Member Info for Exploration

My goodness a1m1 - try reading the Articles in detail;

First of all, your reference to allotment of shares is about award of options etc to individuals.

Second, you find the following qualification in CNRL and all other public companies Articles;

“Subject to the provisions of the Companies Acts”

If you read the Companies Act, you’ll find a general rule that existing shareholders in a public company have pre-emption rights to participate in allotment of new shares, sometimes at a discount. But they can also waive their rights to participate. That’s why shareholders are notified and asked to vote at a general meeting.

Fairdealer

Thanks. The FCA rules are designed to ensure directors act in the best interests of the company and treat all shareholders equally. It’s really basic stuff, although there are exceptions to compliance - that’s called fraud.

No sign of a response from elsewhere. Probably competing for ‘Wound-Licker’ of the Year, or Mr Egg on Face 2019.

Still, does hold the European ‘Arm Waver of the Month’ prize.

Suggest you take a look at any AIM company website which has raised money.

It’s basic FCA compliance and company law.

First, the company has to notify all shareholders of the proposal, timetable and use of funds.

At the same time the company must announce a time and location of a General Meeting where all shareholders can vote on the resolutions described in the Circular.

In practice companies issue proxy forms which enable shareholders to vote by mail.

Then, results of the GM are announced. Example below;

Cluff Natural Resources Plc, the AIM quoted natural resources investing company, is pleased to announce that all resolutions proposed at the General Meeting of the Company held today were duly passed. This follows the announcement made on 6 October 2017 relating to the subscription to raise £1 million.

Application has been made for 25,000,000 ordinary shares ("Second Tranche Shares"), which will rank pari passu with the existing ordinary shares in the Company, to be admitted to trading on AIM (“Admission”). Admission in respect of the Second Tranche Shares is expected to occur at 8.00 a.m. on 27 October 2017. The Company does not hold any ordinary shares in treasury and following Admission the total number of voting rights in the Company will be 396,060,199 ordinary shares. This number (396,060,199) may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

A few points;

Amtech mentioned working capital - a good point. The CFO of a public company has to keep a ‘weather eye’ on assets and liabilities. In simple terms, if liabilities exceed assets the company ceases to be a ‘going concern’ and will be bankrupt.

Current assets include cash, accounts receivable and any assets which can be liquidated in less than a year. CNRL’s liabilities include accounts payable, wages, acreage fees, OGA levy which are due within a year.

The big item which might need funding in the next year is CNRL’s paying interest in a well on P2437 where Shell would pay 75% of the first $25 million. That could mean CNRL raising just under 5 million pounds to participate and retain their 50% interest in the Licence. The p50 estimates of prospective resources in the Selene Prospect is net to CNRL about 3x the boe net to JOG in their Verbier discovery. If Shell does exercise their option on P2437, CNRL might raise money to stay in the game at 50% or decrease their equity to compensate Shell.

I dare say CNRL’s team has evaluated all the options and sounded out the market and major shareholders. Even if Shell does not exercise its option P2437 expires in October 2022 with plenty of time for CNRL to make progress.

Ok - they’ve screwed up their story again.

The JOG analogy was introduced to claim CNRL was contemplating a fund raise to participate in drilling with Shell, but before drilling. In fact, JOG’s Verbier oil discovery was carried by Statoil and the vertical well was announced as a dry hole, spelling the end of JOG. Then, a week later a sidetrack discovered oil and to maintain their interest, rather than default on an appraisal well cash call, JOG launched an accelerated book-build to pay for Verbier appraisal and Cortina exploration.

Please check dates a1m1

Verbier discovery announced 9th October and placing announced 20th October

Wrong again

Anyone can add up numbers - but it’s a case of ‘rubbish in, rubbish out’.

You know the 1.6 million was raised before drilling Verbier and another amount above 20 million came from qualifying individuals following the bookbuild.

And the money is to be used on drilling, not paying salaries for years to come as you suggested.

First of all, JOG raised 20 million pounds, not 25 million as in your misleading post.

Second, the use of funds is to pay JOG’s share of the Verbier Appraisal well, which is not carried.

Third, the use of funds includes JOG’s share in the nearby Cortina exploration well, which is not carried either.

Please try to reference accurate facts and figures.

Tincan1995

On the Balls Bros video BM says Schlumberger has no CT rig available ‘anywhere in the whole world’. So they’re using Smape - which is a privately owned Italian CT operator and probably the biggest CT operator in Southern Europe. Smape has bags of experience and do all ENI’s CT work.

As you say, its very cost effective, safe approach because running into and pulling out of the hole is a continuous operation with no pipe connections. Also, CT with the right equipment, can work on a ‘live’ well, with no need to kill the well between downhole operations and avoids damaging the formation with kill fluid.

Smape also has a nitrogen service to lift the well fluids and coax it into a gentle clean-up which is quite important in tight, stimulated reservoirs.

I’m sure ddboy and others know more about it.

N4apenny

I really don’t know, but clearly Sound think its worth a try. The BB meeting showed that Sound recognises a successful test including hydraulic stimulation has wide implications for the whole Tendrara area.

Incidentally, the condensate yield at the original TE5 test by Onarep was between 1 and 3 bbl/mmscf. So pretty dry gas.

The gas at the Meskala field, next to Sidi Moktar, yields 40 bbl/mmscf. That is a real ‘wet gas’ field.

At SBK, Lone Star thought they had discovered oil in the Triassic fractured basalt, but in hindsight it was probably retrograde condensate which condensed from gas seeping upwards from the Tagi reservoir.

Jafo

Couple of reasons;

Assuming there is condensate associated with the gas, which it is in TE5 area and SBK, depending on the drawdown at the well head there could be gas and liquids to measure.

After hydraulic stimulation water, propant and petroleum will flow to surface and the latest Schlumberger metering gadgets can measure this ‘backflow’ from the supercharged reservoir.

Of course, there is an alternative which is to separate the water and condensate into tanks at the surface and meter the dry gas on the way to the flare. Then the liquids produced are measured with a dipstick in the tank.

Lelo

Thanks for the correction - I’d missed that point

Lelo

It will be a multi=phase flow meter

Weighs about a ton with separators etc.

Not like the gas meter under your stairs!

On the Balls Brothers video

Ducati2

BM mentioned the delay is due to waiting for a non-Schlumberger contractor to mobiles a coiled tubing rig to TE-10.

This means the various tools for testing will be conveyed on tubing rather than wireline.

Coiled tubing is clever stuff and can do all sorts of things a rotary rig can, but lower cost and fewer people.

https://www.slb.com/services/well_intervention/coiled_tubing.aspx

Oh dear, A1m1

I thought you were beginning to understand - it seems not.

Yep - got it right this time A1m1 - finally.

Oil and Gas projects are relatively long term ventures, sometimes with life of more than 50 years, but CNRL’s strategy is to participate in ventures with short term returns over 2 to 3 year periods. Investors all know that, so what’s the problem?

Sorry Scoobydo - here’s my reply

Posting large amounts of content an online forum or social network, in some cases intended to derail discussions or otherwise make the site unusable to its regular visitors, has a verb to describe it which was mentioned last week.

That’s what we have here. Now and again it’s appropriate to put ‘the other side of the arguement’. That’s all.

2252 is an 18 to 24 month project

2437 is a 12 month project if Shell excercises its option. But it is a 4 year licence expiring in 2022.

The ultimate value depends on CNRL’s exit strategy which no-one can predict. Merger, asset sale, corporate transaction - who knows.

Then there is the 32nd licensing round. CNRL was awarded 2424 which was a licence it relinquished in 2017 when it expired. So the assertion relinquished acreage cannot be re-awarded seems weak.

A1m1

I’m afraid you’ll have to explain why you don’t understand my reply.