Member Info for SmartyP1

Forgot Airshagyl block ! Stick a valuation to each asset and you won’t come out with 76m !!

Yep Badge, the production licences are hugely valuable to Caspian and future acquirers.

The current m/cap at c £76m is a joke. How can the company be valued at that when you look at their asset base below. If they sold them individually now, they would achieve multiples of the current sp. They will crystallise the value of their assets over the coming months and if AR deal completes, they’ll accelerate that process. As per my earlier post, the outcome of 803 test and A5 side-track will obviously transform this company and multiple bags will ensue. Only the LTHs know what they're first deep success at A5 did to the sp, 7 bags in short order before the mid blockages. I believe they'll achieve a considerable sum for the individual BNG blocks without success at current wells but if they do, this will fly.

NY deeps

B8 deeps

Rigs

Oil services biz

West Shalva

Shallows - $88m

Caspian Explorer

Morning Mike,

Thanks for following up with some of the history and assets in play. All investors should know the story otherwise they won’t understand the challenges but more importantly the huge upside in play if they convert some of their portfolio. Many stake bulls:long termers may have exited yesterday , all fed up of waiting for Caspian to deliver. Got to be in it to win it and as always, patience required 👍

Contd

Shallows

West Shalva transfer of ownership agreed and company working on deal completion . First well to be drilled in Q1 25 and Caspian are hopefully of replicating their success in the Jurassic and replicating the revenues received from the MJF structure.

Caspian Explorer

First charter completed for c $6-7m. The CE completed the drilling quicker than expected and company believe that further charters very likely annually going forward generating significant revenues. Caspian also could sell the CE and they believe that $60m+ would be achievable. It’s on the balance sheet for pennies !

Other opportunities

Mining opportunity. Their first mining operation and was presented to the AGM attendees. A manganese operation from day one but other copper, gold opportunities could follow. Limited outlay of cash on updating equipment but I expect we see the details of the acquisition shortly.

Oil Services business

They have 5 rigs and about to acquire another G70 rig from Sinopec. This enables them to reduce the cost of drilling significantly as they don’t need to rent rigs. They also have their oil trading business and that is a very high profit business and I expect them to trade other oil producer oil a ell as their own if they’re successful from their current asset portfolio.

I maintain that the assets have considerable value, far in excess of the current m/cap. The barge alone would generate c 2.5p to market cap if they decided to sell it.

Hugely oversold imo and investors will finally start to see a real ROI next year and multi-bagging performance in play 😀

Great to see SPA signed and completion deadline on 31/12 and dependent on debt financing being agreed, Kaz regulatory approvals and no material adverse changes to the business. If deal not completed by 31/12, a new long stop date to be agreed.

I still believe Caspian will benefit from existing production from MJF until deal completes and current revenues should be c $1.8m per month which you could add to the deal value, especially as costs, labour, drilling etc would have decreased considerably as no more drilling on the MJF/SY block, only the 815 acid test as well has been completed.

They also have the $14m in the bank earning c $200k pm. The $ has strengthened over 10% against the Tenge and as we know, they pay all costs in the local currency. Add in the recent payment for the first Caspian Explorer charter, c $6-7m, they’re in a good place financially.Additionally, the deep drilling has paused on BNG so costs will have reduced considerably further strengthening their finavil position.

Hopefully most investors have read the Zeus broker reports and understand their current FV estimates at 10.8p and unrisked valuation at 75p. If AR deal completes imminently as per today’s RNS, Caspian will be in a strong position to start accelerating operations on the key assets. What’s in the pot ?

Deeps

Airshagyl Block. Our most lucrative opportunity with 2 wells drilled (A5/6)that have flowed oil with a 3rd (A7) drilled to c 50% of TD. A5 was the most promising with oil flowing at c 3800bopd on full choke before the blockage issues that has dogged then on all wells. A5 side-track is planned for 2025 and if successful, it transforms the valuation of this company.

North Yelemes Block

3 deep wells drilled (801/2 & 803) and oil discovered at all but heat and pressure challenges have resulted in blockages but latest well 803 was tested at 500bopd but work has been paused as they await production licence approval. They are completing the final reserves update and hopefully full production licences will be approved for both Airshagyl and NY blocks. Caspian are very good at flipping assets for a considerable profit as demonstrated by the historic Galaz sale for $100m and the current MJF deal for $88m if it completes. What could the A block and NY blocks be worth. Could be hundreds of million $s dependant on outcome of 803 and A5/A6 testing and side-tracks. They’ve also split the licence applications so they could sell either block separately.

Block 8 deeps

The are in the process of completing the acquisition of B8 but are awaiting the the licence approval on the Akkaduk structure where they have drilled a deep well to 3450m and will test on receipt. The Sholkara licence has been approved where 2 wells on the block were flowing at c900 bopd, now only 100bopd but remedial work planned to improve production levels with work overs.

Contd

BNG deeps sale. I think they’re being clever with the licence application as they could sell each block independently with a production licence. Same goes for B8 and 2 individual licences. Casper have stated that there aren’t many available blocks with production licences so I’m expecting large sums to be generated from BNG but impossible to gauge as 803/802/A5/A6/7 could be successful. I hear you say, oh no, no chance looking at their track record but allegedly 803 had flowed or is flowing at 500bopd. A5 has glowed on full choke at 3800bopd but they’ve stated that 1500-2k consistently achievable but they’ve never been able to deal with the resulting blockages. The reserves estimates will be done, hopefully complete 803, maybe partner on 802 and side-track A5 pre the For Sale sign is erected.

They sold Galaz for a handsome sum. I believe it’s the right call on the shallow sale and I’m all for selling the deeps. The CE ? I’d prefer $60m today v ongoing charters as I don’t believe they’re hugely profitable after prep costs but if there were 2 a year or a longer contract with a partner over x years then maybe charter route is the way to go.

Sum of assets exceed the m/cap by some way and our broker believes fair value at 10.9p and we are currently 25% of that valuation ! Its the current group of largely stale long term holders ( not all) that dictate the price and most are loaded up. Casper need to start delivering the expectations they've set and start to deliver shareholder value from every asset and I believe we'll see that as we move forward.

I stay invested and am still hopeful that a multi-bagging performance is within reach.

Https://polaris.brighterir.com/public/caspian_sunrise/news/rns/story/xz8dn3x

https://polaris.brighterir.com/public/caspian_sunrise/news/rns/story/xe3qz2r

Important that investors have read the disposal detail. Lots of hoops to go through before the SPA signed. Anything could be holding up the deal eg AR had to obtain debt financing for $54m and that could take time. The Heads were signed 6 months ago and until SPA signed, AR have right to renegotiate terms if the assumptions in the HOTs are not correct. The shallows volume would need to be maintained and although 815 result not part of the deal requirements, if it failed then that may impact AR desire to proceed or to renegotiate. On the other hand if it was successful then the same goes for Caspian trying to increase deal value maybe. My gut feel is that AR are trying to renegotiate but it could be a host of things from bureaucracy, raising funds etc.

In the interim, Caspian are benefitting from the $14m funds received from AR and all the all production until the SPA signed and the $54m received. They also gave the CE cash so anybody stating that they’re struggling for cash ???

SP has crashed 50% since recent run following FY accounts suspension ? What’s materially changed ? The BNG licence approval process has stopped work on BNG but they’re going through the process to achieve prod licence. They’ve had the appraisal licence extended for up to 12 months which implies no issues with the authorities, it just takes time. It also costs money to attain the prod licence and why would they do it if BNG can’t produce. Will they sell the whole BNG licence following the NY reserves update ? Do they wait for 803 completion and A5 side-track which will increase value substantially. I believe they will sell BNG as it’s too difficult/expensive for them to commercialise buy with a prod licence, it will be attractive to the bigger boys who can exploit the opportunity as AR are planning to do with the shallows.

Our seller of WS is taking a beating on the deal as he’s almost 40% down at current share prices and if deal was fine now it would obviously be far more dilutive.

Still all to play for as far as I can see and I’m sorely tempted to take more but I’m resisting the temptation.

Oh and the fact that the nephew has taken shares at the 4p price and not renegotiated at current levels which would have generated another 20m+ shares. We must be grateful for small mercies. Hopefully this is the best return from a 4% dilution of the business.

The biggest positive from today’s announcement is the fact that the Kaz authorities have agreed the change of control. Some investors have been concerned re possible regulatory headwinds from the authorities re licences etc but hopefully they’ll be forthcoming on B8 and BNG in the near term.

West Shalva timeline has moved a quarter, nothing new there. Certainly no guarantees of oil but hopefully the dead camel hasn’t drunk it all. In a serious note, if successful, they believe it replaces MJF . Worst case we pick up a station, a few roads and hopefully a Greggs :)

Hopefully the sale goes through shortly, the B8 & BNG licences renewed so that we can continue to hunt the jam.

Yep.

Now listening to our Reeves to understand how much less this working man will have in his pocket going forward !

Https://wp-caspiansunrise-2020.s3.eu-west-2.amazonaws.com/media/2024/09/MJF-South-Yelemes-disposal-circular-.pdf

Completion date tomorrow and 3 possible outcomes. Deal, no deal or delay. If it completes we get the $54m completion payment adding to the $14m already received plus a further $4m over 4 months following completion.

Worst case scenario is no deal but they’ve had the benefit of $14m in the coffers earning considerable interest at 14%. They continue to plod on with the shallows remedial campaign to sustain existing production.

Best case, the deal completes and they receive the $72m net of licence costs. The next question, what are the key priorities now they don’t have a producing asset apart from B8 Sholkara structure. They have the additional cash from CE charter but that sum is probably Nearer $7m and their owed the $5m from B8 loan.

They're in a healthy position from a cash perspective, they've outline the operational priorities but they are now largely dependent on licence renewals on BNG & B8. Also completion of the regulatory requirements for the WS acquisition.

Next update upon us as AR deal deadline is tomorrow. Hopefully a comprehensive operational update too.

From our Clive in FY accounts -;

Expected future events

Q3 2024

· Licence renewal at Block 8

· Caspian Explorer charter completed

· Confirmation of C1 style reserves for the Yelemes Deep structure at BNG

· Award of licence extension for BNG's Airshagyl & Yelemes Deep structures

· Production commences from Block 8 from existing wells

· Testing new well at Block 8

· First well drilled at West Shalva

· Acquisition of a G70 rig

Q4 2024

· First mining acquisition

· Completion of the West Shalva acquisition

· Completion of the Block 8 acqu

Https://amp.theguardian.com/world/2024/oct/24/ukraine-war-briefing-brics-summit-backfired-on-putin-with-calls-for-peace-says-kyiv

Maybe the end of hostilities is in dire.

Maybe they both went to Southport for a weekend break ;)

BTC,

No George at GM. Only 3 PIs attended inc moi.

Why had he disappeared ?

17 days to completion of ar deal and we will have news either way. much that we have had the initial $14m, the deal isn’t done yet so hopefully no more clive **** ups . hopefully we get a full operational update at the same time as there’s lots to update on !

They’re not going to delist, that will leave them open to the hungry Kaz predators. That’s one thing a FTSE listing gives them, protection to a point. They’re not a mining company, it will be one of the businesses within the Caspian Group. They’ve set up the tax structure and each disposal will be tax efficient.

They’re not going to delist, that will leave open to the hungry Kaz predators. That’s one thing a FTSE listing gives them, protection to a point. They’re not a mining company, it will be one of the businesses within the Caspian Group. They’ve set up the tax structure and each disposal will be tax efficient.

Un,

They certainly know how to instil distrust but unfortunately, invested here as a PI, we are a minority player with no voting power. I do urge PIs to contact Clive to ram home the fact that they need a NED and soon, it's important for governance. They're going to acquire the mining asset but I don't believe it'll be a sweetheart deal, they've positioned it as a low cost operation and a profitable opportunity with a great ROI. They positioned the manganese mining as easy, just need to upgrade some of the existing equipment, $3-5m was mentioned. Pis will remain cynical until they see the deal and many probably believe their trying to siphon off the cash, I don't see that.

Re Divis, we don't see regular payments, it'll be windfall if they receive chunks of cash like a CE sale or buybacks.

I'm still hopeful of a positive return but we need to get licences agreed and deliver results on 803, B8 and WS.

Tick, tock .

Good post Un. I did respond in detail BUT the stupid LSE site keeps crashing ! I’ll post later 👍

Uncertain ? what’s he got to do with it . I used to be uncertain but now I’m not so sure 😀 How did I feel ? indifferent but still hopeful. Body language ? the usual Clive, they were bullish for their future, miffed with the sp and m/cap not reflecting achievements and opportunity.

As always with Caspian, the good, the bad and the indifferent. I believe that we make a good return here but what magnitude ? I don’t know. The licence renewal position is the most disappointing news as it has stopped operational news on BNG but as they positioned it, the prod licence could not be renewed earlier until all appraisal work/CPR was completed.

B8 too, they believe that this is as good as BNG but now we're focussing on 2 structures instead of 3.

The positives ? the CE charter which was a successful venture, too successful probably as they drilled it ahead of schedule but as they state, it puts the CE in the shop window for future charters or sale. There are more projects planned from various organisations in the N Caspian.

The AR deal on MJF, if it completes, on the face of it, it's a good deal.

BNG ? hopefully they convert 803 and carry on work as communicated. There will be a licence fee for the prod licence and I sense that they are playing their cards close to their chest. Worst case for me, they complete CPR on NY and flip the asset. 803 outcome, 802 remedial and A block remedial, they have the cash to do it now.

They are still confident that B8/WS deliver and replace MJF output in short order.

Also the mining asset, they believe it's going to be profitable for minimal outlay and deliver a good ROI.

They won't fritter the cash pile away on buy backs or wasting it on no essential activity. They know the priority areas and will spend cash accordingly. I don't see them doing a sweetheart deal on mining asset and siphoning cash away as many probably believe. They want to build the asset base and eventually this company gets flogged.

The question was asked and the answer, they’re still non compliant but are interviewing prospective candidates. I agree, it’s very important with a mining asset coming our way. I suggest that all shareholders make the point 👍