Savannah Energy Share Discussion Threads

[divmad] 29/8/2024 12:20

Does the continuing wait for a re-listing now imply that AK is still in negotiating mode with SS? Unbelievable, if he is, with OUR money at risk.

[zengas] 29/8/2024 12:14

These were posted on the 13th on the other board and the correspondence is much further along since 5th Aug as well as Petronas own letter stating they were initiating arbitration on the 9th Aug in their reply to S.Sudan govt - rather than the latest news site of now reporting on the situation that we know of 3 weeks ago.







Petronas sale was blocked by the govt over demands made by the govt. Petronas wanted to leave the country as it had long intended and is gone.

It surrendered the assets to the govt with no present option. Petronas doesn't want the assets back. It seeks compensation for failure to allow the sale at fair value which if won at arbitration, the S.Sudan govt like Chad will have to come up with the cash or asset seizure ie exported oil.

With Petronas now having surrendered the assets, the government can sell the assets, it can operate them itself as a partner to the the other companies involved or it can establish a service contract with someone (company) operating the assets at a fixed cost per barrel basis and a potential share of the upside going forward.

Do the other companies involved in the JOAs want to take on more risk by buying the assets and or rely on the government to be able to come up with its share of costs if need be ? In some JOAs it could lift their involvement by 50% when they may not want any further exposure in the country. It could end up at some point potentially leaving the government with no one to operate the assets.

What happens in 2 years for the other operators in respect of their terms when seeing what happened to Petronas. Scare one company, you scare them all.

I don't for one minute think AK is that stupid as to being still in possible negotiations as before.

They'd have to have new terms that the other operators don't have for a longer duration (imo) and in terms of past costs/responsibility.

SAVE could also be negotiating for a service contract at zero cost ?

The govt may need a short term cash injection/low ball sale - given their oil is forward sold to 2027 on top of reduced output and how the other operators view the treatment of Petronas affects that sale if any ?

Let's wait and see but those articles are 3 weeks behind the curve of what we already know so i would expect some news early September on whether we may still have a deal of some kind or not .

[fft] 29/8/2024 11:35

If Petronas, who have *far* deeper pockets and contacts than Savannah, can't get SS to work out / behave then AK has zero chance.More chance of a return if he went to Vegas and put it all on 0..

[ayatollahhighrollah] 29/8/2024 10:23

Once bitten twice shy
Twice bitten thrice goodbye

Agreed MT

[mount teide] 29/8/2024 10:17

Thanks AHR - Exactly.

The SS Government's behaviour will likely go down like a lead ballon with any large O&G company foolish enough to be considering cutting a deal with the crooks who have effectively stolen the Petronas assets.

Smacks of the Government, err sorry crooks running the country, looking for huge up front backhanders and then ongoing monthly envelopes from any stupid enough to buy all or part of the former Petronas shareholding.....which, when considering the state of the civil war in Sudan and current status of the oil export pipeline, is now probably years, rather than months away from seeing the resumption of production/cash flow.

With this latest revelation from Petronas, AK MUST immediately walk away from SS or be replaced.

AIMHO/DYOR

[ayatollahhighrollah] 29/8/2024 09:53

httpx://www.radiotamazuj.org/en/news/article/petronas-launches-arbitration-over-south-sudans-takeover-of-its-oil-assets

Petronas launches arbitration over South Sudan’s takeover of its oil assets
August 28, 2024 MALAYSIA
Petronas International Corporation, a unit of Malaysian oil and gas conglomerate Petronas, has launched arbitration proceedings against South Sudan’s government, reported Bloomberg.

The legal action follows state-owned Nilepet’s assumption of control over Petronas’ assets, worth approximately $1.25bn (RM5.43bn).

This move by South Sudan’s government effectively repossessed the Malaysian company’s investment in the country.

Earlier this month, Petronas announced its intention to exit South Sudan following approximately three decades of operations in the region.

The company had entered into negotiations with Savannah Energy, a UK-based oil and gas company, for the sale of its assets.

However, the Malaysian firm decided to abandon its investment due to escalating costs from a damaged pipeline, which has been affected by the ongoing conflict in neighbouring Sudan.

Petronas is suing South Sudan alleging that the country obstructed the sale of its assets.

On 5 August, Petronas received a letter from Chol Deng Thon Abel, an undersecretary at South Sudan’s Petroleum Ministry, alleging that the company had violated national laws.

The letter accused Petronas of failing to conduct an environmental audit and pay damages, as well as giving the South Sudanese Government an ultimatum regarding the sale of its assets, the publication said.

Petronas has refuted these claims, with its senior general manager Azahari Shuid stating that the government’s actions were “arbitrary, unreasonable and unlawful”.

The roots of Petronas’ involvement in the region trace back to 1997 when it began extracting crude as part of a consortium led by Lundin Oil

[rockyride] 29/8/2024 09:11

I'd like to see a partner bright in to Niger to run the drilling for a big upfront payment and a free carry.The last thing AK needs is to be running a large drilling program with all the other messes he has in his in tray!

[rockyride] 29/8/2024 08:59

With all the recent Twitter stuff are they trying to show off our capabilities to other Governments or trying to work on firming up the share price on re-list? Or both?Whatever it is - I like seeing this Tweet.A successful well test in Niger, successful completion of debt re-structuring at Accugas and the closure of the Stubb Creek deal would bring us back with a decent share price IMHO.

[haideralifool] 29/8/2024 08:17

Savannah have just tweeted this:

The Agadem Rift Basin ("ARB") in Niger, which forms part of the larger Central African rift system, has proven to be one of the world’s most successful and prolific exploration provinces. Since 2008, an estimated one billion barrels 2P Reserve base has been established with an overall exploration success rate of 80%.

Savannah’s exploration and development assets in Niger cover a licence area of 13,655 km2, approximately 50% of the ARB. We have achieved a 100% exploration success rate to date, with five discoveries from 5 wells drilled. Our R3 East development project is expected to deliver plateau gross production of 5,000 bopd for eight years. A further exploration bank of 146 potential exploration targets have also been identified.

hxxps://x.com/Savannah_Energy/status/1829069879523082310

[rockyride] 29/8/2024 07:49

MT - absolutelyWith the Chad deal I think it was a 30 day period at the front end of the process whereby the Gov could pre-empt and failure to do so resulted in deemed consent (NOT IMPLICIT & NO SIGNATURE). As they failed to pre-empt within the period, i think this will be a big thing in our favour with the ICC rulings.After the shambles of Chad with the 'deemed consent' flakiness, AK learnt a lesson (instructed by NOMAD I think) that they would have to have 'implicit consent' (a wet Gov signature) for the SS deal and this was mandated in the terms of the deal.The problem was, as you allude to MT, there was no hard and fast date for the signature to take place by. As this could have ended up being like chasing a rainbow, the NOMAD would not let AK come back to market without the Government signature (and rightly so IMHO).This has led to relationships deteriorating between AK and Strand Hanson. The NOMAD are getting to grips with AK now at long last and are hopefully acting more aggressively in our favour. Granted some on here will think that AK should be allowed as the CEO of the company to run the company as he wishes but personally, I'm glad that the NOMAD have the measure of him now, which in turn will make him think a lot harder about these 10% win chance M&A opportunities.AK may well say we have opportunities of a lifetime in Africa, but an opportunity is only an opportunity if it has a greater than 50% win chance. In my previous role in a large FTSE100 company, classed all target deals as suspects if 50% win chance. For deals over £5m we had to present to a senior director to get their sign off to pursue a prospect as our bidding costs were circa £100k at the time.I don't know how tightly the NED's hold AK but I suspect they need to tighten the thumb screws on our CEO.

[mount teide] 28/8/2024 12:00

CJTK - 'If any lessons can be learned from these previous two experiences then surely if after the 60 day period has elapsed, and written government approval is not forthcoming, then one has to bite the bullet and walk away.'

Exactly, the asset investment risk has deteriorated way too much over the last year - Petronas walking away was the only sensible decision open to them after the crooks failed to give the okay for the deal with Savannah.

Considering the contractual liabilities Petronas would have faced when requesting to walk away, I think they will have been both astonished and delighted at the zero cost walkaway deal they secured from the disingenuous, self serving criminals running the country.

AIMHO/DYOR

[captain james t kirk] 28/8/2024 11:11

Following on from my post 3081, as far as I'm aware there's a 60 day clause in these PSA contracts for pre-emption rights.
I don't know if SAVE proceeded with Chad and SS on the basis of verbal agreements from the respective governments but we now know they did not have government approvals in black and white.
In the case of Chad the government failed to trigger their pre-emption rights and hence the legal action, following the nationalisation of the assets.
The same scenario would appear to apply to SS but Petronas/Save have chosen to take a different route. I can only surmise that a further ICC case for SAVE would have been a bridge too far ?
If any lessons can be learned from these previous two experiences then surely if after the 60 day period has elapsed, and written government approval is not forthcoming, then one has to bite the bullet and walk away.

[gisjob2] 27/8/2024 00:06

Kinkell, the civil war was not subsequent to SAVE's interest in the project because no deal has been done yet but as per the last RNS, AK is still showing interest in the project despite knowing about it.

Hopefully he won't be successful and will refrain from anymore elephant chasing in dire jurisdictions like SS and Chad. Either that or accept responsibility for the forrays into Chad & SS, halving the share price since coming to market, suspending the shares for a couple of years for nothing and losing millions by not addressing the currency issues and resign.

I'd be keen to know just what his KPI's have been over the last couple of years.

[kinkell] 26/8/2024 19:13

RR thank you for youryour properly researched comment. My guarded comment was based on my recollection of an informal online intervew by AK quite some time ago and I do not have a record of it. I humbly apologise fior my errior

[kinkell] 26/8/2024 19:09

I don't know to whom t was or was not a complete shock. Clearly it is a risk across the region. I am simply saying the civil was started subsequent to Save' involvement.The same is true of Niger althOuGH we hope with muh less disastrous consequences.

[divmad] 26/8/2024 18:18

Oh, so it was a complete shock to those in the know in and around Sudan, was it?

[kinkell] 26/8/2024 17:56

The civil war started subsequent to Save's involvement.

SS is said to hold the largest undeveloped oil and gas resources in Africa.

[gisjob2] 26/8/2024 17:03

I agree, AK should never have entertained SS in the first place, it's a dire despot country with no redeeming features and relies on a pipeline through Sudan which is experiencing a civil war. What the f@@k is there to like ?

There's a reason these types of projects look like good value on paper, it's because no sensible small company without the clout of a major would go anywhere near them.

I hated this deal from the start and hate it even more now, the problem is now AK has wasted 2 years on this folly I'm also likely to hate the share price on re-admission.
It's a complete c@ck up !

[rockyride] 26/8/2024 13:49

LETS GET OUTI'd imagine the export pipeline through Sudan is heavily reliant on communication links. There are now major outages of the fibre network. For Gods sake let's get out of this trouble riddled deal. There is no end in sight to the Sudanese war and even should we secure some sort of deal, I guess there would be an endless run of bad news for us moving forward. Let's write off our $20m+ of transaction costs and hopefully run a big workshop called "Lessons learnt"!Dam bursts in war-torn Sudan killing 60 https://www.bbc.com/news/articles/c0mnpr2980po

[rockyride] 26/8/2024 09:19

Even without South Sudan, by year end I think the share price could be very healthy with:-Stubb Creek completedAccugas CPF completedSuccessful Niger well test33mboepd moved from 2C to 2PDebt restructuring completeThere is no reason why the above should not be all done by 31/12/24 and if so, I'd expect to have a year end share price >40p

[mount teide] 26/8/2024 08:09

Niger Aims to Become Major Oil Exporter - Oilprice.com 19th August

'Niger has resumed oil exports after it reached an agreement with neighboring Benin following a recent border dispute. Niger stopped crude shipments in June after the West African nation closed a pipeline operated by China National Petroleum Corp. that links the Agadem oil field to the Sèmè Kpodji terminal in Benin.

"We've reached an agreement. Loading of crude started this morning," Benin Energy Minister Samou Adambi told reporters on Monday, with Prime Minister Ali Lamine Zeine's office confirming the resumption of shipments.

Niger relies on the 1,950 km-long Niger-Benin Export Pipeline, built by CNPC as part of a $4.6 billion investment in the country's petroleum industry, to repay a $400 million oil-for-cash loan from the Chinese company. Niger plans to use revenue generated by oil shipments to repay the loan.

The landmark 110,000 b/d Niger-Benin pipeline will increase Niger's crude production five-fold and make the country a significant exporter. Prior to the construction of the pipeline, landlocked Niger produced just 20,000 b/d of crude from its Agadem Rift Basin, which it primarily used domestically due to a lack of an export route.

Savannah Energy Plc, the only Western company operating in Niger, plans to bring a 1,500 b/d oil project onstream before ramping up to 5,000 b/d.

CNPC was on the verge of overhauling Niger's oil sector when President Mohamed Bazoum was overthrown by his presidential guard in 2023, triggering a raft of sanctions by regional economic body ECOWAS as well as condemnation from Western governments.

Military ruler Abdourahamane Tchiani replaced Bazoum as the country's leader. Niger was a longstanding Western ally under Bazoum and was considered a bulwark against the spread of extremism across the Sahel, including emerging oil producers like Cote d'Ivoire and Ghana. In contrast, Tchiani is decidedly anti-western and quickly cut ties with former colonial power France in favor of Russia.

Over the past decade, China has increasingly abandoned its so-called "Angola model" wherein it provided oil-backed loans to African countries to finance the building of roads, hydroelectric dams, railways, etc. China has, instead, been turning to Gulf countries and Russia with more reliable production infrastructure.'

[kinkell] 26/8/2024 06:35

fft - you could not be more wrong! Never even met the man!

[1madmarky] 26/8/2024 02:15

The Chinese still have appetite to invest in South Sudan