Member Info for pauldrayton

Oops thanks TopDrive!

A the end of the day the current share price is still massively undervalued if FID goes ahead, even assuming the worst happens with insurance/dilution.

I’m not personally convinced it’s Shenandoah related.

They’ve said mid July rather than early July for first oil and I suspect that means 10th at the earliest. Also Navitas are only up 1.5%.

Something else behind it - volume and price increase has been steady and strong for a few days now.

I was thinking 75-90p range at FID depending on the dilution required to get there but if funding is arranged contingent on FID £1+ is entirely possible with the inevitable excitement.

Interesting price action in recent days.

I suppose if you think about it, the NPV10 is $1.8bn (£1.3bn).

Taking worst case scenario and the insurance doesn’t pay out, let’s say they have to raise £70m at 40p to reach FID, that’s another 175million shares, leaving a total of 815million shares in issue.

£1.3bn would still equal a share price of £1.60 with 815million shares in issue so 56p still seems like a relative bargain.

I think I’ve been pretty pessimistic with that assumption and that value is for Sea Lion alone (excluding Isobel/Elaine and other potential across the basin).

Perhaps whoever is buying at the moment is taking a longer term view rather than worrying about a fund raise (which would only be done for a sanctioned project).

GOZZIE2 & Nigoil are a blast from the past. I think they are both now in the lunatic asylum that is ADVFN. Best place for them.

Just catching up with the AGM presentation. Hard to believe the market cap here is still less than £35m.

They said it in their Final Results and also in their AGM presentation. It might be done contingent on FID (in other words the placing is arranged subject to FID taking place, so any investors would be buying into a sanctioned project).

Not sure what’s behind the volume and price rise over the past couple of days. Sam did say they “might go early” with arranging funds but they will need to know the insurance outcome and final up front cost requirements beforehand.

Fair point Dai. I’m certainly not counting chickens as I said. In fact I’m expecting the worst but just thought I’d pass on that the insurance company were well aware of Poncet and his past.

Alma, I don’t know what the insurance company/companies will do (after the annulment outcome it’s a lesson never to count any chickens) but Sam made it crystal clear at the AGM that the insurers were fully aware of all the details and had access to the entirety of Italy’s annulment grounds and all the court documents. Absolutely nothing was kept from them. He said they can’t think of a reason why the claim would be disputed “but we are talking about insurance companies”.

Suddenly picked up this afternoon.

True Much, although from what I understood at the AGM this new senior debt facility is based purely on Sea Lion alone and is not contingent on Shenandoah.

In other words Navitas and RKH could continue to develop Sea Lion even if Shenandoah was a total failure. I’m not saying they would, but they could. The banks aren’t waiting for Shenandoah to come on stream, they are just doing due diligence on Sea Lion.

So who was the guy in the sharp suit then?!

PMO would have gone ahead with Sea Lion if it weren’t for the pandemic. I don’t recall them hitting a brick wall.

In anny case Navitas aren’t PMO and things change. For Navitas to have shifted from the bond route to senior debt they must be sure the banks will lend to them in principle. Sam said at the AGM that the funding noises had all been very positive, it just takes a bit longer because of the due diligence required for this type of lending.

Buzz, Navitas were originally planning the bond route but have since changed tack because they can secure senior debt which is much more attractive. Not sure where you read that but clearly Argentina isn’t an issue for the lead bank or syndicate, otherwise they wouldn’t be going down that route.

With regards to a partner, Sam said whilst he can’t comment for Navitas, Rockhopper are not looking to farm down any further so they are likely to continue with 35%.

No worries Alma, you explained it better anyway!

I think a simplistic way of looking at it is NAV is a calculation of what an asset is worth in the market today whereas NPV is a present day valuation of future income from an asset.

Lassonde, no they are different.

NPV is probably the better way of valuing something like Sea Lion which will deliver future income.

The NPV will actually increase as first oil gets closer, because it’s a reflection of ‘present’ value, which increases as income gets nearer.

Thanks Mogger.

Also on funding, it’s worth remembering that if Navitas weren’t offering a loan to RKH, they would have to raise $280m now. Whilst it’s not as good as a carry, that loan is exceptionally valuable to RKH and if Sam can do something “whizzy” for the remainder then they’re in a very strong position.

SH, I suppose the other question is even if the placing itself isn’t at a premium, what would the share price do in reaction to the fact that funding is fully in place for RKH to get to first oil with 35%?