Member Info for Gudin

Mou 3

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If you scroll back the dates it looks like there has been a change in the last couple of days. It's blurry and I have previously thought that there have been changes when nothing has happened so it could be anything.

Txp have a share of the licence and as a current operator in Trinidad have the skillset and vision but do not seem as keen to develop such claimed low hanging fruit.

Excellent post from ROB absolutely brimming with facts, still waiting for the breakdown of how "modest" oil sales are going to generate £50m in free cash flow. Looks like he is slipping back into his gkp days of posting for ticks rather than facts.

@Keithoz the CM deal has pushed back the drilling program for Morocco into the second half of the year and as Jimmy posted last night the workovers are going to be generating say $2m a year which is not going to fund much. Still waiting for someone to post these significant free cash flow calculations. TXP have spent millions and not achieved this.

The information does not refer to netbacks it refers to net revenue of $39 a barrel after taxes and various other deductions. From this net revenue figure production costs need to be deducted to get the netback figure.

" In total, the Company's operations in Trinidad and Tobago generated an (unaudited) pre-tax operating cash surplus in Q1 2022 of approximately US$0.2 million."

Hardly generating much free cash flow from double the production of PRD expected first workover, combined with the extra 7.5% hofo payment PRD have its not much to get excited about especially as the oil price is $11 a barrel lower currently.

I had assumed brent prices getting WTI is disappointing as this is usually lower than brent $5.5 lower today.

I would like to see these assumptions from very modest oil sales that are capable of generating free cash flow of £50m.

Using TXP $19 boe netback it is going to require in excess of 5000bpd to achieve that unless GRH knows something different?

At the current $77 a barrel full brent crude price it would require nearly 1800bpd to generate anywhere near the current m.cap in pure income alone, no production costs or taxes.

Neither of those figures are "very modest". Would imagine the costs of getting there are not very modest either.

Yawn another deflector. PRD issued the expected date if they are again unable to provide a realistic date then that's on them. RNS are supposed to provide information and guidance not vague promises.

It obviously means released to the market why else would they include it in a rns to inform the market.

They did. They expected to issue it in December 2023 and this goes back to the point. Why not just issue it without giving a date no one would be any the wiser but instead they again gave a date and missed it. Compounding past failures, they are creating a narrative of unreliability of their own manufacture.

They could have simply not repeatedly given timeframes they failed to meet. All the excuses for delays such as ROBs below but no one held a gun to their head and forced them to issue dates. If things are out of your control then do not give dates. Simple as that and all the excuses in the world cannot hide the fact that they failed to learn and repeated the same mistakes.

The Morocco government must have a far reach if they have stopped them from issuing the T&T report in the timeframe given or are the Trinidad government in on it as well.

Why? What is this high level of trust based on?

I can understand people having faith but posters saying they trust someone who at most they have spent a few minutes alone with at an event with the sole purpose of selling you something is a bit strange.

Can you not just adjust your level of investment to a suitable level. Paul has spent 40+ years in the industry no one thought he was worthy of a senior management role, he had to start his own company to achieve this. I adjusted my initial investment to reflect this.

The requirement that "absolutely" trusting directors is one of the most puerile comments on these boards. Companies have folded with posters repeating this mantra. Basing this on gazing into someones eyes when they are at an event where the principal purpose is to get you to invest in their company is asking for trouble.

Paul has presented at an investor presentation, included in a prospectus and released in numerous rns various dates for testing and meet none of them. If people are still "absolutely" trusting after that, then each to their own. Others are allowed to be sceptical following that.

Had a quick look at TXP it seems to me that they are planning 9000boe/d similar to PRD at CM. To get there will have taken them four plus years well over $100m spent and left them with $25m in debt. I have no investment in TXP and do not plan to either on that basis.

As I have said I will wait to see the technical report on CM but I think it's a distraction and the funds would get more "bang for your buck" used in Morocco. $2m would come in handy for fully testing the MOU fan at the minute.

@KeithOz that's taking on debt though and not free cash flow. Would imagine with the waxing issue any lenders are going to want to see consistent production over a period of time, plus they have agreed a new well in T&T as well which is also requiring finance.

As said yesterday I do not understand where this CM free cash flow is coming from. The workovers are targeting 100 to 200bpd, TXP have reported operating netbacks of under $19 a boe. PRD has an extra 7.5% hofo payment on top. 150bpd at those figures is going to return around $1m a year. That's not going to fund any wells in Morocco.

The reduction in the planned testing also seems to have arisen when the extra $1m payment to T&T authorities was required immediately rather than six months down the line as agreed with CEG.

No mention of any exploration budget which they label CM as an exploration licence, should have had the OMC meeting so no mention of a budget for CM or the HOFO payment is strange. They do have $6.6m "allocated to our legacy oil properties, exploration licence payments and corporate infrastructure" either way they do not seem as excited over the CM licence as Paul, hopefully this is due to their smaller stake.

Other things of note are the 18% discount to brent which combined with the 7.5% for HOFO payments knocks 25% of the price of brent before production costs and taxes. The Royston well was uncommercial in the Herrera Sands.

The price has been falling mainly due to the inability to organise testing successfully but it also looks like the focus switch to CM in the new year after hopefully testing is dragging the price down as well. Yet to be convinced that CM is going to generate free cash flow, TXP are years ahead with production already and they are taking on $25m extra debt to effectively drill six wells.

The thing is we have been told numerous times what is happening, the problem is it has not happened.

They raised £10m at the end of July and apart from a two week fully exclusive jolly to Trinidad they do not seem to have done anything with this substantial sum.

Will repeat again. The company stood up in front of investors in May( that was seven months ago) and laid out a timeline in a presentation for testing to be completed in June. As we are now in December I think that is a fair amount of patience and £10m is hardly a shoe string, plus they have raised other cash throughout the year. Mou 1 was completed in July 2021, two and a half years to test would strain the patience of a Buddhist monk.

The willingness from some to accept missed guidance after guidance is staggering.

Think the Chariot deal that put focus on getting testing results and the fact PRD could only secure a MOU has shown that the stance of test results not been important was incorrect. I can remember when you first arrived making the point about this and I disagreed mainly down to Pauls statements. Can see now this was wrong and have to admit it has changed my opinion on management underestimating the importance of testing.

Paul stood up in front of investors at Proactive and went through a presentation with a testing timeline of June It is now scheduled to start SEVEN months later. To say that testing has not been delayed is nonsense.

Paul has also stated that he does not think testing is important on occasion not exactly an overwhelming interest in testing there and probably a factor in the lack of urgency to follow through with the testing program.

You can hold shares and admit that maybe, just maybe not everything is perfect and allow the tiniest bit of criticism is justified.

A placing is the most likely as first gas from CNG is going to be around Q4 if they stick to the testing timelines. Hopefully positive results will boost the share price significantly before the usual broker fleecing.

Cannot see any further delays to testing being well received by either the market or the Moroccan authorities who are desperate for gas.

The cash flow from CM will not be enough to fund the initial work programme on CM never mind Morocco plus the fdp calls for 20 wells will be a while before any free cash flow is generated. Lets see what this report has to say first though as although Pauls management skills are lacking it, his geology record speaks for itself.