RE: Dilution17 Jan 2023 13:37
This has gone off at a tangent I didn't see coming nor that intended it to. I am not in anyway trying to start any sort of disagreement with any serious investors here, especially Push who is an absolute asset to the board.
My initial response back to Lightman was intended to point out that the raise was a necessity but it occurred to me as I responded that there are a few things I'd like to see clarified (and I presumed some others might too) with regards to the need for the raise, that aren't covered by the IQ responses.
An Operational Update RNS issued on 29th July contained the following statement:
"As a precautionary measure, the Company has worked with its hedge provider to roll a portion of the Q3 2022 hedge into Q1 and Q2 of 2023. This has allowed the Company to take advantage of the very high forward gas prices and contango to lock a higher average forward sale price at no up-front cost to the Company."
This statement was , not word for word, repeated by George in numerous interviews but he also said he wouldn't go into specifics of the hedge. That last bit stuck out at the time but in light of the flow rates being excellent and the fact that the missed hedge had been rolled over to be covered by the sidetrack, I wasn't going to lose sleep.
When we get to the 19th December, I'm pretty sure no one expected the RNS we got and assumed before opening it, that it was an operations update for the sidetrack. By this point we now needed £7m for overrun (fine by me as the weather has been bitter and supply chain issues are affecting every sector) and for a "liability that has recently arisen under the hedge". This is surely the payment of the deferred amount previously advised as having been rolled over? I suspect the overall mild winter and reduce forward price of gas meant that Mercuria called in the debt immediately. I don't blame them but the possibility of that should have been included alongside the message on July 29th, in my view. It was written as though it was a given, it turned out not to be the case and the reasons have not really been addressed.
Instead, the response to the IQ explained it away as looking after the Lenders/Hedge holders in the short-term because we, as investors will benefit from the hundreds or millions of gas. I don't disagree with that position as such but we haven't seen ANY of that yet because the share price is currently almost half what it was when the flow rates were announced on Sept 9th.
I am still doing very well with my investment (I hope everyone else is/does too) and I am very positive on the outcome but I am not "moaning", "skewing things for my own reasons" or unable to read a website!
Cheers and good luck all.
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