Tlou Energy Share Discussion Threads

[donkey40] 19/4/2018 20:07

My view of the RFP timeline is no more or less speculative than yours. As for other agreements made prior to RFP, correct but if they were easy to make, why didn’t they nail some of these in the last 2 years while waiting. I would argue that RFP is vitally important for Tlou and for CBM in Botswana, coz I would argue the funding market will want to see that CBM is going to be supported in-country by Govt and Ministry before the Lenders will look seriously at capital intensive projects.
Now you might argue differently - but please Do Not keep Saying that my points are all speculative. Of course they blinking well are, becoz they are about points that may or may not happen in the future - I don’t know what the outcome will be; I never claimed what the outcome would be. Neither do you. Or probably even TG - he didn’t see the retender delay happening. Who knows what else might happen - quickly or slowly...

[wheniamfree] 19/4/2018 19:20

Donkey I agreed that both points were speculative but fine by me on the mute point.

[donkey40] 19/4/2018 19:13

I am not saying Tlou are setting themselves up to fail. I am trying to set out the project plan in terms of progressive steps along the execution path. Some things can be done in tandem, some have to wait until a step before is signed/executed.

Also, I am assuming the partners will all be fit for purpose. That in itself is quite an assumption.

And, as for a team of this calibre - they have sold reserves. They have never extracted gas and delivered as feedstock.

You seem to be countering me that my project timelines are too slow; whilst you want to argue they can move at a much faster clip. Bearing in mind the history, would the smart money bet that timelines will all align and happen Super fast or will they more likely take a more African pace.

Anyway, how about you and I staying quiet since neither of us has said anything new or different in months. Let us hear from others what their point of view is.

[wheniamfree] 19/4/2018 18:47

Donkey none of what you posts is right but your entitled to your assumption/opinion.

The RFP timeline from you is speculative as it is for me. You also don’t know what other agreements can be made prior or if the RFP itself will be expedited. If the terms are broadly the same with the exclusion of a few pre reqs then there won’t be much to amend in terms of RFP and review can be sped up.

As for your point on economies of scale. Let’s be honest, can you see a team of such calibre have overlooked such a basic point in the modelling? I doubt it, very much so! And if they have then they wouldn’t be in discussions around debt based financing since the margin for error and contingency would be too small. You are giving little credit to anybody except yourself I think.

As for power generation, there is a JV party in the mix that goes by the name of IPC that we’re apecifically partnered for the downstream portion - they have near 4500mw of historical success to their names.

[donkey40] 19/4/2018 18:05

I don’t see first power sold until second half 2020. Rest of this year to resubmit, review and award, and likely negotiate details around all of that. Then we hit December/ January quiet time. Then the finalised PPA would need to be negotiated - April 2019. Then they can move to raising project debt and additional equity, so I see that taking rest of 2019. Then end of 2020 to complete construction of well field, power station, transmission lines and connect to grid. So first revenues actually then not until 2021 calendar year.
And regardless of large or small RFP award and the multiple other offtakes being touted, it will still take the guys of that time.
My big worry has always been if the early stage revenue ambition is small, quite how they will raise the necessary debt and equity given the obvious lack of economies of scale in terms of infrastructure required for it all, just simply is not clear to me.
What is clear to me is that bigger numbers eg 50MW or higher does make sense to me.
So Whendy, before you jump down my throat again or repeat the merits of a scalable approach for greater risk management etc (all of which I totally get), this is why I keep saying a small scale approach by Tlou to get CBM going in Botswana, after so many years in-country, just does not match up against all the hype and Pr from you and your mates over on LSE.
Gilby has never delivered 1KW of power let alone 10MW, and I think we can agree he isn’t in this to build and operate power stations. But to get the Reserves story building, he needs Offtakes and pilot projects and RFP success to pull in more $$$ so he can keep growing reserves quickly - rather than wait for slow baby steps from pilot to 2MW to progressively 10MW.
In summary - size matters. Hence the rationale for my profile name !!

[donkey40] 19/4/2018 16:25

That’s a lot of activity for a pilot or up to 10MW power generation and connection to the grid.

[wheniamfree] 19/4/2018 16:11

The plan stipulated first gas into the grid and power in 2019, whilst there has been a delay there is no reason that still can’t be achieved.

Well drilling could potentially be simultaneous depending on rig availability then dewatering commences (likely less time than the pilot given the proposed location of developments wells is adjacent to selemo and targetting the same seams).

Plant will be turn key gensets, procurement and shipping will be the only time factor for those. Gas harnessing pipipelines/facility etc etc can be ordered in advance.

Transmission line and substation integration. All of which can be achieved and run in conjunction with other areas.

A PPA however will have to be priced into the MCAP on a forward projection well before revenues come in, perhaps not to the full extent as commercial production but as a good %. As stages are met the valuation will grow.

In the mean time the reserve base will also be expanded on by a combination of seismic, aero magnetic, coring along with the development wells and perhaps some pilot flows within mamba or elsewhere on the claims.

[money4me] 19/4/2018 15:21

yes lets actually discuss the company and its prospects.what timeframe did they or do they have for production if they had got the previous RFP. surely they must have a plan for commercialisation of the gas otherwise what are they doing

[donkey40] 19/4/2018 14:23

Ok, your points are valid. Other than you still claiming Tlou Bid for 100MW - the Bid was for a specific 10MW with them indicating they preferred a scaled up approach, leaving additional MW at the mercy of Ministry.
So let’s develop the thinking if they get an initial 10 or even 20MW. Then what. The point of my post above was that regardless of RFP or other Offtakes, they still have to follow a certain path of drilling wells and extracting gas. How Long will all that take; how much will it cost re equity and debt; Reserves will of course grow on the basis of successful drilling and gas flows over time; how much time; can they keep increasing reserves without Offtakes; is that a valid or risky strategy; ...

Lastly, we are talking about Tlou. Not my other company. I well enough know the lessons learned from it and many others over the years. Please stop killing the conversation always - and let other people have their say.

[ginko3] 19/4/2018 12:53

I deny it!!! . . .sorry just having a Monty Python moment

[wheniamfree] 19/4/2018 12:28

A company with a revenue stream of zero or even $1m per annum can still be valued at hundreds of millions or even billions solely on the reserve method.

That is undeniable.

[wheniamfree] 19/4/2018 12:24

To have a 100mw PPA in hand is enough to attract major interest whether they start 1mw, 2mw or 10mw.

Doing the scaleable approach lessens capex but also lessens interest payments and collateral requirements for debt based funding. Also reduces any significant dilution risks.

Take a company close to your heart and understand what happens when significant debt is established early on and the risk put forward to shareholders. Bondholders will always come first which is precisely why it makes sense to protect the share holders with a scaleable model.

Point 1 is they key, a PPA of size negates the need to jump in head first, they have the ability to manage risk effectively.

Reserves are also overlooked and are a major contribution to Company valuation. Equally if not more than any offtake agreement.

[money4me] 19/4/2018 09:10

that is what I consider also and from the TLOU comments they seem surprised the share price is not higher. but reserves will not increase soon i.e. next month. but perhaps something else will stir some life into this

[wheniamfree] 19/4/2018 08:22

Money the reserves should grow exponentially as the development wells come online. Additional seismics scheduled and coring rig appears also to be purchased.

Regardless current reserves and license approvals are not fully being factored into MCAP at present.

All things will change soon enough with a couple of pieces of news sentiment and share price will flip on a sixpence as is the way with AIM.

[money4me] 19/4/2018 07:59

TLOU need to increase the reserves significantly and/or get some gas sales going. until this happens it does not seem like the market is interested

[liartidd] 19/4/2018 07:57

The lieing lowlife marches on
Spreading his lies and fake stories about tlou. Why don't you give it a rest liartidd (lse) and give the share a chance. Your putting potential shareholders off with all these promises and you'll have a word with somebody in tlou.

[wheniamfree] 18/4/2018 15:16

Blisters you are Donkey.

Doesn’t affect me but I have shared the lie you posted on a public forum with whom it concerns.

[blisters] 18/4/2018 15:00

Chill out Whendy. My previous post was clearly a piece of fun. Written with humour and wit, both of which seem to be beyond your programming. I merely thought to brighten up your day, given the daily thrashing you get at the hands of Donkey, whose knowledge on TLOU is beyond all who post here especially you. So, relax, it was written in a moment of light hearted whimsy. Do you like whimsy Whendy? No need for your threats and bully-boy responses. Is there?

[wheniamfree] 18/4/2018 14:21

Donkey you told us no nearby roads.

25m is your answer so not far really, unless you wish to tell me that is wrong and if so please feel free to provide evidence.

This should be interesting.

[wheniamfree] 18/4/2018 14:19

Donkey, when you have been involved in creating 2x multiple billion $ companies from micro caps please feel free to comment.

8300km, two blocks of the ten which contains nearly 8TCF prospective.

Impressive indeed.

[donkey40] 18/4/2018 13:01

Gosh you really don’t know much then. Goodness.

Is 8,300km meant to impress people? And they can’t even get 2MW into production, with the great Board and Partners and blah blah ..