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Maurel and Prom announce the Assala deal on 15/8/23.
With what looks to be within the 3 month time frame and which i take as when the govt and Cemac is notified, the Gabon govt say they take the decision to exercise their pre-emption right on 25/11/23.
M&P update the market on 25/1/24 re the Govts pre-emption and their right to do so.
M&P update the market today noting yesterdays signing of the deal between the Govt and Carlyle for the Assala assets and the end of the deal for them and done/dusted in 6 months.
At no point have Save informed the market of any pre-emption by the S.Sudan government nor has S. Sudan said they were pre-empting the deal in the last 15 months.
I would have thought that if S.Sudan had said they were pre-empting the deal, then SAVE would have had to tell the market by now of that fact.
I beleive like Accugas/Nigeria they are continuing on the so called (lengthy) workstreams and approvals - mentioned (on 1/2/24) by AI to be concluded in a few weeks and backed up by AIM extensions.
Thoughts or views anyone ?
More dilution post consolidation which I expected and was clearly sign posted and today for around £1m net. Not even clear exactly how the cash will be split but I expect they were running on air as I posted awhile back given working capital needs.
Still paying the bills by issuing shares. £84k in 2.6m shares or 1% dilution. Shareholders powerless to reign this in.
Seperately this has to be one of the biggest assets landed for a company of this size - ie Block 2A (not counting the hunt for other Asian production assets).
To have 52.5% of a 12,000 km2 block of this size with over 6,000 km2 of 3D seismic not to mention 17,500 km lines of 2D is phenomenal.
The cost to carry out that amount of seismic would run into the tens of $millions alone along with the extensive geochemistry work confirming very high concentrations of methane and low CO2. That can't be understated.
At about 17 mins into the interview James Menzies says they beleive there could be in excess of 9 TCF recoverable for Kertang.
At 18:30 he states that 'there are multiple structures surrounding Kertang that are also extremely big - it's just that they are dwarfed by this giant.'
When you refer back to the Topaz slides particularly page 6 you can see '3 main identified prospects' which includes Kertang. The two other structures are in very close proximity to Kertang with the other 2 combined having an area roughly the size of Kertang itself. All 3 are covered by 2,900 km2 of 3D seismic.
Given the analogue description to the smaller 6 TCF Kasawari field - taking into account the 3 main structures, there could well be potential for 15+ TCF recoverable here.
Retaining 10-20% post farmout would be potentially huge given a ready gas market.
Not since Cove acquired 8.5% offshore Rovuma from struggling Artumas in 2009 has there been an opportunity as big imo.
Their share price was 9p in 2009. If you were patient, Dolmens Brian Gallagher called it a speculative buy on tues 9th March 2010 and a target of 59p.
By the time Shell had bid in Feb 2012 there was an estimated 20+ tcf recoverable estimated. Shell bid $1.8b while PTTEP of Thailand pipped them with a $1.9b takeout at 240p post tax.
Coves 8.5% share of 20-30 TCF = 1.7 - 2.55 TCF.
Reataining 10-20% of block 2A for LBE could mean on the 3 prospects covered by 3D, there might be 1.5 - 3 TCF net to play for here irrespective of all other assets.
So did anyone know beforehand exactly when the JAPEX JV was coming 2/5/23 - (9 months ago) ?
or the first production assets on 3/7/23 ?
Likwise nobody will know until the next announcement when the current assets under review are agreed upon and announced to the market.
Japex did not get involved for fun. They have to be mutually agreed assets and there is a sizeable pot of $100m which can effectively be doubled through debt or RBL lending. With a 5 year window and for the ability of assets to be potentially paid down in 2-3 years from the effective transaction date, we could be looking at $3-400m available in total 2 years on.
It's hard to say Ian.
Some of these institutions have major funds under management and while holdings in SAVE for the top 9 including the EBT are just shy of 60% it might not register that high at all on their overall FUM.
For a few weeks to a few months this either going to transform from $280m to nearly $1.8b yearly revenues with a significant debt reduction (we hope) on the transaction cost 2.25 years on ? and IIs seeing a more realistic valuation/re-rating with perhaps further deals in the pipeline in the short-medium term for continued growth ?.
If they were to pay a $50m div (from $1.8b revs) it's about 12% at the current valuation at 26p to 4% at 78p which imo would be affordable relative to low debt and a $70/b oil price.
Maybe a need to wait and see the expansion plans re reneweables - would IIs pull their money without seeing the details of that growth arm/performance next few years. On the above they'd have to now pull that money and look for opportunities anew and success while Save might be on the cusp of transformation. They may not react in the same way as PIs re access to capital. Just imo.
To me it looks like they want govt approval prior to even issuing the adm document given the wording this morning. In no deals have i seen approval needed prior to an adm document so perhaps that's SAVEs stipulation ?
From Trustilies AI article yesterday, i wonder where did AI pck up on completion expected in the next few weeks to print thar re S.Sudan -
"In the next few weeks, moreover, it is also expected to complete the purchase of the interests of Malaysia's Petronas group in South Sudan in an operation it announced in 2022."
I still don't think it necesarily means though that it could take right up to the 2nd April and could come through before that.
If there's already 2 years to be deducted from the settlement at 50k bopd using $20/b it's $30m/month or $720m to the end of December 2023 with another $90m this quarter to end of March imo. I still think that up to $250m may have been allowed for contingencies on higher oil prices and/or production rates spread over x years.
I don't think it's replacing Gabon with Chad nor do i think why would SAVE even entertain this Gabon/Assala transaction.
I remember it was specifically asked what level of boepd production did they want to go to and how much net debt they would take on and be comfortable with.
Reply was, It wasn't coming down to achieving a target boepd figure for boepd sake. Boepd deals etc were only going to be acquired on a risk/reward value accretive basis and they didn't think in terms of net debt and how much - but risk - and how the overall debt per asset was ringfenced and financed.
So on that basis i don't think it's down to just securing 2-3 deals but the right opportunistic deals and how they are bought and paid for and risk. It's as easy to run a 50k bopd opperation as it can be 5 or 10k.
If they feel capable of running the asset on the above basis then i think it's fairly well considered - they have run over about 40 odd deals i think 27 in 2022 and 21 in 2021 from memory.
They have the authority to seek financing of up to $2.5 billion built in for a good number of years without seeking shareholder approval for greater than that.
On that basis and how they have described it, i would not be surprised that they will consider to seek out major deals.
To me, Chad is running in the background on a compensation basis for X amount of loss/damage times x years. I don't see that being shrugged off as a bad deal without recompense but to be taken in our stride and surely the lawyers to the deal have provided water tight advice and some level of guarantee ?.
Just my opinion on S.Sudan, but on a $1250m total figure for circa 50k bopd and the AI rumoured 300 mmbls - that figure should be well under half if the effective transaction date is 1/1/22 (though as ever we won't know the full details until an adm doc).
With that S Sudan present cost factor in mind, it wouldn't come as a surprise to see them continuing to hunt for other deals in this environment as other companies continue to do.
Following on from S.Sudan they said they hoped to close at least 1 further hydrocarbon acquistion by last year end - ie "at least one" - so 2-3+ would come as no surprise to me over time.
Not all plain sailing for any of them. It's not unique to AK/Save but certainly frustrating being a shareholder.
Sepl has sufferred over the years from lost and shut in production over oil theft and major pipeline shut-ins causing force-majuere. In addition their gas build up has been slower than expected. Every trick in the book re court cases and attempts to kick the CEO out of the country - pretty hair raising on a one country focus.
Seplats deal with Exxon is still not cleared yet in Nigeria. In Oct 2023 they were still confident of it being approved.
First announced back on 25th Feb 2022 so almost 2 years and with an effective transaction date of 1/1/21 so now over 3 years in the making although some of the agreed terms have changed a little due to the deal taking so long and Exxons ongoing involvement.
M&P ran into problems with it's takeover of Wentworth first time around and now the Assala dea in Jeapordy.
Exxons sale on Zafiro turned sour and the FPSO sent for scrap.
Zenith relatively small assets in Tunisia (compared to Saves Chad) and suing for just over $85m.
Even Kosmos and it's partner Tullow had to go to arbitration claims to resolve their dispute.
You only have to look outside Africa and Cairns history in suing India for hundreds of millions.
After todays news re Save and others chasing part of the Asssala (Gabon) assets it will be interesting (whether S.Sudan completes or not), to see where Save can establish itself on the value ladder. We still have no mention of the additional 'at least one more' hydrocarbon asset that was to be announced before end of 2023.
Current m/cap £348m and how net debt position looks 2 years on from possible effective S.Sudan Petronas date and 1 year of lost Chad production/pipeline interest re compensation outcome.
Our average gas price (2022) was $3.69 mcf.
Net 2P = 71.7 mmboe (excluding 33 mmbo Niger, excluding 55 mmbo Exxon Chad) Possible total 160 mmbo 2P if ICC favouarble re valuation restatement.
Production net 20,240 boepd H1 2023. (12,000 bopd lost from Chad) would be 32,000 boepd + pending possible 50,000 bopd/300 mmbo 2P from Sudan.
How will S.Sudan go and how will ICC rule on Chad compensation - Overall this would have placed us at around 450 mmboe 2P and circa 82,000 boepd (not to mention pipeline interest valautions in Nigeria, Chad and Cameroon) and a $2 billion/yr revenue profile at current oil prices.
Compared to Maurel and Proms current valuation -
211.26m shares in issue Euro 5.50/£4.70 = £992m m/cap
$120m net debt.
2023 figures = $682m revenue
Average oil price = $79.30. Gas Price $3.76 mcf.
Production 28,057 boepd ie (15,354 bopd Gabon, 4,103 bopd Angola, 51.6 mmcfd(8600 boepd) Tanzania.
2P Reserves = 182.2 mmboe (139.7 oil + 42.5 gas)
https://www.maureletprom.fr/en/investisseurs/cours-de-l-action
https://www.maureletprom.fr/en/investisseurs/communiques-de-presse
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The price history of M&P was about 4 Euro/£3.40 when they announced the Assala deal rising to 7 euros /£6 in December 2023 now £4.70
Taking over ASSALA would have meant $730m at completion, rollover of Assala $600m facility gaining 40,700 bopd and 97 mmbo 2P.
M&P had 5,000 bopd kicking in from December with sanctions lifting in Venezuela but now seems possible that these are going to be resanctioned.
Re the bond exchange - Though it says 'up to' re all 3 bonds, I think it's about $10.2m outstanding looking at the recent account notes.
If exchanged then this will add a further $500k/yr interest on top of what they are already paying.
They said they were working on a $25m bond ? what interest rate price will that be with those 3 just under 15% ?
Will they use part of the $25m bond if successfully issued to repay other bonds in the portfolio ?
It's strange but imo not surprising they completely ended the three seperate US transactions which i said at the time was extreme folly and nonsensical re diversification over a wider US area and so small.
The 5% royalty interest is another folly and just what is the point of Leopard rather than Zenith ? It's so small and insignificant they can't even say what it's worth or cost or how much actual monthly revenue they'd get. The number of wells in total versus actual producers and the Texas Oil and Gas activity data for Lavaca County imho shows why.
Nilepet on f/book a few hours ago say a meeting was held with the ministry of petroleum and the partners to address the misleading job offers in the 3 joint operating companies through a fake Savannah website. No jobs available at this time and for no one to apply to it.
Interesting that they including Savannah within 24 hours addressed this.
No mention of anything detrimental (or positive) re Savannah in the post. Perhaps all very much up to speed with each other ?
On reflection it could be unlikely that SAVE would have needed to advertise for staff as these are in place at the JVs between ONGC, CNPC, Petronas unless some decided to leave or move on.
That seems to be the case from the old AI article back on 18-1-22
' Vitol aims for grand slam with Savannah
The success of the two operations in Chad, which are still subject to the approval of the oil and finance ministries, is however only one step in an even more ambitious plan by the Savannah-Vitol duo. Savannah is also looking with great interest at Petronas shares for sale in South Sudan. The British junior informed Petronas of this during the negotiations in Chad. The assets represent some 75,000 bpd for Petronas, with reserves of 300m barrels.
Vitol could also help Savannah financially in exchange for marketing South Sudanese crude.
That would be made easier by the fact that most of Petronas's assets in South Sudan are managed by joint ventures with China's CNPC, which are staffed locally and thus would require the partners to supply little labour. '
The date of the article imo could infer a start date of the transaction as 1/1/22 and now a full 25 months past whch at $30m/month imo could have knocked $750m off the settlement price by now and perhaps some of the balance attached to a greater oil price and/or production milestones.
Great find and thank you
The full range of jobs are at all three joint operating companies. GPOC, DPOC and SPOC so looking really interesting with barely 2 weeks to go to issue an adm document.
Resounding vote against.
There was considerable cash at RBD, payment from Shell etc that could be used on other assets as well as that spent currently on ongoing sharebuy backs.
From the 13/12/23
6. The Board is concerned that there is a potential conflict of interest with respect to the proposed CEO, Andrea Cattaneo (who is the current CEO & President of Zenith Energy) and another Proposed Director, José Ramón López-Portillo Romano (the current Chairman of Zenith Energy). Zenith Energy is listed on the Main Market of the London Stock Exchange and is a competitor of Reabold.
"The Board believes the motives of the Requisitioning Shareholders cannot be trusted and that the timing of the Requisition Letter is not coincidental; it is in fact opportunistic. The first requisition coincided with the first tranche payment due from Shell for the sale of Corallian. This second requisition coincides with the subsequent £5.2 million received from Shell on 5 December 2023 and £4.4 million expected in the coming months. The timing is such that the Proposed Directors would be in control of a well-funded company should the Resolutions be duly passed, and the Board strongly believes that the Requisitioning Shareholders and Proposed Directors are using this requisitioned general meeting as a way of attempting to take control of your Company, your cash and your assets.
https://www.lse.co.uk/rns/RBD/publication-of-circular-2acbj16o5vrfe6c.html
Nigeria oil Revenue in 2022 was US$29.8 million (2021: US$ 15.0 million) for oil, condensate sales and US$1.6 million (2021: US$1.7 million) was for processing of third-party crude oil.
I would have thought 2023 oil and condensate revenues + 3rd party processing of oil could be around $25m
"It is expected that the existing Stubb Creek production facilities will be debottlenecked in 2024 to increase oil production capacity to c. 5.0 Kbopd."
That would increase oil revenues by about 70% to maybe over $42m.
Surely that must be a priority/close and if not why - opex/capex paid in naira from gas operations and revenue in dollars reducing exposure.
2024 a year to break through $300m revenue in Nigeria plus whatever 2024 holds in terms of new gas contracts with the CPF upgrade.
Would have thought that the longer the delay the actual net cost must have significantly reduced on S.Sudan.
Either we are an 80k boepd producer for 2024 on S.Sudan completion shortly to $1.5b+ revenues which would be transformational (or not > 30k boepd/$300m ).
S.Sudan has a substantive upside opportunity for increased oil production potential even by what would be a modest 50% next 2+ years so not to be underestimated given the purchase price must have significantly reduced by now (and again in the next 6 and 12 months to this year end (ie 3 years) - perhaps fully paid for - see AET and Panoro recently on circa 2 years for asset being repaid).
Would this potentially negate the need for any significant or all Nigerian financing if S.Sudan were to complete ? (Perhaps wishful thinking?)
What is plan - re alternative growth avenue if not completed versus actual completion ?
Niger - pipeline complete and opportunity for bringing in a partner for ongoing exploration at some point - cash injection/share costs ?
From memory 27 opportunities assessed - what else was close/considered with/without S.Sudan ? Where does 1-2 of those now sit ?
With a year passed, will we hear preliminary news mid year on Doba oil ?
Renewables - not attaching any importance right now for major share growth until the above is clearer.
TYB Khazakstan is fine but i don't think its top of everthing now. I'd keep an eye on the cash RBD has and how it could make a difference for ZEN in the bigger picture.
He's not getting involved at RBD for fun imo. Obviously if it doesn't go through it will cause a rethink to a plan B perhaps (unaffecting Khazak) but that cash would be significant to move it elsewhere. RBD doing share buy backs now.
What management is going to be appointed to Leopard that they said would happen soon? Could it possibly be some of those who are working on getting voted in to RBD in 5 days time if it works. Zeniths Leoprad wants to acquire US assets.
Look at RBD re Daybreak Oil and Gas Inc - USA.
'Reabold has a 42% shareholding in Daybreak Oil and Gas Inc ("Daybreak"). Daybreak is an OTC traded oil and gas company engaged in the exploration, development and production of onshore crude oil and natural gas, primarily in California.'
AC could be working on a bigger plan right now and the $25m bond could be part of it all.
I don't know how it would affect everyones shareholding/dilution if any but imo it would be positive in time.
I think there's more importance to RBD now than some have researched.
As in for a 'plan B' at Zenith if not voted through.
I'd go back to the RBD interview posted a few days ago (which maybe some decided to have it removed without thinking of the bigger picture) in which they talk about their concerns on the assets so yes they must be aware of how they see AC possibly having a strategic plan involving ZEN.
And now SH saying "It has also not received sufficient, detailed explanations which address matters of concern" so perhaps AC doesn't want to engage to divulge any plans ?
ZENs Leoprad in the US could have some relation to the RBD assets as part of all this.