Pantheon Resources Share Discussion Threads

[truant2tb1] 02/11/2022 14:12

Having re read the Dec 21 funding / death spiral RNS my mind is now turning to when the cash runs out! A highly plausible scenario is PANR need to raise again to continue their supposed "testing" throughout the spring campaign. Assuming they won't need to raise additional could be an error! We'll know more when the final results are outDYOR

[alanlyons] 02/11/2022 12:03

I've explained the operation of the CB and the choices in some detail and why it is not a death spiral. We disagree. Peace.

[probabilityofsuccess] 02/11/2022 11:48

JakNife - we won’t need to wait until the end of the five years, operational events will overtake!

As the point of investing is to use foresight, and you’ve shared your foresight on flow (which appear to be ‘commercial217; to many……….though I’m not sure you appreciated that when you wrote it!), what do you foresee happening in the event of positive testing results, and what criteria have you set to close your short position, if the results are not as you hope/expect?

i.e. If it looks like you’ve made a wrong call, what news/information are you looking for which will confirm that in your mind?

Final question if you’d be so kind to respond - why have you deleted so many of your previous posts?

[horneblower] 02/11/2022 11:45

When it comes down to it, JakNife's augument is that when the oil DOESN'T flow commercially, the convertible bond structure will cause a death spiral; and alanlyons argument is that when the oil DOES flow commercially the convertible bond will be financed with cash, therefore no death spiral.

So each is correct assuming their individual prediction of the commerciality of sustainable oil flows.

Hoorah and yah boo sucks.

[alanlyons] 02/11/2022 10:50

Was there any need for that sarcastic remark? I've explained in some detail why I think the characterisation is misleading. You know nothing about me, but If you're telling me that you are short PANR whilst I am long, I am happy to compare our skills.

[alanlyons] 02/11/2022 10:28

No, it isn't that it is below the price, it is that the price has no floor i..e if amortiation payment if $2.5m, you have to give however many shares are required to satisfy that, no matter how low the share price is. That is the "death spiral" element. That would have been a fair description of what the German government did to Uniper. But again, since it is at the Company's election, I dispute that this is a fair characterisation.

Regarding the satisfaction of amortisation to date in shares, I agree that this largely reflects the fact that most of the proceeds from the capital raise are accounted for. Bear in mind that if the Company elected to satisfy them in cash, it would immediately trigger the CB holder to convert their entire position (to preserve their upside). That is one of the reasons I do actually think the Company should do that with at least one maturity.

[alanlyons] 02/11/2022 10:09

Sorry and one more observation. You could add an "or in shares" option to any amortising CB and then call it a death spiral. I don't see how adding this election choice at the Company's behest makes that a fair description.

[alanlyons] 02/11/2022 10:06

We should add of course that there have been what 4 or 5 maturities already of the 20?

[bamboozler] 02/11/2022 10:05

JakNife. The "whole point" is actually that it has funded an incredibly successful winter drilling season at Theta West and Talitha and now a long term flow test and hopefully first production well at Alkaid 2 all for minimal dilution. I think you will find the many holders who have been around since the mid teens are pretty relaxed and see the CB as a very elegant solution to PANRs funding requirements.

[alanlyons] 02/11/2022 09:43

No need to be obsterperous. My point is that, if the CB holder elects to convert (which I would imagine could easily be triggered if the Company elected to pay the coupons / amortisation in cash i.e. deprive them of the upside from 78p), it would be with a hard floor of 65p.

And with respect to the quarterly amortisations I find it entirely understandable that the CB holder is fully protected since these are repayments of principle (i.e. this is an ADDITIONAL election that could easily have been completely missing on the part of the Company which might have instead insisted on only paying in cash).

[alanlyons] 02/11/2022 08:47

But JakNife given this is at the election of the Company, it can avoid this outcome, that is my meaning.

[chris0805] 02/11/2022 05:07

Even easier when he is on filter!!!