Member Info for grsshaw

You would think there would be an update very soon on both Ruvuma and Kili 3D & planning progress - didn't they say 3D for Kili would start around now? Im not holding out much hope that Kili 3D will have any affect on the SP, but at least its costing AEX zero. In fact AEX have very little to pay at this stage - just over £1m operating costs pa while we patiently wait.
I never thought I would say this, but I'm quite glad they did the recent placing when they did to reduce as much uncertainly as possible re going concern. This market is a little crazy at the moment and I feel pretty secure holding AEX at this time with limited cash outlay required while hopefully reading up on positive news flow building up 'still on time' spud

Also, currency exchange rates with a weaker pound won't help the general market and inflationary pressures - might help PPC though when converting back to £ at in the results!

Interest rates will need to move much higher and in the very short here in the UK, if they do, it might well cost more to service debt and mortgages etc.. but if it helps to prop up Sterling it would help the reduce imported inflation as well as Energy prices after the reverse affect right now and compounding the situation. Looks like the $ US will be safest bet for most investors and it looks like US will go much higher with short term interest rate jumps and at a much quicker pace!
Short term pain with high interest rates is needed right now IMO!!

Good job my mortgage is fixed - but only until this time next year :-(

My rationale is that supply uncertainty will be the driver for higher prices. Yes, demand may reduce due a slow down but for prices to fall it would need to drop off considerably. The high prices in itself are already reducing demand, discounting any threat of recession, as consumers are more careful with energy usage. But you can only reduce energy consumption by so much and for a limited time frame.

Perfect storm I would say IMO - could go either way

You only need a little ripple/disruption in the supply chain to create a large wave further down. Even if the price hits $150 per barrel or higher, it probably will mean PPC will drop anyway :-)

If you are a small O & G company looking to add assets, what a time to start looking to acquire O & G companies. If you are looking at offloading assets, no so much a good time...

High commodity prices/low valuation - which one with break first..

My guess is that O & G commodity prices will increase much much higher in the short term, so my money is that MC valuations will move higher in the next few months and the low MC values will be highlighted to the traders/investors. Unfortunalty, only when traders/investors come out of their shell shocked state that is!
All IMO
Good Luck..

Couldn't resist another little top up at 1.41p - very low volume has took this much lower than is true value IMO. Seems very little share dealing appetite at the moment due to terrible market conditions - I think I might just turn off the share portfolio and come back in December!

Good Luck All..

PL might give an update re first half trading at the AGM on 22 Jul

ATOM had a RNS at 7am on the day of their AGM

Might not help the SP in this current market, but might answer a few questions!

Thanks

Geoff

I agree on the debt Brasso3, no more spending until income/cash flow from the additional barrels to reduce the higher interest % debt pile. We could do with more international sales at higher prices to help with the average price per barrel

That is why I hope PPC is not raising money to inject into Green House and hope that the bond loan is not for this reason

As ATOM share holding is not adding any value to PPC MC and PPC have nearly 30% holding, I wonder if PL will do a deal with himself and get Alpha Oil to purchase 50% of PPC ATOM holding to fund the Green House start up. Alpha then match their pro rata contribution and they are off to the races with a few quid. Might actually add some value as its cash rather than share price based asset - plus ATOM shares should be unaffected. I cant be bothered to work out/look back on how much in real terms PL holds in ATOM from PPC holding, direct holding and within Alpha Oil.

I do have feeling there will be some activity in the very near term - just not sure in what now!

If PL is at the ATOM AGM today (not sure if in person or via Zoom) but assuming he is attending in person, I wonder if he will do an interview to update shareholders before the PPC AGM on 22 July.

President has returned to net profit and of course the Atome Energy IPO went well although it was generously priced, to go as it were. Chairman Peter Levine rightly questions the logic of the value of President versus Atome which in my view yet again proves that the former is massively undervalued if any proof was needed.

Argentina is still looking good with reduced opex and higher receivables, and along with high impact exploration later this year potentially substantial upside is potentially very exciting.

All we need is for PPC to be included in his Bucket list - kiss of death :-)

Missed the RNS as was out and about this morning and still have only just skimmed over - but overall okay, no-one rushing to buy the shares this morning it seems, but equally no one dumping large volumes!

Seems to be no real shock in the 2021 results but I am concentrating more on 2022 to date plus the next 6 to 12 months trading/activity. It would be good if PL can keep spending and cost down during the remainder of the year and pay off more of that higher debt. No mention I can see on recent bond loan and why (but may have missed this), so more detail would be welcome on why it was required!

2022 Trading looks to be pretty good to date with the new wells now contributing - prices increasing albeit slowly, but going in the right direction
Salta producing as near expected (a bit later than planned with additional cost) lets see how this performs
Louisiana back online
Paraguay: certainly not shouting about this, but its carried and I'm sure they wouldn't spend $10 to $15m on drill without seeing something of interest at the new drill location - IMO the low COS % is clearly playing this down PL is placing a potential wealth warning on this drill i.e don't chase the PPC SP up to silly heights - the good part if that they don't need to big it up to raise funds and its not all in on one drill for the company. I am betting the drill will be delayed slighty by the comments made - how long delayed will be the challenge!

Green House Capitol: could be interesting side play having O & G and also Alternative energy mix in the same business - how will any new development be funded is my question?
Atome:if this does perform then there may well be some slight upside to PPC SP, but probably not to much based on history Martinez del Tineo field: looks like this could take 6+ months, IMO if gas prices stay inflated it may be sooner than this

Overall: things seem to be going in the right direction with prices increase, new wells online increasing production and US back producing, spending a bit challenging so needs to reduce. Paraguay Drill, Farm Out, Atome holding and Alternative Energy. Fully understand the negatives with LTH but the business seems to moving into a far better shape than the last few years - Good Luck All

Yes, a lot money spent - I have not as yet gone though all the history on Paraguay. So will read up on the events and results and what happened etc.. in the past now, but I do understand that it may be part of LTH history/frustration/trust etc..

Thats what I’m was saying Steven49 - which means if you look at all the other activity areas plus the Paraguay drill and you are looking at this even as short term 6 month investment /trade this should prove to be a good bet - if the short term drill investors/traders come in and the SP rises by a large % I would of course top slice profits, but subject to the how much the SP rises at spud and during drilling - if a duster it shouldn't knock the SP back down too much as many other activities already in play - IMO I do feel a rerate in the SP is due very soon - of course subject to what news is announced next week - my target is 3p or 1 bag from here by Sept - that is if the Paraguay drill is still on target and not delayed. I’m fortunate (unlike some LTH’s - so understand when some are frustrated) that my buying prices are all under 1.70p so I’m more than happy with my risk/reward - well at the moment anyway - anything can happen with PPC so understand nothing Is guaranteed!

So that means if the cost of the drill is $10m then 40% will cover the drill from the $4m payment received from the agreed farm in , if the drill increases to $15m then PPC’s charge is an extra $2m - still a good deal to spend zero or $2m to see if they discover anything -very good small risk/potential very big reward - failure won’t break the bank - of course G & A costs will have to be paid as PPC is the operator. But I think this is very good deal for PPC. Image if they discover oil from a $10m cost drill and it cost PPC nothing. CPC corp are paying at least $10m possibly $13m to see what’s down there!! Not far off a no lose gamble if you ask me!

100% comeonvog - Plus sales 19,000 barrels via trafiguar at international prices - plus Martinex del Tineo field farm out start Q3 - I am hopeful that things will change for the better from next week - I just wonder if PL may buy out PPC now that the company can raise funds via bonds plus he has his own cash - not sure what Aim listing adds to the company at the moment TBH - other than market cap destruction!!

Steve58

WEN will pay $3m only upfront
Then
$3.0 million on reaching FID

This will be the only part of the $16m payable the rest will be out of income

The below is subject to sales numbers
Up to $8 million through a minority share of net profit to Wentworth; and
$2.0 million on reaching gross cumulative production of 50 Bscf.

So they will payout approx $6m to SCIR to FID plus $6.25m 3D and drill. After that it will all depend on the work programme, addtional number of wells drilled and who pays for the 30 ish km pipeline required.

You are right though as they are signing up for a $35m possible spend commitment same as AEX (but they are fully carried) the remaining $10m (subject to performance) to SCIR will be out of income - so you could say they are signing up for $41m expense!

I may have this totally wrong, but I wonder if the recent bond and improved cash flow will be used to pay back PL’s loan in full. A divi payment could be introduced which is where PL,with just under 30% holding, would get a nice income rather than charging PPC high interest on his loan money.

There doesn’t seem to be any value in the SP for the Paraguay drill. Am I correct that the first drill is fully carried for PPC with the farm out payment of $4m if the drill is approx $10m cost? High risk but nothing lost if a duster and costs of the first drill are managed to $10m! Not too bad of a deal, so PPC now have 50% asset with no cash spend risk? PPC as operator you would hope will be drilling this with a strict $10m budget in mind.

SCIR should have done what AEX did - cut costs to the bone until they knew what was happening with their biggest asset. They rushed into spending money on the new assets (to look busy) they should have done the opposite and saved as much as possible, the money from HE1 and funding agreement in place (I think it was $5m) would have gone a long way and the SP would probably be a lot higher than today to raise a little more. Also WEN would probably have moved quicker knowing SCIR had the funds available for 3D and drilling.

I still don't understand why they didn't raise enough for the 3D results and then review following this data, even if not for the drill. Feel they have already paid some out for 3D anyway so makes it even worse! Reckless with investors money and they have totally messed up this negotiation by reducing any leverage they held as each month passed by!!

Thank you so much Katherine for thinking about SCIR share dilution - you are most kind, pity you didn't do this deal a little while ago which would have saved SCIR a lot of dilution and waiting time...