The next focusIR Investor Webinar takes places on 14th May with guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
I have asked the NOMAD this before and he said (the normal standard party line) that any material information needs to be declared in the same way whether a share is suspended or not. I probed further and he said, the point any other deal would be deemed material would be at the point of SPA being signed. If my memory serves me correctly, Z has said he’s seen SPA’s being signed very late in the total cycle and completion happening in a matter of weeks. But in this scenario, while we are delisted with no company currently existing on the stock market, I wold think that this kind of think would be impossible and we have not seen a SPA being signed anyway. However, I would be hoping that we are ready to sign one very soon after re-list either with or without a SS deal. But if it is without, I think we will see a lot of PI’s bailing as they would be in fear of another RTO and subsequent lang suspension again.
And I wouldn’t be surprised for some sort of deal being done with the Government to give them more skin in the game. Maybe they take a higher percentage of revenues from the extensions to the PSC’s. Could they benefit by taking a slightly larger share from ourselves, CNPC and the other partner (can’t remember who they are).
Or could we sell a bit of our share back to the Government, similar to us trying to sell 10% of COTCO back. I know the SS would not have the funds to pay but could it all be done from production revenues with an economic interest date of dd/mm/yyyy. The other 2 partners may do the same if it enhances the chance of the PSC extensions and would reduce any threats of Nationalising the oil fields as happened in Chad.
One way or another we need to take the Government with us and not by dropping suitcases out of planes.
NtM - I agree and on reflection I retract that comment. I now think that if SAVE have made enough progress in country to be granted a 2 month extension by AIM, it’s probably enough progress for the finance provider/s (if we are taking debt on) to put all their wheels in motion. I genuinely think we have a decent chance of a Q2 completion now.
Ian - I think quite the opposite. After all this time II’s will see huge growth and yield potential should SS close. They unlike PI’s in many respects but to mention 3:-
They don’t get bored
They don’t need to take cash off the table
They don’t forget the reasons they bought in
Yes there will PI’s who sell but I see far more demand if and when we land a big one.
And when we do close an incremental accretive deal I’m sure we will see a significant dividend initiated. AK has already previously mentioned $12m and $10m. This will be the number 1 reason II’s are still here and AK will now need to pay them back for their unwavering support as soon as the big fat lady sings!
TiL - thank you. and based on a 2 month further extension I see this as very positive. I spoke to the NOMAD in early Jan and AIM were asking for some very solid reassurances on significant progress being made in SS. If they did not get those strong reassurances, a further extension from today was highly debatable. We must have made progress in country.
If Shore are saying a realistic chance of AD in next 8 weeks, either the debt financiers are also happy with in country progress to incur their legal costs putting the deals together or as my previous note, we are not taking on debt for the deal.
Granted Shore will know some decent stuff to put that note together but we were also told from IR very clearly that Accugas debt re-finance deal would be closed before end of December 2023!!!
Anyway, based on where we are at, we could not have wished for a better note from Shore.
Return price on or before 8th April ……………………wait for it…………
89p
Noix - the main thing being worked on are the license extensions. In addition to those work streams, there are the finance packages, shareholder approval and SS gov approval.
K - yes I do agree finance in place before AD and readmission.
Whilst we all want to see this back ASAP, I too am pleased to see the further extension. Obviously my number one aim is to see the deal done and dusted. However, as TiL alludes to, I also see it like this.
The longer we see suspended, the better chance we have of the SP returning at a higher price even should the SS deal fail. Let’s say the deal failed today and we returned at a made up SP of 25p.
Now let’s say the deal fails in a few months time instead. By that time we would:-
Have a few more months of strong Accugas revenues reducing next debt, therefore pushing SP up.
Improved chance of seeing first oil in Niger and 35mboe moving from 2C to 2P
Possibility of an interim ruling on 4 court cases re Chad / Cameroon
Another M&A acquisition could be announced (or are we not allowed to announce due to everything else at the moment)
Accugas debt restructure may eventually get done in this window
Compression project in Nigeria completes and significant new gas customers possibly signed up
So if a few of those came in over the next few moths before deal fails, the SP would return at a premium compared to what it would be had the deal failed today.
So with all the World volatility and the vast amount of uncertainty we have, a few more months of suspension gives us a chance of some of our issues improving, whilst the Worlds issues will probably deteriorate even further with all the incompetent Governments we have making it all up as they go.
By the way, should we get the in Country approvals by 2nd April, there is not a cat in hell’s chance we will be trading again before 1/7/24.
Should we complete then we may have had 30 months of EI since 1/1/22 to take off the headline deal figure of $1.25bn. A mere $20 per boe equates to $913m leaving $337 to be found from future production deal and or debt and or cash.
At an economic interest of $27.38 per boe, the $1.25bn would be paid in full after 913 days from 1/1/22 = 1/7/24, ever likely AK is camping out in SS. Maybe he will return with a net worth higher than EM!
PS Shore Cap have just issued a note, does anyone have access to it?
Good to see the deal still alive but we are many months away from completion. I’ve said this before but some folk say I’m wrong. But the debt provider/s will not start their work in earnest until some of these in county approvals are achieved. Whilst we could come back to trading when these approvals are granted, there will still be a fair bit of WIP to complete until the deal hopefully gets completed 100%. Having said all that, the longer this stays suspended, the less debt we need to take on. There is a growing possibility that we don’t need to take on debt. The deal could soon be financed by $1.25bn - credit from 1/1/22 - cash payment and the balance from future production payments.
Hoping to see operational & financial update soon but not holding my breath. Whilst all our very sensitive projects are ongoing SAVE have cut back on updates and only given mandatory updates. We may not see anything substantial until 30/6 when 2023 finals are due. We haven’t even seen anything on X since 6/11/23 so I guess we’re not sponsoring anybody in the Olympics this year - ha ha ha…
Hey - we could get one like this:-
South Sudan Acquisition Update
Further to the Company's announcement on 14 December 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. In this regard, a further extension to the Company's cancellation date has been granted to 1 May 2024. Further updates will be provided as and when appropriate.
Although AI can never be 100% accurate, they tend to call more things right than wrong. I read it as we are looking at the Gabon deals to replace the CC lost production of circa 20k. They did not hint that we were looking at Gabon for any reason to SS failing, in fact quite the contrary. I see AI as seeing us as having up to 30k of solid very profitable business in Nigeria, bidding for 20k-45k in Gabon and hopefully closing circa 50k in SS. On top of that we have a reasonable % chance of a significant award fro ICC cases. Roll this lot forward 5 years + ARB production in Niger and all the renewable projects and you can see a huge company. However, my investment period is not 5 years from now, my investment period was 9 years from 2015. I have always said since day one (2015) that I want to completely restructure my finances in December 2024 and the clock is ticking for me. Hopefully I will retain a large SAVE holding post December but will only do this if it delivers a sizeable yield.
Hi hubs - hope you’re well. This will come a a very nice surprise to you as you’ll know nothing about this whatsoever, so I hope you’re sitting down.
Unbeknowns to yourself, I have silently been working in the background for you and am pleased to inform you that you’ve been awarded a significant amount of money from a very old PPI case. I’m holding the money for you in one of my Nigerian bank accounts and would like to transfer this to you if you would like it. If so please send me all your bank details and I’ll sent the funds to you if and when I get 5 minutes spare?
Oh - one last thing. Would you like to receive the money in USD or NGN as I know some people have had horrific experiences with recent fx fluctuations.
I look forward to hearing from you very soon.
Oyinbo
Hey cj - I’ll lighten the mood before the weekend and roll forward your scenario:-
We can the SS deal
Go back to back in to another RTO (If allowed by NOMAD & AIM)
We see 1.5kboepd first oil in Niger
Our 35mboe in Niger move from 2C to 2P
We do a huge farm out in Niger for >$300m
We are awarded >$500m from the ICC cases
We restructure Accugas debt
We complete compression in Nigeria
We add 20kboepd incremental gas sales in Nigeria
We re-list with the RTO complete with another 10k-20kboepd
SP then?
Have a nice weekend and less than 2 weeks to go before we see a further extension to our suspension!
Nothing earth shattering but I think it’s good to keep a line of comms in to IR. My comments:-
Good to see Accugas debt restructuring still expected to close soon and not linked to anything else.
Maybe we could see a nice surprise to the 35mboe 2C moving to 2P and first oil in niger sometime this year.
Good to hear that Accugas compression project still on track to complete mid year. As TiL says let’s hope we add new customers and add to existing customers supplies during H2.
ICC cases, clearly they are saying absolutely nothing until significant news can be announced.
SS RTO text book reply and anything at all could be going on there be it good or bad. But you know what I’ve said about more of a government commitments before debt providers take us seriously and deem it worth their while funding their legal costs to put the debt packages together.
1 As we did not see the Accugas debt re-finance close in Q4 2023 as expected, are there any significant problems with the deal? If not when can we expect it to close and is it independent or interdependent of anything else going on in the company?
It is expected to close shortly, and I confirm it is entirely independent of anything else which is ongoing.
2 Now the Niger pipeline is completed / operational and also that borders seem to be opening up, have things changed for the better at all with regard our well test program and first oil?
We have noted the recent developments with regard to Niger (including the inauguration of the export pipeline) and will update the market on our plans in due course. As detailed in our recent 2023 Half Year Results announcement, Savannah remains committed to the 35 MMstb (Gross 2C Resources) R3 East oil development in South East Niger.
3 How is the compression project going in Nigeria and when is the expected completion date?
The compression project is on track and, as previously announced, is expected to complete in mid-2024.
4 How are things going with the 3/4 ICC cases re Chad / Doba and when can we expect to see an update on this huge issue?
We will provide further updates as appropriate in relation to the progress of these matters.
5 With regard the Petronas RTO, what is the cause of multiple suspension extensions? If we are so close to deal completion, why can't Savannah issue an admission document, lift the suspension and then work on any outstanding work streams such as Government and shareholder approval whilst we are trading again? How long can we keep being suspended for before the Alternate Investment Market (AIM) and our NOMAD Strand Hanson mandate that we pull the deal and re-list our shares from trading again?
I appreciate your frustration but, as we announced on 14 December 2023, we continue to advance the various workstreams required to complete the acquisition of PETRONAS International Corporation Limited’s energy business in South Sudan. Further updates will be provided as and when appropriate.
Https://afentraplc.com/wp-content/uploads/2024/01/Petroleum-Outlook-2024-Afentra-article.pdf
Does anybody know of any previous de-list scenarios and how they work?
AIM have not said to complete by dd/mm/yyyy, they have asked to see significant progress as they were not happy with the speed at which things were happening previously.
I hope oil exports are not getting held up from Port Sudan. Am hoping Port Sudan is a bit too far North in the Red Sea and is not affected by the Yemen issues a bit lower down. Maybe the oil tankers simply sail North from South Sudan and trundle on up through the Suez.
Oil rising tonight on a the news that the US & UK have started to bomb the Houthis in Yemen. POO could shoot up if Iran chose to get involved and retaliate to support Yemen. Wouldn’t be surprised to see Lebanon getting more involved attacking Isreal from the North. This is a very dangerous situation.