Member Info for HeadInTheSand

PS the trouble with the RNS from July 21st that Ocelot quoted below...

...is that the company previously assured that the £7m Dec 22 placing would provide funds to cover "the majority, if not all" of the debts related to the missed hedge contracts.

Here's the relevant text from the RNS dated Dec 19th 2022.

"Reasons for the Fundraising and Use of Proceeds

The Company is undertaking the Fundraising to progress its strategy and the net proceeds will therefore be applied towards:

- Hedge expenditure: £3.3 million. As part of the Company's rolling hedge programme relating to gas sales from Saltfleetby, and due to the late start of production from Saltfleetby, some of the original hedged volumes due in Q3 2022 were closed and new hedges of an equivalent amount, but at much higher prices, were restruck in H1 2023. Whilst the Company had been seeking to defer this liability to include it within H1 2023's commitments and has been in discussions with the hedge providers to that end, it has now been unable to agree this. As such these funds are expected to satisfy the majority (if not all) of the earlier closed hedges."

It now looks crystal clear that the £3.3 million from that £7 million placing actually needed to be spent on something else instead, despite what the Dec RNS stated..

Simple answer.

Getting Saltfleetby back into production cost far more and took far longer than ANGS predicted (presumably unknowingly) to the market that it would

- and -

Getting the sidetrack drilled cost far more and took far longer than ANGS predicted (presumably unknowingly) to the market that it would.

To add to the substantially increased costs required to achieve both the above is the fact that the major delays in both projects caused the first 2.5 months of hedged production (Jul, Aug and 1/2 of Sep) to be entirely missed, causing a substantial derivative settlement debt applying to that period that has needed paying off.

Hence presumably the need for the £7m Xmas 22 placing, and then the first £3m junior bridging loan (mid Mar 23) and then the 2nd £6m bridging loan (Jul 23).

Much talk about mortgages... there's an obvious difference between legal ownership by a party of an asset and a charge on that asset held by another party. Needless to say, the two can happily exist side by side.

@Robday, I owe you an answer to your post of Friday early evening which yes you're entirely right, came as a surprise.

If you have posed that IQ - and I'll take you at your word that you have - then I'm impressed. I'm not sure it'll get chosen as one to be answered by the company and even if it is, I'm not sure that any answer given will be that useful. We'll just have to wait and see.

My view is pretty simple. Everyone's got an opinion on the way things *should* be - presumably based on evidence available at the time of forming said opinion. However, if things stubbornly resist matching the way one thinks they *should* be, then the best thing one can do is to try to come to a further opinion as to why they're not matching one's expectations.

That's actually important. Because without having some understanding of why things are the way they actually are (and why they're running counter to expectations), it'll be pretty much impossible for anyone to come to a view on what needs to change in order for one's expectations to be met.

That's all, really.

One would have thought that any serious PI absolutely should be asking him/herself the following questions as mentioned by both Pactrol and Tygra.

1. Why is the SP less than half it was compared to when ANGS hadn't even started drilling and only owned half the field?

2. Why is the SP less than half it was compared to when ANGS announced the completion of a successful production-doubling sidetrack?

3. Why is the SP c 90% down from the point it was at when the outgoing CEO took over?

4. Why is the company's overall MCAP c. 25% down from the point it was at when the outgoing CEO took over?

All the above questions contain instantly verifiable facts - and Tygra has provided entirely credible answers for all of them.

The cheerleaders will now no doubt respond with a load of desperate smokescreening, jam tomorrow promises and (of course) insults, because they have literally no answers to any of the above. Well, none that they want to admit to.

BV has apparently been having to average down in ANGS, utilising his alleged "other investment profits".... those will presumably be "profits from investments" in other companies that he's never made any posts about. Ever. Oh, unless that one post on UKOG counts.

(One has to smile).

Singhie clearly has a collection of soapboxes - all utterly irrelevant when it comes to ANGS.

Easy enough to answer.

ANGS seems to be consistently churning out around 3 million therms a month. Half of those therms are hedged (at least until Jul 2024, when the hedged amount falls). So they've effectively got a fixed selling price (currently 37.55p a therm).

Therefore ANGS has 1.5 million therms a month to sell on the open market. 1.5 million x 1p? Every penny movement in spot gas pricing changes revenue by £15,000 per month.

ANGS worth £100m? Well...

#1 if that's going to happen, it's certainly not going to occur on Pinocchio Lucan's watch.

#2. if that's going to happen, according to ANGS itself, it's going to take a lot more than Saltfleetby as is to be able to achieve that.

"With production up at Saltfleetby, the Board’s priority now is to identify inorganic opportunities for growth which would provide the route to a £100m valuation." (Answer to IQ, 2nd Jul 23)

From the get-go with CTAG, Amit has always banked on (literally) the fact that it is logically impossible to categorically prove a negative.

As Soyo quite rightly says, whatta guy!

"..watching ANGS grow..."

I wonder what you mean by "grow"?

ANGS's MCap in Q1 2019 when George took over was £34.4 million.

ANGS's MCap today as George leaves is £28.1 million.

BV, not that you could recognise the truth if it slapped you in the face... and not that you're ever bothered about the truth in the first place, but...

I have just the one ID.

I never bought into ANGS at 26p (you're wrong by over 94% there).

Whatever else GL has presided over, he has presided over a c. 90% drop in SP, since taking over the reins at end Jan 2019, when the SP was 7.5p.

More interesting is the fact that two board members (Hans Christian Lucan isn't quite all the way through the exit door yet) are able to deal in ANGS shares right now.

Presumably this means that neither is aware of any inside info that could affect the SP either positively or negatively. Which does make one wonder what's going on with that IMV necessary £20m refinancing package.

To be fait, current production levels match exactly with what ANGS stated its expectations are in the most recent RNS (21st July).

"...it is anticipated that production will be maintained at 90,000-95,000 therms per day over the next quarter."

Not wrong, AFC. As ANGS has for some time (June, wasn't it?) been consistently producing in excess of any hedged volumes, any increase in gas pricing is bound to result in the company benefitting from increased revenues.

A small spate of posts on the CTAG board... there must have been another can-kicking update.

Occam's razor states that the simplest solution is the most likely solution. There's certainly nothing simple about this endlessly protracted affair - if it were simple (and genuine), it'd have been concluded months and months ago.

Sorry, but using said razor in Cloudtag's/Amit's seemingly never-ending case definitively does not suggest that "this is building to a head with sale to be announced shortly".

And as for Amit being in the least little bit worried about being decidedly economical with the truth? Perhaps check his lengthy track record to see how much that bothers him. Runway in the jungle, anyone?

OP, no... and it's a reasonable point... but a) that 8% is going to kick in at some future point regardless and b) the most important thing beyond all others for ANGS to secure itself is more time. More time to generate revenues from gas production to meet its various liabilities.

OP, as we both know, the terms are onerous for ANGS (though it has to be said, less onerous than the current senior and two junior loans). And because the terms are tough on ANGS, they're bound to be highly rewarding for those behind the financing.

Sure, if the opportunity were made available to PIs to offer some/all of the replacement financing and benefit from the same terms that are on the table for Aleph, that would be a very attractive proposition. But IMV that's all moot... there seems zero appetite from ANGS to allow PIs to share in this latest lucrative opportunity.

OP, I see you've run foul of the playground prince... not exactly a surprise.

I see a longer-term replacement finance facility (whether the currently mooted £20m one, or another) as a necessary, let alone positive thing (it'd be both). The terms attached to the £20m one which yes, we have been given details on, are onerous... but still, cheaper than existing debt, and most importantly, with an extended payback period.

And yes, I'd say better for PIs than a dilutative placing - though I honestly couldn't see ANGS being able to raise £20m via a placing (almost. 80% of its existing market cap) any time soon. However, one would have to hope that those behind any financing hang onto any shedloads of shares that they look like they'll be awarded as part of any deal.

I think it best to leave you ranting in the playground, BV.

BV I remember ANGS being equally sarcastic in answers in IQs to the question about whether the sidetrack would take 16 weeks (as their planning submission into Lincs CC stated it would). Here's what it said:-

"We would be surprised and disappointed if the drilling part of the programme exceeded 28 days and the entire programme involved more than 7-10 days either side. On behalf of the Board, we have never heard or seen of any internal document which suggested we were planning for a 16 week side-track at Saltfleetby and we would challenge the poster to produce it. For that matter I haven’t heard of a drilling programme anywhere to these depths which could conceivably take 16 weeks – except perhaps on Mars, which is possibly where your poster hails from."

As we all now know, the sidetrack in fact took over six months... so it would seem wise not to be too reliant on any sarcasm expressed by ANGS, since their usage of it demonstrably tends to leave them with a face dripping with egg.

Nevertheless, it would undoubtedly be a very positive (and indeed necessary) thing for them to get the replacement £20m of financing.