Member Info for ICB888

This will prove to be a game changing day that will quickly take JLP to a new level and a serious player in copper. The SPV arrangement they have unveiled today could be rolled out globally with major mining groups such as Glencore Rio and BHP. The big boys finance it so it can be rolled out quickly and it’s very attractive for their environmental credentials as it’s dealing with large amounts of waste. JLP will come on a lot of radars now as a potential partner and as a potential takeover target.

JLP was 9p in June and 12p last December. I don’t imagine this will be available for under 6p for very long.

Strategic Investment in a Historical Waste Rock Dump in Zambia

Jubilee, a diversified and leading metals recovery business with a world-class portfolio of projects in South Africa and Zambia, is pleased to announce that it has secured one of the largest copper waste rock assets on surface in Zambia and has formed a strategic partnership with Abu Dhabi based International Resources Holding RSC Limited ("IRH"). IRH is affiliated to the Abu Dhabi conglomerate, International Holding Company PJSC ("IHC"), the most valuable listed holding company in the United Arab Emirates, and the second-most valuable in the Gulf Cooperation Council region.

I think ARA are bringing in long lead items and making positive noises to demonstrate that they are doing their bit in the hope the Government will be encouraged to do their bit and sign the outstanding documents. ARA can say to the Government they can’t proceed any further without Government sign off. I think ARA are doing all they can to get this going and are handling the Government as best they can as they did with the SCIR transfer. ARA have to be very diplomatic and smooth talk the Government as threatening Governments tends to increase the delay in Africa.

Malcy has put a number of questions to Julian and has printed his answers. One I particularly like is:

“ We have secured a great partner, that like us, believes there is significant upside potential unaccounted for with this project, and we now have a financial pathway to reaching first gas, that doesn’t see equity holders diluted further. We both have a common goal – to deliver the development of the project in a safe, cost efficient and expedited manner.”

They think there is significant upside potential currently unaccounted for and we won’t see equity holders diluted further. So as shareholders we don’t have to worry about any further fund raising prior to first gas. That fact being clearly stated should greatly assist the recovery of the share price once the current heavily oversold shares bounce. There has always been a lot of trading in this share which has led to wild fluctuations at times, but hopefully it will now settle down then return to 14p and then 18p before the drill bit starts turning again.

Seawolf

We all share your frustration. In response to your comments I will repost something I posted last week in response to a post by Hardnose.

I think we all know that the drill is six years late due to the actions or more correctly inactions of the Tanzanian Government. AEX \ARA can’t force the Government to make decisions and hence the delay has been essentially out of their control. The previous Government was particularly bad but the new Government has promised to be more mining friendly and reduce delays. They are certainly better and decisions are being made. AEX /ARA have made progress most recently with the consent for the SCIR transaction which has now completed. The new 25 year license which is awaiting Government signing can now have the current partners on it ARA and AEX. The delay with the 2 signatures is not more than a few weeks late and could land any day now. There are no rose tinted spectacles on my part as I have been invested here for more years than I care to remember. I firmly believe we will have the signatures very soon whereupon the sp will correct. I am just finding the continuing negativity from some posters unjustified and unhelpful.

It is important to remember that this has been conducted as an asset sale as for a very long time the share price has been totally disconnected from the value of the Gold. Do not make comments or calculations based on the current sp as it is completely irrelevant. This is being sold on the basis of the $400 million NPV which is clearly higher than that now with the gold price above 2000 and moving higher in the future.

It says “some new oil and gas projects”. CHAR’s project is not a new project ,it’s an existing project that has already completed a successful drill and undertaken extensive analysis. So it appears to me that Soc Gens policy does not have any effect on its relationship with CHAR. They want to fund the energy transition and all 3 pillars of CHARS business are focused on the Energy Transition.

I think AP was caught off guard by the question about had bids been received. He realised he had to answer truthfully but hadn’t expected it to be asked. It seems clear it wasn’t going to be mentioned which begs the question was it at a level where they thought shareholders would be tempted to sell and they don’t want to. The bid must have been framed as pre bid discussions about acceptable price, because if it was a formal bid they would have had to inform shareholders.

It would be interesting to know how much was offered for the whole company and whether there was more than one offer. I feel sure it would have been at a premium to the sp when it was made, so much higher than the sp now. Perhaps we can draw comfort from the fact they believe they can extract a lot more by carrying on rather than taking the money now.

It also throws up the possibility,particularly at this low sp, that a bidder or bidders will return. ENOC will have done serious due diligence and they know what they are doing, so that in itself gives further confidence to a bidder. Personally I hope today has shaken out the traders and the people who were hoping to sell on a spike on news and they will be replaced by institutional shareholders who will be in for the journey to production and cash coming in. CHAR is massively oversold and should recover to a more sensible level in the coming days and weeks.

The conclusion:

“ Clearly, the farm-out transaction fell short of the expectations of some investors as Chariot’s share price fell 15 per cent from 13.7p to 11.6p following the announcement. The share price is also below the 14.75p level when I assessed the farm-out possibilities (‘Chariot could soon announce a 'game-changing' deal’, 20 September 2023), albeit the holding has still delivered a 282 per cent gain in my 2017 Bargain Shares Portfolio.

It’s a very harsh reaction. That’s because Cavendish’s total risked valuation per share of 57.7p for the company is not only five times the current share price, but it rises to 71p assuming Energean exercises its option to acquire a further 10 per cent stake. This highlights the value embedded in the Anchois gas project and which Energean has clearly recognised. So, although the initial reaction to the news is disappointing, expect the heavily oversold shares to bounce when the dust settles. Hold.”

Chariot’s transformational farm-out is underrated

The fall in the company’s share price is a harsh reaction to what looks a good farm-out of its flagship gas project

December 7, 2023

Energean acquires stakes in Lixus and Rissana licences

Option to purchase a further 10 per cent interest

Chariot’s share price falls 15 per cent on news

Chariot (CHAR:11.6p), the Africa focused transitional energy group, has announced a farm-out agreement with Energean (ENOG:995p). The transaction covers its Lixus Offshore licence, which holds the company’s flagship Anchois gas development project, and the nearby Rissana offshore licence in Morocco. Energean is a £1.8bn market capitalisation FTSE 250 company that has a proven track record of successfully developing large offshore gas projects.

The agreement provides funding for both Chariot and the Anchois gas project through upfront consideration, deferred consideration and potentially a full carry to first gas. There is potential to upscale the development and target further exploration prospectivity across the two licences, too.

Energean is acquiring 45 per cent and 37.5 per cent interests in the Lixus and Rissana licences, respectively, to take operatorship. It reduces Chariot’s stakes to 30 per cent (Lixus) and 37.5 per cent (Rissana) with Moroccan state company National Office of Hydrocarbons and Mines maintaining a 25 per cent stake in each licence. In return, Chariot will receive $10mn on completion of the transaction; $15mn on Final Investment Decision (FID); and has an $85mn gross carry that covers its Lixus costs up to FID, including the additional Anchois well being drilled, which will have a gas flow test in 2024.

Following completion of the Anchois well, Energean has the right to acquire a further 10 per cent of Chariot's equity in the Lixus licence for an $850mn gross development carry to first gas; $50mn five-year zero coupon convertible loan note with a strike price of 2,000p or by issuing 3mn Energean shares; and 7 per cent royalty payment on Energean's gas production revenues in excess of a base hurdle on the realised gas price (post transportation costs).

Analyst James McCormack at house broker Cavendish values Chariot’s retained 30 per cent interest in the project at $476mn (35p) on an unrisked basis, or $310mn (23p) on a risked basis using a 65 per cent commercial chance of success. Assuming Energean exercises its option to acquire an additional 10 per cent in Lixus, Cavendish values the 20 per cent fully carried interest at $595mn (risked) or $447mn (unrisked), using a higher 75 per cent commercial chance of success (due to the lower financial risk and result of the Energean carry). This implies a valuation of 29p (risked) to 44p (unrisked).

Here is a reminder of the Analysts targets:

The 5 analysts offering 12 month price targets for Chariot Ltd have a median target of 48.57, with a high estimate of 60.51 and a low estimate of 35.03. The median estimate represents a 254.50% increase from the last price of 13.70.

Wentworth held most of that gain closing up over 23%. The market clearly believes good progress is being made with the Government approvals and that they are coming soon. AEX ended up having a positive day Up 5.9% on volume of 4.5 million despite the best efforts of the weekly deramper. If anyone wants to suggest he isn’t a deramper just look at the negative header he uses on all his posts and that negative header dominates the bb as people reply to him. A well know ploy from the Derampers playbook.

Sorry I used the wrong header on my last post.

Wentworth held most of that gain closing up over 23%. The market clearly believes good progress is being made with the Government approvals and that they are coming soon. AEX ended up having a positive day Up 5.9% on volume of 4.5 million despite the best efforts of the weekly deramper. If anyone wants to suggest he isn’t a deramper just look at the negative header he uses on all his posts and that negative header dominates the bb as people reply to him. A well know ploy from the Derampers playbook.

Hard nose

I think we all know that the drill is six years late due to the actions or more correctly inactions of the Tanzanian Government. AEX \ARA can’t force the Government to make decisions and hence the delay has been essentially out of their control. The previous Government was particularly bad but the new Government has promised to be more mining friendly and reduce delays. They are certainly better and decisions are being made. AEX /ARA have made progress most recently with the consent for the SCIR transaction which has now completed. The new 25 year license which is awaiting Government signing can now have the current partners on it ARA and AEX. The delay with the 2 signatures is not more than a few weeks late and could land any day now. There are no rose tinted spectacles on my part as I have been invested here for more years than I care to remember. I firmly believe we will have the signatures very soon whereupon the sp will correct. I am just finding the continuing negativity from some posters unjustified and unhelpful.

The pontificating deramper has now been peddling his negativity and misinformation for over a year now having created his account in November 2022. His 63 posts all relate to AEX. If all he does is post weekly to deramp one share it’s a very sad existence. It would appear he has just created this account to deramp AEX and probably has multiple other accounts .

If anyone can be bothered his ramblings about capital raising due to delays can easily be demolished just by reading the RNS. But he doesn’t deserve the oxygen and the filter button is probably the best course of action.

I have corrected my original misreading of the Wentworth RNS, but the fact that it went up 25% just by reporting positive progress towards Government approvals is very impressive in its own right. Just imagine what will happen on actual approval. As MrMoi has posted x3 I will repost as he seems not to have read my last post:

“ Edgar222

You are correct in your interpretation of the Wentworth RNS and I apologise for not reading it properly and jumping to conclusions based on the 25% rise. The relevant extract is:

“ Commercial discussions have been ongoing between M&P and relevant Tanzanian stakeholders regarding the satisfaction of the above-mentioned Governmental Approval Conditions. Over the course of the last two weeks, representatives of the Company and M&P attended a number of meetings with TPDC.

As a result of progress made in these commercial discussions, the Board has made arrangements for the Jersey Court to consider, and if thought fit, sanction the Scheme at a Scheme Court Hearing to be held on 19 December 2023 and all parties are working to satisfy the Governmental Approval Conditions prior to this date”

So essentially WEN are reporting that M&P are making progress in there discussions in a number of meetings over the last 2 weeks. They are then saying that on the basis of those discussions they are proceeding to the next step in approving the purchase of WEN’s stake. A similar process to ARA buying SCIR’s share of Ruvuma.

It is encouraging that WEN’s share price rose just on the basis of positive discussions with Government and a clear indication that they believe it’s close as they are taking a further step that is reliant on the approvals.

Obviously it’s a different approval to the 2 ARA are waiting for but ARA have already been successful on that front with SCIR. ARA are just waiting for formal sign off which I don’t believe require further discussions, the delay is just down to bureaucracy.

As for the poster casting aspersions on a 25% rise and relating that to AEX current share price that was not my point it was simply to illustrate that news relating to Government approvals had been well received by the market. So to be clear I am not suggesting that AEX will return to 1p on news. I would expect it to be closer to 2p than 1p on receiving the approvals we are expecting imminently, but obviously that’s just my opinion based on previous share price movements.

Edgar222

You are correct in your interpretation of the Wentworth RNS and I apologise for not reading it properly and jumping to conclusions based on the 25% rise. The relevant extract is:

“ Commercial discussions have been ongoing between M&P and relevant Tanzanian stakeholders regarding the satisfaction of the above-mentioned Governmental Approval Conditions. Over the course of the last two weeks, representatives of the Company and M&P attended a number of meetings with TPDC.

As a result of progress made in these commercial discussions, the Board has made arrangements for the Jersey Court to consider, and if thought fit, sanction the Scheme at a Scheme Court Hearing to be held on 19 December 2023 and all parties are working to satisfy the Governmental Approval Conditions prior to this date”

So essentially WEN are reporting that M&P are making progress in there discussions in a number of meetings over the last 2 weeks. They are then saying that on the basis of those discussions they are proceeding to the next step in approving the purchase of WEN’s stake. A similar process to ARA buying SCIR’s share of Ruvuma.

It is encouraging that WEN’s share price rose just on the basis of positive discussions with Government and a clear indication that they believe it’s close as they are taking a further step that is reliant on the approvals.

Obviously it’s a different approval to the 2 ARA are waiting for but ARA have already been successful on that front with SCIR. ARA are just waiting for formal sign off which I don’t believe require further discussions, the delay is just down to bureaucracy.

As for the poster casting aspersions on a 25% rise and relating that to AEX current share price that was not my point it was simply to illustrate that news relating to Government approvals had been well received by the market. So to be clear I am not suggesting that AEX will return to 1p on news. I would expect it to be closer to 2p than 1p on receiving the approvals we are expecting imminently, but obviously that’s just my opinion based on previous share price movements.

Wentworth is currently Up 25% having secured the approvals it needed from the Tanzanian Government. They are making decisions and hopefully they will move on to AEX/ARA now, although hopefully the ARA approvals have been running concurrently. News should be very soon and look at the effect on their share price just from that news as they now move to compete their transaction.

Finally something to comment on as we have actually had an update. The sales process continues and there is very important new information in the RNS:

“ the Company is in advanced discussions with 2 gold producers”

And

“ Jim Mellon, Chairman of Condor Gold, commented:

"I continue to be impressed with the asset sale process. We are very aware of the value of our assets and will maximise value for all shareholders. My investment of a further £1M is designed to ensure sufficient financial runway during the sales process until a desired price is achieved."

So a very clear signal of good progress with those advanced discussions and Jim providing another £1 million by exercising his warrant at the same price as the last placing, to ensure there is a sufficient cash runway to get to his desired sale price.

There can be little doubt that his desired price is multiples of 15p and the share price should now start to rise back towards 30p as we await further news. The last 12 months have been difficult for all junior gold companies and indeed resource companies generally. The recent strength in the gold price which looks to be sustained has to be a very positive factor for the advanced discussion as gold is now above the gold range used in Condors original sales pitch and BFS. CNR’s gold is considerably more valuable than it was 12 months ago and when that is plugged in to the valuation it becomes very attractive. If it was a 12 month payback period on the original figures how much less will that be on the new figures which will rise exponentially.