Member Info for flundra

Re Solo/ONE-Dyas, it sounds like there was a deal to be done. HALO are better funded, hedged, managed, and established. It might be they could make it work, particularly as they've already done one deal with ONE-Dyas subject to closure. Maybe now's the optimum time to pick up dirt cheap assets. Just a thought whilst this loooong wait goes on.

At least the markets seem a bit happier this week.

….should complete "early 2020".

And there's another One-Dyas asset available now after the abortive deal with SOLO. Of interest to HALO maybe?

https://www.lse.co.uk/rns/SOLO/transaction-update-and-restoration-of-trading-9giszwh1z1p92h4.html

Urgently curbing emissions from burning hydrocarbons seems to be particularly high on the environmental agenda atm, quite rightly. Maybe a real tipping point is near, when wider opinion shifts towards greater acceptance of more nuclear power, or at least greater resistance to the more radical counterproductive outmoded anti-nuclear agenda of some environmentalist groups, at least whilst the reliability and scalability of other renewables catches up. There are hundreds of existing and new reactors being built in the world, so it's happening in places like China anyway, and realistically unstoppable. Most of England is downwind of the Hinkley Point nuclear reactors. Somerset's pretty laid back. So is a simple U mine in impoverished rural Spain, built to the highest standards, such a problem, or really such a risk, or such a bad idea? It could help save the planet. Stakes are getting higher.

Maybe digging for gold's a good idea atm

Sale or t/o always possible. It's hard to predict where HALO go from here imo. Officially we have a fairly firm and recent commitment to re-list this year and a strategy to build the SNS business with innovative funding. But we may well see a change in direction given the fast-moving issues and developments in the O&G space.

Goldman Sachs eg say the increasingly significant ESG issue is another disincentive for private O&G companies to go public.

Nor can I MTS. Best strategy is probably to concentrate on getting the funding right and hoover up some more cast off assets on the cheap. Bottom drawer share.

Hopefully they'll keep the BoD execs on the straight and narrow, and do something useful with their contacts and experience. Perhaps see what they come up with, but vote them out at the AGM if they turn out to be no good.

No point selling at these depressed prices imo. The chances of t/o must be pretty high, as a cash rich, oven-ready listed company for a natural resources project looking for a home perhaps?

Any views on the new NEDs, Messrs Livesey and Brown, and what they might achieve? Anyone in ORR, for example (where Livesey is CEO)?

As Salamanca is already well progressed, it could move quite quickly anyway with a good CSN report, and an epiphany or implosion of El Guapo's latest coalition.

This comment today by the BBC's Douglas Fraser on the BP/PMO deal seemed very apposite to HNL:

This transaction is one of several similar moves over recent years, in which big oil firms move out of maturing oil fields and smaller firms move in.
Big firms, such as BP, are judged by the efficiency with which they deploy capital. Projects measured in the multiple billions of dollars tend to offer bigger returns at scale. So raising capital from older assets, to go after bigger projects around the world, tends to be attractive to shareholders.
The smaller firms are in a niche market, targeting smaller reserves, and searching out new deposits around existing fields, which they can extract without having to invest heavily in new kit. They're being encouraged by the UK regulator, the Oil and Gas Authority, to maximise extraction.
The market in such asset sales has been lubricated by complex UK tax changes affecting liabilities for decommissioning equipment in the North Sea.
And such companies can only invest because they can secure the capital: this kind of transaction is seen as an encouraging sign of the financial health of this maturing "basin".
A further consideration for big firms, with public reputations to defend, is the growing pressure to leave oil and gas under the seabed. Some oil majors are making strategic shifts into renewable energy.
Small niche players in the North Sea are less vulnerable to climate change campaign pressure.

Not a chance? OK, so you're confident that €6m is an undervalue, and that Oaktree's plan B will be to increase and/or re-structure the deal. Maybe you're right, but the bigger fear for me is that you're not, and that Oaktree's plan B will be to ride this out till default and security enforcement. This project is too risky for ORM now imo.

Vote FOR the proposal imo.

Saloro’s debt pile is already huge, and significantly more funds are needed following the latest debacle with the old (actually quite recent) mine workings. In reality the amount required going forward even in the short term can’t be stated with any confidence, because major unforeseen issues keep arising, and it’s become clear that the technical, DD and risk management work has fallen well short. As shareholders, we’ve never seen the JV or loan documents, but even if you don’t believe the ORM bod, it’s a safe bet that as things stand Saloro are near default anyway, with limited progress and product sales unlikely to be anywhere near covering loan and repayment covenants.

Much better to bale out now, and at least recover E6m, rather than risk continuing involvement and further funding requirements, or risk security enforcement and lose everything.

ORM’s interest in Barruecopardo is unlikely to be readily marketable, saleable or fundable in the open market atm. Probably the only realistic buyer is Oaktree itself (who else?), and there’s a negotiated sale to them on the table already. And the only realistic lender to Saloro is…er… also Oaktree (again who else?), charging ridiculous rates. Despite looking, no other lender was found for the most recent loan, for example. So it’s also far too great a risk to think we can somehow sell elsewhere, or force Oaktree’s hand into switching from an interest in asset sale/purchase, to eg an offer for ORM the company, by voting down the negotiated sale proposal. Oaktree could just wait for the inevitable default, and step in or enforce security and wipe us out. ORM are in a parlous position with little influence.

It’s better to have any shareholders revolt from a position of relative strength, ie once we’ve got the E6m in the coffers, rather than from the current weak position where we’re risking everything. But let’s see what the new BoD looks like before picking up the pitchforks. Imo.

Broomfielder, you’re spot on with your comments on SP, NAV, and RTO potential.

Evil now rates it a screaming buy, target ca 225pps

https://masterinvestor.co.uk/evil-diaries/evil-knievil-south-american-history-repeats-itself/?utm_source=Daily+Bulletin&utm_campaign=19d09c9983-Daily_Bulletin_2020203&utm_medium=email&utm_term=0_25eff0bb7f-19d09c9983-37354589

Tim Gitzel, always worth listening to. Nuclear back in vogue, comments on China particularly interesting.
How long before the Spanish govt wake up?
https://www.cameco.com/invest/events-presentations/cibc-western-institutional-investor-conference-2020

Yes. The Germans in particular seem intent on increasing reliance on Russian gas, as well as persisting with coal and closing their nuclear capability. All bad economic and environmental policy imo.

The various deals and finance arrangements look good, but basically we need gas prices to go up.

Yes, ironic, but the best hope may even be that there's a good chance this coalition (like other Spanish governments recently) will disintegrate too, and in short order. I'm sure you're right about the court proceedings, although I'm harbouring some hope/delusion that BKY's recent comments about collaboration (eg in Sept quarterlies) might have meant their withdrawing from the proceedings was a quid pro quo for CSN taking a more rational unbiased scientific approach. Maybe something's been said.

The Germans should do another policy U-turn, close that lignite mine, and build a nuclear power station on the land freed up. That would help slow climate change, and redeployment of the workforce to building it would ease the local economic consequences of mine closure. I'm not sure how well the news would be received in the Garzweiler Miners Social Club after a few beers though.

The Sept '19 interims said "The legal challenge that the Company had previously lodged against the procedure for the 2019 appointments to the Board of the NSC was withdrawn during the quarter." I don't know if this Jan decision is in the same proceedings (PP are a party too I think). I think the decision leaves Castejon (as a Podemos MP) on the CSN, although I believe there's a PP member too. Broxy, I'm sure you'll know!

Meanwhile atmospheric CO2 continues to build and drive climate change. Difficult for them, but I'd like to see Attenborough and other expert commentators on CC articulate their specific ideas, solutions and policy suggestions for reducing CO2 now, not just keep repeating there's an urgent problem no-one does anything about. Bill Gates, Barack Obama, James Lovelock et al (not stupid people) all favour nuclear.

PS Where's BKY's new boss, and where's this CSN report?