Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
Hey Whimax,
I am not sure its about constantly posting negatives it's, imo, more about looking at weak points, areas of concern and looking for answers, BDC has given some decent and thought full replies and they are appreciated.
BUT some respected posters on here have over the years made to quite bold comments and have been very wrong....because the BODs have not gone as they stated (and /or thought).
Me, personally, am not so concerned in what is going well, that was what was expected, but what can go wrong, its called risk assessment (and i have seen the ways it has gone wrong in AIM and other listed companies).
All the best to us all, the market (IMO) will relate this share very quickly when the gas and farmin has been announced (Gas side DE RISKED) BUT again NOT as favourable as it once could have been and that remains IMO down to the increased RISKED factor of the other pillars and the required and significant share dilutions
That new or increased RISK introduces unknown finacial qualities: "Market no likey"
Anyway, it's always good to try and discuss and find POSSIBLE answers.
GLA
Kind rgds Sft
Hi BDC,
It's a good point with regards to the future of any of the old OnG companies. There is possible a very shrinking finance market for a none cash generative company like Chariot Energy to secure financing with out going along the renewables path and in my opinion AP is gambling / staking / positioning / or forsight on the future release of large funding into Africa for such.
Risky but he "knows" the african continent and may know more than us on UN/IMF etc etc funding. If the West does not invest the it will be left to Rusdia, NKorea and China...so what choice is there but...
As before I belive he has learnt through his experience with Petra and the loss off control by aquiring to much Debt, but the new strategy of share placing (and significant and continued costs of Share incentives) to continue to finance, would be acceptable if for gas alone but its not and with a cash burn rate of approx $1.5million a month (see latest update) and the comment regarding the last placement:
"......The net proceeds of the Fundraising will be used for near term onshore drilling and development planning on the Loukos Onshore licence, AND NEW VENTURES and WORKING CAPITAL"
There is concern over how the company funds its self over the next 2yrs ( 1st gas imo) 24x $1.5million= $36million required as a minimum???
So after the farm in is competed we should have an idea on what returns we may get for the previous exploration investments and coupled with my continued (comments looked to support such in RNS update) belief that the onshore gas will, IF SUCCESSFUL, be used to supply an "unfettered" and seperate source of cash for Chariot and AP aspirations and directions.
So we have it being September now a good 6months of cash left before the board need more, at current burn rates (imo)?????
Which would thought to be sufficient to get us to FID /Sanction and farmin Cash???
Thoughts
Rgds Sft
Hey Fernan, I share your concerns.
I think investors will be left with either following what AP and his side want to do with the company or possibly taking a return from after the gas contract/ award/ farmin and project sanction.
To get to first gas could take 2 years, I am assuming they will get a % return from the Anchois exploration and anything else tide into the farm in.
But having seen RKH squander 200million (although alot that was lost paying back Permier oil during the FEED process) , there is a lot of outgoings just in salaries, share incentives, operational costs for the gas AND THEN the big unknowns with those "Aspirations"
It seems to me they are trying to set up Chariot to aquire a position for what they see as hugh international funding.
Ref just as one example:
https://www.un.org/africarenewal/magazine/july-2023/african-leaders-call-more-investments-green-energy-and-water-infrastructure#:~:text=Africa%20currently%20attracts%20less%20than,hydrogen%20a%20year%20by%202035.
It fits with the "water", renewable, Hydrogen "pillars" they are quickly trying to create and supported buy the energy supply minnow they bought into.
How much will get shifted off gas and into these aspirations is unknown and I am not sure institutional investors will belive its possible either.
So my concern is as yours.
If you invested at 5p (guess) and are getting $750k included share incentive AP is doing well. But he is well known in Africa through Petra mining of course.
They have obviously managed to partner with Total
for the project Nour which is good, but Total have "slightly" deeper pockets.
On another plus the 2x new 6 % are hope fully in it for more than just the gas.
Question: if they came in on the last share CLOSED placing would they be under a close not to sell within a certain time frame? Or could they exit on conformation of gas awards?
It very up in the air, I have aird such concerns before. But last time as all have heard it before and many thi k its deramping rather than speculative musings. We all make our choice on what is a risk, a profit and what is our own level of risk.
GLA
Rgds Sft
Anyone into PANR, flippin jumped some what. Just looking at the bb board they are putting it down to a short squeeze?
Apologies its not about CHAR. But I thought PANR were down and out follow poor drilling results and more cash requirements.
Rgds Sft
Hi WWP,
I would be very interested on what would be the response from CHAR IR, I have had answers back from them in the past.
It is of course how the sender sometime phrase such questions as they do seek advise from office staff, or use to anyway.
But it would be great if you did pose the question, maybe in the form of asking for clarification or conformations on your calculations?
Rgds Sft
AJ you could well be.
My indication that we are getting large or decent sell is down 10% in 5 days.
Yes I am highly suspicious with regards to SP movement in Chariot as before my concerns started from the the fall 2 weeks prior to the suprise listing back in May 2022.
Of course it may be a McCarthyism paranoia of course 🤔
Rgds Sft
Hello Jimmy,
No.3 seems WAY too harsh and I would not expect an large operator to force a non cash generating company to take that deal. Nor would I expect the Char management to accept such OR accept and gamble on unproven / drilled assets (onshore) assets.
Have you any projects in mind that that was applied?
Just my opinion of course.
I DO (as speculated before) still see the onshore as a seperate deal and exclusive to CHAR to free them financially of large operator fiscal constraints.
But could be way off of course, seem not so on why we really needed the "exploration" cash though: Management (not FEED) cash burn rates.
GLA we will need it over the next 3 weeks.
Rgds Sft
That 400k shares "off load" was a pretty decent size gamble and looks like a faily visable statement (push) on saying they are not expecting any RNS news that imminently. I can only hope they are well in profit already and will trickle buy back in again later...I.e. a week before an RNS.
Great being in the know as a broker hey.
Rgds Sft
Hi Klein,
The project is a pretty simple one for an experienced company. But if they do not have guys employed that have done project set before (or for a long time) there is room for error that's for sure.
But it's no suprise to me that's why they had to raise irrespective off FEED costs/ or errors. They have multiple outgoings some consistent/ regular and some that we just are not going to know about untill its spent
Note: which we have been paying for in either topping up and dilutions.
Thank you for heading down there and supplying your experience and thoughts.
Qurstion: Are you in for the gas project or do you have enthusiasm and continued (or new?) investment for their other two "pillars" ?
I ask as I have not noted any one yet who is in for anything but the gas (or if you are a LTH, It would have been the Namibia oil duster)..
Kind regards and thanks Sft
Hi Klein,
Re "Spoke to JMW about cash burn and $12.1 million end of 2022 resulting in a raise THIS year"
As the feed raised was incorporated and we had $12.01 left at end of year (9 month ago) he was the referring to this latest placing " this year" was required to keep liquidity and not as they had stated for exploration, which has been my thought(s).
Is that how you read his comments.
Rgds Sft
Hi Whimax,
Imo as they have gained significant holdings and are either privileged to information that we are not, which could be regarded as insider information, buying in because they have done there own calculations and are totally satisfied and confident with the BoDs or moving into affect change?
Did you see my previous post on Covalis Capital LLP ??
Latest "Suprise" Share placing 89,631,143 RNS
Askar Alshinbayev 59,676,544 RNS
*Covalis Capital LLP 66,815,976 RNS
*Note: I am not sure if this is a grand total upped from an existing? As the total shares from the respective RNS's exceeded the placing.
What are your thoughts on remaining calculated cash runway and remaining liquidity timeline prior to this latest surprise placing?
Kind Rgds Sft
My guess we were down to very dangerous levels of liquidity if we had $12mil left 8 /9 months ago and that also gives an indication of the BoDs true transparency!
A rather disappointed Sft
Rgds and GLA
The BoDs lack of clear information must be influencing the 2 most recent investors Askar Alshinbayev and Covalis Capital LLP AND any other potential institutions.
The continued suprise share places and block issues (incentive renumeration) for directors does not give a stable platform for investment and again fiscal confidence.
So accordingly from the RNS Number : 3644D
Issued in June 2023
The share-based payments charge of US$4.2 million for the year ended 31 December 2022 was US$3.4 million higher than the US$0.8 million in the previous year mostly due to the granting of employee and Directors' deferred share awards in the current year, and the full year impact of awards granted to employees joining the group as part of the Africa Energy Management Platform ("AEMP") Transitional Power acquisition in June 2021.
We successfully raised US$29.5m in June 2022 to progress the FEED for the Anchois project AND for FURTHER development of our POWER portfolio
Sft note: Unknown expenses or potential finacial costs on AP "ideas" and justification for annual $750,000 salary/ renumerations (up from $500k)
"The Group's loss after tax for the year to 31 December 2022 was US$14.9 million"
Green hydrogen and other business development costs of $1.7 million
Other administrative expenses of US$8.5 million for the year ended 31 December 2022 are higher than the previous year's US$4.5 million due to one-off new venture costs, employment costs from scaling up the team to progress the Anchois gas development, as well as the inclusion of administration costs from the Transitional Power acquisitions.
"As at 31 December 2022 the Group had cash of US$12.1 million, no debt and minimal licence commitments"
So any guesses on current cash burn rates...and the real reason of the very latest large share placings...IMHO NOT just onshore exploration and "finding more gas"
GLA
Rgds Sft
Bit old information as in May 23
But it does show SS7 are busy and very busy in 2025 for pipeline and Subsea umbilical installation ops.
So there is a very definite timeline required for getting contracts/commitments and putting cash down for ALL parts of the project(s).
Both Schlumberger and SS7 can not magic Eng's and personnel out of thin air (industry shortage as it is), so the BoD need to get it done.
https://splash247.com/subsea-7-lands-new-contract-worth-more-than-750m/
Rgds Sft
Thank you NorViking,
Getting that farmin signed, as AP is stating there is equipment supply bottle necks is of CRITICAL importance.
They must know that another share placing (to maintain cash runway) will expose the BoD as incompetent AND send the SP down further, erroding potential future gains.
It follows that they COULD use the latest cash raise to protect the company?
I am guessing they did not mention anything on timeline with the onshore drilling, land rigs being in no way comparable to offshore rig demand.
I still do not understand why they are gambling on land drilling (and the funds) BEFORE securing "proven" assets.
Besides that we cannot generate income from onshore without the construction of the onshore processing facility?
Be intresting to have heard if Covalis Capital LLP had anything to say.
In general as expected a disappointing agm, but so far the SP has held up.
And in the BoD we must trust 🤔
GLA
Rgds Sft
Thank you NorViking for the attendance and feedback.
So following your written comments:
"Adonis did admit that there were 'delays', epxlaining these to a large extent on the changing project costs, and difficulties in securing rig/equipment suppliers"
Was there any further elaborations, did any one else press him? The BoDs have known this as a significant and serious threat for project delay (explained as an incentive for Morocco Gov departments to not delay, reference that "leaked" artical last year, does any one still have the link to that?).
So could we see that as the initial negotiations on farm in/ financing have been protracted this has resulted in pushing back the ability to secure financing / signing off with Schlumberger and SS7 on purchasing (Processing plant, subsea umbilical, flowlines/ pipelines, trees etc etc) equipment, vessels rigs and allocating project personnel both onshore and off.
They themselves said to the Moroccan Gov departments that delay could push it back by a year (againg quoting from that leaked artical) and specifically named securing equipment and rigs as the threat, which it appears they have walked us into now?
So if there IS such a delay then company cash flow will AGAIN become a SERIOUS concern.
They would have been in contact with SS7 and Schlumberger. I would have preferred using the exploration raise to have secured equipment orders not more exploration gambling before protecting the single point of income.
Again thank you for attending and the feedback, greatly appreciated.
Kind rgds Sft