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Stockcheque
The Tanzanian authorities now expect the pipeline to be completed by the end of 2024. APT is working closely with the TPDC to expedite construction as soon as possible.
Would be great if the next update reflects your sentiment.
Hardnose
Not personally defending anything and have previously stated any timelines given by BoD should be taken with a large hand of salt.
It's very clear they have constantly missed targets yet its hard to dismiss the progress being made. The key Milestones are important and as can be recently seen, we are achieving them albeit slowly and steadily.
Now we await the development license to be issued to considerably derisk the project and meet another key Milestone.
This coupled with the CPR and CH-1 drill rig contract will put AEX on step closer to achieving its goals.
Given the constantly missed deadlines, it looks like the BoD are wising up, hence changing the wording in RNS so no dates are given although they did slip up and state NT-2 test by mid year....again
Hardnose
The same reason why FTSE100 companies put out their timelines and expectations and hence why they go up if above expectations or down if below expectations.
The same applies here. We are currently at this level due to the delays. But once we get closer to drilling CH-1, I expect the mcap will be much higher.
£100m mcap prior to drill results is the expectation reflecting current market valuations of other companies.
Until we hear about the Development licence and CPR, it will be slightly difficult to establish risked valuation but based on current 25% stake of 700Bcf, we can comfortably expect £100m as can be witnessed by PRD atm whom are valued at £80m based on 300Bcf
The Development Licence is with the Cabinet of Minsters and awaits their final approval. Nothing ARA or AEX can do except wait for it to be issued. Last RNS states that they expect early issuance therefore I expect in the next month or so.
It's been 3 weeks so can't be that long now.
I expect following the issuance of the Development Licence we will get an update a few weeks after that relating to all the Ruvuma workstreams.
The CPR will come after the Development Licence imo
The issue with most "investors" on AIM and some shares that are listed on the main market, such as AEX, UPL, etc, is that they don't realise these shares are rarely for investing rather for trading, and as such timing is everything.
Taking HE1 as a recent example. Those positioned much much higher than the current level will now become legacy "investors" like RoJo and the like, trapped and forever waiting for the sp to get back up to their breakeven price.
Now, unless there is a major commercial discovery, that will never happen unless they took the risk and averaged down.
Where-as those that bought at the lows, took the risk, are now up considerably, even those who traded it on news have made money.
Where-as those sitting and waiting for it to return back up to 8-9p will never see the light of day hence being stuck in that position.
The same applies here. Those is much higher will not see any return unless they take the risk and average down.
In some cases it could be good money after bad. Those sitting much higher here could have averaged down when the sp was at the lows around 0.4 and probably would have broke even at 1.3p by now.
Hence its always about timing your position in every share you buy and sell. You can do that and have a strategy to making money or as Rojo sit and complain about getting his timing wrong hence it will never come good
No brainer imo. Third shipment of long lead items for CH-1 Well were expected in October so they have definitely arrived by now.
GSA issued with Development License to follow soon, I expect February given Xmas recess would have delayed things a little.
CPR update coming in Q1 with further guidance on drill rig contract and NT-1, NT-2 workover/testing.
I expect to hear about the pipeline being progressed mid year by Tanz Government given the rainy season.
Considering the upside potential here is between 200-500%+ upon CPR update and the Development License being issued then I'd say that's pretty appealing.
Upon successful drill results, we may see it go as high as 8p although I think most here would be happy to see anywhere between 4-6p, which coincidentally is what the NPV value is...
Winalot
Given that they have by now probably received all the long lead items for the CH-1 Well which were due in October, I'd say they have most likely selected a rig hence the statement but agree it can be read differently.
BoD stated they would give an update following the Development License being issued relating to other Ruvuma workstreams, so I guess we'll have to wait for that for clarity.
The Sultan wanted to get cracking with the CH-1 drill in December so he must be chomping at the drill bit by now..
The base case valuation makes the assumption of production plateau of 140mmcfpd and gas price of $3.5mmbtu, which is what other producers are getting currently.
It also assumes if the recoverable resource is upgraded to 2Tcf at 140mmcfpd it would take 40 years to deplete hence why the high case is based on 250mmcfpd over 20 years.
When the research note was published it had the GSA as a risk hence discounted the risked valuation.
With the GSA confirmed they valued AEX higher. I guess the market wants the Development License in the bag prior to assigning any higher valuation which is one of the risks remaining.
Once this has been issued the only remaining risk will be the gCoS (geological chance of success) of the drill.
The BoD stated that the Development License will be following soon and once that has been received then the drill rig contract will be confirmed with a date for spud.
This is all that remains hence from current levels there is a 500%+ upside to be had and given the GSA was issued just last week, we can be sure to hear about the Development License in Q1 with CPR and CH-1 drill to follow.
Crusty
Have a look at CHAR before and just after it's CPR and Anchois drill. On CPR upgrade it climbed a little but that was nothing compared to its climb on drill results.
If CPR confirms anything above 5Tcf with 1Tcf+ net to AEX and the CH-1 drill proves this up then watch what the sp will do.
CHAR 10 bagged from CPR to drill results. AEX can do that from here quite easily.
Crusty
Need to correct you on the "we have no cash" position. As per Half Yearly update we have $5m cash which will see us through to 2026 seeing as cash burn is roughly $1.4m pa and being reduced considerably.
Also since NT-2, yes we are not the Operator, so have no control but that has its upsides. The main one being no constant cash calls for opex or capex as we progress.
AEX is fully carried for its 25% which means it just needs to sit back and let ARA, an internationally recognised player with vast experience, to get on with developing the Ruvuma basin.
And yes I agree the delays in the past have shot AEX down but past performance doesn't necessarily tell you about future performance.
Since ARA have taken over, a 3D seismic survey has been completed with a CPR to follow.
The GSA has been approved, the Development Licence will be following soon alongside the plan to drill CH-1.
Let's not forget between 2020-2022 there was a pandemic which has been the main reason behind the brakes being put on coupled with red tape.
But as recently seen, with the firing of the Energy minister, the GSA followed very quickly and I reckon we will see the Development Licence sign off by February with the CPR being released in quick succession.
Following this, I expect an update will be given about CH-1 drill timeline, given the third shipment was due in October/November.
IF we get 25% of CPR 8Tcf AND the drill proves this up then I reckon we will get a lot closer to the risked 8p per share target.
Flow tests are essential for commercial production and will give an indication of future revenues.
So far CRCL has done well, with a 500%+ move from the bottom. Hence why it's taking a breather now and will begin to consolidate.
As ART stated, it all depends on the flow rates now for this to go higher. Take BCE as a recent example of what happens if flow rates don't materialise so good point to derisk is now
With all the news that is now overdue, MM's continue to soak up the sells as they know they will be selling them higher.
Seen the same price action prior to GSA news. Plenty of weak hands were selling only to miss the trade they had bought for, with the intraday mini spike catching them out.
With GSA agreed, the Development Licence will soon be following it, with an update for the CH-1 drill.
The CPR I feel will then be conveniently released, demonstrating the resource that the drill will be targeting.
This will then be chased all the way into drill results and flow rate tests. For those skeptical of it rising towards these results, have a look at CRCL which has just risen over 500% from positive drill results just recently.
AEX has 500Bcf for its 25% share as per previous CPR which is worth £250m once drill results prove up the 2C resource.
Any upgrade from the overdue CPR will add significant value to this amount.