Member Info for Valuation-it-is

GaiasKidney Wed 17.48 "Alkemy retaining just 10% of that still offers astonishing upside from where this is now"
The higher the share price goes, the likelihood is that the retention percentage will rise. An inducement for investors perhaps?

noelpbz 18.33 Many thanks for your feedback. Vii

PeterashBeck 13.53
Do your hedged amounts i.e. 5.38mmscfd include the amounts to be made up to cover the shortfalls in July/August, or do those have to be added to the 5.38mmscfd?

Manonfire2

Why not use the filter ? It saves a huge amount of wasted time.

Average Dave
Thank you for the link. I will read it this evening.
I am not suggesting there is a problem with the hedge, I am seeking to confirm how the compensation arrangement works.

gallder

Many thanks for the links. I will follow up this evening.

Howey Today 11:36
I can understand why the finer details might not be shared. Especially if the hedge provider can, with the benefit of hindsight, can be seen to have not done well out of the negotiation. Who would want to embarrass a finance provider?
However it does not seem like a fine detail to me. It seems crucial in determining the surplus volume of gas to be sold at market prices next year. And dependent on whether it is volume or value the surplus could be high or low respectively. From what I have read and understood so far, it seems as if ANGS has been very lucky with the turn of events and a volume based compensation package has been negotiated. However, given the likely materiality to profits, an RNS should be forthcoming to clarify the point.

gallder
Many thanks for the information. As you have probably guessed I am trying to get up to speed with ANGS and am not conversant with all the complexities despite following this board for some time.
How do you interpret the data you posted? Does it allow the reader to work out the compensation ANGS has to provide to the hedge provider?

A graph of UK Day Ahead Wholesale Gas Prices can be viewed on
https://www.catalyst-commercial.co.uk/wholesale-gas-prices/
scroll down.
The graph suggests July and August prices rose from around 200 to 570. Currently they are shown to be around 85.
Why would Mercuria opt to lose value?
Perhaps it did not look as if they were going to at the time. Perhaps the negotiations between Mercuria and Angus took place in the period when prices were rising sharply i.e. up to around 1/9/22. That seems likely to me. If so, it was when europeans were struggling to replenish reserves and it looked as if rationing by price was likely during the coming Winter. So Mercuria might have welcomed compensation based on volumes to be delivered later which then would have been thought to be at even higher prices. Since then we have had a very mild Autumn with the highest temperatures on record, so European reserves have been replenished well ahead of schedule and the gas price has dropped sharply. It seems to me that Angus may have been extremely lucky. However, I would like clarification/confirmation from the company on this point as it seems crucial in determining the amount of gas surplus to the hedge plus hedge compensation, which can be sold at market prices.

Average Dave

Many thanks for your input. That also suggests a volume compensation rather than a value compensation. My reading of it suggests to me that the hedge provider will be getting higher prices for the hedge volumes rolled forward than they would have got if the hedge had been satisfied as originally planned. That is a surprise as I had thought spot prices had come down from July August levels to the present. I will take a look at a graph of spot prices over the period to see if they fit with the narrative.

Tygra
Question submitted, company confirmation request received by me and my attempt to confirm was met with the following response:-

"Server status

We couldn't process your request at this time. Please try again later. If you are seeing this message repeatedly, please contact Support with the following information:
ip: 92.8.63.77
date: Thu Nov 17 2022 10:49:07 GMT+0000 (Greenwich Mean Time)
url: https://angusenergy.us12.list-manage.com/subscribe/confirm
We're sorry for the inconvenience and appreciate your patience while we get everything straightened out. "

Tygra Many thanks

The wording suggests to me that it is the volume which will be made up, rather than the value. That appears to be because the prices early next year are expected to be high. However, given prices have been extremely volatile and are now around a quarter ? of those at the peak, in my view this is a crucial point. If the VALUE of the shortfall has to be made up with VALUE next year, and prices do not return to the levels seen at the time of the shortfall, then ANGS might have to provide 4? times the amount of gas than if the shortfall is made up with a volume replacement.
Perhaps I should put a question on the company's Q&A board...................

HITS Wed 23:32
Thanks for your helpful post. I have a query........
Is it the volume of the hedge shortfall that has to be made up over 6 months or the value of that shortfall as per volume each day times the price foregone on that day?

One comment was "ANGS produced ZERO gas in ALL of July and every day bar one in August. ALL of that needs to be paid back from Q1 2023 up to Q2 2023."

Yes I understand that , but does "pay back" mean the volume of the shortfall or the value of the shortfall? Simple question if you know the answer your help would be much appreciated. There are so many time wasting posts on this board I despair of getting a good and correct guide.

which thread?

I have read on this bb that Angus fell short of providing quantities of gas in several months due to delays, when the gas price was very high.
Does anyone know what the arrangements are for compensation for when the hedge quantities were not met? i.e. Will Angus (1) just make up the volumes later, or will it (2)have to compensate for the volume shortfall, times the price at the time of the shortfall?

First Russia, next China. The writing is on the wall. Look elsewhere.

patch13
Thanks for clearing that up.

Hi MO hope all going well for you. You wrote on 3 Nov "To add , Cornish Lithium plan is to use offshore wind as the main power source through the year. They however have to build a mine too ! Alkemy & Tees Valley through Sembcorp is just plug and play units , bingo."

A thought for you. How will power costs compare? Plug and play may come through the grid - at grid prices - whereas wind power may come direct from the wind farm at wind farm prices ( around 3p/kwh) If a significant amount of power is required then those operating with power direct from the wind farms may have a huge extra operating margin.

And tungsten.............