Member Info for littlegrandma

That looks a very promising partnership, but I'm surprised that there was no RNS, I wonder why? Perhaps tomorrow, and thanks for the link anyway.

Looks a good update, hope I'm not the only remaining holder here!

Nice news, but I think we are being held back by the long history of major cuts to projects whenever the economy gets into bother.

Should be.... as you are positive.

Unfortunately Strangy83, I have to say that I'm as negative about sub coal and its prospects are you are positive. imo, no one will buy this anywhere in the world, and shareholders are just being let down gently. Again, imo, it does not make sense on an economic or environmental level.

The only way out for SAE as I see it, is a massive investor with a very long term view prepared to take perhaps 90% of the company in order to fund the next stage of Meygen. That would almost certainly have to be an American investor as none of our institutions have the guts to take such a long term view on a big investment I feel.
Hope I'm proved wrong!

There are some interesting points being made here now, and I thank the contributors. The conjecture seems to be on the optimistic side, which is to be expected from shareholders, and I would just point out a couple of things that need to be remembered.
Firstly, the actual cost of Meygen phase 1 was not the projected C£51m, from memory it ended up costing £69m which would, using the same proportions, mean that the turbines were about £7m each.
Secondly, Gupta never bought Shares in SAE, I think. He was given half the company for Uskmouth and a good story, I believe. It's very hard to find the Gupta purchase cost of Uskmouth from SSE, but two entries in annual reports seem to indicate either £12m or £25m. In all the many subsequent share issues by SAE he didn't buy in, I think, which is why he currently owns a lower percentage.

I think you are flogging a dead horse there Wenglishboy, the people investing absolutely billions into wind and solar don't seem to be doing too badly.

Anybody know what the guaranteed price for the initial phase of Meygen was? I remember reading something where the government had set a "strike price, for tidal of £305/mw but never saw details of the Atlantis award. I do remember that a purchaser had agreed to buy all power output from the project for ten years, which I think was signed in 2014, but don't know if it meant 10 years from certification or from 2014.

Thanks Strangy83, you saved me some time searching as I was sure that they had developed a 2MW, but posters here posting about 19 turbines to meet the 28MW CFD award, and being unable to find easily the AR2000 details had me worried that it had been withdrawn.
mister_tidal, judging from the last five years of turbine operation, and making reasonable assumptions about the benefits gained from R&D over that period, would not convince me that phase 2 will be profitable, nut I would think that if it could be cash positive that would be a great step forward, if they can find a very big, cash rich partner with a long term view.

Interesting Strangy83 that you mention the AR2000, which is the 2 MW turbine that I was complaining about not being able to find mention of anywhere in RNSs yesterday. Thank you for confirming that there was news that they had developed a 2MW turbine, which would tie in with 14 number matching the 28MW capacity for the next phase of Meygen. I will have to look harder to find where it was announced.

Absolutely agree with most of your post mister-tidal. The record, both financial, and in production terms, for the four existing turbines has been terrible, which will not help to convince financiers for the next phase, when asked to provide perhaps £100m+ . When the fourth turbine is returned to the sea, hopefully early next year having been out of the water for just about two years, they really have to perform brilliantly to drum up support. The one which stayed in operation while the others were out has been in continuous operation since initial installation about five years ago, so there is a serious risk of problems there I would think, and without a brilliant performance from all four turbines they are very unlikely to show any profit and might not get far past cash breakeven .

On the point that you make about SAE being perhaps what I would call "economic with the truth" I first really noticed this with the stuff they initially pushed about Uskmouth and the claimed 50% reduction in CO2 emissions. Eventually, at least a year later, they had a paid for research / presentation of about 70 pages proclaiming that this was going to do wonderful things put on their website, but in the middle of the document they fact that emissions were just not counted for the wood based component was revealed. That research paper was subsequently removed.

Recently, within the last year or so. I'm sure that I've read news from them about a newly developed 2MW turbine which tied in well with the 28MW array for the recently awarded 28 MW concession as 14 units, but having looked all over their website today, I can't find any reference to that development. Hopefully one of the regular posters here will know where it was mentioned, and it hasn't disappeared.

I think your assessment is very realistic and hope your positive scenario prevails.

The company is effectively skint, as was made fairly clear by the auditors in the AR. The cash on hand will, imo, not keep them going for a year, so they desperately need more funds, but the share price is so low and the share count is so high that any sort of conventional share issue is unlikely to succeed. The loan from the Uskmouth battery project was intended to keep them afloat until that project reaches financial closure, I think. Tomorrow I believe they have to stump up half a million in interest payment on bonds, perhaps there will be a sigh of relief and a share price rise if they don't default.
So far the Meygen first phase has not been cash positive in any of the four or five years since it began to generate.
That is what causes the share performance imo.

There is a big difference between this:-
please also do not forget that SAE turbines are now being retro-fitted with the wet-mate connection system - halving deployment and maintenance costs

this is a pretty huge cost-saving strategy which will massively benefit the figures.

And This :-
With 3 turbines now fully operational, SAE remains on schedule to re-deploy the final turbine in March 2023. The turbine is being retrofitted with a wet-mate connection system, which more than halves the cost of future operation and maintenance deployments.

My expectation is that this wet mate connection system halves the cost of the actual future operation and maintenance deployments, ie. the time spent by the ships and crew actually removing or returning into place the turbine, but not the mobilisation and demobilisation cost, or the cost of the actual maintenance work.

Although I always had great doubts about the transaction giving away half of the old Atlantis for what I thought was a hair brained scheme to burn alternative fuel at Uskmouth, I believe Strangy put his finger on the cause in his post yesterday. To date the Meygen first phase has not managed to cover its operating and interest costs on a yearly basis, let alone depreciation. In those circumstances, without lots of further follow on schemes to bring costs down, increase expertise, etc, and bring Atlantis into at least cash break even, followed in time by profit, Atlantis had to do something to survive. Unfortunately they chose Uskmouth, which has left them on the brink of bankruptcy. They now need exceptional performance from Meygen 1 to prove up the concept asap so that they can get funding for the phase awarded recently, at a time when they are so financially stressed that anything going wrong could finish them. IIRC they have an interest payment due this week on bonds of half a million, which is yet more stress on the finances.

Wet Mate connection system cannot halve installation and maintenance costs imo.

Disappointing that they only managed to install the third turbine and the fourth and final one is still scheduled for next March, but at least the third one is in even if a few months later than scheduled.

It was the third turbine they were supposed to install in May with the fourth scheduled for installation by April 2023. I'm still hoping that the loan from the future Uskmouth rent has enabled them to scrape up enough money to pay for the work to the fourth turbine, so that it can go in now, and the cost of installing it. If they have managed that, it would reduce the installation cost by an enormous amount I would think, as mobilisation and demobilisation of installation vessels doesn't come cheap. Hopefully, there will be an RNS in the next few days after they have got the turbine(s) tested and running.

You would hope so, wouldn't you, as in the April Fools Day RNS it said that the installation of the third turbine was scheduled for May, making it 4 months late based on a prediction of imminent (within 8 weeks) action in April. Perhaps the loan connected with the battery storage at Uskmouth has enabled SAE to pay for the repairs / improvements to the fourth turbine earlier than expected and we'll get for once a positive surprise, with both turbines installed in the next few days. Hope so anyway.

It's not just Uskmouth and management changes holding the shares back, imo. There are lots of large loans outstanding to be repaid over the next few years, including some which are overdue, and a requirement to raise a huge sum for the next Meygen phase asap.
SAE's milestones, such as the PP & financial close for the battery facility at Uskmouth and those associated with the CFD award for Meygen (and we don't know what those milestones for Meygen require SAE to achieve, but probably financing?), have the ability to become Millstones around the company's neck.

The increase in admin costs was explained in the presentation as down to two significant factors: high tendering costs which should result in a good inflow of work over the next six months or so, and what sounded like increased recruitment into the design / consultation / digital side of the business which is apparently growing quite well although the numbers are not revealed. Presumably there was also some salary inflation effect included as I believe they acknowledged. I can understand the overhead cost if they are working on tenders for major schemes and framework bids, as they will have been pulling huge numbers of individuals from existing projects into bid teams on a short term basis, as those are always heavily marked on quality of bids. The fact that they are already preferred bidder on £800m worth of work and are predicting a bumper six months at least of further awards, backs up the explanation as far as tendering costs are concerned, imo. Better to win projects on the quality of bid presentations - despite the raised cost, than by being cheap!

There are two turbines out of the water, and two operating, it seems magmanus's constant BS confused some into thinking that three were in operation. The one which was replaced in March had been "upgraded" according to the RNS, which presumably was the variable pitch modification, but the other one had been operating continuously for several years.