million quid. This 3 year contract is likely to be worth £200m+ for Mercuria. They will bend over backwards to maximise it's potential. Albeit, if Angs do need to flex then there will be a cost but imo it's certainly not a case of "this is the contract and that's that".

BV, I thought you may have learned that it's that approach that makes things worse. WG imo has raised some valid points and through adult dialogue we can better understand the risks and rewards here.