Member Info for pauldrayton

Well I finally got a response but it didn’t say a lot!

No answers to any of my questions, and just stating that they plan to issue a Notice of AGM in the next week or so.

Whilst I can’t be sure, it sounded like they aren’t planning on saying anything on Friday regarding the 18 month deadline from IPO so I’m no longer expecting anything.

Maybe they will say a bit more than just a Notice of the location, time & date of the AGM (and I replied asking them to) but to be honest I get the sense that they don’t really care too much about their private investors. Frustrating because I’m sure the institutions have more knowledge of what’s going on behind the scenes but there we go.

Maybe the reason why they haven't replied is that they are scrabbling around trying to get a deal over the line before Friday. You might get your ice cream van afterall!

Yes that might be exactly what happens. Even if they could reassure the market that they have irrevocable backing from the major shareholders to continue their investment strategy, that would at least be of some comfort for the market which tends to dislike uncertainty.

An update on progress since March would be much appreciated though - as you say they have had a tendency to say as little as possible which is fine to a degree but after 18 months it would be nice to have a bit more meat on the bones rather than just ‘pursuing opportunities’, ‘involved in various processes’ & ‘strong outlook’.

I haven’t seen news of any other M&A in Norway for a few months though so it doesn’t appear that they’ve missed out on anything recently...so far anyway.

Just to update, I haven’t received a reply yet but will post here if I do. I suspect I might be ignored and they will either release an RNS on Friday or just continue as usual with no news at all ;-).

I’ve sent a quick message to the company to ask if they will be providing an update.

Will post here if I get a reply but they aren’t usually very forthcoming so I’m not holding my breath.

Yes it has been strange although it will probably drop now you’ve highlighted it! Volume seemed to fall off a cliff in April and I thought it was interesting that the major shareholders were updated on 30th April but still no signs of white smoke!

The website appears to have gone down now - either a sign they’re shutting the whole thing down or about to release a bumper update ;-). Or more likely just a tech glitch!

As ever the wait continues, I wonder if they might have something to say on Friday.

Ok thanks, I was just wondering if there were any immediate implications. The AGM was 24th June last year so I guess it will be a similar time this year.

It’s looking likely now that 18 months will pass without the investment strategy being substantially implemented (Friday is the deadline). I don’t think I’ve been invested in a shell before where that’s happened.

Do they have to cease operations pending shareholder approval, or do they carry on? Do they have to call an EGM and shareholder vote? Just wondering what the process is and the implications. I’m sure they will get shareholder approval to carry on assuming they still believe in their strategy and have made some progress, but what happens in the meantime?

Oh dear it’s the daveri “news soon” curse - at least another 6 months then ;-)

I don’t think Longboat have missed their chance - from what I understand there is still plenty for sale in the North Sea. A few months of high or low oil prices might won’t change the longer term strategies of large companies. It may alter the way in which deals are structured but I don’t think it will prevent deals from being made. There are still fewer buyers than there are sellers, and even fewer financiers wanting to be associated with fossil fuels so the advantage lies with those who can get access to funds.

Yes I had a quick look at LinkedIn to see if there were any clues. The only change I could see was Ludvig Hovring as Finance Manager although it’s backdated to November so maybe he’s been with them for a while. He had previously worked at Faroe Petroleum then DNO when it was taken over.

His profile states “ Background from audit, tax (especially oil taxation), financial reportng. Financing of exploration expenditures, and RBL ( reserve base) lending”.

No sign of any of the recent jobs yet on LinkedIn but I expected it to take a little while and not everyone uses it anyway.

Guessing it was underwhelming given the lack of Twitter ramping ;-)?

The recruitment company told me the positions are due to be filled shortly and I guess they’d know! I’m still convinced Longboat wouldn’t add that much to the cash burn without a deal in place but then again nothing has been announced yet so who knows.

I’m probably only seeing what I want to see but the recent website edits might be a sign that they are getting closer. I’m sure the ESG references in particular have been added to satisfy a financial institution.

It’s also not like Longboat to be so efficient in updating their shareholder register(!), particularly as there has been no recent Holdings RNS. Made me wonder if they’re getting their ducks in a row in terms of current % stakes for a funding deal - there was no need for Blackrock to notify them of a sale of less than 14k shares unless they’d been requested to do so for some reason. And no reason to update the website really.

Thankfully there are only two current active applications to be a license holder on the Norwegian shelf so hopefully it won’t take too long. They will need approval for any purchase of assets so hopefully this is the reason why they’ve got the ball rolling:

“Transfer of a licence or participating interest in a licence for petroleum activities may not take place without the approval of the Ministry”.

As ever pure speculation from me during what is definitely a boring wait!

The website has been updated with major shareholdings - not as of today but as of 30th April. It was previously updated on 28th Feb a few days after Blackrock announced their reduction.

It appears that Blackrock sold a few more but not many (13,541) and Pentwater Capital sold 50,000 - this should really have been notified to the market because they dropped below 4% again.

Do we know that the drop in production is temporary? Has any explanation been given? Very poor of the company to put those figures out without explaining why.

Ombrina Mare decision now expected in July.

I see Longboat have edited the Strategy section on the website to include references to HSEQ & ESG (having added the separate ESG section last year as well).

ESG is obviously becoming more & more important to fund managers and Blackrock especially are pushing hard on it, so it’s not surprising that Longboat are making a bigger deal of it as I think it will be key to them getting the backing they need.

On a separate note I understand that the jobs that were advertised recently are due to be filled shortly.

True Whirlaw but that report also stated that the company “is targeting an initial acquisition that will deliver asset(s) that are able to meet its investment criteria (including near term cashflow)”.

The first bullet point of their investment criteria was:
“• producing and/or near producing assets, providing cash flows to fund organic growth with robust economics, sustainable in a low oil price environment”.

Exploration assets via farm-ins and APA applications came second.

Also in their presentation business summary they stated:

“Production remains a focus - also pursuing attractive Norwegian opportunities in the exploration, appraisal and development areas”.

So whilst I think you’re absolutely right that they are looking at exploration, appraisal & development, I would be surprised if the first deal doesn’t include some form of production and cash-flow.

The other point I would add is that if you have a look at the first link again (which appears to have been updated since yesterday):

https://www.npd.no/en/facts/production-licences/pre-qualification/

You can see that there are two options for this pre-qualification process - one for a licensee and a separate one for an operator. The applications for operator are denoted by “(Op)” after the company name, which Longboat’s does not have.

If this process was to enable them to participate in the licensing round then I’m guessing they would be applying to be operator of any license they’re successful in applying for (at least to begin with anyway). As it’s an application to be a licensee instead, perhaps it’s a sign that they’re expecting to be a smaller partner in a license which already has an operator (which is probably what we were expecting anyway).

I do agree with Whirlaw that they will want to participate in the next licensing round but I think this may be more to do with them getting their ducks in line for a deal.

I’m just musing really! We only have breadcrumbs to go on but they’re better than nothing!

“The authorities will normally expect new players to develop an organisation as described above within 12 months from a swap or award of the first participating interest in a production licence”.

On that basis I’d say it’s another positive sign that Longboat are recruiting now. They could have waited until after the award of a new license before doing so if they are relying on the licensing rounds. Also, the next licensing round in Norway hasn’t started yet, and outcomes won’t be known until next year so maybe this is more to do with a license they are looking to enter via a deal rather than through the application process?