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Hopefully you’re still checking in here occasionally Bismarck and you’re keeping well. Thought I would reach out in case as I’m thinking that the last 12 months have been pivotal for geec.

1) national pipeline infrastructure now connects to Kolkata and huge urban demand

2) geec seems to have been committing capex to well enhancement over last few months with plan to start to drill out new wells starting soon.

3) Iran conflict has forced hand of Indian govt to more rapidly evolve Indian Nat gas market with residential gas connections being enforced where possible and market reforms to make piped nat gas more dominant supporting medium term demand and pricing for cbm

4) should be easier to secure a long term supply agreement as numerous potential buyers look to derisk Nat gas price volatility

5) geec shares seem to be hanging hands at around £1 per share on Planify (although this is according to ai - I haven’t tested this directly yet)

Good to get your thoughts Bismarck if you’re still here and reading this. I’d expect geec to accelerate well expansion and production growth now given the favourable market backdrop for medium to longer term demand. Looks like everything is aligned: demand, policy environment, pipeline infrastructure. As long as the wells are still producing reliably and operationally geec dont screw up this is about as good as it’s ever been for the company. £1per share is only £117m mkt cap

Https://www.business-standard.com/amp/companies/news/kolkata-city-gas-distribution-network-expands-with-pipeline-reach-gail-125020701135_1.html

GEEC will need to start accelerating their plan for drilling out the CBM field and possibly also exploring shale gas production potential. Kolkata demand set to rise 3x and demand in the surrounding area will increase also. Have no idea how they will fund expansion but if I were them I would look to a US listing as there seems to be renewed interest for fossil fuel companies under the ‘drill baby drill’ regime. Suspect that is the best chance to get their reserves valued appropriately and a share price that would then avoid massive dilution.

Alternatively production sharing via an arrangement with a major producer like Essar oil and gas where they stump up for capex and geec take a small percent of the revenue. Either way unlocks the value of the reserves which has to be in play now that end markets for natural gas in the region are opening fully up. Geec valued their reserves at 1000p a share not that long ago…last transaction at 4p. Hope the management team step up and get this share valued properly. They own 70% so you would think that they would want to!

Https://timesofindia.indiatimes.com/city/kolkata/new-town-bypass-homes-to-get-1st-shot-at-piped-gas/amp_articleshow/118190072.cms

All good thanks Bismarck. Hope so with you too.

I also missed the agm unfortunately. I haven’t checked the geec website or news for a while so might be worth a search to see if any progress has been achieved. I doubt there is much if any detail in their agm statement (if there is one).

All good thanks Bismarck.

Am i right in using then an earnings based measure of valuation for a rapidly growing resources company as a baseline valuation? so in this instance roughly 8p of earnings which could be put on a 10x P/E. and then look at the resource based valuation once we have certainty that GEEC can get this resource fully extracted (which remains to be seen still with the immature end market and financing questions still outstanding). Obviously, with it being private its a bit of an academic question with relisting, buyout or long-term divi stream being the only ways we get our return. Just nice to have a handle on a theoretical value.

Hi Bismarck. Hope this message finds you well. Thought i would post a link to an encouraging article

https://www.goodreturns.in/news/kolkata-gail-gas-pipeline-clean-fuel-boost-gen-1330215.html

while pipeline is only one piece of the puzzle for GEEC, its completion is likely to increase demand through time for GEEC gas. Then the main question of how they are going to pay for the huge capex plan over the next few years needs to be answered. Given that they are profitable, lowly geared and growing year on year again i think things are looking good. One way or another if the progress continues and they develop out the field fully (especially if with shale gas reserves as well) the true value of the shares will be reflected in the share price - private or public. Feel like we are finally getting a bit closer to the end game.

Thanks for the link Bismarck. I notice that JP Jenkins have a mid price for GEEC at 4.2p so no real move from the price that GEEC was at delisting. Then again difficult to see why it would be. I like the look of the results. Revenues up around 38% and profit after tax up over 100%. Rest of this financial year is about increasing existing well production and then additional CBM wells next year. Balance sheet headroom look to be able to accommodate at least $100m of debt for expansion capex. I notice also that in the notes to the accounts that there have been two favourable court settlements in favour of GEEC that should bring $20m or so cash into the business. Add in a farm in at some point when they know whether shale gas is an option. All looks to be going in the right direction still. Might see if i can pick up a few more shares through JPJenkins in the not too distant future. Indian government have put in place measures to simplify and speed up approvals for pipeline land acquisition as well so this should mean that we are on the verge of a connection to Kolkata.

for those that want to reconnect on GEEC and share information and thoughts/insights as the company moves to wards scaling production in 2003/4.