I saw a great post by noairbags last night, posting a link to the latest Edison Report, which every holder should read. Edison has always conducted a comprehensive and detailed assessment of LNG’s project operations and financing!!!!
I also saw noairbags post was followed by one from mrwalker, again offering one of his eternally optimistic replies with his never say die attitude. Good for you mw, as the Phantom (or Ghost Who Walks) it’s starting to look like you might be the only person who can live long enough to see this company succeed!! I know you live in Sydney, and I’m tempted to ask you to lend me your ‘skull ring’, grab ‘Devil’, give Guran a ring, tell him to round up a few of the pygmy Bandar tribe, pack a few poison arrows and we’ll pay a visit to the new office in Sydney.
Unfortunately Edison lowered their valuation from $1.00 to $0.70 and no doubt GV won’t be thanking them for all their hard work on his twitter account.
It just reminds me how he has operated over the last three years, eg recently thanking the **elli analyst for his 2020 $10.00 SP valuation.
A few months back Champee asked me if I thought LNG would succeed, and my reply was, I wouldn’t put my energy into keeping up to date with information if I didn’t. I guess I still believed in the concept, the prospects and the fact we had all the regulatory boxes ticked.
The more I think about it, the more it reminds me of how GV has misled share holders during his time as CEO, and of course this is just my opinion, but I will post some evidence to back it up.
Before (once again) posting that evidence, I want to post what regulatory accomplishments were achieved before and after his tenure.
Regulatory Accomplishments Maurice Brand versus Greg Vesey:
12/16 Bear Paw Receives Environmental Assessment Approval
05/17 MAGNOLIA LNG RECEIVES FERC NTP
12/18 KBR Increases capacity to 8.8mtpa
03/19 FERC grants 8.8mtpa export to FTA countries
In my opinion, misleading statements made by the company (GV) include:
12/16 “As we finalize LNG offtake agreement efforts”
01/17 “We will be moving to finalize firm offtake agreements in the New Year”
03/17 “No one is horse trading” 03/17 “Forecast FID in July 2017”
03/17 “Confident this is a matter of when, not if”
03/17 “All three projects are in an advanced stage of development”
03/17 “Construction at Bear Head could start by as early as next year” 03/17 “Construction on the Magnolia facility is expected to begin later this year”
03/17 “In discussions for more than three times the 8mtpa capacity of Magnolia”
06/17 “Expected to have the whole facility contracted in the next 6 - 12months”
08/17 “Outlook remains bullish” 08/17 “Likely finish selling remaining capacity at the Magnolia project by the end of 2018”
10/17 “Confident of signing offtake agreements with credit-worthy buyers later this year or early in 2018”
11/17 “We hope to have it done by now to mid to 3rd quarter 2018”
11/17 “Discussions heavily focused on investment grade and credit worthy buyers”
12/17 “The discussions with potential customers are good”
12/17 “Talking about deals up to 25 m tons just to see what's real and who's going to sign first”
03/18 “There’s ‘real potential’ to get a final investment decision by the end of the year”
05/18 “Demand has taken off”
05/18 “Buyers are willing to sign 20 year deals”
05/18 “Buyers of LNG are no longer balking at contracts” 05/18 “Expected to make that call by the end of the year”
05/18 “Contract talks have picked up significantly this year”
05/18 “When we got back from holidays, the phone started ringing like crazy”
10/18 “We remain confident in our ability to reach FID whether or not China participates”
Seven (7) times between March 2017 and October 2018 GV forecast reaching FID, having the whole facility contracted and / or beginning construction by 2018!!!!
Statements made prior to the IDG investment in June 2018 include the following:
“The discussions with potential customers are good”
“We hope to have it done by now to mid to 3rd quarter 2018” “Negotiations (with investment grade counterparties) are advanced”
“Expected to have the whole facility contracted in the next 6 - 12months” “Discussions heavily focused on investment grade and credit worthy buyers”
“Offtake agreement negotiations are continuing with a number of LNG buyers”
“There’s ‘real potential’ to get a final investment decision by the end of the year”
“Likely finish selling remaining capacity at the Magnolia project by the end of 2018”
“Confident of signing offtake agreements with credit-worthy buyers later this year or early in 2018”
Statements made after the IDG investment in June 2018 include the following:
Previously to IDG investing “we only had access to lower level discussions”
Excuses made by the company in chronological order include the following:
“Global political developments” and “US administration inaction”
“Speculative proposals clouding the commercial landscape for buyers”
“Low global oil prices”
“A global supply glut”
“Qatar”
“The trade war”
“General malaise”
“Low spot prices”
What makes me post these facts again is that the loss to share holders goes beyond the amount of share value lost; it includes the potential losses from being unable to make wise investments elsewhere for a number of reasons:
I believe many holders have held onto their shares because they have remained loyal, or hopeful (or both), based on the speculation from management that FID or at least some BTA’s or SPA’s would be achieved by now.
I believe that holders who have put their due diligence into researching, and keeping abreast of this company have been distracted from putting that energy into researching other companies, of which I could name more than half a dozen that have made healthy returns.
I believe many holders have simply held because they could not emotionally bear the financial loss they would incur if they sold.
I also believe that GV and the company has bias it’s marketing towards conjecture over risks, failed to provide clarity around a number of speculative statements and failed in respect to Corporate Governance Principles related to upholding a level of integrity, factual accuracy, and ensuring Ethical Standards of Behaviour are adopted and complied with by management and the BOD.
To my mind, the company has never demonstrated accountability for misleading market disclosures and the fallout to many holders here, such as exchanger and Harvey who had previously expressed their frustration on these threads, only to be disparaged by others.
Though it wasn’t easy for me to sell a few large parcels at a loss, I was fortunate enough to put those funds into companies that returned my losses. To me, there is nothing worse than share holders not being able to trust their executives to provide them with honesty, openness and transparency and it will certainly be an interesting time at the next Conference Call if they decide to go ahead with one.
Before then, I expect news on the KBR LSTK contract and perhaps even word on a CR.
If you need reminding of LNG exec's and NED salaries:
Column 1
Column 2
0
EXECUTIVES
Base Salary in Australian Dollars
1
John Baguley / COO
$573,333
2
Kinga Doris / GC
$446,683
3
Michael R Mott / CFO
$548,920
4
Joe B’Oris / COO
$453,333
Column 1
Column 2
0
NED
NED remuneration in Australian Dollars
1
Cavicchi
$ 370,217
2
Beresford
$ 173,520
3
Bond
$ 191,520
4
Moeller
$ 232,320
5
Steuert
$ 232,320
LNG Price at posting:
26.5¢ Sentiment: None Disclosure: Held
