Member Info for rossannan

Garnhiem. From past experience, that is certainly possible.

TCGLOVER Posts crossed I think, I was answering your 15:55 post.

Garnhiem. Or understand it only too well?

TCGLOVER As I said the other day I am done explaining that one! Feel free to check my posting history if you are that interested.

TCGLOVER I don’t have a sp prediction for 2019, just my prediction that it will be less than 8p at EOY 2018.

Which does beg the question why the share price is lower now than it was immediately before Steeldrum was announced...

TCGLOVER Making predictions is anything but ridiculous - the share price is, after all, essentially a prediction of future success or failure.

Garnhiem.

So it is not true to say that it remains to be seen whether Steeldrum is a good deal or not?

willowpillow

LK does not want to dilute unless it is accretive. You would hope so. I think there is a misunderstanding about what accretive means though. You could increase the number of shares in issue by 10% to buy something that adds 11% to the MCAP. That would be accretive. You could keep on doing that until you had a £500M company with a share price still in single figures. Accretive is as accretive does.

Garnhiem.

It remains to be seen whether Steeldrum is a good deal or not. It is complex and contingent.

willowpillow

It is indeed an if and that first SWP drill is not now going to happen until mid-2019. It is hard not to hit oil when you drill in Trinidad but it is important to remember that the SWP is exploration drilling, not development drilling. It is also important to remember that it has to be paid for.

Sorry, if the fully diluted share total as at the end of April was 751,519,330 then taking the Steeldrum deal and the new convertible into account we could be talking about less than 40p already.

goupplease

People worry about the short term because of the difference between MCAP and shareholder value. LK is trying to build a £500M company. When he first shared that ambition with us some folk assumed that they just had to wait for that MCAP to materialise to have an exit option at around 80p. You can go back and read the posts. LK has made some progress on the MCAP front but not that much. If he does eventually get to his £500M target the best exit option folk can now hope for must now be less than 50p. That’s what short term issues can do for you and that is why they are worth worrying about. If that trend continues over the next couple of years, what might a £500M MCAP equate to? 20p? 10p?

HH

Thank you very much for doing that. These bulletins are going to become increasingly relevant to CERP and at certain points in its quarterly reporting cycle may offer a form of advance notice. It is probably sensible to expect the worst from RRL.

HH

That’s the June MEEI Bulletin in:

http://www.energy.gov.tt/wp-content/uploads/2018/08/MEEI-Consolidated-Monthly-Bulletins-January-June-2018.pdf

The IPSC total for June is 956 bopd - we know that 553 bopd of that was CERP - any thoughts about how the rest of it breaks down?

TCGLOVER

Okay, you say 8p or more EOY, I say less than 8p EOY. Bottle of beer to the winner.

Vmax

I am not advocating that LK keeps the cash in the bank, I am highlighting the negative cash cash flow at group level. So if the cash balance is down to $1million at the end of Q3, which looks likely, LK will have no choice but to crack open the LIND facility, which was just supposed to be an insurance policy for contingencies relating to Steeldrum. What if he has used up the LIND facility before the cash invested in the business begins to pay off? Repayments in shares for a start. No placings though, that toy has been confiscated (most likely by Schroders, IMO). It’s not a great scenario, is it?

TCGLOVER How do you work that out?

TCGLOVER LK says 1000 bopd+, so that’s probably 900 bopd at best.

TCGLOVER

No, I have a pretty good idea. Steeldrum, FWIW, will be added in Q4 but Q3 production should be very similar to Q2 unless there is a significant contribution from Bonasse, Icacos or Goudron WF, but that is not looking very likely. Q3 costs should also be very similar to Q2. So the Q2 to Q3 cash burn should be very similar to the Q1 to Q2 cash burn, which was a bit hefty.