Member Info for ps200306

And since my lowercased post now says SOU are "selling seme for $1" it's one letter short of looking ACTUALLY offensive.

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LOL at LSE interpreting the word P-A-R-S-E as containing an expletive. Their expletive-detecting algo then corrupts the offending post by stripping out all uppercase characters. Shoddy.

couple of interesting questions in recent posts:

"why would the shares crash when the company has just received twice its market value in cash, with a significant ongoing interest in the asset?"

sou haven't received anything. they are selling seme for $1. they get a number of carries, similar in value to the calvalley deal but retain a smaller percentage. there are also at least as many conditionals attached as with the previous deal. it remains to be seen how quickly this comes through. i wouldn't put it past them to piggyback a fund raise on any short term euphoric spike in the sp, based on past form. i do think this deal is unlikely to meander like the calvalley one, given the heft of royal influence and deep ties to banks and state institutions. calvalley were interlopers. managem are blue-blooded moroccans.

"it says it's a sale, but we keep an interest in everything going forward, is this not a farmout, what's the difference?"

this one's a conundrum. it's hard to p**** the rns reference to sou "continuing as the operator of record of the concession and the permits" ... even though it's selling the company that owns the concession and permits. from what i can glean, "operator of record" means sou are still responsible for technical operations and for compliance with rules and regulations. i guess this makes sense given managem are bringing nothing in terms of o&g experience. but sou will not own the concession, so it's a sale and not a farmout.

Interesting to compare the now defunct Calvalley deal with the new Managem one. They are not dissimilar. However, SOU retains considerably less of the Tendrara production concession (20% instead of 30%).

The back costs for Phase 1 are probably the same as Calvalley when allowing for the additional year of expenditure. The carry on Phase 2 is comparable. Interesting to see the carries on SBK-1 and M5. I presume that means TE-4 is no longer in the plans. The other two are maybe better prospects, plus M5 fulfills the Anoual well commitment (though that had been extended anyway). I never had a good feeling about TE-4 and drilling a different part of the same structure that had already shown up cementation. But I think drilling in Tendrara and Anoual generally have a low chance of success.

All in all I would say this is a worse deal for SOU, but obviously better than NO deal. If like me you believe that the production concession was SOU's best asset (compared to the lottery ticket of further drilling) then they've just given away a third of what they would have had with Calvalley. If on the other hand you still believe in dreams in the desert, you get a crack at two more drills. I would imagine an SP Angel valuation that does not include the drilling potential would now have a target SP under 3p. My prediction this time last year that SOU's share price would not exceed 2.5p in the next two years seems safe enough.

Amazing! Just as they discovered that little clerical error that prevented the AGM from going ahead, SOU discovered on the very same day that they had a major announcement to make about the sale of the Morocco East company. It's almost as if they hadn't got the agreement over the line quite in time for the AGM and were desperate to postpone when Lady Luck intervened. Truly remarkable.

That's not the only strange thing. The buyer, Managem, has seemingly no previous connection to oil and gas whatever. A major expansion that they announced last January focused on expanding their mining operations, including new gold mining and the provision of cobalt sulfate to Renault for batteries. There's no oil and gas in their strategic plan for 2025, nor any mention of it at their recent strategy days.

Their capital expansion by $300m announced in January completed on 17th April. That's just eight weeks ago. They MUST have been in discussion with SOU by that time. Maybe the money was burning a hole in their pocket. Maybe their owners in Al Mada, who just happen to also own Attijariwafa Bank, had a word. Maybe they wanted an anniversay present for King Mohammed whose coronation Silver Jubilee is next month. Who knows.

TOTL: "I'm going with the most logical reason. Clerical error from ONE of the shareholders."

The RNS says: "certain of the Company's shareholders". Is that ONE or multiple? Why didn't they say ONE? How come they notice it literally on the day of the AGM? And why does one clerically challenged holder get to stall the whole show? More of the same level of clarity we've come to expect from SOU. Are they buying time? Will heads roll if there is no positive news in the next two weeks? And why aren't they being less opaque about it? I'm going with the most logical reason: it doesn't suit them.

What a firkin' clown show! Proxy votes "filed in error" ... by MULTIPLE large share holders? What are the chances? Whose leg are they pulling? If I was to hazard a guess, someone changed their mind (or was persuaded to change their mind) about either reelecting or not reelecting the BOD. This absolutely stinks.

Still, have to credit them with a truly novel way to wrongfoot all the pre-AGM predictions.

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10. Soundboy's imaginary tea lady rescues the day with another major (fictitious) news leak.

It's obvious there's going to be no (positive) Calvalley announcement by the AGM. If we don't hear about a Plan B either, Graham has got some serious explaining to do about why he has allowed himself to be strung along.

Share price is back in the crapper too. Funny how nobody on here ever shouts "leaky leaky" when that happens.

Tincan1995: "Optometrists needed here ... "

Predictive text slip-up? I suspect you meant "optimists" but yeah, you always need to read the small print in SOU's news releases. 🤡

It was completely obvious from the start of January that something had gone wrong with Calvalley. There is no other explanation for not extending the period of exclusivity. Whether the "something" was mundane or serious became clearer at the two investor presentations. Graham was shifty in the first one, but downright negative in the second. It was more a case of what he DIDN'T say -- Calvalley were barely mentioned. Go take a look. They get all of five seconds in his initial presentation.

It's one week to the AGM. If there had been good news it would have been announced. That means the chances of deal consummation are very slim. I can't believe they would be barefaced enough to continue the fiasco beyond the AGM so I'm predicting an RNS tomorrow or Monday to say they've pulled the plug on Calvalley. It's not a racing certainty but I'd give it 70-30.

JP2000, TE-5 Horst estimated to contain 377 Bcf of 2C reserves (197 1C). TE-4 (chance of success 36%) could add somewhat to this.

377Bcf = 70 MMBoe. That's energy equivalent. At 8$/Mcf gas and $70/bbl oil, the gas is only worth 60% of the oil equivalent.

Value of 2C gas at $8/Mcf = $3 billion. SOU share, 35% = $1 billion.

Sorry, don't have an NPV. Gas pipeline alone will cost $350 m, more than 10% of the gas value. Also, 54 Bcf commited to LNG at much higher production costs. Latest target share price from SP Angel research note would value the company at around £90m. That was before likely further slippages.

(P.S. I was congratulating SOU for not slipping the rig activities, promised for June back in late April. Forgot that the SP Angel note from late Feb said rig activities in late March. So actually, they managed to slip 3 months in the space of 2 months. No doubt the "wind sock" at fault :-/ )

The terminal isn't being linked to Tendara. It's being linked to the pipeline, along with the Tendrara field which will ALSO be linked to the pipeline.

I think we'd have heard from Graham if Calvalley were trying to change the terms of the initial agreement-in-principle. We don't even know if it's Calvalley that are holding things up. Maybe they're looking at the fiasco of SOU having fallen a year behind schedule on Phase 1 in the course of just one year. Maybe it's THEM that are wondering "is this a reliable partner?".

Graham has been extremely tight-lipped about it ... we've had TWO investor presentations at which he's said essentially nothing. It makes it impossible speculate as to what has gone wrong or who is at fault (even though I just did ;-)

But that something has gone horribly wrong is without doubt -- next week is a year since the initial Calvalley announcement. Even if you think the 45 day initial period was optimistic, the Attijariwafa loan offer was based on all conditions being met by September 30th so there is no doubt the parties thought it would be done and dusted by then.

I'm pretty sure it's a condition of the Attijariwafa loan that 35% of the cost of Phase 2 has to be funded by equity. So SOU needs a partner ... I don't think it can just be another bank. I could be wrong ... the agreement refers to a "simultaneous capital contribution in ensuring maximum gearing of 65%". My guess is Attijariwafa would want the money coming from someone with skin in the game who could actually influence project execution. Just my guess, though.

bit of a first for sou. i know it's only a month since an rns mentioned rig operations in june, but it wouldn't be beyond sou to be wildly off just a month later. this time they've managed not to slip. perhaps a sign of greater realism? now how about a bit less *****footing around calvalley before the agm!

Perhaps Graham has decided that the AGM is the drop dead date for Calvalley. Either they sign, or he moves on to the next prospect. Either way it'll be an RNS.

"Graham is neither Naïve nor stupid, look at the deals he has got over the line. Bond restructuring, GSA, pipeline …. "

Let's also not forget bond restructuring part 2. And the fact that part 3 is going to be needed in 2027. All because of unexplained delays. He may not be naive or stupid, but he's certainly slooooooooowwwww.

"and for some reason you decide to spend your time today telling people you don't know that the you now think no one is interested in Sou's acreage. very odd."

Hilarious from the person who spends all his time personally insulting anyone who ever dared to voice caution, and making dozens of baseless predictions that have never come to pass. That's not odd?

"Sp looks a little perky today."

Only if that's an allusion to Perky of "Pinky and Perky" fame, the well-known pig.

Not sure if you mean dump Calvalley or dump your shares ;-)

Assuming the former, there isn't enough information to go on. It depends how confident Graham is that Calvalley will complete in short order and how close he is to a deal with someone else. The body language from the last presentation was not that of a confident person. He barely mentioned Calvalley and that was just to say he was frustrated. Something has gone horribly wrong there. I would hope and expect that SOU are talking to other parties at this stage. It would be a huge risk and a serious dereliction of duty were they not. We all hope Calvalley comes through. It's up to Graham and GD to plan for what happens if they don't (as they themselves said at the presentation).