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Could be interesting!

lse:sle

#642

Well, unfortunately, no,

No company can turn a winning position into a disaster like SLE and O.F. can. They’ve excelled this time and just one paragraph from the complacent and incompetent CEO who is taking a couple of million a year.

Or has been. I’m hoping the 1 million bonus isn’t paid this year if the loss continues for the full year - and it looks set to.

SLE haven’t even named a date or amount for the dividend payment which might, just might, have put a bottom under the share price. “In due course” from O.F. usually means targeting the first quarter of next year, and missing.

32% production losses through the pipelines. I pointed this out back in 2016 when certain people were ramping up the deal and was howled down by the cheerleaders.

Now SLE seem to see fixing the pipeline problems as crucial, more than 3 years in. In fact a lot of the trading statement is speaking about nothing else. That’s because there really isn’t anything else to say that wont draw attention to the loss.

Can it really be that OML 18 needs oil @$70, like last year, to make a profit ?

Needless to say I feel I dodged a bullet NOT adding @31.5p as I had intended. I reset it @27.5p. I have now cancelled that. This is going to be more a case of taking a loss (again) or averaging down with a purchase well below @25p if I want to try and trade my way out of having bought a tranche @37p.

I doubt I’ll bother though. Definitely a sense of good money after bad given the history of this munter.

They could pay around an 8pps share dividend for 2018. Even if they did that’s going to take 18 months or more to just replace lost capital.

Feel very sorry for those who have had so much belief in SLE and poured their hard earned in. Not so much for Martin Hughes and Tosca. Why did they get involved to the level they have and leave Fanning in charge? You could cut the losses by a double figure percentage just by sacking him.


#643

I also keep asking myself the same question - “why did Tosca get so involved” but then again it is not his money - only his reputation - but then as far as the investors in his funds go they probable have never heard of Eroton?


#644

good bits…but like all companies on AIM they have their ups and downs…but on the whole sle with $36.8m in ther bank with $7m owing…plus we have October payments all under guarantee… its not a bad set of interims…

Cash as at 27 September 2019 was US$36.8 million…
The Company anticipates announcing its first dividend in due course, as part of its shareholder distribution policy…
During 2019 to date US$37.8 million (30 June 2018: US$37.7 million) has been received in relation to payments due to San Leon under the US$174.5 million Loan Notes…
The Company is scheduled to continue to be repaid against the Loan Notes, the balance of which is currently US$133.8 million, on a cash receipts basis …
Oil sales were approximately 32,000 bopd in H1 2019 (26,003 bopd in H1 2018)…

Eroton informs the Company that it has concluded and executed an agreement with Energy Link Infrastructure (Malta) Limited (“ELI”), for ELI to finance and construct the ACOES. The FSO (“ELI Akaso”) has been procured and the required conversion works completed, and is currently being fitted with a LACT unit in Malaysia while awaiting final certification by the Nigerian Department of Petroleum Resources…

The FSO is expected to set sail for Nigeria in November 2019. Work on the pipeline system is ongoing and the expectation is that the completed ACOES system will be commissioned in the second quarter of 2020…

it is anticipated that the FSO project will improve overall well uptime…by 15000bpd…

Eroton has advised that it is the only supplier of oil into NCTL with functional LACT units, meaning that pipeline losses allocated to Eroton are materially lower than allocated to other NCTL users. In the longer term, the export pipeline and FSO system mentioned above will provide additional control…

To date, San Leon has received US$143.6 million representing Loan Note payments…leaving US$133.8 million of principal and interest on a cash receipt basis outstanding and payable as of 27 September 2019…

Administrative costs decreased to US$5.9 million for the 6 months to 30 June 2019…
The property is available for use by all staff and consultants requiring overnight accommodation while conducting business on behalf of the Company…
(sle now use OF flat as office )…

The Company continues to be in a strong financial position, with the benefit of an expected future income stream from the principal and interest repayments due from the Loan Notes issued as part of the OML 18 investment and future dividends from the indirect interest. The Company believes that significant shareholder value will continue to be realised from its world class Nigerian interest, through cash flows from San Leon’s indirect equity interest in OML 18, and from its technical services provision which are expected in due course when production and OML 18 financing issues are addressed.

In the six month period to 30 June 2019 San Leon received total payments under the Loan Notes of US$10.7 million. As at 30 June 2019 there was US$133.5 million due under the Loan Notes.

Since this reporting date, 30 June 2019, the Company has received a further US$27.1 million of Loan Notes repayments.

US$18.0 million was due on 1 July 2019 under the terms of the Loan Notes of which …US$7.0 million remains outstanding. ( unfortunately)…….but will be paid…obviously…

There are various undertakings, guarantees and security in place with Eroton, Martwestern and Midwestern with regard to the Loan Note

Midwestern and Mart Resources Limited jointly and severally guaranteed the payment of the Loan Notes following a default and to make immediate payment and performance of all obligations to holders of the Loan Notes.

While San Leon is also a beneficiary of any dividends that will be paid by MLPL as a 40% shareholder in MLPL, the Loan Notes repayments must take priority over dividend payments made by MLPL to shareholders with a minimum 65% cash sweep of available funds for a period of four years in order to redeem the Loan Notes.

A Master Services Agreement exists which entitles San Leon Energy Nigeria BV to provide specific services to Eroton and Midwestern for their activities.

During 2018 San Leon entered into an agreement with Eroton for the provision of drilling technical and management services with estimated consideration for the services of US$6.0 million until the end of 2020.

Zag Licence – Bank Guarantee

In September 2019, Office National des Hydrocarbures et des Mines (“ONHYM”) returned the Zag Licence bank guarantee of US$1.4 million to the Company. This bank guarantee had been previously fully provided for in the 2017 and 2018 annual financial statements.

ONHYM have also withdrawn their request for a penalty regarding the non-performance of the Zag Licence work programme of US$1.4 million. This penalty was not previously recognised in the accounts as the directors believed it was unlikely to succeed in any arbitration case.


#645

There is no question there are good bits, mostly to do with the loan notes. Also a reduction in costs and sale of assets. There is also the news that certain potential court actions have been laid to rest, although I don’t think there was any great anxiety about those.

The production side is bugged with problems, and that is the medium and longer term future of SLE.

They are being addressed, but unfortunately a lot of people will see that as ‘jam tomorrow’ and note that some fixes have previously had slippage on completion dates. More than once. A lot of it is out of SLE’s control which may or may not be seen as a good/bad thing, frankly.

Also the promised/suggested bi-annual (from memory) return of shareholder value is starting to look like, from the initial announcement of the first buyback, a 12 month gap between then and the next announcement. Possibly longer unless the “in due course” for a dividend announcement is within weeks. It certainly could be as the cash is on hand.

I’m assuming that dividend will be 4 US cents per share to 8cps, depending on how cautious they are about paying out. A higher figure will be such a large yield on the current share price it would set off all kinds of red flags.

A special dividend would probably be the way to go to manage expectations. Maybe a special and an interim with forward guidance of intention to pay a dividend six monthly from now on. That would certainly help the share price, imho.


#646

I don’t know about the current situation, but it was rumoured that Toscafund itself, the hedge fund, had pretty much lost its investors some time back. Hedge funds have relatively few investors, maybe only a dozen or two in many cases. Investors have large sums involved and are usually intolerant of even two quarters of under-performance which will cause them to place their cash elsewhere.

I don’t know if this is the situation for Toscafund, my knowledge only comes from a friend who worked for a Wall Street hedge fund and the numbers of hedge funds which have closed in the last couple of years in USA where the laws are that investors must have a minimum of $500k invested, otherwise hedge funds are not open to you.

The only other thing we know about Toscafund is how intolerant of the CEO they were in another company (the name of which I forget) and how quickly they moved as activists to try and have him removed. The patience shown with SLE is a stark contrast - so we can only guess at the motivation as outsiders.


#647

very interesting post from bluerill lse…could be spot on actually!..

bluerill
Posts: 395
Price: 27.10
No Opinion
RE: Interims
Today 16:00
All I can tell you redeyemines about a divi/special divi is 1. you’re absolutely right about the rationale for paying them and the company’s ability to do so. With the final 7m payment to come soon, the company will have over 40m net cash and low expected outgoings, so a significant cash return remains very likely; but more importantly, 2. In fact, such a divi declaration could NOT be included in today’s interims by regulation, as the current rules would require such an important disclosure to be declared in a separate RNS, so logically that would come in the next day or so. ‘In due course…’ would be all the company would be able to say, again by virtue of the current rules, in the meantime.


#648

I don’t believe there is any such rule.

I own lots of shares that include their dividend declaration in half yearly results reports. Every single company that pays a dividend included it in their half-yearly results report after a quick scan of a dozen or so AIM companies.


#649

I suppose time will tell eadwig…in due course.hee!!


#650

That’s the problem, innit.

I dunno how you can be so patient, Links. Mind you, your approach is far better than mine which would be fretting badly if i had anything like as much exposure as you have here.

Either approach wont change anything and yours is much better for the blood pressure I’m sure.

You don’t have to answer, but would you be happy with a dividend from now on from SLE of say 5 U.S. cents per share (4 GBpps) x 2 per year? Would that be an adequate return for you what ever your holding average is?


#651

Eadwig, it would be fine with me yes two dividends a year "brilliant"it would show the Market sle are again true to their word in returning cash to shareholders, at present 1 tender has returned cash and with the next quarterly payment sle will have a nice cash chest to do something.

Regarding my position I am extremely confident with it and through trading sle in the past I sit very comfortable


#652

They already have $36m or something like that from memory, waiting for another $7m doesn’t make any sense.

All it does is delay the next payment and subtract from the payment after that.

Well I’m glad to hear that. You’ve certainly shown enormous loyalty to a stock, which is often a mistake in the investing world.


#653

And they might/may be just waiting for that amount to come in before releasing that"due"date!!..we will see…


#654

#655

#656

https://sweetcrudereports.com/nigeria-in-talks-with-aramco-uae-over-potential-investments/

Bit more Info…


#657

https://sweetcrudereports.com/iran-oil-industry-must-be-alert-to-physical-cyber-threats-minister/


#658

Aramco sweetens IPO with $75 billion dividend. Saudi Arabia said that Aramco would pay $75 billion in annual dividends, an effort made to attract more investors ahead of the company’s IPO. The government also said that it would overhaul royalty payments and cut corporate tax.

https://www.ft.com/content/e3dfeb6e-e38b-11e9-9743-db5a370481bc


#659

#660

#661

Oml18 has shed loads of gas …watch this space!!