Firering Strategic Minerals: From explorer to producer. Watch the video here.
It’s too early to know how this will play out. But if things continue at they are, I think the best we could hope for is that the Chinese / CNPC and the ARB oil production are left to be business as usual. Would the Jaunta / Wagner / Russia take on the Chinese here and the $4bn pipeline they are due to complete within the next 5 months?
There are no good options in Niger. The West looks set to lose its strategic counter-terror bases there and military intervention by Ecowas would almost certainly lead to a civil war.
The current evacuation of French nationals is quite likely to be followed by the abandonment of US and French military bases and the departure of their 2,500 troops that have been engaged in helping Niger fight jihadist insurgents.
So who benefits from all this? Certainly not the population of Niger.
The presence of Western forces was far from universally popular but the country was receiving hundreds of millions of euros in annual financial aid and military assistance. That has now stopped.
Russian flags have appeared on the streets suspiciously quickly, so it is likely that Russia's Wagner mercenary group will be looking to fill in behind the departing troops.
And for the jihadists of Boko Haram and the al-Qaeda and Islamic State groups active across the Sahel, all this disruption and uncertainty is a strategic gift.
Guess the Q4 well testing will become embroiled in this mess.
Niger coup: France to evacuate citizens after embassy attack https://www.bbc.co.uk/news/world-africa-66370002
Great stuff Zengas - cheers. And hey wouldn’t it be spooky if we resumed at the SP I’ve banged on about for years, the magical 89p?
I’d be over the moon with that and I’m sure it would be seriously life-changing for a few peeps on here.
Also I’ve been in a bit of dialogue with IR today and nothing of much significance of note. I don’t think we will see any ops / finance updates before the interims which will probably be issued on 29th September as a separate RNS to the SS Ad Doc RNS should that be issued on 29th Sept too. Maybe new gas customers announced prior to then and maybe more renewable deals too but they could also come post end September as well. So not a lot to get excited about here for a while me thinks. Guess in the meantime we need to rely on the top posters on here and industry papers / AI etc. Seeming like a bloody eternity now being suspended and hope it’s all worth it. Guess if we come back above, let’s say 40p, everybody will be happy though. At least I’ve got 2 holidays to look forward before end of September and also one in October should we get suspension extension for a bit longer. Sweet dreams to one and all for 9 weeks.
Great posts again Zengas. What would you see a high and low SP being based on production of 85k (55k SS + 30k Nigeria), net debt of 700m 23YE, 1.4bn fully diluted share base and 2P reserves? Am not sure of our Nigeria or SS 2P numbers but am hoping we get 35m 2P bookable number from Niger later this year / early next year. I’m no expert in converting these numbers in to SP but surely we much be looking at over 80p.
LST - I fully appreciate $1bn is a huge number and may be nothing like that. But think of it this way. We had bought 11kboepd of production along with large 2P reserves. The assets were ours and fully funded. Whilst I appreciate we would not receive the full cost of each barrel, from a gross revenue point of view $1bn looks like this:-
$1bn / $80boe POO / 11kboepd = 1136 days which is just over 3 years. I’m sure we’d have stood to gain a lot more than that with further field development.
Personally I’ll be glad and expect to win an award and will be disappointed if it’s much less than $1bn. But let’s see and we may hopefully find out before the end of the year.
K - would love a quick ruling. And as Chad Gov can’t be trusted and more than likely will never play ball, how about this for an outcome:-
Retain our 41% of COTCo and still sell 10% to SNT for $44.9m
Keep getting paid our dividend from COTCo
Forfeit Doba oil back to Chad Gov / SHT
Be awarded $1bn+ as compensation and be guaranteed payments from liftings in Cameroon
I’d take that all day long pal. What do you think?
Ecowas & the West are worried to death of this situation prolonging and Niger forming relationships with Putin / Wagner. It’s hotting up now but to be honest I can see this fizzling out soon and business as usual resuming.
https://www.bbc.co.uk/news/world-africa-66353284
PS TiL only 44 trading days and 61 sleeps until 29th September LOL
South Sudan Acquisition Update
Further to its announcement on 8 June 2023 the Company continues to advance the various workstreams required to complete the acquisition of PETRONAS International Corporation Limited's energy business in South Sudan (the "PETRONAS Acquisition") and now intends to publish an AIM Admission Document in respect of the PETRONAS Acquisition on or before 30 September 2023, following such point the Company will seek restoration to trading on AIM of its ordinary shares.
Niger soldiers announce coup on national TV https://www.bbc.co.uk/news/world-africa-66320895
Morning all
It’s always worth keeping an eye on oil price forecasts, especially with regards to the funding structure (when we know the precise detail) for the Petronas assets in South Sudan.
https://oilprice.com/Energy/Crude-Oil/Demand-Surge-Set-To-Push-Oil-Prices-Higher-This-Year.html
Obviously we would all prefer the deal to be done with cash and debt as per the RNS back in December. However, as you rightly say, assumed revenue from Doba was probably in the equation back then, so I’d guess the mix of funding will have changed significantly since day 1. And also let’s not forget that every day that goes by, the final payment will be reducing nicely, especially with the rising price of oil. Very crudely (pardon the pun) on a wild guess of $30 per barrel to SAVE and 50k per day the headline figure of $1.25bn would be reducing by $1.5m per day and has probably averaged more than that over the 19 months (if 1//1/22 was the economic interest date) due to >$100 oil during 2022. So if the $1.25bn did remain as the starting point, what is the balance payment due? Maybe ($1.25bn - ($1.5m per day x 575 days)) = $387.5m to pay. AM I MISSING SOMETHING HERE AS THAT SEEMS A RIDICULOUSLY LOW SETTLEMENT PAYMENT? Zengas IZ PF help please?
But for this note, I’ll carry on with $387.5m to pay and how would this be funded? Cash and or debt and or equity? Did the primary finance providers insist on AK providing a junior loan and could something like this happen again? We can assume cash is more limited now without Doba and I hope not to see issue of equity. So personally I’d like to see the balance 100% debt funded but am not sure if I’m hoping that pigs fly!!! But with the uncertainly linked to the security of the export pipeline through Sudan, I’d guess that the typical debt funders would be extremely nervous. And as Petronas want out and much as we want in, could the remaining debt be taken on by them and linked to SS production? Yes, I maybe dreaming and this would be absolutely perfect in theory to SAVE and ourselves and I’d hope that it could be a possibility. $387.5m to Petronas is small change and would be paid for with another 259 days of production based on the numbers above from 1/8/23.
Another thing which is perfect in theory would be a full completion RNS on Friday with explicit government sign-off. And who knows, it may already be signed and we’re just waiting for the ink to dry before somebody changes their mind and nationalises the SS oil LOL.
Finally let’s not forget that Accugas is making very healthy FCF every day
Accugas debt to be restructured to match the 15/16 years remaining of our contracted gas
Niger oil test and first oil getting very close now
Another >475MW of renewable business to be signed in 2023
At least 1 more hydrocarbon deal signed and maybe completed in 2023 (my guess is Cameroon)
And hopefully no more suspensions although I fear we will if SS should fai.
Court award for Doba & Totco in our favour and >$1bn awarded to SAVE taken from production at the point of sale in Cameroon - OUCH to the Niger administration.
One way or another it should be a VERY interesting 12 to 18 months and a sincere GLA.
Really looking forward to this. AK was talking about 1k to 1.5kboepd when we were going to truck and sell locally. Now that’s canned and we’re waiting for the imminent pipeline completion, I wonder what boepd we will start pumping in to it. We will be running a well test program in Q4 and I assume it will include testing all 5 discovery wells. I think we will have plenty of capacity available to us re the new pipeline, so will we produce from just Amdigh or possibly all 5 wells? If we produce from all 5, don’t be surprised to see way more than 1.5kboepd. We are long overdue a nice surprise and a bit of luck.