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There isn’t the liquidity but GS have written me call options whilst the shares are being acquired.

People need to relax - this is a technical pullback and very healthy.

Gaps act like magnets - given it’s relative proximity and in the absence of further news flow a few pence pull back from here or slightly above likely. That said the reaction from the lows is impulsive so any pullback will be just that - a pullback. You need the H4 and D1 technicals to wind down a bit before more news flow ideally - the reaction will be stronger.

The upper bollinger has been breached on the daily chart - we may see a bit of a healthy pullback here as it’s technically stretched . Should set up the next leg up.

I’ll post a full note of call and my thoughts later. All positive.

No surprises here. I’m interested to know how far along they are with well location subject to views of farm in partner and what impact this has on their “internal” COS on drill.

I’m a special situations trader and physical/paper oil trader.

I know Char of old - it used to be a Dustbin for everything in the sector no one else wanted but has turned itself around.

Havnt done much in the sector since 2014 as mainly been focusing on special situations in the bond market for the last few years given the opportunity there.

It’s not about price and I’m bullish Char - a raise would unlikely be at a discount and whilst any raise is dilutive if the result is more value creation than the resulting dilution then why a negative.

They may release equity through sale of renewables but reading between the lines they are going to put debt and equity investment into the sub. So unless some other form of lending at plc I suspect there will be a raise between now and august - financing in renewables buys them additional 4-6 weeks. I say again the share price is where it is because of financing concerns. Remove that and this flies. I’ve taken a call option with GS as insurance until next week to hedge against a substantial rise in price.

To be clear I don’t think a raise would be at a discount not result in a negative reaction.

Why are people viewing a raise as a bad thing? It’s the one thing holding the share price back - ie the funding gap.

If you look at the numbers and assume that the cash burn currently allocated to renewables is taken by subsidiary debt/mezz financing this still leaves a funding gap with investment required to get onshore moving.

Equally, the last thing Char want/need is to go into a major drill campaign without contingencies - for eg, what if there are problems and their cap is breached? These unlucky events have happened time and time again and market is discounting for the right cash position.

There will be a raise unless there is an outright sale of the renewables business or equity release. However whilst you seem to view as a negative I think it will unlock the share price. I’m not waiting for a raise.

SP is likely being held in range for pending equity raise. Market should respond positively when financing concerns are lifted.

Hi there

I am looking at making quite a substantial investment in char at the right time over the next 2-3 weeks. Could anyone point me in the right direction as to the most recent broker notes with risked NaV calculations?

Holders have absolutely nothing to worry about here.

I’ve had three coinvestors call me today to tell me what I already know about the DROs - it’s out there.

If I was to hazard a guess , if I could find out what assets they have been awarded it wouldn’t be a stretch for some of the smaller funds invested. Wait for the AGM or just before.

- the data room for 2A will be extremely competitive. As such the farmout terms will be very favourable.

- 2A is additionally attractive as it’s outside the carbon belt - don’t underestimate the importance of this to majors.

- as for the discoveries , PETRONAS are very good at the gas offtake side which in return provides the covenant for farm out or finance.

The equity value here is potentially extraordinary.

I can’t say too much - my understanding is that the Board hope to be in a position to tell investors at the AGM about the new acreage with undeveloped discoveries. I’m told there will be a full presentation.

What I will say is the discoveries aren’t small and could be FDP approved this year if financing in place.

I’m now aware of which discoveries have been provisionally awarded. We are in for a treat and I suspect financing will not be an issue!! It’s going to make Norway look like pocket change.

Remember commercially the forfeiture clause is there to ensure japex get best recourse if relations sour. I’d expect japex to relax conditions otherwise JV fails and they lose the inroads into the region - there was a reason a bigger player didn’t just go it alone.

I don’t understand why the board agreed to the 31 dec 24 payment deadline for the 17m - given the two year payback. It was a big gamble on being able to do another deal in a competitive market.

Suspect they will refinance japex - effectively borrow 17m on mezz terms and refinance. In reality with cash inflows minus increased capex will be 10m.

Plc will need to raise some capital but they needed to anyway before the announcement.

That’s not quite right. The capex costs are mostly a red herring. Of the original 17 paid 12.75 was for the purchase price with the balance of 4.25 being working capital adjustments. The full amount plus some cash in hand was paid over using the facility which was amended by exception to accommodate this. The problem is the amended terms require repayment of this by 31 dec 24 not the end of the five year period.

The ONLY issue of any substance here is how that 17m repayment is funded or renegotiated in dec of this year.

It’s never plain sailing in E&P - I’ve stated my view on the Norway position below.

More importantly in Malaysia the fact that they have established a JV with another oil company and submitted applications with another oil company to take on an already discovered and development ready asset is interesting and was mentioned briefly in the broker call last month. They are further down the line than they let on. Will likely be gas and condensate discovery that majors are not interested in.