Bahamas Petroleum Share Discussion Threads

[chutes01] 31/8/2020 19:24

a guy called Pete Jones was brought in for a couple years to plug the gaps, day raters on £700 had their desks cleared, staff fired.
Huge de-comm lies ahead, with liabilities for many years to come.
The Cladhan field was Koot's folly, and his inability to negotiate a deal to bring Dana's Western Isles through existing infrastructure. do some research on it
He failed there, and he's failed at CERP.

[chutes01] 31/8/2020 17:44

Rossannan

He headed up taqa bratani for ADNOC, Abu Dhabi oil Co.
they bought mature assets from shell/esso for around 500 Mio, and oil price was initially high, they did well for a few years then it turned sour.
Not much value was added, it was a play on oil price, and a bizarre play on north sea oil from the UAE.
Several subsea tie-backs failed to deliver, and they are left with massive de-comm costs over the next few years, shell did well of course to exit.
Koot ultimately failed, as he has one with CERP and sold the shareholders into a corner with BPC.

[bigsi2] 31/8/2020 16:43

As it stands with the share price at 1.95and not having currently met terms of CLN with Bizzel it has ACCESS to $9m approx

[bigsi2] 31/8/2020 16:41

BOTH conditional - convertible loans

[bigsi2] 31/8/2020 16:40

20/2 RNSFacility Summary:The Company has entered into the Facility for up to GBP8 million zero-coupon, second ranking, unsecured convertible loan notes (the "Notes").-- Structure: An initial draw-down of GBP2.43 million to be made immediately, with four further instalments of GBP1.19 million-- Conditions to future draw- downs : if the Company's share price falls below 2 pence for five consecutive trading days there can be no further draw downs; and no material adverse events subsisting at time of draw-down17/3- The Company has entered into an agreement to expand its zero-coupon, second ranking, unsecured convertible bond facility from GBP8 million to GBP16 million , of which 90% is available for cash draw down, provided by an institutional family-office investor based in the Bahamas

[bigsi2] 31/8/2020 10:02

Funding In place but not executable at current SP- as $16m of the CLNs is only available according to terms agreed to draw down with share price above 2p - The majority of the relatively small sum that has already been drawn was quickly converted for as little as 1.17pQ- Do you envisage the share price remaining elevated once CLNs drawn down?Trafalgar crashed it 40% with just 100m shares being converted Q- do you envisage the lenders waiting till post TD (on a new frontier wildcat drill) to convert loan ?? would it be possible for BPC to repay these $25m loans with existing producing CERP assets ?? CERP had already themselves been utilising CLNs rather then funding through any production.

[tomford8] 31/8/2020 08:28

Revised Costs Estimate

The Company had previously provided guidance as to the estimated total cost of drilling operations for the Perseverance #1 well - most recently on 25 March 2020, when this estimated cost was confirmed to be in the range of $25 million to $30 million. At that time the Company also identified a number of contingency costs relating to pace of drilling (rate of penetration or "ROP"), the potential requirement for additional casing strings based upon real-time drilling outcomes, and/or additional logging activities. These contingencies (if required) were estimated to add up to a further $5 million, such that in the extreme case of all contingencies being required without any offsetting cost savings being achieved, the cost of Perseverance #1 might be up to $35 million in total.



The revised firm pricing and operating parameters encapsulated in the Rig Contract, as well as broader industry conditions exerting downward pressure on pricing, has provided an opportunity for the Company to revisit the cost of the Perseverance #1 well, with a revised estimated cost now in the range of US$21 million to US$25 million.



This revised estimate of US$21 million to US$25 million is not only materially lower than the previous cost estimate (of US$25 million to US$30 million), but represents a narrower range (in absolute terms) as compared to the previous cost estimate, given the now greater certainty on specific input costs (and notwithstanding that additional costs have been included in the estimate to accommodate implementation of a number of possible strategies for the mitigation of residual Covid-19 impacts - the extent to which these will be required as yet unknowable, given that the drilling window remains more than 6 months in the future).



At the same time, potential operational contingencies relating to real-time drilling results (as previously identified) are essentially unchanged, such that on a like-for-like basis, the total cost of Perseverance #1 is now estimated to be up to $30 million in total , representing an approximate reduction of 15% to the previous well cost estimate (of up to $35 million).



Over and above this revised estimate, the Company has also now scoped a further $3 million - $5 million of provisional cost elements relating to an expanded range of formation evaluation work, that the Company previously identified but that can now be undertaken at the Company's election in a success case, subject to capital availability (i.e. the identified cost savings mean, assuming accuracy, in a success case, that considerable additional work could be undertaken within the same $35 million capital "envelope" as had previously been estimated).



In summary, BPC now estimates the total cost of Perseverance #1 to be in the range of $21 million to $25 million, a material reduction from the most recent prior comparable estimate. In addition, the Company continues to assess there to be up to $5 million in potential operating contingency costs, and has scoped up to $5 million of provisional costs for additional formation evaluation work that the Company could elect to incur in a success case. However, the extent to which these contingent / provisional elements are utilised will not be known until closer to or during drilling operations, and decisions in relation to incurring these items will be based on capital availability at that time.



Funding and Funding Strategy Update



Prior to the Covid-19 pandemic shut down, the Company had commenced procurement of various long-lead or critical path equipment items required for drilling, such as casing and wellheads. Some of these items had been ordered and received but not yet paid for; others had already been paid for. All items received have been warehoused at minimal cost, and are available for redeployment at recommencement of drilling activities. The Company has also sought to work collaboratively with suppliers to reschedule payment obligations where items had not yet been paid for.



At the same time, prior to the Covid-19 shut down, the Company had already undertaken and paid for a considerable amount of preparatory work for drilling - largely reflected in "manhours" - most of which expenditure will not need to be repeated for recommencement of operations. Against this, the Covid-19 delay has added an additional 6 months of general working capital needs.



The Company has current cash holdings of approximately US$12 million. Taking into account ongoing working capital needs and costs associated with initiating the rig contract and readying for operations, at the time drilling is ready to commence in late 2020 / early 2021, it is anticipated the Company will have cash holdings of approximately $9 million. Thus, on the basis of this revised total well cost estimate of US$21 million to US$25 million (plus potential contingencies), the Company's current funding "gap" for Perseverance #1 is in the range of $12 million to $16 million (plus a further $5 million to $10 million depending on the extent to which potential contingency / provisional costs may be required / opted for).



In this context, shareholders are reminded that the potential funding sources established by the Company prior to the Covid-19 shut down continue on foot, and, if available and drawn (and when aggregated with the Company's existing cash holdings), would more than meet the Company's overall funding needs for Perseverance #1. In summary, these potential funding sources are:



· A Conditional Convertible Loan with Australian-based Bizzell Capital Partners Pty Ltd for a total investment of £10.25 million (approximately US$13 million). Once advanced, the Conditional Convertible Loan would be for a term of 3 years, with a coupon of 12% per annum, convertible at a price of 2.5 pence per share. Funding under the Conditional Convertible Loan remains subject to satisfaction of a number of conditions precedent, and, as announced on 25 March 2020, the parties to the Conditional Convertible Note Loan had agreed a variation such that the date for satisfaction or waiver of all conditions precedent and election to subscribe to the Convertible Notes was extended to no later than 15 October 2020 (and, to the extent that the subscriber elects to subscribe on an unconditional basis for at least £1.5 million of Convertible Notes prior to 15 October 2020, the date for the satisfaction or waiver of the conditions precedent to draw-down of the balance of the Convertible Notes will be extended to 15 November 2020), with accrual of interest not commencing until actual remittance of funds by the Subscriber to the Company, and therefore with no cost to the Company until that time; and



· A £16 million (approximately $21 million) facility with a Bahamas-based family office investor for a zero-coupon, second ranking convertible bond (the "Facility"), entered into on 20 February 2020 and expanded on 17 March 2020 (and as more particularly described in the Company's announcement of that date). As at 17 March 2020, the Company had drawn down an initial tranche of the Facility of £4.23 million (net of face value discount) , with the balance available to be drawn in four additional tranches. As announced on 25 March 2020, in view of the Bahamas and US Covid-19 situation, the parties to the Facility agreed to keep the Facility on foot, and to replace the draw down dates of April, May, June and July 2020 with revised draw down dates in November (£1.19 million available net of face value discount ) and each of December 2020 and January and February 2021 (£2.99 million available per tranche net of face value discount ) . The parties also agreed to further review the Facility terms and draw down schedule once the overall market impact of the coronavirus response is better understood.

In addition to the above noted facilities, given current market conditions and the revised drilling timing the Company is now actively seeking to revisit all potential funding sources for Perseverance #1, with a view to optimising the availability and cost of its funding. This includes continuing to pursue a farm-in, and farm-in discussions remain on foot with a number of parties. As noted above, consequent on signature of the Rig Contract, Stena Drilling has also been granted certain options to invest in BPC or the project.

Overall, given that drilling operations will not commence until at least 15 December 2020, the Company now has in excess of 6 months to refine, implement and complete its optimal funding strategy in a measured way. In doing so the Company's previously articulated funding principles will remain unchanged:

(i) to ensure that funding is available as and when required;

(ii) to seek to minimise shareholder dilution from such funding, such that the dilution required to secure the funding for the well would be less than or at least no more than the dilution that would result from a farm-in transaction; and

(iii) to create multiple funding sources with maximum flexibility and optionality.

Source RNS BPC rig contract re Stena

[pro_s2009] 31/8/2020 06:00

All depends on the well cost.

It was 60m to 80 US$.

Then it came down to 25m to 30m US$ with the rig contract agreement with Seadrill ??

Now its supposed to be how much with Stenna rig contract..... ??


The well cost seemed to always fall depending on the available funding, so what is it really ?

I would estimate perhaps 40m US$ all told, so quite possibly why they are still holding back from proceeding ? Who knows, its all going to come out in the wash before too long - the ship has to sail - unless of course - another delay........

[pro_s2009] 30/8/2020 22:39

roassannan, do they ? Tis the question. The cost keeps moving around, its always a range and the range keeps moving.

However, to put it simply, if they had the funds, why not draw down and proceed now ?

Pay for the insurance, pay for the rig, pay for everything so its unstoppable ?

[linton78] 30/8/2020 18:52

We are still 4-5 months from the drill... the funding mix will almost certainly change.

[linton78] 30/8/2020 16:51

It must be another busy day for Specialist in the global financial hub of the world..... BRISTOL !!!

Ha, Ha, ha... !!!!

You could not make this up.

Our £72 big head who thinks he is Warren Buffett ! Lol.

[pro_s2009] 30/8/2020 10:42

rossannan, an amount of one of the CLN's is dependent on certain conditions being met, conditions which BPC have so far failed to comply with. So no, the funding is not certain, its conditional.

A lot of people will have a punt on BPC if they drill, thats for sure. The question is of course, will they drill.

There is always a reason to delay a bit more, delay a bit more, delay, delay........so obviously quite a lot of people are suspicious and will not be convinced until the rig contract payment is made and the rig departs...........all the while thats not happened, people will remain suspicious.

[specialist is the living god] 30/8/2020 09:45

Bin 🗑 boy being ripped apart on the other thread for the pleasure of his Messiah. Hahahahaha hahahahaha 👏👏👏👏8512;😀ԅ12;😀

I love my IDIOTS IN THE DARK - the IDIOT IGNORAMUS.

[aberloon2] 30/8/2020 09:43

The big spiel from LSE is all very compelling and (for me) worthy of investment, however, i need to see the vessel leaving for the Bahamas. I won't have the return if doing it now but that's a risk choice.

[specialist is the living god] 30/8/2020 09:43

Bin 🗑 boy being ripped apart on the other thread for the pleasure of his Messiah. Hahahahaha hahahahaha 👏👏👏👏8512;😀ԅ12;😀

I love my IDIOTS IN THE DARK - the IDIOT IGNORAMUS.