Member Info for ps200306

Indeep, sorry about your losses. I know you were up to your tonsils, like myself. At least we're free. I've already moved on to another oily with a funding crisis ;-)

lossgain, no, never been to an AGM.

sounder, you're certainly the perennial optimist -- perhaps I mistook it for ramping. According to your posts you were still topping up last month, and twice last year. And the year before that, after the TE-10 trainwreck you said that the "price is now silly and will do 300% + very quickly". (It went down a further 80% within six months of that). Anyway, I'm the bigger fool ... I was still buying millions at that stage in a desperate attempt to average down. Good luck. I truly hope it works out.

No need sr -- even the old time trolls have had the stuffin' knocked out of them by this dog of a share.

I'll check in from time to time, but will avoid being a b*tchy ex-holder. Regardless of what happens the bail-out decision was the best one for me, based on the most pragmatic assessment of risk I can muster. Still interested to see if the LNG gets sorted as it could yield a modest SP rise, though I don't think it will be anything that could ever have made me whole given how underwater I was. GLA.

What I can't understand from Graham is his inaction on the bondholders. Five months now since he announced they were doing something, and no sign of agreement. With no further bondholder meeting even announced, I can't see how anything is going to get done before SOU run out of cash. Even if he does get something sorted there is the tax bill hanging over him. I don't see how a gas purchaser is going to hand over a ton of money in advance unless the company's finances are squeaky clean with a clear path to first gas. And even if *everything* gets sorted, the trickle of income from LNG will take a long, long time to pay off debt let alone pay for a pipeline or more drilling. Barring market hysteria, I don't see the share price going anywhere for years in the *best* scenario.

That's why I've lost all confidence at this stage. I bailed out this morning ... or rather I *finished* bailing out as it took a week and a half to offload what is now a highly illiquid share. On the new exchange every trade goes through a marketmaker, who have been busy taking their cut even as shareholders flounder. Down 92%, £600,000 ... a lesson in stupidity I won't forget anytime soon. At this stage having 8% left to invest elsewhere seems like the best hope of recovering anything from this fiasco.

Best of luck to remaining shareholders. I genuinely hope things turn around for you.

Thanks for the links donalb, interesting stuff. Those real-world wind capacity factors are seriously impressive. Average lifetime capacity factors of 40%, with a few farms exceeding 50%. Given the absolute theoretical Betz limit of 59.3%, it doesn't get much better.

I looked at that Supernode superconducting cable stuff before. It's a fine idea, but I wonder how feasible it is anytime soon. Up to 2018, the longest superconducting cable carrying actual grid power was just one kilometre. Even high temp superconductors need liquid nitrogen temperatures, making the infrastructure for widespread grid usage sound pretty complicated (and expensive).

https://phys.org/news/2018-07-superconductor-technology-transmission-grid.html

Agree with you that fortune may not favour the shareholder despite our pragmatic need for hydrocarbons for some decades yet. Personally, I'm still betting on PVR and buying a fair bit on the dip, but time will tell whether I'm the fool about to be parted from his money.

I know some of the posters here used to comment over at ii until they revamped their discussion board using Discourse forum software. Users with the temerity to suggest that the new layout was borderline unusable were slapped down and branded as Luddites for not embracing the modern way. Predictably, the forums very quickly became a ghost site. The closing chapter appears to be a mealy-mouthed email sent to ii users just now to say:

"We are proud of the role we played in bringing investors together, but times have moved on. Social media has evolved and ii has, too – to become the UK’s second largest investment platform. We must decide where to place our support for products and services in the best interests of all of our customers. Therefore, we will be closing the discussion forums to focus resources on our core website and investment platform."

Uh, weren't the new forums introduced BECAUSE times had moved on? You gotta laugh.

donalb, regarding cryogenic storage, I saw Highview's claims alright (they have some good youtube videos for anyone interested). The basic cryogenic storage process involving compression and regasification is only 25% efficient. Additional efficiencies require heat storage during the compression stage and cold storage during regasification. In Highview's literature they claim 60% efficiency for a standalone configuration. However, that neglects to mention that the actual efficiencies depend on how many hot and cold storage units you buy, though this flexibility of cost / configuration could be considered an advantage.

For their claimed 70% efficiency you need sources of waste heat or cold, e.g. from thermal generating plants or LNG regasification terminals. That obviously reduces the location flexibility of the Highview plant, which is one of its selling points. Also, LNG regasifiers are already seeking their own improved efficiencies through partnering with producers of industrial heat. Similar to people generating power from waste biomass from the forestry industry, sawmills etc., you may find that once you create a market for "waste" that it's suddenly not considered "waste" anymore ... and is no longer free.

Anyway, I don't want to do it down -- it's a fantastic idea. But I will also note that it's targeting applications from a few tens to a few hundred MW of output capacity, and a GWh or so of storage. So we are talking about storage of a few hours, filling the niche between the larger storage of pumped hydro and the few seconds/minutes of instant power from batteries. It will never fix the problem of large chunks of northwest Europe being becalmed by an Arctic or Azores high for days or weeks at a time. (Especially so if increased frequency of blocking patterns in the Atlantic jet turn out to be a feature of climate change).

donalb, there is no doubt that we have plenty of wind resources. Integrating it into the grid is a different matter, requiring transmission capacity, grid storage and interconnectors to access distributed markets. None of those things on their own is a magic bullet.

The Celtic interconnector to France won't make up for any of our potential shortfall in baseload supply. It's an understandable misconception that we'll suddenly have 750 MW of new supply, but that's not how it works. The EU requires each member state to manage its own adequacy of supply, and it mandates a bevy of risk and adequacy assessments for long term, short term and seasonal supply. We can't just string a wire to France and stop worrying about our own supply infrastructure.

The Celtic interconnector will function according to SDAC (the EU's Single Day Ahead Coupling mechanism, managed by the Luxembourg-based Joint Allocation Office which also manages interconnectors across Europe). Electricity provision is auctioned on a day-ahead basis based on who can provide it cheapest. It's designed to make regional supply more efficient. It also helps build capacity because it provides a sort of hedging mechanism for operators. This comes in the form of a financial instrument called a Financial Transmission Right Option (FTR). An operator who expects to have spare capacity buys an FTR for a particular period in a particular direction on an interconnector. When that period arrives, if power is cheaper at their end of the connector compared to the other, they pocket the difference between the two prices whether or not they have to actually supply the power.

Apart from interconnectors not being a license to just import someone else's electricity, we have a new problem with the existing East-West connector to Wales and NI's Moyle connector to Scotland. From Jan 1st 2021 the UK could no longer participate in SDAC so the existing interconnectors have their own day-ahead trading scheme but no FTRs to allow longer term hedging. It's an additional blow for NI which has to retire its coal power under UK legislation but is coupled to the Irish market for power (I-SEM) and not to the GB market. I can see it being unpopular if we have to bail them out when we are struggling with our own capacity.

We also have the rise of the CPPA (Corporate Power Purchase Agreement) whereby companies pledge to buy power from particular wind operators (perhaps to establish green credentials). This also helps build capacity by guaranteeing a market for the operator. Of course, there's no direct wire from the wind farm to the company, so the grid operator has to guarantee the power regardless of source. That's why Eirgrid has recently written to the data centres to tell them there'll be no guarantees for new business in future. If they want electricity they will literally have to build the generators on site themselves.

All this points to a continuing (and growing) need for reliable baseload supply.

Ireland is on a bit of a sticky wicket when it comes to power supply. Our peak electricity demand recently tipped over the 5 GW mark. Demand averaged over every hour of the year stands at 3 GW. As of 2020 we have 4.2 GW of wind power nameplate capacity in the republic, 5.5 GW for the whole island. We have an all-island market for electricity and a second north-south interconnector is planned so it's reasonable to consider both (unless Brexit still has a sting in its tail). The average capacity factor is 30%, although that can run a few per cent lower in a bad year and there can be a few per cent of curtailment. So we have maybe 1.5 GW of supply from wind. Actual supply averaged over the year in 2019 was 1 GW.

Power demand is expected to increase 18% to 41% by the end of this decade according to low and high demand scenarios considered by the transmission system operators (Eirgrid in the republic, SONI in NI). Demand from data centres alone is currently 0.7 GW, but that is expected to rise steeply. With 50 already operating, there are 10 under construction right now. Eirgrid believes that data centres could account for 30% of total demand by the end of the decade. Meanwhile the island is committed to retiring its coal-fired power generation by 2025 -- Moneypoint in Clare has a capacity of over 0.9 GW and Kilroot in Antrim is 0.7 GW (of which 80% is coal and 20% gas). Those two power stations alone provide baseload power equivalent to a quarter of average demand. Kilroot used to provide a third of NI's total consumed electricity. Under the median demand scenario the TSOs consider that Northern Ireland will not be able to meet demand by 2025.

So we have the prospect of significantly increased demand and retirement of significant baseload supply. Can wind power take up the slack? Wind generated 36.3% of Irish electricity in 2020. We regularly have power surpluses which we export. How high can wind penetration get? In Denmark it is 48%. However, Denmark is surrounded by countries that can both take and deliver power pretty much on demand. High wind penetration depends on integrated markets and sufficient quantity of grid storage and spinning reserve. Battery storage is increasingly deployed and can be very successful -- not to mention lower cost -- than natural gas for smoothing out hour-to-hour demand. But daily, weekly, and seasonal grid storage is not an option nor, in my opinion, is it ever likely to be. Chemical batteries have fundamental limitations that simply cannot be overcome. Pumped hydro is a good solution but is geographically challenged. One of the promising things on the horizon is cryogenic air storage which is scalable but only 50% efficient. Green hydrogen, ammonia, and similar options have both efficiency and distribution challenges. Long term grid-scale storage is simply not something we can depend on in the medium term, if ever.

I can't see but that we need to maintain -- if not increase -- baseload supply from natural g

Not sure I get you there 1cagney, maybe we're saying the same thing. PVR has farmed out a 50% interest in the field, not 50% equity in PVR. The consortium partners were fronting a ton of money in return. The question is whether they will require a bigger interest in return for more money. Yes, of course, they are providing loans, but their share of ownership interest in the field will far outweigh the interest on the loans. That "alignment of interest" is the essence of the SpotOn model. The question is whether they'll require a bigger stake in the field in return for the extra cash.

I wonder if / how all this affects the divvying up of Barryoe. PVR and LOGP between them farmed down 50% of the field. That was going to be split between SpotOn, the consortium members and the bond purchasers. I don't recall that GIEK were getting anything other than interest payments on their bit. So if the consortium + bond are now expected to come up with 25% more funds (100% of development instead of 80%) would they be expecting a bigger slice of the pie? Not clear whether GIEK would be completely out of the picture but if so, might the other parties now want 62.5% instead of 50%?

We're much too far away from a drill to be worrying about the value of the oil to PVR. I was thinking more about the appetite for a bond issue. The price of oil feeds into that. Commodities are hot at the moment, see Exxon price for example.

Might well see $70 oil this week after Thursday's conservative OPEC meeting. Brent already within 50c of that mark on NYMEX.

Was intrigued to see this years Eurovision songs on Youtube are "presented by Moroccan Oil".

... turns out it's a shampoo! No relevance to SOU, then, except maybe for an instruction to "rinse and repeat".

Also more or less when we run out of funds.

That was a pretty cruddy RNS, even apart from the typos and the flung together appearance. What does this mean: "the financing structure has had to be adjusted to reflect the fact that GIEK is unable to participate in the Barryroe funding consortium in the form originally proposed". Unable? Or never committed in the first place? This has the hallmarks of another APEC about it. Linn needs to get real about the actual status of the funding. How much of it is solidly tied down vs. wishful thinking and vague promises on the part of SpotOn? Are we looking at another two months of radio silence before long-suffering PIs get their next dose of bad news?

If the bondholders are playing hardball Graham should have known better than to offer them a derisory 2% back in October. And, even if he made a stupid mistake, two and a half months is plenty of time to come up with an alternative. We know he's not coming from a position of strength but the deathly silence is frustrating.

What is Graham actually doing? He RNS'd a bond restructuring proposal on October 28th. It took two weeks to hold a bondholder meeting which was adjourned due to lack of a quorum. Then it took a further month to reconvene and reject the proposal. Two and a half months has elapsed since then without a peep from Graham. SOU is running out of road. Even if Graham came up with a new plan that could fly, we don't have another six weeks to wait for it to be proposed and adopted. And we would still need the gas purchaser agreement to be instantly signed, sealed, and delivered to get some money in the kitty. The silence is deafening... apart from the clock which is ticking louder and louder. The next sound you hear will be SOU getting flushed down the toilet. SHOW US THE MONEY, GRAHAM!

WL, at some point Marco and his mates held 70 million shares in SOU. That would be quite a bit to give up, even at the current price. That said, I've no idea what his holding is now. It's a long time since I've been optimistic about this share, but if you want a glimmer that's all I can suggest.