Member Info for jointhedots

A number of years ago I had the pleasure of hosting investors who where considering a multi million pound investment in an enterprise in the extractive industries.

These included Pension funds, a major bank and a very well known venture capital groups, the most significant takeaway from the encounters was that they had not got a clue how to assess the project and were simply looking to see if the operations matched the financials/proposals they had been presented with. I know for certain they didn't ask the questions they should have the same goes for the respected international consultancies that where employed to do due diligence.

In effect the visits did not penetrate to uncover true value, so when I hear Malcy and other analysts have visited some site or other including Amerisur I take it with huge scepticism.

Which bring me to the point of this post, the institutions currently selling/buying probably have a much poorer understanding of the underlying business than many PIs and really don't care one way or another as long as they follow their own financial rules - we can read nothing into the sales of any institution except they are selling.

I believe selling now is a huge mistake, but I can't say the institutions are making a mistake as it's their objectives that are being met and that might not be holding on for the best price like me (e.g. reducing risk).

The entities that will truly know what the business is worth are the potential bidders and what anyone does now will hold no sway in the final outcome.

No one should be fretting about the SP now, it will have no bearing on the ultimate price you receive for your shares. Keep your nerve and trust your own judgement.

IMO the thing we should really concerned about is the lack of visibility of operational progress as we approach 2/3 of the way through the year - only 4 months left to drill more wells than we're ever previously achieved - it's unlikely and it will soon become impossible to achieve the operational targets. I pointed out this exact SAME SITUATION last year when the BoD continued to maintain the façade of control when it was clearly, IMO, deceitful.

The lack of progress wrt Indico-2 is really becoming a significant concern, not least because potential bidders will have to be confident that ONGC intend and can actually develop the block.

Hermes have bought now sold.

All this is to be expected as is the wobbling SP, news on any offer or the million to 1 shot, operational progress, will move the SP appropriately, 1p, 10p, 20p, whatever and none of this will matter.

As someone just said it depends on Viewpoint and we all have different viewpoints and objectives - not everyone feels Amerisur is a great buy or hold for instance.

Which brings me to River & Merc - someone has just said " are river and Merc selling out now because they don't think any meaningful offer will materialise and the SP is at a ceiling"

Even in respect to that statement there is a huge Viewpoint related error - R&M are not necessarily selling out, they are selling down and god knows what their reasoning is, it maybe to reduce risk or exit the sector, liberate cash to buy something or even tell a potential bidder to approach them! It tells us nothing about what they eventually expect to get for their holding.

IMO anyone for off is best encourage to sell and gone, the more remaining shareholders with high expectations the better change of pushing for a great offer price, unless you are for selling out yourself you are not being hurt be their activity.

Turning to ONGC and their Viewpoint, everyone needs to realise they are having all sorts of problems in loads of places with Colombia representing one of the bright spots - forced to buy an India peer at an inflated price, systematically forced to stump up spare cash to the Indian government, pressured to sell down shares in their businesses to provide more cash to India, not paid in Venezuela, hit with a huge fine in Russia, committed to high investment, some faltering projects around the globe the list goes on.

I don't think the above is conducive to them getting on with exploration on CPO-5 (not withstanding they appear unless in any case) or making a bid.

I do not believe they will be the likely buyers of CPO-5, hope I'm wrong and the push hard though, my opinion is it will be any of or combination of: Geo Park. Ecopetrol and Parex.

Took another look Jeremy Coller yesterday to see any other oil related links and maybe get a feel for his viewpoint, noticed his group had gone into business with Shell in the past, that's all I found wrt oil. But much more interesting is his environmental stance. Read a Forbes article citing his pressure group FAIRR of 80 major investment entities and I mean massive $12trillion - that's not a typo and dwarfs just about anything I've come across (6 times UK national debt). The guy is well connected to say the least, however, the group is pressuring for responsible meat production/land use etc and IMO it provides ample explanation of why he would be frustrated and want out of Amerisur and not wish to be identified as a shareholder (could look hypocritical to some to be exploiting a pristine rainforest). My view is he is highly unlikely to increase his interest and will have told GC what he wants - I suspect Michinoko could be insiders. Is there a listing anywhere?

Declared sale of another 1,125,000 shares - looks like they are the sticking point for now.

The good thing is that someone is taking on the shares.

On a different subje2ct - perhaps the drilling contractor for CPO-5 have forgotten their spanners and can't dismantle the rig. Just a thought , it's as plausible as any other pathetic reason we are likely to get for the timescale.

Finally, I checked the BoD's last couple of presentations - anyone know what the various types of play we're going to test this year are? Or is it just more BS.

Selling shares and holding the SP for now, last three RNS's from them.

They may well be selling a few or a large batch, who knows but the SP is best lodged at 19p until they are finished.

Fev - I'm not saying that the sale is anything other than by far the most likely outcome, just that other possibilities still exist until the money changes hands and we shouldn't stop being curious until we're got our money - we need to keep our eye on the ball.

I appreciate many shareholder don't want to consider anything other than a clean sale now, but I will because I don't want to get ripped off.

Colonel questioned why I'm bothering as the sale is certain, it's not, the Strategic review may determine we should not sell at the offers tendered - what if we are only offered 25p and there is a clear alternative path to double that .

Oh- forgot to mention wrt your comment "...I don't know why you're bothering to speculate as it has no bearing on the process going forwards"

How can the ongoing relationship between the BoD and the company's biggest shareholder have no bearing on the process - it may well be the thing that precipitated the process.

Colonel - Totally disagree, but if it works for you then all you need to speculate about is the price.

Personally, having seen bids fall through, companies sold of a pittance, taken private, gone into packaged administration to allow director to takeover for a pittance, activist investor blow the entire thing out of the water etc.

What I'm saying is your "the company will be sold. That's that." is a very blinkered view to say the least. If that were the case we would all be totally relaxed and simply speculating on the eventual price and timescale - some are but it's incredible naïve.

What if:
Shareholders don't get a satisfactory price.
Big shareholder become activist and oust the BoD in favour of a new set-up
The situation changes in respect to all manner of things including security and oil price
Indico-2 produces at a phenomenal rate (nearby wells have produced at over 10000bpd)
We accept it will happen in a fatalistic way then the BoD do not need to represent our interest quite so strongly.

Whatever, there are lots of shareholders and some have a totally different perspective on a fair/likely SP else the SP would be static, as I said yesterday it's a long way from over. With your view though, you may as well spend your time looking at something else.

Colonel - it's not about the money, I'm sure none of them are strapped for cash, though I don't think pushing up to £1m is beer money to anyone bar the super rich, they're not on the Richard Branson or Warren Buffett scale.

It's more about the potential falling out, most likely over progress and following on from that if this is being done for the good of all shareholders or perhaps for some other reason like the benefit of the inner circle (the BoD) in a messy divorce. If the BoD where given the elbow would Michinoko perhaps stick with this a little longer and see CPO-5 to fruition.

I think not, Ironveld (NH director, JW major shareholder and GC- chairman mining enterprise) was one of the biggest rises on AIM yesterday after announcing an update on it's strategic review. Apparently "the Company has entered into confidentiality agreements with several parties interested in potentially making an offer to purchase all or part of the Company's assets", it's too much of a coincidence for me and I suspect in the case of Amerisur and Ironveld the guys have made the running and it is they and/or Michinoko that are driving events.

Major shareholders are
Tracarta Ltd. 68,680,767 11.6% - JW's investment vehicle
Michinoko Ltd. 54,592,653 9.22% - Jeremy Coller

Looks like there could have been a falling out (as reported by the times) or perhaps retirement or even cashing up for a new venture as they work closely as a team. If Michinoko are the driving force then there is no way they will cash in early IMO.

The plot thickens, here's the RNS:

"12 August 2019
IRONVELD PLC
("Ironveld" or the "Company")

Update on Strategic Review

Ironveld plc, the owner of a High Purity Iron ("HPI"), vanadium and titanium project located on the Northern Limb of the Bushveld Complex in Limpopo Province, South Africa, is pleased to announce that as part of the strategic review of its mining assets announced on 2 July 2019, the Company has entered into confidentiality agreements with several parties interested in potentially making an offer to purchase all or part of the Company's assets. Ironveld is currently in the process of providing such parties with further information on the Company's assets and access to the Company's site, management and advisers.
The Company is encouraged by the level of interest it has received to date and looks forward to working with interested parties to further the strategic review.
Further interested parties are encouraged to read the research report available at https://researchlibrary.finncap.com/User/Login that sets out the potential for the Company's assets to become a vertically integrated vanadium mining and processing business, as well as review the Company website (www.ironveld.com/). Such parties should also contact finnCap through the details set out at the bottom of this announcement."

Juxtapose - "Where has that rig got to? Surely by now it will have traveled the few kilometers back to Indico?"

We need to be patient, it's probably had to be stripped down and sent back to India for a quick check over, give it a few more weeks the lads are working their cobblers off. lol

I think we have to go forward on the basis that they will move heaven and earth to slow the drilling down and fail to finish another well before the sales process completes - if they manage one then a potential buyer might assume they are competent and they can't be having that.

A question, as I've not tracked all the holding RNS's I can't say categorically - but I have read a few and can't recall seeing anyone undertaking any shorting of Amerisur. thoughts?

Surely that suggests no one has any confidence the SP will fall back or at least the risk is worth committing the cash.

Does that also mean that a good portion of the shares are being bought are being up and held by those to see this through - following that logic (unless it's flawed) the MM's are going to find it awfully difficult to dip the SP each day. That has been evident for the last few sessions when after the early morning and mid afternoon dips the SP has recovered - something totally alien to Amerisur shareholders who where punished at the end of almost every session.

My interpretation may be totally flawed but the pattern has changed totally, we'll see how it pans out again today.

I think the BoD's strong advise to hold onto your shares in the face of offers from M&P stands for any price at least until we push well past 20p, them it's up to each persons judgement IMO.

I won't be selling at all as I think the final sale price will be the absolute top deal, but sensibly of course there will be those that are happy to go at 25p particularly as that was the price of the last capital raise.

Anyone selling now is IMO selling them selves short - as have all those that have sold since the sale process was announced - every one of them as of todays high.

I've also had a random thought, the signing of the non-disclosure agreement with potential buyers also (I would be amazed if it didn't) includes them agreeing not to buy or sell shares or allowing persons working in concert to do so - in fact are they not insiders?

It follows that for the most part the buyers pushing the SP up now this is formal are other parties that merely want a share of the potential rewards - so when the consultation party breaks up and the disgruntled bidders are free to trade we could see a second push on the SP if they try to push their case!.

More interestingly, there could be parties that have decided not to entry into the consultation process and plan to launch their strategy later - it's not as far fetched as it sounds many of the interested parties will have already done due diligence on the part of the company they might bid for because the company has already gone through the process with multiple companies over the Put blocks and OBA (e.g. Occidental already know about the company and ONGC know all they need to about CPO-5, Gran Tiera know all about the block we just bought from Vetra)

Those companies could buy or make an offer to shareholder without BoD agreement or enter into the process late on after everyone else has shown their hand. Likewise unless companies have signed agreements not to make an aggressive bid it is possible some may walk away from the process and launch a bid if they get frustrated. Occidental came in with an offer for Anadarko after a BoD negotiated offer was advised to shareholders.

It's not over until the fat lady has sung and our fat cat directors have their pockets fully lined.

It may run smoothly like clockwork, but it only takes one rough to bleak ranks to set the ball rolling .

willec - the clue is in the name "Market Maker".

Actually we are on the same page in respect of this, I'm no supporter of ONGC, they appear awful, their tender process is pathetically cumbersome as it is drawn out endlessly to get all the services in place. Everything end to end as my old boss used to say.

I also agree with you about ONGC buying CPO-5. They're unlikely to beat the likes of Geo Park or Ecopetrol to the prize unless they stand down by agreement. Both of the afore mentioned companies are in partnership with ONGC to look at opportunities and have interests in adjoining blocks.

It's not a big stretch of the imagination to envisage the companies, any 2 from 3 forming joint ventures to bid - I would actually be tempted to place a bet that Geo Park where one of the companies that made approaches before the disclosure of M&P interest.

pickedpeck - your comment "What exactly would you have our team do? Offer to buy ONGC out of CPO5?"

Ask a question by all means but your inclusion of an implied silly solution I might have isn't really fair.

I started my post and continued along the lines that the have failed and are continuing to fail, I did not suggest a solution and said clearly that I was resigned to throwing in the towel as I consider them a hopeless case.

However, the answer to your question is that I expect them to box clever in respect to every aspect of the business, to suggest they are helpless victims of ONGC is ridiculous, they are big boys who approved the drilling campaign and though claiming to be massively experienced didn't spot the geological problem with the failed well (lets not forget they also screwed up on the N-sands, misinterpreted and never closed the project off properly (why no further wells to prove other horizons or a statement that it's not worth it?) and why has every other block led to nought).

Out of interest, here's a few possibilities they could perhaps have done to gee up ONGC, I'm no expert in their domain but they should know what levers they have:

1) Told ONGC clearly and repeatedly they where unhappy with progress, pressed for proper explanation
2) Offered a greater contribution to costs (to be paid back later like the pipeline project)
3) Offered practical help - there was a suggestion of Amerisur undertaking the drilling a few years ago.
4) Offered to take over operatorship, joint operatorship, and yes if necessary take a greater share, say 21% from them as they are under. I actually think a deal may be done with other operators to surrender control, tremendous pressure to dispose of controlling interests from the Modi government.
5) Told shareholders what was going on, we have been kept in the dark for a long time.
6) Stopped being all pals together as Cricket fanatics and used some leverage.
7) Reviewed all information and advised ONGC on actions and deficiencies.

Obviously the above are all passing thoughts and maybe some have been done or are inappropriate, but we have no visibility of what they have done if anything. Actions could well have had negative repercussions but doing nothing has resulted in a failure in any case. Your suggestion that our BoD could do nothing is too simplistic, we pay a share of the bills look what happened at VOG with their partner in and out of court when they were ignored.

Barring JW, our BoD are all but invisible.

What I expect now is for them to handle this process properly, but for god's sake don't ease up on operations as the price will be better if they are firing on all cylinders and able to tell buyers to sod off. It's too late for them to change their spots, but they could still screw things up if they take their eye off the ball.

Though I'm happy with the way this takeout process is being handled it is incredibly frustrating that the company/partnership is making such a meal of drilling a few holes in CPO-5.

It's not just slow, it's verging on pathetic, correction it is pathetic, Indico-2 could provide a significant uplift in the value of CPO-5 let alone completing the other wells that are supposedly planned. It's so sad, they are so lack-lustre, that's perhaps the main reason we are up for sale.

The reason I've posted these thoughts is because I've just read about Gran Tierra's recent find, announcement made on Wednesday. The contrast could not be more stalk , just read the article, they go for it just like the other successful operators and our BoD dither about and bluff with pathetic forward aspirations.

At first I was torn between holding onto my shares and taking whatever we can get - now I afaid I'm in the camp that believes our bozo's will never make a go of it.

"Canadian firm Gran Tierra Energy announced Wednesday an oil discovery in a development onshore Colombia, Kallanish Energy reports.
An exploratory well encountered 77 feet of oil pay in the Acordionero oilfield, located within the Middle Magdalena Valley Basin. It produced an average of 509 barrels per day (Bpd) between Aug. 1 and 7, and an average of 751 Bpd between Tuesday and Wednesday.
The company also announced the commissioning of the expansion of Acordionero's central processing and water injection facilities, and the completion of further infrastructure to allow for a total oil production capacity of 30,000 Bpd.
“With this recent well result, along with the waterflood expansion and performance at the Acordionero and Cohembi fields, we expect positive proved and probable reserve additions at year end,” Gary Guidry, president and CEO of Gran Tierra, said, in a release."

Come on guys - thinly veiled ramping of your investments - really!

There are specific ramping BBs, try on those where there a hundreds of tips to go at. lol

Many thanks - but I'll pick my own, SomewhatGullible, maybe I am but not a complete idiot.

I'd love to ramp my investment on the BB but exercise restraint as it is disrespectful IMO.

Good list but there are numerous others the most obvious of which a are:

Ecopetrol who are Colombia's biggest and national oil producer, partnered with just about everyone and into everything - just bought into the Llanos blocks around CPO-5 in partnership with Geo Park. Don't discount them I believe they'll be in the mix

Frontera, the largest independent O&G producer in Latin America according to them, market cap $1.05m and almost $500m in cash. They have also declared an interest in acquiring asset

Sinopec - extraordinarily quiet but still a significant presence in Colombia and partnered with ONGC - and with respect to size there is no one with more clout as they're backed by the Chinese state.