Member Info for edgar222

Baramara

Rofl.

I have always thought Aminex are safe from takeover because Ara own 30%, are the operator and when they first bought into both Aminex and then the licence said they wanted to use Aminex as their vehicle for getting into East Africa.

Like Sainsburys saying they wanna use Jim's corner store for breaking into the market of a new country.

So far Ara as good as their word.

1meteor

Correct. But the income from sales wont stop and wont be spent on development as much as it is currently. Plus, phase 2 will increase income as well.

1meteor

I disagree. It is enough to pay off the bond.

There is a £65m (it might be $) injection under thr farmout when phase 2 commences.

Baramara

Thanks for the WEN tip off. In short the authorities might not approve the takeover of Wen.

Could it be that Tanzania are so impressed with our little consortium that they want Ara to takeover Wen?

Total wild speculation on my part. So shoot me. Am just joining the club.

From my own calculations based on upcoming production levels even at the lower rate just announced and at the lower gas prices that are current, there is no issue with repaying the Bond in late 2024.

The bond issue is covenant breach before that. O see that as low risk and easily negotiable given the repayment ability.

Of course, that depends on spending. If IOG can get into phase 2 development under the farmout they have a lot of money coming their way (is it £65m?). Which would mean the income from production can be banked and not spent and go towards the bond repayment.

The real risk for me (with thanks to more knowledgable posters here and elsewhere) seems to be the issue with the lower flow at the new well. It is potentially a mechanical issue. But that is to be confirmed. Which means not reservoir damage. There is no sign of reservoir damage, no water ingress, but I think the market is doubting the geology generally given the problems to date. If the reservoir is sound that will go a very long way to reassuring on the geology and is (I think) more important even than increasing the flow rates. We will know soon what the conclusion is and whether it can be fixed. Thats the potential re-rate event (positive or negative). Thats all a bit binary. But thats the risk we assume when investing in O&G.

Seems to me the operational difficulties and confirmation of the sound geology and reservoirs are way more important than the Bond at the moment.

GLA.

...is a coming.

The market does not believe the story is happening. Yet.

These little bits of news falling into place will change its mind. The GSA is little to me. Compared to seismic and drill results. But it is very significant the speed of it being signed off. LTHs will know the years we waited for the last one on a different licence. Yet more evidence the Govt is fast tracking things.

Any newcomers, take a look at Roger Jolly's list of upcoming newsflow. Its all about to accelerate.

GLA

Sorry posted on wrong board. Oops. That was Aminex not IOG.

Apologies.

...is a coming.

The market does not believe the story is happening. Yet.

These little bits of news falling into place will change its mind. The GSA is little to me. Compared to seismic and drill results. But it is very significant the speed of it being signed off. LTHs will know the years we waited for the last one on a different licence. Yet more evidence the Govt is fast tracking things.

Any newcomers, take a look at Roger Jolly's list of upcoming newsflow. Its all about to accelerate.

GLA

Jamtart

I certainly remember talk of migrating oil and the Mike Rego video springs to mind. He thinks there is an awful lot of the stuff in East Africa. Somewhere.

That is a lovely blue sky hope and it may turn into reality. Total gamechanger as you say.

But. The reason I am concentrating on the gas, the numbers, the funding and the plans is that those ARE reality now. Finally. Funded reality.

But fingers crossed for oil too!

Best

ICB888

Note the basis of valuation now....

From the numbers its 2tcf found. Operator estimate currently 8tcf. So do we multiply fair value by x4 if that is profed up?

From the narrative in the note its clear that the current fair value is only bassed on current and near term news. Which is fair enough. But proving up much more gas as well as fully carried full field development will blow those numbers out of the water.

Obviously I dont know whether they will prove 8tcf at Ntorya. But I do know the seismic is about to be announced and we are about to drill again. Both are routes to significantly increasing the numbers. Ara are a private company. They dont have shareholders to impress or a market to sell the story to. Why would they estimate (pre 3d seismic) that there is 8tcf of gas there? Unless that is honestly what they believed.

.....long overdue.

Should be posted every Friday. Don't we think?

I also say 8p is just the start....

Lots depends on the target via seismic then drill.

And I say 8p this year.

https://twitter.com/sadaatumar/status/1661985079839674368?s=61&t=qBcoKadtpeaziPRqZIXyxg

With this news today from SCIR I hope I am wrong that Ara are waiting for completion of the deal. It would be reasonable of them to wait, imho.

There may be a glimmer of light within today's RNS as it does contemplate payments being triggered faster under the deal because of progress on the ground and with the development. Which reads to me as though SCIR are not expecting Ara to wait for the deal before progressing. For what that is worth.

Seawolf

Agree with every word.

GLA

Name them!

(There arent any. Its 50% Ara/Zubair, 25% each Aminex and Scir)

They have every incentive. They want the Scir %age. They dont want a licence default to lead to the reversion of the Scir 25% to the govt. There is no downside to Ara in funding any tax bill out of the consideration for the deal. There is considerable upside, the deal goes through quickly.

The deal is with the taxman in Tz.

They slapped Aminex for a tax bill that was dubious. Ara sorted out the finances to keep the deal on the road. I suspect the same is about to happen to Scir. It would onviously be in Ara's interests to either lend the amount of the tax bill to Scir or just take it out of the first tranche of payments due for the sale? Ara keen to keep moving forward and not delay.

Either way I suspect a find raise for these purposes is unlikely for Scir. (Never held Scir, held Aex for years)

Obvious typo. We are not coming to the end of Q3 now!

Scir guided for completetion of their deal to sell their share of the Ruvuma licence in quarter 1, 2023. That was in December 2022.

On the 2nd March they said this

"although it is possible that this may slip into Q2 2023 rather than the previously guided timeframe of Q1 2023. We will provide an update in due course."

Coming to the end of Q3.

We know that the deal is with the Tz taxman. We know the Tz taxman hit Aminex with a dubious bill that Ara helped out with in order to keep the show on the road. Could the same be happening with the Scir deal?

It must be close to completion?

It has always felt obvious to me that the deal is the penultimate regulatory hurdle and it is very important to Ara and Aminex that it is completed before next major steps and expenditure. I believe the completion will be followed by the granting of the 25 yr development licence to Ara/Aex, which has been talked about in the last few Aex RNS. That licence will be the last major regulatory hurdle removed and will, hopefully, be the green light to announcements, drilling, development and sales. Taking the Tz bureaucracy out of the process will be a major step forward and removal of a brake.

GLA