Member Info for Soundingoff

Mancave- If we get the deal, then everything changes. We will have development funded, cash to pay off debts, a potential dividend/exploration. Side issue is Sidi loan notes. Until the deal is done, we don't know specifics though.

We would move to a non-operating company. Delisting is not an option.

Jones- I think it all stems from being too confident in the sale of the Horst/exploration. With the TR-1, it's either notifiable or not. Unless you don't adhere to the AIM/FCA rules of course. Unlikely, so it was probably multiple parties or engineered as such.

You'd hope so Wh0s.

I posted this after the placing:

'Wh0s-£1.5m gives us just over another 3 months of annualised Opex and interest payments at the reduced 2020 rates. I'm surprised our cash balance was that high but it's clearly a pointless number without current debtors/creditors. If we need to run to end of Q2 to sign the deal off then we probably would have needed more cash. '

No-one knows if we need the cash or not. There's a difference between conserving and running out of, but those who want a trade or just enjoy the negative narrative will continue to shout.

Quite a few questions:

Why are the shares being issued on 25th Jan, before his termination date from the board? 6m shares at this price. Very nice if the deal goes through, and of course the opposite if it doesn't.
Is Brian leaving as a employee and continuing as a consultant/moving to the potential JV?
The loss of Office/change of control provisions provide Brian with 8 months of salary. Standard termination is 6 months
The RSUs vest on a change of control. Can they on any other terms?
There was no mention of JJ's RSUs in his RNS?

Mon, 20th Jan 2020 17:16

RNS Number : 3753A
Sound Energy PLC
20 January 2020

20 January 2020



Sound Energy plc

("Sound Energy" or the "Company")



Board Change



Sound Energy, the Moroccan focused upstream gas company, announces that, as part of its planned preparations for the forthcoming potential partial divestment of Eastern Morocco portfolio, Brian Mitchener, Exploration Director of the Company will step down from the Board with effect from 31 March 2020.



At the Board's request, and to enable the Company to conserve cash balances, Mr. Mitchener has agreed to accept new ordinary shares in the Company ("Ordinary Shares") in settlement of termination of his employment contract. As a result, the Company expects to issue new Ordinary Shares, at the then prevailing price per Ordinary Share, with an aggregate market value of £107,983 on or around 25 January 2020 (the "Settlement Shares") and a further announcement will be made in this regard, as appropriate, in due course.



In addition, the Company announces that a total of 863,682 restricted stock units ("RSUs") previously awarded to Mr. Mitchener will now vest in full on 31 March 2020, ahead of the original date of vesting of the RSUs, announced on 26 April 2018, of 1 January 2021.



The notification below, made in accordance with the requirements of the Market Abuse Regulation, provides further details of the accelerated vesting of the RSUs.







Marco Fumagalli, acting Chairman, commented:



"I am grateful to Brian for his leadership of our exploration programme and his continued support of our orderly handover of executive responsibilities for this next important phase of our development."

The shares have been issued and Companies House has been updated.

The average transaction price is north of $8/mmbtu for the first 29.0 MMscf/d :

'The MOU covers the first 0.5 bcm per annum (approximately 48.4 MMscf/d) of production of natural gas with the arrangements for further production above this level (including up to and beyond the mid case production rate of 60MMscf/d used in the concession Field Development Plan) intended to be negotiated in the final GSA. The gas is priced and sold to ONEE at the M04 tie in point of the Gazoduc Maghreb Europe pipeline.


The MOU includes a fixed unitary price for a minimum annual volume of 0.3 bcm per annum (approximately 29.0 MMscf/d or 10.13 MMbtu per annum), which will, once implemented, result in first year gross revenues attributable to the Tendrara concession (100%) of US$84 million. The MOU stipulates that this first 0.3 bcm of production will be both a take or pay commitment from ONEE and a send or pay commitment by the Company. Pricing for the gas above the 0.3 bcm per annum has not yet been agreed and will be negotiated as part of final GSA.'

We don't have a price for the remaining 30+ MMscf/d but on that basis the gas in ground is $2 billion +. It's not possible to turn that into a value to Sound without adding costs and discounting. We were give a value of around 25p per share, but the current deal values it at around 18p.

He did. But that's where you analysis falls flat. More crucially he bought an extra 400k a few weeks before TE-9 failed. Apologies it doesn't fit your narrative, but the simple fact is JP believed his own hype.

'Utilty man. You posed a question - did The Failure know the price would plummet.? Er I believe so - you do not sell shares, especially as CEO if you believe the sp is stable and believe in your own argument of Golden Tickets, no-one will lose money, gas everywhere, etc. etc. '

Testpack- JP sold only to buy more shares... I imagine the aim was to sell later on when we hit gas. But we didn't. His trading plan doesn't fit the conspiracy narrative I'm afraid.

Actually, looking at the website, that appears to older than Badile and so may be the original purchase?

I'm not surprised given our share ownership and potential conflicts of interest.

A delay to gas delivery is not an extra dimension then? Given the geopolitical aspects. No need to answer, it's rhetorical.

Bennnpustung isn't a word, but really should be!

Indeed Ducati. Thanks for the article. Adds an extra dimension to the discussions.

The figures are mid-case. Could be better/worse.

Yes I worked out $64.55m paid for the 9%, comprising direct cash and refunded carry.

66 MMscf/d was Sound's expected production, but the concession is based on 60MMscf/d.

1.5p would drop to 1.4p, but obviously that assumes a rate per MMBtu from the MOU and that income isn't used for exploration etc.

Long wait- It would be 23.3% or 14.3% depending on whether the 9% option is taken up. I worked it from a dividend point of view which I posted a few weeks back:

'I took a slightly different approach to you partridge, but get similar figures (2.5p/1.5p per share). I grossed up the GSA figures for 66m scuffs p/day (unlikely you'll get the same rates but only an estimate), used £1:$1.3 and allowed for 20% royalty and operating costs. The field can run for 15 years on a mid case basis, but of course should be front loaded due to field degradation. Also we'll pay corporation tax after 10 years.'

This was prior the the 6% dilution though, so you need to revised down.

Maldini-

From the MOU RNS

'The MOU covers the first 0.5 bcm per annum (approximately 48.4 MMscf/d) of production of natural gas with the arrangements for further production above this level (including up to and beyond the mid case production rate of 60MMscf/d used in the concession Field Development Plan) intended to be negotiated in the final GSA. '

60MMscf/d is around 21 MMbtu per annum. We have agreed 10.13 MMbtu at $84m dollars per the MOU in October. Production at the rate of 60MMscf/d would be around $173m per annum at the same rate. However we haven't got a rate above the 10.13 MMbtu yet. Obviously we only have an MOU at the moment.

Thanks Maldini. An interesting summary and hopefully points to significant continued exploration in Tendrara/Sidi.

Many are A trade buy orders though, which always show as sells.

Today, 1.9m of broker sells have been mostly bought up via auto buy orders (1.6m)

PS- Good to see you back Longwait.