S7,Badger27 Dec 2019 09:09
I was in aaog about a year ago, can't recall exactly and then sold out, I seem to recall there being a small profit involved too. Have looked in there many times since to see if any progress was being made as the Tilapia certainly appears to be a big prize, although still a high risk (despite DS saying that it is de-risked and should be producing 5000 bbls a day). I think the last payment from SNPC was around September with no more money coming forward on the basis that it was good money after bad. There was a rig identified and a first refusal agreement on it, but the rig then wasn't available until mid 2020 after initial thoughts that it may be available early 2020, payments stopped. Aaog took their driller to court... any dispute is seldom welcomed by the market even if the outcome could be positive financially, to me it indicates a certain amount of incompetence and failure to manage the contractor....whatever the industry or situation. Anyhow, just my view. These factors would, if I were sitting in the govt, deter me from payment. Yeah I know they are supposed to pay for work already done but there were no results and unlikely to be any in the foreseeable future so why pay?
Hopefully, as with previous potential acquisitions, Zen will walk away if the 'if's' become too onerous, but this time I think they will go ahead with it. If it could be conditional upon the renewed license and a renewed commitment from the govt then I think we would see a big step up in market confidence. Govt, in theory should be keen to see development and income from the field, support from them in terms of importing a big rig, a rig crew from outside the country and an Italian wine grower might just see 103c put to bed by mid year. debt to Zen is unfortunately growing and the company is now a million miles away from the reasons why I and others first invested, hence why I am not happy...mainly with myself for making the wrong choices here.
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