We last spoke to David before he flew offshore to go onboard the MS-1 rig in Australia. This is a follow-up interview as he talks us through the Sasanof-1 well results, and plans to explore deeper targets in the block? Plus what does the future hold for the company and investors?
Holders want to know the timeline for the next phase of drilling if any?. Is the company still considering farming into Western Gas after these results? Update on your assets in Ghana (Tano 2A) and Bolivia (lithium), is this the next play for CLON? What can investors expect in the coming months from the Company?
May we add, that David, answered every question we asked, with no editing.
Please find some questions included in the podcast.
- You announced that the Sasanof-1 well did not show commercial hydrocarbons. Has this affected plans to explore deeper targets in the block?
- What is the timeline for the next phase of drilling?
- Are you still considering farming into Western Gas’ recently acquired projects from Hess?
- You raised £3.5 million in April – will Clontarf need to raise more funds to progress its projects?
- Can you give us an update on your assets in Ghana (Tano 2A) and Bolivia (lithium)?
- What can investors expect in the coming months from the Company?
Though the Sasanof-1 well did not intersect hydrocarbons, we retain our strategy to seek out gas and liquids in Western Australia: originally North-West Shelf discoveries were considered “stranded gas” because of long distances to population centres in the south-east across that vast continent. However, the development of a competitive LNG industry by several leading players, including our former partners Woodside-BHP, Exxon, Chevron, Inpex, and others, have transformed LNG into now the major export, by value, from Western Australia.
It is important to note that funding for the Sasanof-1 well (£3.5 million) was provided by local Australian investors who invested at a 25% premium to the then-bid price of our shares (when the funding process began). We believed that we would struggle to raise such funding from traditional London investors, while institutional investors might expect a discount for a strategy to seek out opportunities without having a defined investment.
Although the Sasanof-1 well was water-wet, the Australian gas play remains excellent, with a world LNG shortage, high gas prices – as well as pro-mining policies, legal title, and reasonable fiscal terms.
Clontarf Energy is also pressing the Ghanaian authorities to complete the ratification of the signed Petroleum Agreement on offshore Tano 2A Block and is discussing with the relevant authorities in Chad on how to convert Clontarf’s signed Memorandum of Understanding on prospective sedimentary acreage, close to existing infrastructure in southern Chad, in a manner consistent with corporate governance. Progress on these promising projects had been slowed by the virtual disappearance of the farm-out market after 2014. It made little sense to commit to a substantial work programme, without a reasonable prospect of de-risking through partnering with companies with deeper pockets.
As expected, demand for lithium, specifications and lithium prices have surged. In Bolivia, we hope to conclude a Technical Cooperation Agreement on a systematic mapping exercise shortly. Clontarf Energy did not participate in the pilot plant testing of Direct Lithium Extraction technologies in Bolivia, since Clontarf is a user of such services rather than a services provider. Our proposal is to explore and develop mid-sized Bolivian lithium salt lakes.
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