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Here you go Westie - near the bottom:

https://www.lse.co.uk/DirectorsDeals.asp?shareprice=EML&share=Emmerson

I wonder if this in the annual report RNS sums up the challenge / possible mismatched expectations:

“We have had extensive discussions with the Moroccan government and other key stakeholders, and have been impressed by the high levels of support for the Khemisset project. We are keen to reciprocate this support by using Moroccan suppliers, contractors, and financiers wherever possible, and by working with local partners to optimise the project.”

Using local suppliers, where possible, is quite a long way short of ‘developing a partnership’, equity, JV, etc.

Hope they can get this right.

I had understood that we would have to service convertible loan notes but now I see they would be the form of US$40m investment if the conditions were met by 30 Sept, so our liabilities do not increase if that passes but we will need money to keep the lights on.

Does anyone know the duration of financial ‘runway’ we have, from memory, from the last ~£6m raise?

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Strategic investment RNS
https://www.lse.co.uk/rns/EML/strategic-investment-of-up-to-us4675m-5myehg1p7cpqz7k.html

UK energy company Chariot Limited signed a Moroccan pipeline tie-in agreement yesterday with the Office National des Hydrocarbures et des Mines ("ONHYM") securing access to Maghreb Europe gas pipeline in Morocco.

In February, Chariot announced its licence award with ONHYM taking a 25% stake in the project.

https://www.lse.co.uk/rns/CHAR/signing-of-rissana-offshore-licence-morocco-awkxrn6ktmtmh1l.html

Sound Energy appointed Attijariwafa Bank, Morocco's largest bank, as exclusive lead arranger for the senior debt financing in June 2022.

On 12 February 2018, it announced the award of a new petroleum permits with ONHYM taking a 25% stake in the project.

Predator Oil and Gas secured environmental approval in Morocco for the drilling of exploration wells in the onshore Guercif permits in the North African country with ONHYM already holding a 25% stake in the project.

https://www.lse.co.uk/rns/PRD/approval-guercif-environmental-impact-assessment-pv8r76yqsmiemlv.html

I can't recall any reference to ONHYM in any Emmerson RNS, despite the M being for mines.

I do wonder, did we think we were 'going it alone' because there is no written legal obligation to give up a stake? If so, did the strategic investment we got actually rile the government and have the opposite effect of that intended. Finally, is it s challenge that Graham is perhaps an experienced technician but not an experienced business person.

Though it's not something you usually look for, I've always wondered if he was dodgy / wide enough to get in and do the deals needed to cross the line?

Certainly the pattern of investment is consistent so I would have thought a seasoned approach to the ESIA might have been to simply say we'd like to open a move and give you a share in it. No point in beating around the bush if it turns out fatal to do so.

The only saving grace that I can think of is that there is demand and the government may wish to exit the special investor or not have the additional weight of the CLNs affecting its income stream and both would benefit from closing a deal before 30/09.

Amazing that 30%+, at least, of the business is in private shareholder hands and we have no way to ask what’s happening.

The business tweets yet ignores any questions or replies.

Not limited to this share but frustrating.

Thanks for sharing - hard to find everything!

It also confirms (or rather suggests) that the spread of articles in the press a few weeks ago did come proactively from Emmerson - I don’t think the others generally referred to any source and this is the first one (I recall) referring explicitly to a named source for the quote. All good to know.

“remover“
- missing last word from the post below

I think the same; the several businesses that have gone ahead while we've been going hands all had an in country tie up (Sound Energy, Rainbow Rare Earth now). Creating local jobs is alone might not be enough to wash.

OCP’s recently announced ammonia tie up in Nigeria was reportedly a year in the making, being with sovereign wealth fund support.

What I have yet to see is EML's public inference that this seems a necessity.

It must be dawning having expected the ESIA any time from a year ago but Graham said in November that there were no then current talks with OCP and seemingly none in prospect, which he almost indignantly seemed to be down to OCP to sort (2 min extract below):

https://youtu.be/z4TG_YhEoXU?t=1888

I recon banks must all know the score because we could have got go alone funding conditional on ESIA and none has been announced.

An update to confirm he hasn't timed it too late or rubbed gate keepers up the wrong way would be a big risk.

AIM listed Rainbow Rare Earths this week closed a deal with OCP to extract rare Earth elements from OCP's phosphogypsum.

https://www.proactiveinvestors.com/companies/news/990693/rainbow-rare-earths-announce-very-significant-deal-with-morocco-s-world-leader-in-fertiliser-990693.html

Phosphogypsum contains rare earths as a by-product of phosphoric acid production.

Emmerson's CFO Jim Wynn was at Rainbow Rare Earths.

https://www.emmersonplc.com/about-us/board-management/#tab-19

Arguably academic because any Emmerson deal with OCP needs to already be well underway but fyi as I noticed the link.

UN Secretary General Antonio Guterres has said transporting Russian and Ukrainian food and fertiliser is critical to help with acute shortages and hunger worldwide.

Guterres added that enabling the transport of food and fertiliser from Russia is also critical as the cost of living crisis deepens.

"It is important that all governments and the private sector cooperate to bring them to market," he said.

My ‘happy path’ explanation would be,

- main deal now ready and circulated for signing;

- EML got this in the press as a last go to ramp the share price before the deal closes and pricing metrics attach - the old news navigates any deal NDA while creating anticipation;

- main deal announces in 3-5 days and we see why Graham, etc. stocked up with new options at locked in prices.

Warning: All events described are fictional and any resemblance to real life events are entirely coincidental. Ha ha!

Thanks Danpam for sharing.

Interesting PR piece. No new news. I wonder what it’s for in their process. Either way, hope the King is a regular reader of the website! Ha ha.

Fingers crossed it will trigger other news.

Good question, Westie.

I think it would be disclosable because it would go to value. If the company already knew that it could not obtain an ESIA without completing its works slated to take until October, then it would already be in prospective default of its strategic investment deal, because it could not meet the draw down requirements of being fully funded and permitted by 30 September. Value would be affected because the last CLN guidance would be unlikely to be met (that the CLNs would convert early avoiding material interest) and because the value of the strategic investment entitlement would be known to be only the ~£6m already received and no longer the further ~£40m because that would already known to be unobtainable on the current contract terms.

The value of the strategic investment deal would be affected and I think that information would substantially affect purchasing decision the share price and so require RNS.

Assuming, then, that none of that exists and they're in a deal negotiation and subject to an nda preventing disclosure of either the negotiation or the nda, that leaves two conundrums:

1) it leaves the company vulnerable because if OCP simply drags its heels and 30 Sept passes without proper transparent explanation, the share price could fall and OCP benefit in any JV or other deal that uses the company's value as a pricing measure; and

2) it still wouldn't clearly explain why Graham keeps appearing to mismanage expectations by intimating variations on the ESIA appearing 'soon' in some shape or form (the Midas column lady's impression, for example). It could be that he has perpetually thought the whole deal would close soon and unlock everything, but that has its own challenges because it would mean that he's thought that for a year or so and that would itself suggest the company had little bargain power or control. Also that the market change was no catalyst, which wouldn't add up much either.

Shades of this may feature but I suspect there's something I'm missing as to why the business doesn't feel able to say more or show its progress in the way it sis before.

Apologies for typos below - mobile phone autocorrect!

I think it follows the same way, that if the company has been told that the ESIA depended on all worlds being completed, then it would be duty bound (and want) to tell us, as it would clear the uncertainty. It seems inconceivable that full completion would be a requirement and the government not tell them.

For that reason, for me, 1) a deal, or 2) the company has no idea are the two most plausible.

Like Dshox, I'm happy to wait, on a personal basis, and I am concerned objectively as to the impact on valuation and liquidity if 30 Sept were to pass in silence as to the cause (i.e. ‘were remain confident’ seems insufficient after even the Midas column journalist having spoken to Graham understood it as being expected any day / H1 on that Vox podcast). Delay is okay (if finance is managed) but needs accompanying explanation to be fully okay.

Early EML was renowned for news flow and transparency and I’m sure it would be now if matters were within its control.

More helpful, I think would be for OCP to ask us to mine it’s land as a contractor. Could bring in greater economies of scale and be strategically secure for us.

I think that’s right; the counterbalance this time waiting has eaten into the existing ten year licence. Another reason to get skates on!

Again well put, it’s very hard waiting in silence but all logic points to success, the time time is right and the asset is not a basket case. Careful footwork required and hopefully in play.

Ha ha, very nicely put!

For me it’s just chat and, I suppose, awareness of the CLNs, which the guidance was would simply and quickly be burnt off as the price reached 18p+ on ESIA (can’t remember if that was ‘and funding’).

The world doesn’t end if they aren’t fully approved and funded by 30 Sept, but it’s a little more complex, more costly and we haven’t seen the business’ Plan B.

Out of interest, what’s the vision of how the cost of the CLNs will be handled if we aren’t fully approved and funded by 30 Sept and do those things for end of year?

Did the guys just self-issue their bumper July share options package (outside the recent AGM or any calendar waypoint), knowing a deal will soon close and that they won’t any longer have independent authority to do that with an OCP appointee on the Board? Who knows! (not a completely crazy idea)

The information landscape is so barren that we can make anything up! Ha ha.

P.s. Agree we definitely haven’t had an funding or approvals since March, just two rounds of share options going out. I’m guessing CleverThoughts is saying the background should be a catalyst for those things?