Member Info for MountTeide

Regardless, anyone looking at SAVE as a 3+ year investment is likely to benefit hugely from Ibom Power's decision to increase their generating capacity with the building of a new 500MW power plant.

komakino - something may have been lost in the transition by This Day, as other news sources i checked did not specifically mention that completion of construction was imminent.

He maintained that, currently, NBET’s indebtedness to Ibom Power runs into billions of naira, adding that if it invoices N1 billion, it does not get up to N300 million payment.

Etukudo, however decried the persistent energy crisis in Nigeria even after privatisation and with huge funds invested in the sector by the federal government, blaming it largely on the failures of the distribution companies (Discos).

The power expert expressed disappointment over the disappearance of maintenance culture in the system, saying most of the transmission and distribution network infrastructure had been left unmaintained for years.

Insisting that solving Nigeria’s power problem needs a will power, Etukudo declared that he has the magic wand to giving Nigerians electricity, adding “everywhere, all over the country is dark but there is power. The Discos don’t give power to the people.” '

The Managing Director of Ibom Power, Mr. Meyen Etukudo, disclosed this in a session with energy reporters in Uyo, the Akwa Ibom State capital, adding that the 685MW licence acquired by the company had even been renewed till 2028.

Etukudo also declared that based on his wealth of experience in the power sector, right from his time at the glory days of the defunct National Electric Power Authority (NEPA) and his exposure in the international energy developments, he knows what it would take to solve Nigeria’s power problem if given the opportunity.

He listed some of the challenges confronting Ibom Power to include the inability of its host Disco to take the quantum of power it generates.

‘‘For instance, if I generate 100MW of electricity and the Disco is only able to take 60MW, I send the remaining 40MW to the grid at the National Control Centre in Osogbo, Osun State. But if the Disco can take everything I generate, there is no point sending it to the grid,” Etukudo explained.

He lamented the inability of the host Disco and the Transmission Company of Nigeria (TCN) to invest in infrastructure upgrade, saying that was a major setback to the state.

Etukudo stated that the Akwa Ibom State government had however taken up the responsibility of TCN by building 132/33KVA and 260MVA at Ikom, Cross River State, which was inaugurated by the Vice President, Prof. Yemi Osinbajo, in 2020.

According to him, this is a giant leap that has not been recorded anywhere in the country, as the Akwa Ibom State Government is the first to record such feat.

He said Governor Udom Emmanuel, took the decision not to wait for the federal government through the TCN to invest in the project because it would go a long way in solving the power supply challenges confronting industries in the state.

He said the gesture by the state government was also to ensure that the schools and hospitals also enjoy uninterrupted power supply, noting that it was regrettable that the state government was doing all this alone without help from anywhere.

He said if the governor had all the powers, he would have done far more to transform the electricity sector in the country.

He pointed out that the 40 per cent stake of the federal government in the Port Harcourt Electricity Distribution Company (PHEDC) had prevented him from making the desired investment in that regard.

Etukudo said Akwa Ibom was blessed for not havimg gas constraints, explaining that the gas pipeline layed to Ibom Power was enough to take about 400 million standard cubic feet of gas (scuf) which was enough to take care of the phase two of the 500MW power plant.

On the electricity market’s indebtedness to the firm, Etukudo said since 2016 when he came on board at the company, it had not been able to receive up to 30 per cent of its invoice to Nigerian Bulk Electricity Trader (NBET) Plc.

A new nationally important development was announced in Nigeria last week that will see Savannah Energy's gas supply to the three power generators in Ibom Province increase by up to 130 MMscfpd (more than 70%.

SAVE currently has 5 Gas Supply Agreements in Nigeria, three of which are with the region's power generators:

* A GSA to supply Calabar Electricity Generation Company Ltd, which owns and operates the Calabar power station, with 131 MMscfpd of gas for a 20-year period which ends in September 2037, with a take-or-pay commitment of 80% of the contracted volume. This GSA benefits from a World Bank supported US$112 million Partial Risk Guarantee which guarantees payment to Accugas for gas supplied. The Calabar power station has installed capacity of 560MW;

* A GSA to supply 20 MMscfpd of gas to Ibom Power, operator of the Ibom power station, for a 10-year period which ends in 2023 with a take-or-pay commitment of 80% of the contracted volume. The Ibom power station has a current installed capacity of 191 MW and is owned by the Akwa Ibom State of Nigeria.

* A GSA with FIPL to supply a maximum nominated daily quantity of 35 MMscfpd of gas to the FIPL Afam power plant which has a current power generation capacity of 180MW. FIPL is an affiliate company of the Sahara Group, a leading international energy and infrastructure conglomerate with operations in over 42 countries across Africa, the Middle East, Europe and Asia. The GSA is for an initial term of one year with the ability to extend upon mutual agreement.

The Accugas facilities and pipelines have significant spare capacity and are strategically located in South East Nigeria, an area with substantial undeveloped gas resources (c. 10 Tscf undeveloped gas estimated to be located within tie-in radius of Accugas pipelines), and significant expected demand for gas from power stations and industrial offtakers in the Calabar, Port Harcourt, Aba and Uyo areas.

So, the Nationally important development announced last week that Ibom Power is to build a new 500MW Power Plant alongside its existing 190MW Plant to increase the company's regional generating capacity to 685MW is tremendous news for Savannah Energy, as it will see Ibom Power's gas demand surge from the current 20 MMscfpd up to a potential 150 MMscfpd based on Savannah's supply contract for the modern 560MW power plant at Calabar Power Station.

Ibom Power Targets Generation Increase with New 500MW Plant - This Day / Nigeria 25 Jan 2022

'Ibom Power Plc, one of the Independent Power Plants in Nigeria, is rounding up the construction of its new 500 megawatts (MW) power plant to ramp up the company’s generation capacity.

The project being handled by General Electric (GE), is expected to be completed this month, and will add to the firm’s existing 190MW plant.

Exited the year extremely well positioned to deliver a very strong performance in 2022 with $117.4m in cash, production of 20,000+ boepd, Opex at circa $22.50/bbl, operating cash flow building at circa $45m a month, sharply rising IMO and regional oil price premiums to dated Brent, and Brent averaging $85+ YTD.

A very clear hint in the commentary as to where the focus will be in 2022!

'We are seeing an active asset market in our core Asia-Pacific region. We are working hard to take advantage of this, but will only do deals where we are sure of delivering accretive value to shareholders. We are hopeful that 2022 will finally see accelerated progress on the Maari acquisition following recent changes to New Zealand's hydrocarbon legislation, specifically around decommissioning. Similarly, we anticipate that the positive fundamentals of the Vietnam gas project will lead to renewed momentum this year.

'No new production wells have been drilled on the fields by the operator since 2015 and Savannah intends to make further investments in the fields, including drilling an average of 12 wells per year from 2023.'

Suspending the drilling of new oil wells for 7 years on these assets due to low oil prices has seen the average field production drop from 46,218 bopd in 2017 to circa 33,500 in 2021. Since 2015, only the two hundred high performing wells responsible for 75% of total production were prioritised for work-over. The top 200 wells averaged 173 bopd each in 2015 while the other 400 wells averaged 29 bopd. Comparative figures for 2021 are 124 bopd and 21 bopd respectively.

New production wells in the Doba and Doseo basins typically test at rates up to 2,200 bopd and 2,368 bopd in the lower and upper cretaceous reservoirs respectively. Consequently, recommencing drilling in 2023 with a 12 well a year programme, should have a highly material impact on production.

According to BP’s January 2018 statistical review "over 40% of Chad’s reported proved reserves of 1.5 Bn Bbls, that is 635 MM Bbls, have been produced from four production licenses in the Doba Basin fields operated by ExxonMobil. This implies that as of the end of 2017 around 900 MM Bbls remains to be produced from the fields and areas that contributed to the original estimate."

From Exxon:

Successful restructuring of Chad oil field operations

The restructuring program began in early 2015 following EEPCI’s decision to reduce both capital and operational expenses by suspending the drilling of new wells. The company’s focus shifted to maximizing oil recovery from the project’s producing wells.

By the start of 2016, the project had transitioned from operating multiple drilling and completion rigs to one well work rig. The demobilization of equipment was accompanied by a reduction in contractor and employee staffing. These actions resulted in a 95 percent decrease in EEPCI’s 2016 capital expenses compared to 2014, the last year of substantial drilling.

Described below are the operational changes that led to a 20 percent reduction in operational expenses from 2015 and an all-time best safety record.

Top 200: Recognizing that 30 percent, or 200, of its 600+ wells produce 75 precent of its oil output, EEPCI opted to give maintenance and well enhancement procedures priority to this “Top 200.” To the extent time and resources permit, crews also repair and restore lower performing wells outside the Top 200.

As we move into year 11 of the disingenuous management doing nothing more than losing all their 'investors' money by, lets be generous, impersonating 'Port Developers', here's an idea...... the Board could perhaps use their time more productively by giving Pavin Bakhshi, their former CEO and now highly paid MPL 'Consultant' moral support, by flying out to New York for Pavin's upcoming trail in the US for allegedly carrying out a $300m securities fraud, while he was telling his shareholders he was busting a gut running MPL.

Bakhshi will need all the support he can get as the US courts have a 98% conviction rate compared to just 61% in the UK.

With Brent back up to $79.5/bbl, production doubling in H2/2021 to circa 20,500 bopd, and OPEX dropping $6/bbl(21%) to circa $22.50/bbl, Jadestone Energy's high denomination bank note printing press business has entered 2022 firing all on cylinders!

Jadestone's Stag production should currently be realising circa $92/bbl inclusive of the most recent heavy sweet crude regional premiums to Brent, while the light sweet Montara and PM grades around $84/bbl inclusive of the current $4.50 Tapis premium.

Marine Fuel Oil and Major Oil Benchmark pricing - change compared to pricing on 9th December 2020 in brackets - (all prices rounded to nearest whole number)

$117 / (+38) - Marine Gas Oil - APAC Average
$102 / (+38) - VLSFO - APAC Average
$92 / (+35) - Jadestone / STAG
$84 / (+31) - Jadestone / Montara
$84 / (+31) - Jadestone / Peninsula Malaysia
$84 / (+31) - Maari
$79 / (+31) - Brent
$77 / (+33) - High Sulphur Fuel Oil - APAC Average
$76 / (+28) - WTI

Demand for marine fuel oil is at a record level, and is driving very strong price premiums to Brent for both light and heavy sweet crudes.

At today's Brent price, management guided current OPEX of $22.50/bbl and the latest IMO 2020 heavy sweet and Tapis premiums to Brent, Jadestone should be realising a staggering circa $64/bbl of operating cash flow for its combined circa 20,500 bopd Stag, Montara and PM production.

Suggesting the business should currently be realising circa $479 million/yr of operating cash flow(pre Capex), with the potential to increase to $554 million/yr by Q1/2022 on completion of the Maari acquisition.

Current market cap: $557m.

Estimated Annual Revenue at $79.5/Brent:
$643m - Current
$745m - On Maari Completion (plus a circa $75-80m net consideration cheque)

Assuming Maari completes in Q1/2022, Jadestone Energy may well then have over $200m in cash, no debt, and generating $554m/yr of operating cash flow at $79.5 Brent.

AIMHO/DYOR

The average weighted price paid by II's for equity following this latest placing will have dropped from 39p to 34p for a total consideration of $324m.

With an economic effective date of 1/1/2021, and completion expected in June 2022, the total adjusted consideration could well end up around $325m were Brent to continue averaging around the current price. This would suggest a total debt of circa $625m-650m by the end of H2/2022.

Market cap was around $250m at 19.35p prior to suspension, and will increase to $310m after today's cash raise.

According to today's announcement, all SAVE's assets are currently generating around $300m FCF/Yr. So, at a s/p of 19.35p, SAVE would be trading at around 12 months free cash flow - ridiculously cheap for a company that is generating cash flow at a level capable of paying off its debt in just over 2 years.

With Brent back to $75.5/bbl, production doubling in H2/2021 to circa 20,500 bopd, and OPEX dropping $6/bbl(21%) to circa $22.50/bbl, Jadestone Energy's high denomination bank note printing press business will have moved into overdrive!

At $75 Brent, the quality end of the recession leaned oil and gas industry, according to latest results, is now churning out operating cash flow equivalent to when oil was $100+/bbl during 2010-2015.

At today's $76.5 Brent, Jadestone's Stag production should now be realising circa $89/bbl inclusive of the most recent regional premiums to Brent, while the light sweet Montara and PM grades around $81/bbl inclusive of the Tapis premium.

Marine Fuel Oil and Major Oil Benchmark pricing - change compared to pricing on 9th December 2020 in brackets - (all prices rounded to nearest whole number)

$116 / (+37) - Marine Gas Oil - APAC Average
$100 / (+36) - VLSFO - APAC Average
$89 / (+32) - Jadestone / STAG
$81 / (+29) - Jadestone / Montara
$81 / (+29) - Jadestone / Peninsula Malaysia
$81 / (+29) - Maari
$76 / (+28) - Brent
$76 / (+32) - High Sulphur Fuel Oil - APAC Average
$74 / (+26) - WTI

Such is the demand for all grades of marine fuel oil, HSFO is now changing hands for the same price as premium grade light sweet Brent.

At today's Brent price, management guided current OPEX of $22.50/bbl and the latest IMO 2020 heavy sweet and Tapis premium to Brent, Jadestone should be realising a staggering circa $60/bbl of operating cash flow for its combined circa 20,500 bopd Stag, Montara and PM production.

Suggesting the business should currently be realising circa $450 million/yr of operating cash flow(pre Capex), with the potential to increase to $520 million/yr by Q1/2022 on completion of the Maari acquisition.

Current market cap: $497m.

Estimated Annual Revenue at $76.5/Brent:
$617m - Current
$715m - On Maari Completion (plus a circa $75m net consideration cheque)

Assuming Maari completes in Q1/2022, Jadestone Energy may well then have over $200m in cash, no debt, and generating $520m/yr of operating cash flow at $76.5 Brent - now there's a thought worth raising a glass to the management and staff over the festive season.

AIMHO/DYOR

The average Brent price for the 42 month period from 1/1/2018 was circa $56/bbl - during which the businesses generated an average operating cash flow of circa $200m/yr.

The two upstream businesses will have potentially generated an additional $150m per annum of operating cash flow at the $72/bbl price Brent has averaged this year.

Even after assuming that production was shut down for 2 months over the summer - the adjustment to the headline $568m price + contingencies of the deals from the 1/1/2021 economic effective date, could still be in the $275m-$300m range.

AIMHO/DYOR

How to turn £1m into £2k - invest in MPL at the 2010 London IPO and let its management 'manage' your 'investments'!

Former MPL Executive Chairman for nearly a decade and now NON EXEC Nikhil Ghandhi continues to fight a number of lawsuits alleging he carried out industrial scale frauds,....... one writ states he siphoned tens of $millions from a previous company he had Executive Responsibility for, into accounts run by him and his family.
Ghandhi has a previous criminal conviction for industrial Scale Insider Trading which saw some of his companies either banned outright or suspended from the Indian Securities Market for up to 8 years.

Former MPL CEO, professional liar and shyster and now highly paid MPL consultant Pavin Bakhshi's jury trial in connection with charges that he and three accomplices carried out a $300m securities fraud in the US, has been scheduled to commence on 15th Feb 2022 before Judge Madeline Cox Arleo.

Only Bakhshi and Parmjit Parmar will undertake the jury trial as the other two alleged fraudsters are currently fugitives from justice, hiding from law enforcement!

Now down 40% from the recent placing !
Back in late 2016, two shipping and port industry friends and I (all 40 year veterans of the industry with long and deep senior management experience) during phone calls lasting hours, explained to the largest II's that they would lose all their clients money and how we knew - they subsequently refused to listen and then compounded the problem by doubling down twice in subsequent Placings. These guys collectively bought £tens of millions at the IPO at £2.50 a share and are now down 99.8% on that 'investment' and 98% on the first placing 'investment', and 90% on the second placing 'investment'.

The sharper eyed will note the current market cap of £13m is less than half the bank debt drawn to date before the ever savvy banks, that have a Lien over the 'assets', embarrassingly put a complete stop on any further withdrawals. It is now at a level that is just 40% of our estimation of the current market value of the construction work completed to date!
If it looks and smells like Industrial scale FRAUD, avoid like the plague !!

Why did they do that?

Answers on a postcard to the Mumbai Fraud squad.

Jadestone Energy's (JSE) business/operations update issued today (see below) gives a good indication of the operating cash flow that a 20,000 bopd second phase, low cost producer of high quality light sweet crude oil can generate in the fast growing Asia Pacific energy market today - where Buffalo's ultra low sulphur crude would currently attract a circa $4.50 price premium to Brent.

I strongly believe and continue to articulate that Advance Energy has all the hallmarks of an early stage Jadestone Energy:

Jadestone Energy's business/operations update this morning:

* Production of 17,800 boe/d during Q4 to date.

* Averaging 20,000 boe/d prior to shut-in of the worked-over Skua wells to facilitate demobilisation of the rig. With production expected to "increase further once both of the Skua wells are brought back onstream."

Let's assume average production of 20,500 boe/d post demob of the Valaris 107 rig. With the potential to increase to 23,750 boe/d on completion of the Maari deal.

Post release of the rig, lets's assume Montara and PM production will be generating 18,000 boe/d and Stag 2,500 bop/d .....Montara and PM (and Maari) production is sold at Tapis price, which is currently at a average of a $4.50/bbl premium to Brent, while Stag is currently achieving a $7.50/bbl IMO 2020 premium to Brent.

This suggests with the Brent spot price at $74.50, Jadestone should be achieving an average realised sales price of $79.50/bbl for their 20,500 boe/d of production.

With current OPEX 'Significantly'(this generally means more than 10% in financial sector jargon) below the lower end of the guidance figure of $25.50/bbl - so, lets assume current OPEX of $22.50/bbl.

This suggests:

With estimated current total production of circa 20,500 boepd Jadestone should be realising:

* $426 million/yr of gross operating cash flow, with the potential to increase to

* $500 million/year on completion of the Maari acquisition(plus a circa $75m cheque for the adjusted consideration from the 1/1/2019 effective economic date of the $50m deal)

Estimated Annual Revenue at $74.50/Brent:

$595m - Current Revenue
$689m - On Maari Completion

With the current market cap at $498m, by any objective analysis, Jadestone Energy has got to be one of the best value/growth plays in the O&G sector, or any other sector!

AIMHO/DYOR

* Production of 17,800 boe/d during Q4 to date.

* Averaging 20,000 boe/d prior to shut-in of the worked-over Skua wells to facilitate demobilisation of the rig. With production expected to "increase further once both of the Skua wells are brought back onstream."

Let's assume average production of 20,500 boe/d post demob of the Valaris 107 rig. With the potential to increase to 23,750 boe/d on completion of the Maari deal.

Post release of the rig, lets's assume Montara and PM production will be generating 18,000 boe/d and Stag 2,500 bop/d .....Montara and PM (and Maari) production is sold at Tapis price, which is currently at a $4.50/bbl premium to Brent, while Stag is currently achieving a $7.50/bbl IMO 2020 premium to Brent.

This suggests with the Brent spot price at $74.50, Jadestone should be achieving an average realised sales price of $79.50/bbl for their 20,500 boe/d of production.

With current OPEX 'Significantly'(this generally means more than 10% in financial sector jargon) below the lower end of the guidance figure of $25.50/bbl - so, lets assume current OPEX of $22.50/bbl.

This suggests:

With estimated current total production of circa 20,500 boepd Jadestone should be realising:

* $426 million/yr of gross operating cash flow, with the potential to increase to

* $500 million/year on completion of the Maari acquisition(plus a circa $75m cheque for the adjusted consideration from the 1/1/2019 effective economic date of the $50m deal)

Estimated Annual Revenue at $74.50/Brent:

$595m - Current Revenue
$689m - On Maari Completion

With the current market cap at $498m, by any objective analysis, Jadestone Energy has got to be one of the best value/growth plays in the O&G sector, or any other sector!

AIMHO/DYOR

What has changed over the last 3 months with respect to the potential of the asset? Nothing.

I suspect the recent price action is the result of impatient traders running 10-15% trailing stop losses doing what they're very good at - losing money.

Value/growth investors with a 2-5 year investment outlook would likely see the current valuation as a highly compelling buying opportunity.

AIMHO/DYOR

AK recently reported that new institutions wanted to invest.

I calculated a total adjusted consideration in the range of $300m to $350m using relatively conservative assumptions.

If correct, given the very strong cash flows these assets will generate over the next 25 years, we could see a scenario where just $80m to $120m would need to be equity.

3 - A $100m equity raise at various prices:

370m at 20p
246m at 30p
185m at 40p
148m at 50p

Considering the astonishing value of the deal and the very strong cash flows/income stream these assets will likely generate over the next 25 years, it would be reasonable to assume the equity raise has the potential to be at a price considerably higher than the 19p price on suspension.

If the equity raise were at 40p this would give the company a new market cap of £480m - hardly demanding for a company generating annual revenue of circa $1bn at $75 Brent, and operating cash flow around the new market cap !

AIMHO/DYOR

The current annual operating cash-flows of the acquired assets are probably significantly greater than the likely net price of the deal(and the assets have an estimated further 25 years of commercial life) - they are probably close to twice the current market cap of the company.

Consequently, strongly suspect Mr Market will think this has the potential to be a completely transformational deal ......likewise the II's who have an average weighted purchase price from the IPO and subsequent placings of 39p/share.

Hope those that took a SAVE position following the Covid collapse last year had the patience to continue to hold as the s/p doubled with the recovery in the oil price, before suspension in June to announce this deal.

These assets were originally touted for sale at $1B plus in March 2020 at the height of the Covid low oil price collapse - SAVE may well have picked them up for a third of that price after adjustments from the 1/1/2021 effective economic date.

AIMHO/DYOR