Tlou Energy Share Discussion Threads

[timw3] 24/3/2017 07:29

Lol sdavis. rose tinted specs?

[ftangftang] 24/3/2017 07:29

The proceeds of the Placement, along with existing cash, will be applied by Tlou for the following:

-- acquisition and interpretation of new 2D seismic data in areas considered to be highly prospective for additional Reserves by Tlou's reserve certifiers;

-- drilling a limited number of vertical (cored) wells along the new seismic lines (with geophysical logging and coal core gas sampling) to a depth of approximately 500 metres;

-- completing various studies (upstream and downstream) required for the submission of the mining licence application and tender for the Botswana Government's 100 MW CBM pilot project;

-- on-going production testing at Selemo, including installing gas engines to run the pumps on the existing wells;

-- costs of the Placement; and
-- working capital for its Lesedi CBM Project and corporate costs.
The objective of the work program above is to expand the Company's independently certified gas Reserves and complete the licencing requirements prior to commencing development of the Lesedi CBM Project.

Tlou's Managing Director, Mr Tony Gilby commented, "This Placement along with the recently announced agreement with Independent Power Corporation PLC provides significant momentum for Tlou to progress the upstream (gas field) and downstream (power and transmission) components of the Lesedi CBM Project with the objective of supplying the first gas-fired power in Botswana. We were very pleased with the introduction of a number of new investors to the Company along with continued support from existing shareholders in Australia and the UK".

good use for funds
imo
cheers
ft ft

[sdavis] 24/3/2017 07:27

These new funds will help accelerate the project. I thought it was going to be project finance, but they have decided to keep everything under their full ownership. A positive sign I guess.

[timw3] 24/3/2017 07:19

6p placing. though they had enough money for another year? Wheres all those that said no placing was coming when joint broker was anounced?

[timw3] 24/3/2017 07:13

right time to get out all the posts that were mocking me for calling a placing when a joint broker was annoucned..

thought the company had 18 months funding as per last podcast?

[coley15] 24/3/2017 07:11

There we go - 6p. Oh well, temporarily down to this level imo but all good in the long run.

[adorling] 24/3/2017 05:56

FF and SS - Where is the evidence that they are doing a placement? It is just AIM short term traders selling as they did not make 100% profit in 3 days......usual AIM behaviour and mentality IMO.

[ff2345] 24/3/2017 05:03

What makes everyone think it is a placing?

[coley15] 24/3/2017 00:08

Yep. Guesses on placing price? Whatever it lands at, it usually over shoots

[soulsauce] 23/3/2017 23:40

They finally doing the raising that a lot of people have suspected?
The share price of late has had the feel of forward selling about it.

[2lb] 23/3/2017 23:30

Suspended on ASX ?

[master esox] 21/3/2017 13:40

Just picked some up at 7.4. Dont think it will go much lower.

[wheniamfree] 20/3/2017 18:38

Funding in regards IPC deal perhaps yes.

[defcon3] 20/3/2017 17:02

Funding required first

[ch1rp] 20/3/2017 15:57

Looks like we may have reached a low level. Looking for a good push up now!!!

[raggedtp] 17/3/2017 21:51

No, I meant 55p. The founding of the company was at one Aussie Dollar. Then raised more, at 20c and then 30c at IPO, in Australia. Then it listed on UK AIM. So my Aussie shares are well underwater. But knowing some of the investing people behind Sunshine Gas, and knowing a bit about Botswana northern SA and the chronic lack and high price and dirtiness of power there, I put some faith in the early indications of that reservoir. Private equity takes patience, and you win some, lose some.
The market cap is tiny, almost priced to fail still. If you don't have much capital raising power, you don't spend needless millions on proving bigger reserves than you currently need. The wildcatting days are gone, and a good thing really. Much more money was lost by PIs that way.
I'm not trying to ramp. I of course wish I'd bought it all at 4.5p, but 55p would make this a £130m company, which is not too much of an ask, especially if you're saving places like Morupule £10ms a year in diesel costs. That could well take another four years.
But I'm interested to hear anyone else's valuations, as I'm quite fully invested, but wondering if this merits more at 8p or less.

[nugacity] 17/3/2017 18:44

Pointless post :O) ... did he mean 5.5p?

[antrot91] 17/3/2017 17:43

raggedtp 55p??

[raggedtp] 17/3/2017 00:48

I think these BBs cause stress because we can all dream of doubling our money in 6 months. As a founder shareholder, who would underwater if I hadn't bought more at 4.5p, please realise that this floated privately first at AUSD 1, so about 55p at the time. It'll take another few years to get back there probably, with volatility along the way, as with all junior miners. If I get my first stake back, will you be happy?

[tidy 2] 16/3/2017 12:13

TLOU The proven and probable reserves (2P) were increased by 44% to 3.9bcf of gas, but have plenty of further potential upside with the 3P figure getting a 390% boost to 261bcf. There is also still massive potential for further reserves and resources to be added across the whole project area, with more than 3tcf of 3C contingent resources across all the coal seams in the Karoo Basin. The beauty of this project is that the gas would be used to fire the power plant, and in turn offtake deals would be done for that power, so the demand would always be there for the gas. In terms of infrastructure, it is proposed that a gas pipeline would be put in place to supply the power plants – the existing 90MW Orapa plant, plus a new, larger on

[tidy 2] 16/3/2017 12:07

3.9 bcf gas isn't very big. Aex kiliwani gas well is small at 28 bcf and will last 6 years 500 bcf and above are respectable volumes.

[pottermagic2310] 16/3/2017 10:10

Does anybody know how long "The proven and probable reserves (2P)... of 3.9bcf of gas" would last, if extracted via (say) 6 drills at a pressure/rate typically needed to service a 10MW (or 100MW) Plant ?
Just trying to guage how long those anticipated Reserves might actually last once piped to a Plant ?

[mgellie] 15/3/2017 09:55

For christ's sake, just let the bloody price rise to a decent level before starting to sell

[ftangftang] 15/3/2017 09:49

full article

TLOU Energy (TLOU) was once one of those AIM companies that was hugely popular with PIs and was attracting a lot of attention and hype. Now that has now subsided, I can see real potential with this company going forward given the track record of those who are running it.

Like many of the natural resource outfits on AIM, I would tend to question the current market cap being as high (£17 million or so) as it is, but when compared to other similar companies that certainly isn’t an outrageous amount given the potential gas reserves that the company is sat on.

At the moment all of its attention is focussed on the Lesedi CBM project in Botswana, and that isn’t a bad thing as at least it means that it can focus its limited cash and resources in one place. The fact that it operates in Africa may be a concern for some, but the reality is that Botswana is one of the most stable countries on the continent, having been an independent democracy for more than 50 years.

It is also one of the most affluent African countries in terms of GDP per capita, and diamonds make up a decent sized chunk of its exports, alongside other mining, but one thing that it has definitely been lacking is electrical power, with outages being common, and power is having to be imported or obtained via generators.

TLOU, which is dual listed on the ASX and AIM, actually looks to be well placed to benefit from these power supply problems through its coal bed methane gas reserves at Lesedi, which can be used to fire a power plant, as an alternative to the far more expensive diesel which is currently being used.

For such a small company it has already made good progress and has the support of the Botswana Government. It was recently invited to tender for a power plant of up to 100MW, and subsequently signed a binding Heads of Agreement with Independent Power Corporation, and will now work on a proposal that will be put before the Ministry of Mineral Resources, Green Technology and Energy Security, for approval. The deal with IPC means that it will carry out a feasibility study (at its own cost) into an initial 10MW pilot project, as well as contributing 50% of any external costs involved in the tender. Under the terms of the agreement, TLOU can opt to be up to a 50% equity partner in any power plant.

Back to the Lesedi project itself, which totals five CBM blocks, and that has already seen numerous exploration wells drilled on it as far back as 2009 – TLOU has held 100% since 2010 – and several appraisal drills have been carried out as well.

This has led to booked gas reserves, and although currently not huge on a 2P basis, those have recently been further upgraded following a report by SRK Consulting. The proven and probable reserves (2P) were increased by 44% to 3.9bcf of gas, but have plenty of further potential upside with the 3P figure getting a 390% boost to 261bcf.

There is also still massive potential for further reserves and resources to be added across the whole project area, with more than 3tcf of 3C contingent resources across all the coal seams in the Karoo Basin.
The beauty of this project is that the gas would be used to fire the power plant, and in turn offtake deals would be done for that power, so the demand would always be there for the gas. In terms of infrastructure, it is proposed that a gas pipeline would be put in place to supply the power plants – the existing 90MW Orapa plant, plus a new, larger one.
It may seem like a big ask for an AIM company to actually achieve all of this, but from what I can see TLOU already looks to be well on the way, and the BOD certainly have a track record in this area, as it includes former CEOs of Sunshine Gas and Mitchell Energy – companies which successfully pioneered CBM in eastern Australia – and the company does look to be ahead of the competition at the moment.
In terms of the finances, it is burning through cash at a similar rate to other AIM resource companies, around £120,000 per month as at the last interims up until the end of December 2016, and at that time had around £1.5 million left in the bank.
It does seem inevitable that ultimately it will need to raise further cash via equity, but as long as it can continue to demonstrate that it is progressing the project forwards and everything is still on track, I wouldn't expect that to come at a huge discount. The IPO was done at 6.5p back in November 2016, and a further over-subscribed placing was carried out in August at 5.5p, raising A$3 million.
This one could well drift a bit lower on any lack of further news, but I can see value in buying at anywhere around the 7p area – that should give upside both longer term as the project progresses towards production, as well as the potential for upward spikes in the shorter term on the back of any good news.

cheers
ft ft