PrimeAOI owns Prime 50/50 JV. They have half the director seats. Prime hords the cash and does not pay down debt. No dividends lately from Prime.
Do investors really believe the Forward Sales Agreements and the AOI accounting for these contracts?
Remember two things here. These are not financial hedges on exchanges. These are forward sales agreements at Prime, not Africa Oil. And there is very little detail disclosure about the specifics of these contracts in the Africa Oil accounting disclosure in the quarterly reports and the Annual Financial Statements.
I think the other owners of Prime are some shady Investment Bank down in Brazil. They have been investigated quite extensively for fraudulent avtivities before.
If I look at the timing and disclosure of when Africa Oil announces their hedge positions last year from Quarter to Quarter, with these forward sales agreements, it looks to me like they are not legit. They may exist, but exist at different volumes and prices at Prime that what we see.
So, I think this may be a way to skim or kickback money off the top from Africa Oil shareholders. Prices actually realized for the oil is higher than the hedge prices.
Prime and Africa Oil had to hedge back in 2020 and 2021 for the debt from the acquisition, and the debt Prime carried, but debt has been paid down a fair bit and they are still hedging thru forward sales agreements? The year end disclosure in 2021 sure caught they market by suprise for all the hedging at crappy prices in 2022!! Keith was supposed to be bullish on oil. He was the Pumper Super Bull on oil prices, so why does he hedge by selling forward all this oil.
I thinki they want to use Prime to make the acquisition of off shore oil in West Africa again so they can continue with these "Forward Sales Agreements" and skim, IMO it's either a skim right off the top, or a kickback from the counterparty to these Forward Sales Agreements.