Member Info for mrc_mrc_mrc_mrd

She’s is flying again pal.

Just need to wait for the great rotation to get underway. When it happens oil stocks will go bananas.

It just shows that we have the wrong BOD in place. Yes transactions cost money to arrange, but I’ve never seen soo much spent to achieve so little.

The related party links to Gneiss are of course very concerning from a governance perspective. It’s all rather murky

AA - they will justify it somehow and some will swallow it again.

Did we ever get a good explanation of what the last lot of fees were for?

Brent going at it hammer and tongs now.

$70 will be in the rear view by the end of the week IMHO.

Oh that’s strange....if I click the direct link it is a paywall, but through google it’s not....

https://www.google.co.uk/amp/s/amp.ft.com/content/686184ea-04f8-4141-a4f5-fca007d06132

Pretty sure it is a free article laddie

https://www.ft.com/content/686184ea-04f8-4141-a4f5-fca007d06132

Pretty sure it’s free

Slift,

The ring fenced accounts are not debt facilities (other than I believe a debt facility for sullem voe to cover working capital for the JV).

The sculptor and Magnus accounts are not debt facilities but ringgenved accounts to manage the cash flow for the 3rd parties.

Where they talk about available facilities, the bulk of that will be headroom from the overpayments on the existing RCF.

I really don’t think we have much in the way of a rainy day debt facility at the moment, and I also don’t think we need one. If we get a loan to cover the remaining RCF and GE, and the $50 million equity, then there is a large amount of cash on the balance sheet from the FCF generated this year that can be used for capex spend, unexpected opex, and general safety net.

I think we will only get funds if they are for an agreed transaction. JS stressed that the new facility would be paid back before the bonds and I got the feeling that this was something that the banks required.

I think the days of getting traditional RBL are over.

Slift - the 2 loans you mentioned are not for working capital. They were for asset purchases and therefore we do not need headroom.

Enquest hold a cash buffer of around $280 million dollars from memory. I don’t think this Loan will be a conventional overdraft type facility. It will very specifically pay for the GE asset and consolidate the existing debt. Enquest have small facilities for example at sullem voe to cover working capital and these are not being rolled into the new facility.

Romaron, slift,

You probably know more of the financial side than I do - why would we want (and the banks want to give us) headroom? I see this as a very short term facility- basically extension of the existing one.

Headroom in my mind is a bit pointless...I think we need to fund our capex spend next year from this years FCF (or have enough hedging in place on next years barrels to meet it.

So headroom only for acquisitions or big unexpected opex costs? I’m not sure the banks would go for this if the facility expires in 2 years. I would understand if we had a big project ongoing that you would want some contingency cash available...but in normal operations we have managed without that safety net for the last 4 years really.

Slift,

The 2 year date was for the new facility only. He said bonds would be refinanced later.

So only need $700 million reduction over 2 years. Easily achievable.

I’m not worried, you asked my opinions.

SP might go up or might go down and I wish you good luck.

How many years have we held HE1? 5 years?

And return so far of zero? Not very well played IMHO.

This current BOD has done significant damage. That terrible one dyas deal, then making it even worse by pulling out after incurring substantial costs and penalties.

I am amazed that shareholders are letting these guys continue to destroy value.

Lol - if NR were still around I think SCIR would have 20% of HE1 and be worth considerably more than £9 million.

The really unforgivable thing for me is that the current BOD allowed the massive dilution due to the IPO shares. Gave away £10 million. Maybe they had some mates participating in the IPO? or added a few to their personal accounts? Was this a Gneiss special?

Romaron - governments and subsidies are not the driver behind renewables now. It’s Finance and the free market. It’s got to the point now where people can see an eventual end to fossil fuels. There are lots of viable alternatives and they are now getting investment to scale up.

I think we will all be surprised by how much the energy landscape changes in the next decade. It will take a lot of oil to get there though and no money is being invested so prices will have to rise.

Not quite right...

Money will need to be raised if that £2 million is not realised on sale of the HE1 stake.

If this dips to 0.8 as you suggest then the dilution is going to be crippling when the placing hits. Say they get it away at 0.65 pence, that would be an extra 300 million shares. Easily taking us above a billion shares in issue.

SCIR really need that cash to put a bit of a bottom in place.

If they can sell at a higher price then they will obviously have more cash!

Is it worth the risk of losing the couple of million they could get at the moment? Absolutely not IMHO. That money would secure the next 12 months.

It will make zero difference to being able to borrow, but likely that new shares would be placed at a higher price.

Sorry should’ve - do you mean good result at HE1? Or confirmation of cash position?

On borrowing - I’m sure they could borrow for an acquisition of a cash generative asset. They had a facility lined up for the last deal....though rate was eye watering and made the whole deal very unattractive. I expect we will see something similar to fund the new deals. Some equity and some debt. The problem with SCIR is that they don’t really add value. Just look at their projections...pretty terrible returns forecast.

Highly unlikely they could develop Ruvuma out of debt. Even the big boys are struggling to get bank finance.

Hi shouldve - I think the sort of funds we are talking about are out of reach at current market cap. Debt funding will be next to impossible for a company like SCIR IMHO.

In terms of placings, I think it would be bad news for existing shareholders. The asset is far too big for a company of SCIRs size.

If nothing changes over the next year then SCIR will be in a very weak position.

Best thing would be to sell HE1 and take advantage of the SP rise (which I expect we would see) to do a placing. Potentially they could do what HE1 have done and bootstrap themselves up to the sort of market cap that can afford Ruvuma.

Now is really the only time to sell. If they wait until post drill we are back to a vulnerable position of being asset rich and cash poor.

HE1 has saved the day this time but where will the development funds come from for 2022 until first gas. This is a huge project we are looking at. If we can’t fund our part of the work programme I believe we forfeit our stake? Maybe that is the end game.

Hi Chilts,

I am aware of at least one NS operator looking at CCS from the turbine exhausts.

Power from shore is probably not an option for AK.

Maybe biofuel bunkering instead of diesel? Higher opex but low capex.

As you say, gas might do the job for the immediate emissions targets.