Member Info for HighYield

Mick, thank you very much for sharing. As usual when there is some positive information about WRL, the share price drops. MB-1 to start flowing soon, I assume that is because of a positive outlook for gas demand as other wells keep on performing.

Thanks for sharing Irishmouse. Yes, also WRL has noticed that Tanesco has been more regular in paying invoices to them. The Mnazi Bay partners sells gas to a small 18 MW powerstation in Mtwarra owned by Tanesco.This is from the Q3 report. "At September 30, 2017, the Company was owed nine months of invoices for gas sales made to TANESCO, totalling $1,544" "Three months invoices totalling $541, were received subsequent to quarter end." At the beginning of the year 13 months of gas sales was outstanding. Regarding Orca, they have a long-term receivable on Tanesco for gas sales, that is still unsettled. However, part of that receivable (27 MUSD) will be paid to TPDC for their share of the gas. So when Tanesco eventually pays all its outstanding debt to Orca, TPDC will also get a substantial payment and that is good news for all producers that sells gas to TPDC.

Josik, in the balance sheet this receivable is divided into short-term (estimated repayment within 12 months) and long-term (more than 12 months) The long-term part is currentlly (30 Sept) 4.6 MUSD. The rest is short-term.

Josik, in your spreadsheet under investments you have included reduction in long-term receivables also in 2018. I do not think that is correct. The book value of the long-term part of the TPDC receivable is 4.6 MUSD as of 30 September 2017 and most part of it will be transferred to short-term (to be paid within 12 months) in Q4. The Government long-term receivable with a book value of 5.3 MUSD is still a bit more uncertain regarding timing of repayment.

Mick2020, now you are getting a bit overexcited and sound almost like an AEX shareholder. The payments from TPDC include repayments of outstanding receivables and should not be included when talking about net profits. However, if you say cash-flow, then I would agree with you.

I think that would be too much information in one day. Right now they are discussing if Solo's toxic financing is positive for AEX or not.

The reported numbers were very good and the outlook for coming quarters is ever better. I made a quick comparison between WRL and AEX. WRL's Q3 numbers almost match AEX's 1H, when production at KN1 were operating without problems. Comparing the valuation on a debt free bases (EV). AEX is valued about twice as high as WRL. Really strange. USD m Q3 2017 6m 2017 WRL Aminex Revenue 4,10 4,59 EBITDA 2,08 2,75 Net result 0,70 1,01 Cash flow from operations2,08 2,50 Change in WC -1,78 -4,91 Capex 1,13 -7,49 Financing -1,90 -2,77 Total Cash flow -0,47 -12,65 Balance sheet Cash 3,36 6,91 Net debt 14,42 -6,91 Working capital 13,48 7,46 Valuation Market cap 69,7 181,0 Net debt 14,4 -6,9 Enterprise value 84,1 174,0 Production, mmscf/d 59,9 15,00 Share of production 32 % 57 % Net production, mmscf/d 19,17 8,62

TBL, I am not aware of any planned drilling in Tanzania for 2018 as the current 5 wells can produce about 100 mmcf/d and current demand is about 60 mmscf/d. However, if demand were to increase faster than expected plans could change, I suppose. In a recent research report from Peel Hunt they say "More specifically, multiple drill-ready prospects have been identified using 2D seismic and available well and field data within the Mnazi Bay licence area. An independent assessment carried out by RPS Energy in 2013 defined six separate prospects that in aggregate could contain net working interest prospective resources of c614Bcf. Of these we understand that the 85Bcf Nanguruwe North prospect (1p risked/17p unrisked) would be prioritised in the event of renewed exploration efforts. In our view, given Nanguruwe North�s proximity to existing infrastructure it is likely that monetisation of any newly discovered resource would be both straightforward and low cost, meaning it would also be materially NAV accretive." However, the next drill is Tembo in Mozambique. However, that one is probably depending on a successful farm-out. WRL is due with their Q3 report on 14th of November. Hopefully, we will get some more news then.

Hex 314, first I would like to give you some credit for really wanting to discuss valuation of WRL and AEX in a civil manner, very unlike many other AEX shareholders on this forum. For what its worth I will give some of my reflections regarding the comparative valuation of WRL and AEX. I have no knowledge when it comes to reading seismic maps, so I will not try to verify or dismiss AEX estimate of 1.3tcf in unrisked resources. However, I put less value to an estimate made by a company compared to a CPR. Hopefully, the CPR will confirm the 1.3 tcf estimate. Furthermore, I would value estimated reserves and resources significantly higher from a producing company compared to stranded gas resources. Until the Ntorya field is connected to the pipe and a GSA is in place, I feel we are comparing apples to pears. I have a question for you as well. Since you also mean that the main value in AEX is the Ntorya discovery, why not go for Solo instead. Solo holds 25% of the license and is valued at 20MGBP, while Aminex is valued at 150MGBP as holder of 75%.

http://www.thecitizen.co.tz/News/Magufuli-reiterates-govt-s-commitment-to-end-power-woes/1840340-4163504-rtu581/index.html

In today's update from Bounty Oil, in the picture over the field it says 18 BCF. In previous updates the field has been estimated at 28BCF. In light of the falling production, a downward adjustment of reserves sounds plausible, but a bit odd that the operator, Aminex hasn't said anything.

In today's update from Bounty Oil, we see some explanation for the strong growth in demand for gas from the Mnazi Bay partners. Production from another producer's well Killiwani North fell significantly during Q3. "Tanzania � Nyuni Block: � Kiliwani North (KN) gas field averaged 15 mmcfd gas sales in the half-year to June 2017 but was shut in during part of the quarter for plant maintenance and down hole pressure tests. " "Production from KN 1 in September 2017 was 7 mmcfd. " http://www.bountyoil.com/wp-content/uploads/2017/10/Bounty-Oil-ASX-Release-Quarterly-Activities-and-Appendix-5B-September2017.pdf

Bounty Oil's annual report was dated 29 of September, and we know that AEX has said that they have some problems with fall in pressure and are considering some sort of reentry in Q4. We will see, what number that is most correct when AEX present their Q3 report.

I base the 12 mmscf/d on the statement from Bounty oil in their annual report. http://www.bountyoil.com/wp-content/uploads/2017/10/Bounty-Oil-ASX-Release-Full-Year-Financial-Report-2017.pdf "During the half-year ended 30 June 2017 gas production from the Kiliwani North-1 well averaged 15 mmcf per day and commissioning has been completed. Current production is 12 mmcfd. " I believe that the development plan will be approved at some point in time and the most likely off-take will through a connection to the gas processing plant that the Mnazi bay partners are connected to today. Why build a huge gas-pipe with a capacity for over 700 mmscf/d if you are not going to use the capacity. However, I do not expect TPDC to start building a connection to the gas processing plant before the demand for gas is there. As of now, the Mnazi bay partners can deliver 100-130 mmcf/d without any additional investment for TPDC. Then there is Orca, that has additional volume to supply, maybee up to 100 mmscf/d. I expect those volumes will be delivered before any additional gas will be required from the Ntorya field.

The deviation in valuation will even be more obvious going forward as WRL's production is increasing significantly. The the Q3 production has been announced and there is more to come in 2018. At the same time, AEX production at Kiliwani North is decreasing, 12 mmscf/d is the latest number from september, I believe.

Yes WRL has got 15 MUSD in net debt vs AEX nil. That's why it is better to compare EV (Enterprise value) Market cap + net debt when you compare valuation.

Correction to my previous post. It should be current liabilities not current debt.

That is net interest bearing debt. Gross debt is even higher as I have reduced gross interest bearing debt with cash. However, part of this debt is long-term (more than 12 m). The multiple you really should focus on is Working capital, which I have defined as current assets minus current debt. Here you can see that WRL is in a better position than AEX.

No net income yet, but I guess you know that. Although, I expect that WRL will report a positive quarterly result in Q3, due on 1 november, I think. Here are some comparative multiples for WRL and AEX if you are interested. USD m 6m 2017 6m 2017 WRL Aminex Revenue 5,10 4,59 EBITDA 1,27 2,75 Net result -1,66 1,01 Cash flow from operations 1,27 2,50 Change in WC -1,85 -4,91 Capex 1,06 -7,49 Financing 2,38 -2,77 Total Cash flow 2,85 -12,65 Balance sheet Cash 3,83 6,91 Net debt 15,18 -6,91 Working capital 9,08 7,46 Valuation Market cap 69,20 170,17 Net debt 15,18 -6,91 Enterprise value 84,38 163,26 Production, mmscf/d 36,90 15,00 Share of production 32 % 57 % Net production, mmscf/d 11,81 8,62

Yes, that would be a pity. On the other hand if they do get a farm-out deal it will be a great trigger for the share, I think. Latest reported (Q2), net debt was 15.1 MUSD. Gaslady asked the same question on the AEX board on friday. But my reply was deleted.