Member Info for Santos1

Supra 3 says stamp duty is a deterrent to moving to AIM. I disagree. The stamp duty charge is 0.5% on the purchase ( not sale) of UK listed shares. AIM shares are exempt.

In the context of a volatile share like RKH that can move 0.5% in seconds, can a 0.5% purchase charge credibly be described as a deterrent to a move to the main market, when you consider all the advantages of being on the main market ? No, is the correct answer.

I suppose the stamp duty charge might impact traders more than long term holders, but so what? The overwhelming majority of shareholders in this company are long term holders.

In answer to Caledonia's questions , you are not required to move up from AIM to the main market ( although I see proposals are being circulated in the City for a move up to be automatic for companies with a market cap above £500m, so that might change ) . However an ambitious growing company ( which we are ) will benefit greatly from the move to the main market in all kinds of ways, notably the access to a much wider national (and international) investor base, and the higher profile. More prestige, more visibility, more institutional investors, in a nutshell.

On regulatory issues, there have been recent updates to to the UK's listing rules which have narrowed the regulatory gap between AIM and the main market, ie it is less burdensome to move up than it used to be. I don't think there are significant advantages anymore to staying on AIM for those reasons alone.

NN asks ' under what circs would RKH move out of AIM and what would it mean for us'. In short, RKH could move out of AIM and onto the stock exchange main market anytime if it wanted to . The main requirements are to be of a sufficient size ( the threshold is £30m market cap. - we are already above£450m ), and 10% of issued shares must be held by the public. Personally I hope we make the move sooner rather than later. Advantages-loads of institutions can't invest in AIM stocks , so the potential investor base would be much larger. Also many more share analysts would cover the stock, and our profile would be higher. Disadvantages - more paperwork than AIM, but the company looks well managed with systems in place to handle it. Yes, it would cost probably £2-3m in legal, advisory and other fees , so maybe that can't be justified right now when everything is focused on FID. But I think it makes sense to consider it after FID and before first oil. The higher profile and larger potential investor base would be very positive for the share price as we go forward, imo.

Hi LTT. My thoughts are that institutional investors of all kinds invest typically in exploration stocks at later stages, eg FID, or later still on first oil, or when uncertainty reduces as to the sheer scale of the many opportunities ( Nom explained that process yesterday) or simply when there is sufficient liquidity for larger block trades without unduly affecting the share price, or when RKH leaves AIM and moves onto the main market, etc etc . In other words, there are all sorts of internal rules applied to fund managers at institutions as to when to invest - some will come in at FID, and others later at different points. Institutions range from pension funds , investment trusts, family offices, hedge funds etc etc - all with different needs and investment parameters. So I expect an ongoing process whereby private investors over time get replaced by bigger investors. I do expect the share price to move at FID but I wouldn't be surprised if it moves through 100p before FID. My goal is just to hang in for the long term rather than expect significant movements at particular moments. The stock market adage is that ' it is better to travel than to arrive' so you may even see selling at FID. But we wont have 'arrived' at FID- the whole opening up of a new oil province will have barely begun. In short- I expect ups and downs but the overall momentum is clearly upwards and I am expecting previous highs eventally to be surpassed. There could likely be times along the way when the share price gaps up - including at FID- another major reason why ' buy and hold' is the best strategy.

Happy says I didn't give him a specific example of a placing that was conditional on a 'milestone' being reached. Just to be clear, what I am saying is that EVERY SINGLE PLACING in the capital raising marketplace is in fact conditional on a range of conditions being met, as he would know if he had ever worked in corporate finance in an investment bank.

I didn't comment on the terms of the placing. In my view they are good sensible terms. They remove uncertainty as to whether RKH can board the train at this critical juncture. The capital raising hugely enhances potential earnings per share in the future when production gets underway. Btw, the bulk of the funds being raised ( $115m out $140m ) won't be dependent on Happy's vote, or any other shareholder's vote, as the shares are being issued using the authorities to issue and allot new shares granted to the directors at the AGM at the end of June. As to shares offered to existing shareholders, personally I shall be applying for excess shares in excess of the basic entitlement and look forward to the terms being announced in a few days time.

Lastly, thank you Nomlkanymore for your further comment. Exciting times indeed.

Happy asks ' please give me an example of a placing that was conditional on a milestone being reached'. If a company is raising capital e.g. to acquire another company, or a complementary technology, or an asset, or to participate in a drilling operation, then the placement to fund it will be conditional on 'milestones' being 'reached' e.g. that all contract terms relating to the acquisition have been agreed - negotiations can be ongoing right up to the moment when the contract is signed and the funds are handed over. In this case if there is no FID then there is no reason for a placement and the escrowed funds will be returned. Escrow accounts are routine with placements- precisely because funds are not handed over until all conditions ( or milestones , as you call them) are met. (As mentioned there is every reason in this case to think FID will occur within the next few months ). The administrative/ tick box conditions attached to this placement will also need to be met . Please note that the range of possible ' milestones' or conditions for a placement are freely negotiated by parties and their lawyers and are theoretically only limited by whether they are lawful or not.

Great post from Nomlkanymore, thank you for that. A great overview of the the prospects in store and the many exciting years ahead. On the subject of accelerated development I like your suggestion that : ' if done correctly NAV/RKH could bring in partner cash for a relatively small percentage of the fields as uncertainty reduces' . [ I think there may be a word or two missing from the sentence before that - grateful if you could confirm that you are suggesting NAV/RKH could ( or should) consider bringing in partners on a field by field basis as the scale of opportunity is understood and uncertainty reduces with each field brought into play, rather than bring in a single partner on Day 1 ( whether at Phase 1 Fid or later before first oil ). Sorry if I have misunderstood ].

On another subject- share ownership dilution - I think its worth highlighting that while capital raisings involve share ownership dilution, i.e. you own less of the company in percentage terms, this doesn't mean there will be earnings per share ( EPS) dilution. EPS in this case will be massively enhanced by the capital raising, which effectively unlocks the new oil province for RKH and allows RKH to participate. You will own the same number of shares as before the capital raising ( or more if you exercise warrants) and these shares will all have much higher earnings per share potential than now, assuming the capital raising goes ahead ( I fully expect FID before Christmas, and by end March at the latest ) . Btw, the suggestion by another poster that capital raisings are not normally conditional on other events happening is simply wrong. They are all conditional on other events happening, from administrative matters to corporate events.

Happy investor thinks ' 53p is essentially what Sam and the board have essentially agreed what FID is worth'. This is total nonsense. You have entirely misunderstood what is happening. Based on NPV10 calculations for Phase 1 of Sealion alone the stock would theoretically be worth closer to between two to three times 53p at FID, if it is announced ( I fully expect it will be announced by Christmas) ie well north of 100p. If it doesnt trade at theoretical value then it will undoubtedly do at some point in the future and the theoretical NPV value will be rising as the NPV discount reduces. The placement , which is conditional on FID, was at an entirely reasonable discount of around 13.5% to the share price of around 60p when the terms were agreed. . Discounts at capital raisings are often made at much higher percentages. Its not the discount that matters , its whats the money is going to be used for. Its going to be used to ensure the company is on board the train when it leaves the station.

Lufc4eva asks for opinions whether share price could drift to the placement price before the new shares are issued. There is no theoretical reason why the share price should fall due to the capital rising, either before the new shares are issued or after the new shares are issued. On the contrary, this capital raising is hugely earnings enhancing. It brings money into the company which will be used to fund Sealion Phase 1, which will unlock a hugely exciting new oil province. This is the exact opposite of a capital raising by a weak company trying to stay afloat by any means possible. In those circumstances you would expect the share price to fall. But in this case the new funds will be used to ensure the massive growth in the company's earnings per share that we have all been waiting so long for.

Back in late 2024 I posted my view that I wouldn't be surprised if the RKH share price gets to £1 before FID, based simply on my experience as a former stockbroker who for a period in my career dealt in exploration stocks of various kinds. RKH has a typical share price chart - the share price leaps massively on discovery, followed by a long grinding drop, followed by an eventual sharp start of the share price recovery to previous highs as the prospect of production increasingly becomes a reality. I still hold to the view that 100p could come before or after FID and personally I expect the share price eventually to get to previous highs of £4-5 , and exceed them, over the next number of years as subsequent Sealion phases and satellite discoveries are brought into production ( some of the satellite discoveries have already made , and others can be expected as with any major new oil province). There are other very exciting prospects in store beyond the satellite discoveries, as discussed frequently on this board.

The best advice is to lock the shares in a drawer and forget about them but of course that's easier said than done. The share price will zig zag up and down ( it always does) but the momentum is upwards, and there will be a constant newsflow to keep the pot boiling. The share price will eventually be underpinned by dividends and by dividend yield calculations based on comparisons with other oil producers - personally I would rather own a dividend paying share operating in a stable environment like the Falklands than one operating in certain less stable places - and by the incremental reduction in the NPV discount.

Keep calm and carry on !

GLA

This is my last observation ( for now) on the trading we have been informed about recently in this stock. We are told that the main holding is held long and that only a fraction is traded- let's assume 10%. For the sake of convenience let's assume the total value of the holding is £10k when the share price is 63p. If the stock then falls 8% to 58p, the total loss on the position is (£800). However if 10% of the holding had been sold at 63p then the total loss at 58p would have been slightly reduced to (£720.)

Conversely, if the stock had risen 8% from 63p to 68p after 10% had been sold at 63p then the total profit on the position would have been correspondingly reduced.

The scope for being 'whip-sawed' using this strategy is obvious, even with reduced dealing costs.

I would say the technical term for this type of 'trading' is 'fiddling around the edges of a long position' and has the same probability of 'success' as tossing a coin.

A fascinating read, thank you Nomlkanymore.

'I was suggesting checking my trades prices against the market at the time'.

There is no way to independently check whether they are YOUR trades, or whether you actually did the trade as opposed to telling us that you did.

But carry on regardless....we are not interested. You remind me of a man with a placard round his neck who used to parade up and down Hyde Park every day trying to get people to listen to him. But he probably had more interesting things to say.

Ripley says" My trades are posted shortly after deals and can be fact -checked'.

In fact there is no way to check the identity of the buyer or seller of shares in this country. The identity of buyers and sellers on the stock exchange is confidential. The public has no right to access this information. There are two exceptions, both in the interests of transparency ; 1. Major shareholders need to make disclosure if they exceed a certain ownership level, or dispose of their shares below a certain threshold; and 2. Company Officers ( 'insiders') need to disclose their share trades at Companies House.

if Ripley is offering to send his trading statements for independent analysis, the problem with that is 1. no-one is interested in his trades, and 2. he has already disclosed that he has various accounts , so there is no way of verifying whether all the information has been provided regarding his glittering trading history and 100% success rate, etc etc.,

He is therefore free to continue boring us with the fantasy trades as well as with the real ones, assuming you can understand the confused language in which he reports them. .

'I have now spent time replying with a longer post then ( ? than ) my usual to correct your nonsense' .

And no one is any the wiser.

Ripley from Shipley- trading is for mugs. But perhaps you know that already. Or will find out. Maybe with the help of the gambling therapist.....

Ripley from Shipley is to be congratulated on his long and distinguished career as a spreadbetter, with his 100% success record. This is an all the more remarkable record when you consider that spreadbetting providers consistently report that between 80% to 90% of their clients lose money. To be fair, we do not know for certain if he is spreadbetting ( betting on the direction of the underlying stock) or trading ( actually dealing in the underlying security), but spreadbetting is more likely as it is so easy to set up an account , and minimal funds are needed.

As to trading, the North American Securities Administation Association reports that only 11.5% of traders actually trade profitably over the term of their trading, and that a large majority eventually lose everything in their trading account. This includes all types of trading- whether intraday, end of day or any market.

Anyway, good luck to Ripley with all the frantic top slicing etc etc but please be aware that the great majority of participants in this forum are obviously ( very) long term holders so have zero interest in your no doubt glittering trading history. I just hope for your sake that the downstairs corner shop in Shipley has a large enough stock of scratch cards to meet the margin calls.

The same goes for Grim in Grimsby.

Today Dripley bought back his 100 shares at 58p. Imo he should issue a press release. The general public would just be as interested ( or not) to hear about the frantic slicing and dicing of his position as the readers on this board.

.....Grim rueing the day he put the short position on at 20p and occasionally going down to the corner shop to buy a scratch card in a vain attempt to cover the margin calls , while the other one is busy top-slicing his 100 shares down to zero......

I picture grim and dripley etc in adjoining bed-sits somewhere up north, both obsessively posting thousands of confused messages - could be wrong of course. It might be further south. I suppose they have some minor entertainment value while we await the exciting prospect of a new oil province to unfold in a stable part of the world with so much to look forward to.

I see Ripley is back with more comments on his unverifiable leveraged trades in an ISA account ( is HMRC aware of that ??) and concludes his comments with this enigmatic remark:

'What is the obvious? buzzthomas asked '.

Isn't the obvious that you should go to some other chatroom and bore them there with your slicing and dicing ? I have lost count of the number of times you have been requested to do that on this board. Is there something you can't understand about these requests ?

....' Nature of Business: Extraction of Crude Petroleum/ Extraction of Natural Gas '

I think the company name is an excellent choice with a nice ring to it !

Great find at Companies House - thanks Mogger.