Bowleven Share Discussion Threads

[dianecarberry] 24/9/2018 14:04

RM137

Just look at the problems VOG are having in Cameroon with ENEO/SNH and the Government over non payment of bills for power generated from gas.

Absolute bloody nightmare.

Cameroon is a cesspit of a country to do business in as VOG are finding out to their cost.

This is fact.

[rm137] 24/9/2018 13:56

dianecarberry, please back up these assertions with either evidence or logic. Potential uses of Etinde gas include ullage in local FLNG facilities (Hilli or Alba/Bioko) or as source for gas to power. Cameroon is highly dependent on hydro schemes for power, which are fine through the wet season. As you will know, power cuts in Cameroon are not uncommon and reflect both dry season, overall generation capacity, transmission challenges and the inevitable poor management. So, while the local gas demand may not exist today, the potential exists to create demand by integrating either with existing FLNG projects or with a new power project. In my view, this is why the value of Etinde is a function of the intent at New Age - the result of IE-4 will impact sentiment in the short term, but the share value will depend on New Age.

[dianecarberry] 24/9/2018 12:42

no demand for any gas in Cameroon

[cyan] 24/9/2018 12:34

The wells are being drilled up to firm up the areas resouces and it was hoped identify enough gas to justify a FLNG.
Liquid gas is transported all over the world on a regular basis. You do not need to rely on a purely local market.

[deanroberthunt] 24/9/2018 12:31

why are they drilling another well? there's no demand in the area....

[rm137] 24/9/2018 09:54

cyan, I’d agree with the potential. But I need to see who ends up running New Age before committing heavily. The current CEO is transitioning out this year; a new non-Exec chairman with BP background just appointed. I’d want to see some genuine project delivery experience appointed in the Executive ranks at New Age as a signal of intent.

[cyan] 21/9/2018 13:44

For me its quite reassuring that I am not the only one to think 50p plus is a fairer valuation of this stock.

We will get there, in the end. So much patience is required.

Anyone buying now with a medium term investment view; say a year, should, imo, do rather well.

[cyan] 21/9/2018 13:31

Was something said that caused embarassment? I think there was.. the only logical explanation.

[warbaby43] 21/9/2018 13:26

cyan, yup all very weird as you say. I had looked on Tuesday and it wasn't there so e mailed BLVN on Wednesday and got a very swift response that it had been removed with no explanation offered.

They clearly had a reason and what I suspect this episode demonstrates is that a watch is kept on these boards with your post at 17858 triggering action to make sure it was kept removed.

I am pretty sure that somewhere a complete transcript does exist but damned if I can find it.

[cyan] 21/9/2018 13:03

I wish I recorded the call now. Why take it down?. Here is a bit I started to transcribe;
Question from Ahmed

"..your current market cap is around $115 million of that we said about 85 to 90 million is cash and securities, and then you have the contingent cash on FID of $25 million, so, you know,essentially what i am trying to say is; the stock price today is reflective of the cash and FID and, you know,in your opinion, why do you think the market or investment community at large is failing to value or acknowlege the resources in Etinde; we're talking about, you know, 300 million in barrelsa of oil equivalent, more or less in Etinde, of which 60 million is Bowleven's share. Conservatively by our estimates that's 25 to 30p, so that's another 75% of upside to this stock.
It just, you know, baffles us that the market does not acknowledge that."

Reply

"I think that's a fair comment Ahmed. clearly we're disappointed that the value of Etinde is not reflected in the share price, in fact, if youb do break it down as you have` in terms of the cash component ; the FID and of course, the carry; we get to where the current share price is currently which effectively values ETINDE at, you know, very low numbers. Certainly , you know, we are no-where neare where we would like to be.
I think one of the problems with small oil & gas companies is its really hard to view or see how quickly this assets going to take to monitization. The history of Etinde has been disappointing in terms of the delays in appraisal program and i think the challenges of work in west Africa are well docomented. I think as we get closer to a development option that's sanctioned by the government; there's no question, in my mind, that we will get there , and i think the catalyst are, of course, the test results , and when they come in, and when we have a more active engagement from the governmentwho is quite keen to see this asset developed, and there has been........"

sorry that's as far as i got

[cyan] 21/9/2018 12:21

Hi warbaby. That's wierd as i used the link and re-listened to the whole call yesterday. Even started to transcribe the really interesting discussion of the valuation.
The link no longer works for me today.?????

[warbaby43] 21/9/2018 10:59

cyan at 17858, thanks but when I took the link it simply got me to the BLVN home page. I did e mail the company but was told that the Call had been removed (no reason given) but that there would be another Call following IE-4.

If you have found another route to access I would be most grateful, as I think another listening a month on and particularly in the context of the ongoing debate on here on development options and FID would be useful.

desha, not so much the agreement itself that was being referred as the contracts placed with SBM and JGC. If you got to their websites, you will see that both are large industry engineering players and while the SBM site is pretty bland, the JGC site provides a lot more info, but what I couldn't find was any reference to a current Cameroon contract.

[desha] 21/9/2018 08:44

warbaby

I have no industry knowledge but assume this is not a binding agreement, more like a 'show of intent', to keep the investors and politicians happy.

I assume NewAge can walk away from the agreement or else why commit to this before Etinde FID / project sanction?

[warbaby43] 20/9/2018 17:31

"The project company, CMLNG, will utilise a newly-built FLNG production vessel to process gas from the Etinde production sharing licence. As a result of a competitive tendering process undertaken during 2016, a contract has been awarded to a consortium led by SBM Offshore, in conjunction with JGC Corporation and Chinese partners, to develop the FLNG project"

I would dearly love to know whether they are still engaged and what is being worked on - I don't suppose any of your mates in the industry might know RM137?

[rm137] 20/9/2018 11:51

Well, this is where transparency comes in - and entering a FEED contract forces transparency, at least for Bowleven. So, if the JV, with Bowleven as a partner, enter into a FEED contract, then this is a market moving event for Bowleven and therefore needs to be reported by Bowleven.

[ramayer] 20/9/2018 10:27

I would imagine that would be the cases for outsiders, however our partners or perenco may know a lot more that we do and feel an early bid would be cheaper than a later one?

[rm137] 20/9/2018 09:22

Ramayer, at the risk of sounding like a cheep pun comedian, why would any bid unless there was line of sight to a FID. without a FID, or at least available FEED and a schedule to sanction, you wouldn’t know what to bid; there is a no assessment of value until there is a project. Anything else is speculation.... fine for a punt with the fallback of cash at the bank equals market cap, but not fine for a full bid.

[cyan] 20/9/2018 09:15

Commenting on the encountered hydrocarbons in the deeper middle Isongo sands;

12.02 mins " What's probably more interesting is that it does seem to provide support that the middle Isongo prospect identified does have legs and there maybe larger volumes of prospective resources in the license than currently thought."

We will just have to await the analysis to get a better understanding of what volumes the drill added. Apparently not as much as was hoped but ,maybe, still significant.

[cyan] 20/9/2018 08:40

I understand that some have been unable to access the conference call again.

This link worked for me;

[ramayer] 20/9/2018 08:08

Fid or bid?

[rm137] 20/9/2018 07:50

Agreed warbaby43. So, how does this play out on share price. I’m now moving out of my area of expertise, so perhaps you and others can comment here - but my speculation would be as follows. IE-4 result will prompt same oscillations - as a banker friend once said to me, prices move on news - but the value realisation event is FID. SO the price will settle back to money in the bank with a little bit extra for hope, just like now, until there is a line of sight to FID. I’d offer that the indicator will be a credible FEED for whatever is agreed by the JV and SNH. Thoughts anyone?

[warbaby43] 19/9/2018 18:22

Yeah, thanks RM137, and what it boils down to is that there are multiple development options but FID 2018 has certainly gone as now has Q1 2019, but sometime later next year is now like highly likely.

With regard to the Marathon option, while this piece does now look like it has been some while since updating, interesting to note the offtake agreement with BG expiring in 2024, though Shell being heavily now gas focussed, every chance I guess of a new agreement or an extension:



Meanwhile, as well as New Age being probably loath to surrender the FLNG option, so I would guess will be the government given the song and dance they made, when the agreement was signed with NA, over the onshore infrastucture jobs and local content opportunities that it would offer. They probably fancy a slice of what Marathon offers to Eq Guinea:



Perhaps, IE-4 might be more significant for FLNG, if it is successful, not just from what it throws up by way of Drillbit resource but also by de-risking the Bolt and Crowbar prospects.

The Conference Call has now been removed from the BLVN website but I see from my notes that between c13.10 and 14.50 Our Eli makes the following points:

1) NA proposal contingent on 2 tcf

2) FLNG always going to be best

3) 3rd party funding based on gas only supplies

4) Finance needs long term project and extent to which 1-1.5 tcf facilitates that is a question for the project financier.

[dianecarberry] 19/9/2018 13:28

1% chance of happening.