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Seven days have passed since Angs announced the RNS on January 24th. Angs hasn't released information about the sidetrack so far. As usual, if the sidetrack drilling goes well, Angs should be eager to announce the good news.
There were originally 8 gas wells and 7 sidetrack wells in the saltfleetby gas field. Now only A4 and B2 are left to produce gas, and the other wells do not produce gas. I estimate that there will be no outflow of gas from wells A4 and B2 next year.
Angs disclosed in the RNS on January 24 "as a consequence of drilling issues in the Westphalian reservoir". Strangely, the RNS did not disclose what exactly drilling issues are. RNS disclosure on January 3 "The present drilling operations on the final horizontal section of the SF-07 side track are scheduled to resume on 5th January and this well is expected to be in testing mode in the latter half of this month." And "January 24" is "the latter half of this month." It can be speculated that the drilling of the SF-07 side track should have been successful without any failures, (so, Angs has no drilling problem disclosure), and has been tested. However, the result of the test is that there is no outflow of gas.
kodal's issued share capital consists of 16,903,730,956 ordinary shares.
On January 19, RNS "Kodal and Xinmao have entered into a subscription agreement (the "Kodal Subscription Agreement") pursuing to which Xinmao has agreed to subscribe for the Kodalate Subscription Agreement price of US$17,750,000 (£14.5 million), equaling to a subscription price of 0.5p per share, ”
In other words, Xinmao (Hainan) will subscribe for 2.9 billion kodal ordinary shares. This dilutes kodal's total share capital.
Suay chin currently holds 2,397,614,425 kodal shares, equalizing to 14.18% of the total issued share capital of the Company. (0.38p per share)
Kodal Minerals and Suay Chin signed the Off-take Agreement, which, among other things, sets out the basis on which the parties will negotiate an extended off-take agreement (“Formal Agreement”) for between 80% and 100% of the Spodumene product produced at the Project (the “Contract Quantity”) for a period of three years from the commencement of commercial production.
Now, the off-take agreement has been undermined by Hainan's acquisition of the bougouni lithium mine.
I believe a settlement has been reached between kodal, hainan and suay chin.
But will suay chin continue to hold 2.3 billion kodal shares? I don't think suay chin will continue to hold kodal stock. Because Suay Chin is a company dealing in lithium ore products, he will not invest in a company engaged in gold ore exploration. So, suay chin will sell its holdings. This will put selling pressure on kodal's share price.
I think suay chin has started selling his holdings since 19th January taking advantage of the skyrocketing share price of kodal.
Maybe kodal will announce TR 1 soon.
Kodal at risk
1. Political risks in Mali. I've said this over and over again.
2. Whether Hainan can successfully acquire the bougouni lithium mine.
3. If Hainan successfully acquires the bougouni lithium mine, kodal's interest in the bougouni lithium mine will be reduced from 100% (90%) to 29%. The interests of kodal shareholders have been seriously damaged. Therefore, shareholders of kodal should not regard Hainan's acquisition of the bougouni lithium mine as good news. This news is actually bad news for kodal shareholders.
4. The remaining minerals of kodal are:
bougouni west. The project is being prepared for sale for $2 million. This shows that kodal will completely break away from the lithium project and focus on the gold project.
5. Gold project
Kodal has multiple gold projects in Mali and Côte d'Ivoire. However, some of these gold projects have not yet started exploration, and some are under exploration. These gold projects are still far from commercial production. It is particularly noteworthy that the Mali government has suspended the issuance of production licenses for Mali mines. Then, kodal can only explore gold projects in Mali, but cannot produce gold mines in Mali. What does this mean commercially for kodal shareholders?
Based on the above analysis, the only intrinsic value of kodal now is the 29% interest in the bougouni lithium mine. So, kodal's share price will fall.
Bougouni lithium project is the most profitable project of kodal company. Now, China's Hainan Corporation has acquired the project. The shareholding structure of the Bougouni lithium project is: Hainan Company holds 51% of the equity, the Mali government holds 20% of the equity, and Kodal holds 29% of the equity. Originally, Kodal had a 90% interest in the project, but now it only has a 29% interest. Excuse me, have the interests of kodal shareholders been damaged?
Stimulated by the RNS announced by kodal on 19th, the excitement of retail investors has now begun to calm down. Next, what retail investors have to do is to wait for the progress announcement and final results of the "Major Funding Package for Bougouni Lithium Project".
According to a report by Agence France-Presse on the 20th, a draft report by the UN Secretary-General stated that the UN peacekeeping mission in Mali is "unsustainable" if the number of peacekeeping troops is not increased. According to reports, in order to stabilize the situation in Mali, which is facing the danger of collapse under the wave of jihadism, the United Nations Multidimensional Integrated Stabilization Mission in Mali was established in 2013, but the local security situation is still deteriorating.
“Completion of the Kodal Group Funding Transaction, including receipt of funds, is conditional upon satisfying various conditions preceding on or before 30 April 2023, or such later date as the parties may agree (the "Long Stop Date") and …there is no guarantee that the transaction will ultimately proceed.”