FTSE has also just had its worst week in years so it’s not surprising there are outflows from funds and reduction in equities for safer securities. It would be interesting to see Majedie’s AUM over the past to get a feeling for whether this is a targeted reduction in AEX air a wider selling down.
Having been invested since 2006 I would like more than most to be proved absolutely wrong and to kick things off with an Old Fashioned, to be followed by sea bass and a decent Albariño.
Everything crossed but the weight of expectation is difficult to shift.
Was it not posted here that in the spirit of cost saving, there is currently no rush to find a new CEO? I think it was for a report someone posted who attended the AGM. Sorry to be vague..
Also interested as to why people think we’re close to receiving the licence - have I missed something?
One of the v helpful articles shared below states “the team is looking at financial and economic modelling used in the PSAs to determine the best for the country”. To me, this doesn’t sound like a quick process - modelling economic terms on a national scale sounds a) complex and b) bound by process, approvals and beurocracy.
My view is don’t touch it with a barge pole and wait for the licence news.
If it turns out that the licence doesn’t happen then Aminex is a dead duck and you’ve lost your money. If the news happens to be good and you can move reasonably quickly, then even if the SP gains 100% in a day, then from these levels you’re still going to get in at a price lower than or equivalent to ARA’s investment price.
Positive news on the licence should still be the catalyst for a protracted bull run in my view.
Thanks for these updates CPerkin. They note the committee is now looking at financial and economic models - to me that reads like we’re at the end of the beginning of the process rather than being close to closing it out - any thoughts?
I agree that nobody could have predicted the actions of the Tanzanian government. I also agree that the country should not be subjected to corrupt business practices and as long as we are treated fairly, then I’m morally in agreement with the whole process. But this is exactly what diversification is for - to mitigate against the uncertainty of the future. Any management team should recognise that doing business in some nations comes with more inherent risk than others, and operations should be hedged accordingly.
We are where we are though so I won’t bag on (any more). At the end of the day we all want the same thing..
Do you not think the management team must take some responsibility for pushing the company towards a binary bet in the hands of the Tanzanian government? The company I invested in many years ago was far more diversified than the one it is now. It may well get come good, we really don’t know. I hope it does. But in my view, passing the current frustrations onto the government and absolving the management team of poor guidance is incorrect.
I’ve seen comments here and elsewhere akin to “don’t invest more than you can afford to lose” and “being overweight AEX is a poor investment strategy”. That for me is exactly how Aminex has been operated, all on the back of poor, unreliable communication.
I recognise that sounds negative but whitewashing the story isn’t helpful either. Personally, I think we’re on the verge of coming good and the last few months will be seen as the most glaring buying opportunity in the company’s history. But it will have reached that place through high risk misadventure as opposed to solid diversification and a management style that fills you with confidence. It’s not a level of risk l’ll look for in future investments.
Thanks for sharing the interview.
Interesting reason right at the end for ditching the premium listing “it allows us the flexibility to do some things”. Super-vague. But does it tee us up for a share consolidation I wonder?
I’ve seen a post or two noting difficult questions will be put to the board at the AGM. Considering Eclipse, Majedie and the BoD hold 39.15% of the shares, how effective will this be?
For me the last interview was more telling when a love for family was expressed. I thought it somewhat bizarre at the time but on reflection I wonder if it’s the statement of a man given up on any meaningful relationship with his PI community. The bashing he’s received here and elsewhere could drive an individual in that direction.
I see the CEO kindly sacrificed his bonus, which las year was $72k. But oh, look - he has been awarded a pay rise of $49k or 15%. Oh gosh, and a pension increase of 3k. So that, coupled with a bonus next year, should be worth more than retaining the existing salary and taking a bonus this year.
At what point does increasing a salary by 15% per year become unsustainable? For me this, coupled with the departure of Keith Phair, does not indicate a company with share holders long term interests at heart.
If the description of his family life is anything like how the company is described then my money’s on him currently going through an acrimonious divorce after his brother ran off with his wife - we should probably cut the poor lad some slack.
Thanks for sharing gaslady.
You had me until the “short time horizon” ;-)
I just can’t see anything evidence based to make that seem likely unfortunately. We’re also in a sector that is increasingly unpopular. Chatting to one of the PM’s in my office recently about his new fund and he said he won’t go near any oilies.
Anyway, back to the day job - thanks for sharing your thoughts.
I think a not uncommon strategy will be selling into the spike around drilling CH-1 - that is, looking at the trading pattern around the NT-2 drill and expecting it to repeat. It’s certaibly what I had in mind but I think looking for 7 pence per share is too optimistic.
There’s a bull case:
- natural excitement around the drill and high COS
- outside chance of oil (or other new discovery) in the lower target
- chance of monetising any discovery due to farm out
But the bear case exists, too:
- Aminex now own a smaller proportion of the asset
- Selling pressure on any spike and people look to exit with their short in tact
- Possibility of the market losing interest due to too many false dawns
My average is still 4p - I’m hoping for 5p at some point but I’m not convinced we’ll see that around the CH-1 drill (I hope I’m wrong!) for me that is more likely to come with a combination of things in place - not least of which is a revenue stream - but also a clear development plan for Ruvuma.
I do think the licence will come - whatever frustrations Aminex deliver they have managed to keep the lights on throughout a horrible period whoever others have collapsed.
Tar for the full reply. In fairness, I did answer you question before posting my own - I’m not sure I could live with myself being compared to that ‘orrible lot in Westminster.
And to be clear - I’m not suggesting they are lying - I’m saying their communication strategy is poor to the point where it can mislead (a PRODUCING oil and conpany?) and that has broken trust. Even if I had such concerns, I would not post comments accusing a conpany of lying to the market on a public discussion board.
I learned very early on in my career that to communicate something as happening before all the i’s are dotted is an absolute no no as it can be impactful financially and reputationally. It’s basic bread and butter stuff.
Perhaps not putting things like “Aminex PLC is a PRODUCING, upstream oil and gas company” as a headline on their website. It’s the first thing you read about the conpany. Perhaps not writing “the Company will provide an update on this and the timing for the spudding the Ntorya-3 well during Q4 2017” in the 2017 half-yearly financial report (and similar messages through other channels that I really can’t be bothered digging out now. Communication creates trust and Aminex have broken that trust through repeatedly providing misleading information.
So a question for you Mister Drewky - can you tell me another avenue of life - be it personal or in business - where you would regard this level of communication as reasonable or acceptable?