I believe the company is putting together a mega deal, this type of deal doesnt happen over night and doesnt happen in the timescales us aimers want it to. We are not talking a few hundred million here we are talking billions.
Either that or this is the scam ponzi of the century, which i dont believe. A massive miss here would also take down echo and CORO which i cant see happening.
You need patience of a saint here, but some of us have been here for 8 years and life sometimes has felt like its on hold. Lifes a journey and not a destination (and all that) but for sure if this comes off then some of us will be enjoying the remianing a lot more than the last 8 years in here.
For me its FRR big party soon then transfer to here then when big deal done (i reckong Q2 2019) then im out of aim and retiring below 50 and will just buy a little crypto here and there for fun.
If not im a slave to work and pension years. Its worth the wait so no worrying myside just juggling the boredom of waiting for things to develop to the point where the market and sp reflect the true worth of this company, however i think when it does it will be fast and possible over quicker than we think.
Hi P44 and Cruncher,
Thank you for taking the time to post up the notes on the Bristol presentation. The broad picture seems to be much the same as it was in Edinburgh although JP does seem to have taken the opportunity to correct the horlicks he made about what information Sound were going to publish in public and what information was going to be withheld. I must admit it did bring a smile to my face to hear him suggest he was withholding certain info as he did not want our neighbours to have access to it.
The only way to do that would be to bar them from the data room and since they are among the favourites to make a bid come LE time , that does not seem likely.
As usual the time frame is stretching out a bit with 2019 now coming into view. I must admit it would not break my heart to see Sound still being around at Easter next year as I still have a wheen of Sound shares to get transferred into an ISA, although I recognise that this is not a view shared by the majority of the PI.
As usual JP is coming in for a fair bit of stick on timelines. What most of the PI fail to grasp is JP is a great proponent of Albert Einstein, in that most of his statements are relative, while most of the PI expectations are measured in absolute terms.
What is becoming clearer though is that with the G&A at $7m then any serious foray into the 2019s will come with a requirement to raise funds - not a lot as JP says - but it depends on how far into the 2019s they intend to go and also what curved balls we are presented with from the drilling campaign.
I am beginning to come to the opinion that the withholding of information and the requirement for extra cash may not be unrelated.
To examine this proposition one must first determine what information we , as investors, are entitled to get.
First of all we are entitled to get immediate access to anything that is deemed price sensitive as explained in Rule 11 of the Aim guidelines.
Secondly because we are an O&G company there was a specific note published in 2009
"NOTE FOR MINING AND OIL & GAS COMPANIES - JUN E 2 0 0 9"
The document is in two parts, the first part deals with IPOs while the second part deals with the ongoing information that investors are required to receive from their companies as they progress their exploration efforts.
And, just to add fuel to the fire, there are new rules this year, some already in and some due by the middle of the year that are neatly explained in this page on Denton's website.
As ever the responsibility for monitoring and enforcing the rules lie with the Nomad so there may be some degrees of "difference" between how these rules are interpreted and enforced among the various Aim entities.
The above details what we are entitled to expect from the company but obviously there is a lot more information, expensively gathered, which the company uses to decide how to exploit it's assets. That information would be a godsend to our neighbours and a reason enough , if reason were required, to sign the NDA and pop into the data room to give it the once over.
When JP states that he wants to limit the data in the public domain due the prying eyes of our neighbours that only makes sense if it is also restricted in the data room.
What would be the point of following such a course? Superficially it would appear pointless to go to the expense of obtaining the data only to withhold it from your potential suitors.
Just look at Sounds cash position and the revised timetable. What would our information (not data) be worth to a neighbour.
Thank you for the update Pendulum - it still seems to be optimistic.
Here's a post from elsewhere - courtesy of Riddlers - about the Bristol event:
Good morning all, a very enjoyable evening in my home city in the fine company of Panther and Jobbinscl as well as meeting for the first time SoundingOff, Kempseyman, Borderer amongst others. I have summarised my notes taken as follows, all of which I am confident is accurate but please fellow attendees let me know if I have missed anything. I have several thoughts and observations which I will post separately - firstly the facts set out in sections for ease:
- The data set was viewed as very exciting, showed the structure of the basin, thickness and distribution of the Paleo and generating new leads.
- Results have optimised seismic lines, including moving some a little to look at new features seen. Also shows the deeper section of the Palaeozoic and the overall basin.
- emphasis placed on just how large this job is, how slow and time consuming it can be. c 150 people involved, 120 local recruits plus 30 experts from Western Geo, 6 vibra trucks.
- Shearwater has also been contracted in addition to Geo to process the seismic. In part to speed things up and in part.
- Limestone and the salt seal creates additional work processing/cleaning up the seismic
- 3 month process to rebuild the model, 1 month in at the moment
- Rebuilding model to test assumptions, Jason and John confident that the model would confirm current model
- Spoke afterwards and the model is being developed in 3D and will also have 4D. This includes looking at how the substructure has moved/evolved over time.
- Model being developed by a company in Devon, company Jason/John have worked well with before.
- Downhole pressure gauge still in hold on TE7, pressure incrementally continues to build. View is that 5/6/7 all connected, 8 where the TAGI is tighter might be connected but tighter.
- Should still be April but out of Sounds hands
- Uncertain if will release the whole CPR document or just the numbers. JP seemed mindful to put them out in the public domain, also mentioned £neighbours£ in respect of the CPRS are more aimed at external parties rather than the retail investor. Jason/John suggested there is a lot of geological data in a CPR which they would prefer to keep in house.
- 2 CPRs for phase 1 as expected (drill target first and then remaining area), may be merged for subsequent CPRS.
- As a reminder, Palaeozoic numbers are not included in the CPR numbers, TAGI only.
- 3rd well could be Anoual.
- Will await the final phase of seismic and pull all phases together before deciding location of the 3rd well.
- TE9 £ shares some analogies with the TE5 Horst, especially on 2D seismic.
- July will be month to start drilling. Rig mobilisation was mentioned for May.
- Palaezoic £ carries more risk than the TAGI with less data. Separate pressure system for TAGI and Paleo, which is what we would want.
- Good session explaining the risk % calculations for wells. Most risk is the reservoir.
- GSA is being negotiated at the moment
- This price will be the most important number the company will give us £ critical in terms of value with the difference between $7 and $9 resulting in millions of difference.
- James quietly confident. Also stressed importance of Mohammad in the gas permitting, working very hard within Morocco.
- Pipe/BOT, quite confident can get the BOT away. Contracts are complicated and complex.
- Want to know results of first 2 wells before taking FID
- Still have an eye out for any distressed assets, not seeing a lot in Morocco. Mentioned some interest in off-shore/shallow waters being area of focus by others.
- Covered for the 3 well program from current balance and Schlum£s share
- Dilemma is how much to leave the company with in case
Hello all, BF posted following the Edinburgh meeting,I can add a bit from what was said last night. Very much the same story sorry to say,but things are moving forward as planned. JP spoke about progress in general,and the end game,but his fellow speakers added a bit more. He introduced the two geologists who joined SOU from BG some time ago,and they are top men. JP and the experts commented something along these lines.
The seismic is a large scale operation.
A major would take ages more to do what SOU are doing (Poss years)
They were VERY exited about the seismic.
3 wells planned ,anything could happen re the LE along the way.
First well will spud in July.
Well 2 and 3 much bigger than well 1
JP warned, nothing certain about drilling,but 3 failures would be very very unlucky,or they had things very wrong,its SIDI then,and plan C
The GSA which they are working on now,is VERY important.(pipeline size and progress being worked on daily)
CPRs will be released as and when ,SOU investors should not be worrying about CPRs,they will come soon. News which has to be released by market rules ,will be released.
LE, maybe this year,maybe next,its all down to the seismic and drilling,(we all know that anyway).
All staff were very upbeat,James from CORO spoke for 30 mins,all good there,but very early days of course..
Forecast......its going to be the same risk -reward outlook going forward, seismic good,geologists excited, if well 1 comes in good, lots will change. If the others come in good,its BOOM. (all above comments are as I saw them,dont shoot the messenger.)
Don't book the cruise yet,(not the around the world one anyway)
Maybe we can go on the outer space flight if the wells are on the button
Good luck all
Hmm, I seem to remember JP sounding similarly bullish (oops, I did it too about Badile.
But, hey ho, thats Exploration for you. Some you win, etc.
Very much a lottery at this stage, although seismic techniques and interpretation are much more advanced these days.
Ive got money on 3 potential whoppers at the moment , SOU, CHAR and FRR. with CORO, ECHO, and ZEN waiting in the wings.
Whats not to like ?
Then again JP has said that 1 out of 3 would be sufficient, so providing the first drill is a resounding success (see what I did there ) who says we will even get as far as the third, nice thought.
I just hope that they have identified what I think JP called the Goldilocks zone when he was in full hype mode, as anything other than a success of some sort will hit the SP and that would really test my resolve.
Regarding the point raised about who is going to pay the bills after the Italian disposal; as Billfish detailed last week the approximate cash position at the point of this summers drilling program appears to be around $29m-$30m. Three vertical wells are likely to cost about $27m-$28m.
My view is they the company may need to raise/borrow a small amount of cash to keep them going past the last drill. If the drilling is successful this should not be a problem.
If it is unsuccessful, I think that the company will be in a great deal of trouble.
Resolutions all passed at SRON/Coro AGM on 29 March. Record date for SOU shares 3April. Cant find a date for distribution but theyll go to where your current holding of SOU shares is, ie nominee account or certificate. Dont expect them to arrive for a week or two myself.
I know that quite a few folk are hanging their hats on getting 10 cents on the dollar for the seismic. I am not one those. I don't think you can expect a multi-million dollar payout based on seismic alone. I have had this conversation with JP and BM and I am still of the opinion that the seismic needs proving up via drilling in order to obtain the credits we are expecting from the big boys.
I think I have mentioned before the need for calibration wells in order to justify the value of the seismic and to a certain extent that is what we are getting with 3 vertical weels scheduled for the summer.
If these wells marry up with the siesmic - all well and good. Perhaps though the results may require some adjustments to the seismic interpretation and this will necessitate a certain amount of reprocesing of the seismic before they can be presented to the big boys as evidence for the final pay day.
I think the first news that will move the SP forward is the news of nthe GSA as that will provide the underpin for valueing any hydrocarbons on our acerage.
There are a few other bits and pieces that came out of the Edinburgh preso that I did not mention as I was expecting Saleem to post up his recording of the event.
From JJ in Edinburgh we learned that the G&A is expected to be $7m dollars, from JP we learned that stimulation and testing will cost $1.5m-$2m per well ( if it is thought necessary). Both indicated starting cash position around $29m-$30m. Three vertical wells costing $8m gross or approx $5m net to Sound.
Taking both pressos together the max cost therefor for the complete plan would be around $27m-$28m which does not leave all that much in the kitty - that is why I beleive the plan, after the first well is fluid.
JP did indicate in his presentation that he would not be averse to some minor capital raising if it was found necessary. This got me thinking about JJ diary when he was up in Edinburgh. His presentation was originally scheduled for Wed evening, he then had an appointment with Schlum on Friday in Aberdeen. So how was he going to fill his time in Edinburgh on Thursday. Well from the venue of the presentation it a 5min walk accross North Bridge to the offices of Bailey Gifford one of the largest asset managers in the world. Heading out the door and turning left, heading towards the castle a 2 min walk takes you to the head office of The Bank, an institution well versed in financing the North Sea oilies. Skipping past the castle onto Lothian Road takes you to the offices of Standard Life, the address of one Harry Nimmo ,doyene of the uk small cap companies. A 10 min trip on the tram would take him to the headquarters of the Royal Bank, another institution well versed in financing oil stocks. That does not include Aegon the Dutch asset manager or The Widows, anothe large institutional fund manager. You can see that JJ ( who lives in Edinburgh) would have no shortage of oportunities to present his case should Sound be thinking of taking early steps to expanding their capital base.
Thanks for that BF. If the current SP reflects the ~0.5tcf @£1 per tcf, then the upcoming seismic CPR might give an indication of how the market values Tcfs proven by this method, as opposed to the drill - thoughts?
At the preso in Edinburgh JJ confirmed that the A structure would be the first drill, target date July. At the subsequent event JP indicated the spud date would be around the 26th of June I think. So first up will be the A structure, I think the plan after that is fairly fluid.
The overall seismic acquisition programme is planned to be completed by August 2018 with the final processed products delivered to the Company in October 2018. Separate independent competent persons reports ("CPR") will be commissioned after the completion of each phase of seismic acquisition. The first CPR, due in March 2018, will cover the Phase 1 seismic area including the A Structure.
Did anyone attending recent roadshows in Scotland and Chester pick up any mentions of the above, and if this timeline is still on track? Next one in Bristol I believe, mid April, by which time groundwork will have commenced for TE9 spud in July.
The difference with Sound is that their intangibles relate to an awful lot of tangible stuff in the ground.
WHEN (and of course there is a potential IF) the stuff is extracted on a commercial scale, the intangibles will be offset multiple times.
Regarding funding, the latest report states that we are sufficiently funded for all planned activity this year.
Therefore, anyone who wants to short this stock be warned. Further good news can be expected before we get into serious talk of dilution.
I've just looked at it as well. The first page shows:
1. Negative on G3E: Now at an all time low after I speculated that it is in default on its bonds.
2. Negative on FRR: 20% lower than the circa 0.52p when I first started posting negatively.
3. Positive on SKY: a rarity for me to be positive but it does happen
4. Massively negative on PHE: Now pretty close to its all time low
5. Massively negative on UKOG: it's difficult to hide my joy at how much money I've made from this terrible company
6. Negative on AFC: Pretty close to its all time low
7. Very negative on EVRH: oh dear, this one's the outlier
So all in all, 6 our of 7 on the first page called perfectly.
Now that we've got that out of the way can we discuss Sound or are you more interested in me than Sound? Are you going to stalk me? You wouldn't be the first.
Sound is a pile of [email protected]@. The market cap is totally out of kilter with its assets which are pretty negligible once you factor in the debt and remove the intangibles which produce zilch.
My thesis is simple: the company is massively over-promoted by management who have completely failed to deliver. The net cash position is now close to zero and they will need to place again in the near future to raise more cash. That will need a big placing and a huge ramp in advance of that placing in order to get retail investors frothing at the mouth but ultimately any such placing will need to take place at a material discount to the current price.
Saffron/Coro- James Menzies joins the Holy Trinity
Saffron has announced today that James Menzies is to join as CEO with effect from the first of May. James was founder of Salamander Energy, later taken over by Ophir Energy in a transaction worth $850m in 2015. Menzies will join the board with Sara Edmonson as Deputy Chief Executive and will lead the process of building the business in SE Asia where I am sure a number of opportunities are well advanced.
This appointment is a real game changer for Coro and will surely mean that the company is set for dynamic growth in the region and the aim of building a business of material size becomes a genuine reality. James Menzies can provide the team with deep regional knowledge and combined with the local experience from Chairman James Parsons will provide a launch pad for the company that even the most optimistic shareholder might not have dreamed of.
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