Alkemy Capital Investments Share Discussion Threads

[audigger] 18/9/2014 07:18

They have reduced their holding not increased it.

[woolybanana] 17/9/2014 17:32

Henderson on over 22% now. Are they buying for someone with a view to takeover bid? Any thoughts?

[rivaldo] 15/9/2014 12:14

New article today on Oilbarrel:

[...]

Conclusion:

"The good news is that analysts and the company itself are forecasting that there will be a lot of catching up in the second half. First, the planned works programme at Maltby is now complete and the site has returned to full producetion this should signifcantly boost output and offset any weakness in energy prices.

Second, Alkane has built up its capacity to 140MW and a great part of this will be devoted to Power Response. The looming energy gap in the UK is a key factor in the UK energy market and Alkane will be able to participate in power response operations this winter as well in additional schemes like the Supply Balancing Reserve which the national grid is bring forward as a result of a higher rate of power stations outages.

Third, the company has booked a £10 million exceptional profit from the sale of its shale gas assets to Egdon Resources in exchange for shares. “We’ve got a free ticket to the shale gas party and we’ll see what happens to that in the next few years,” says chief executive Neil O’Brien. He also says the company is, “on track to meet full year expectations” of around £4million in adjusted pre-tax profits.

Edward Hugo, Head of Research and Equity Analyst at VSA Capital Research says: “We forecast that ALK will produce revenues of £20.9 million with adjusted PBT of £4.2 million which requires Hw2 revenues of £13.8 million and adjusted PBT of £3.7 million. However we note the Board’s confidence in meeting market expectations.” VSA maintains its BUY recommendation and target price of 56p against 37p last Friday."

[gucci] 15/9/2014 09:07

l2 perking up, ready for next move up

[rivaldo] 13/9/2014 17:47

Nice excerpt in the Mail's small cap summary:



"Independent UK back up power firm Alkane Energy expects to see a major benefit from increasing pressure on the UK’s power network.

Alkane, which supports the grid’s 'power response' during peak periods by generating electricity from mains gas, is well positioned to benefit from a predicted spike in power cuts - Ofgem says there’ll be a one-in-four chance of blackouts by the winter of 2015/16.

After what it calls a “transformational” period Alkane has increased its power response capacity to 93 megawatts (Mw) from 39Mw and it intends to expand beyond 100Mw by mid 2015."

[spaceparallax] 12/9/2014 12:29

I like the sound of Velocys

[woolybanana] 12/9/2014 00:04

Velocys are growing fast. In tyhe UK they are involved in a scheme in south London to turn rubbish into bio fuel for BA.

[bobdouthwaite] 11/9/2014 12:14

Cyfran, are you aware of Velocys (VLS)? Gas-to-liquids and already doing what you suggest on a limited scale in the USA I think.

[rivaldo] 11/9/2014 11:35

Good coverage here, with some juicy quotes from the CEO. In particular:



Extract:

"Alkane’s CEO Neil O’Brien said the group will hear next week whether its bid to supply 60MW of standby power for this winter has been successful.

The Department of Energy and Climate Change, alongside Ofgem and the National Grid, are introducing capacity initiatives to ensure the UK has 400MW of reserve power this winter.

At Maltby, the closure of the colliery took longer than planned, which Alkane said was not within its control. The initial plan was that the shaft sealing operations would take five weeks, but in the event they took 13 weeks.

“We are pleased to report that Maltby returned to full production in June,” said Mr O’Brien. “We have seen a number of record production figures for total group coal mine methane production since this date. In particular, current output from Maltby is ahead of expectations and we expect production in the second half to compensate for the delayed shaft sealing operations.

“We should be back on track by Christmas. We’ve not lost the gas, it’s still there.”

With all eight engines running Maltby can produce 10MW.

“We always knew Maltby had some of the highest concentrations of gas to coal, but we couldn’t get at it while the miners were still there,” said Mr O’Brien.

“Maltby will be a very good site over the years. The 15-year lease runs for another 14 years and could well be chugging along after that.”

The group is working on the drilling of new sites and it expects to know the outcome of tests at Markham Main by the autumn.

“We’re hopeful,” said Mr O’Brien. “It could be a 4MW site.”"

[woolybanana] 11/9/2014 09:41

If you are talking about using flare off gas, I suggest you might examine Velocys, an AIM company who do just that. See also their involvement with making bio fuel for BA

[m4rtinu] 11/9/2014 09:25

Cyfran - great idea. Surely it would be good for environment and enhance ALK's green credentials.

See this part of their website

[spaceparallax] 11/9/2014 08:22

.....unless someone could find an economical way

[puffintickler] 10/9/2014 23:44

Gas is flared from oil fields because it would be more expensive to use it than the value you would get from it. Alkane or anyone else for that matter could in principle burn it and generate electricity but the cost of the infrastructure needed to store the gas, generate the electricity and transmit it to the nearest grid point would be more than it would be worth.

[cyfran101] 10/9/2014 22:10

Sent a speculative e-mail to Alkane two weeks back:

"I'm currently an investor in Alkane and I noted a statement in Time magazine 28/10/2013 "Power Surge" re' the shale gas boom. "On night-time satellite images of the US, rural N Dakota is lit nearly as brightly as Chicago - because of hundreds of oil rigs flaring off excess natural gas". Gas flares are nothing new but I was wondering if Alkane may have an answer to this consistent waste of a natural resource. How easy would it be to have a modular generation unit capable of being retrofitted to shale gas installations? Gas flares are much more prevalent in Russia and Nigeria however with shale gas booming in the US and now the UK we have much more acceptable business environments to take advantage of this waste"

No answer to date but I was hoping this could be another string to Alkanes bow.

[spaceparallax] 10/9/2014 20:50

H1 figures down but what does it matter if they're confident of making the year and more importantly really building for the future.

[gucci] 10/9/2014 16:10

like the look of this
bought in today

[rivaldo] 10/9/2014 14:36

Analyst comment from VSA:

[...]

"Alkane Energy ready to step up if power cuts happen
By Philip Whiterow
September 10 2014, 11:08am

Broker VSA forecasts revenue for the full year wil recover to £21.5mln.

Electricity supplier Alkane Energy (LON:ALK) expects to see a major benefit from increasing pressure on UK power supplies.

Regulator Ofgem recently said the risk of power cuts could be as high as one chance in four by the winter of 2015/16.

Alkane has increased its power response capacity to 93 Mw from 39Mw, but wants to go further and raise this to 100Mw by the middle of next year.

Neil O’Brien, chief executive, said it had been a transformational period for Alkane that had now positioned it for the future.

Over the period the group also transferred a portion of its shale assets to Egdon for £10mln.

That deal meant profits of £7.3mln in the half year to June though stripping them out, they fell to £530,000 (£1.42mln) due to outages at the facility at Maltby. That also meant revenues in the half year fell to £7.1mln from £11.1mln.

Broker VSA forecasts revenue for the full year wil recover to £21.5mln with underlying profits of £4.2mln as it expects production to pick up strongly in the second half as Maltby comes back on line.

The looming energy gap also remains a key risk for the UK energy market, added the broker.

Alkane benefits from this through more demand for standby power in its power response operations and additional schemes to bid into and also more generally when electricity prices increase in its coal methane operations.

"With UK electricity capacity margins potentially reducing to as little as 2% in winter 2015/2016, next year is forecast to be even tighter," VSA said.

The broker maintained its 'buy' stance and 56p target price."

[rivaldo] 10/9/2014 11:20

VSA Capital and Liberum reiterate their Buys, with 56p and 50p price targets respectively:

[lageraemia] 10/9/2014 10:11

The Ofgem capacity appraisal published in June predicted that without action the risk of power cuts could be as high as one chance in four by the winter of 2015/16. Since this report, following shutdowns at a number of power stations, National Grid have announced emergency measures to reduce the risk of power cuts in the coming winter. In addition, DECC, Ofgem and the National Grid are introducing capacity initiatives in order to increase longer term security of supply. These capacity initiatives include winter Demand Side Balancing Reserve which starts in November 2014 as an interim measure before the introduction of the capacity mechanism. The Company has bid into the 2014/2015 round and is expecting results in mid-September. The full capacity mechanism is being introduced in respect of plant being available from 2018/2019 onwards. The process for the first year is underway and Alkane has submitted for pre-qualification its portfolio of existing and new-build power response and base load CMM, with results due in early October. We will take part in the auction for 2018/2019 in December with results expected on 24 December 2014. These initiatives provide the Group with an opportunity for a significant additional income stream in future years.

Woo-Hoo!! Jam tomorrow!

I like the way ALK does business.

[mortimer7] 10/9/2014 09:20

Impressive interims and good supporting narrative. I think any prospective investors getting up to speed with the story would be able to clearly see the exciting potential here.
"This has been a transformational period for Alkane"

[rivaldo] 10/9/2014 07:44

Good to see ALK confidently state they're on track to meet 2.9p EPS market expectations, despite a downbeat H1 results-wise due to Maltby etc.

The outlook sounds most promising:

"Outlook

The first half of 2014 has been transformational for the Group. We have invested for the future, and including the acquisition of three sites from Carron Energy in July 2014, our power response capacity has grown by 158% from 36MW to 93MW, delivering a broader balanced generating portfolio and giving scale to a business where there are opportunities for growth in the tighter UK generating market. We have also taken the strategic decision to transfer our shale gas interests to Egdon, and we will benefit from the potential upside from the development of shale gas without any financial commitment from the Company. We are confident that 2014 will be another year of progress for the Group."

[lageraemia] 08/9/2014 18:08

I think I read that the downgrade is diue to worse than expected reservoir characteristics.

Ther smaller does however reduce NIMBY pressure and amke grid connection earier.

It's still the equivalent power of 180 homes with 4.2KW solar pV panels, without clouds or 'nights' so not too shabby.

[spaceparallax] 08/9/2014 08:31

Is that downgrade just due to NIMBY effects?

[cyfran101] 06/9/2014 01:27

3 Nooks scheme scaled down from 2000kw to 800kw, revised planning permission submitted:

hxxp://www.alkane.co.uk/images/documents/Company_Documents/Web%20site%20write%20up%202nd%20September%202014.pdf

[123qwer] 05/9/2014 19:57

will do for in the future.