Keith Hill Is a liability, not an asset for this company.
The day they announce that Keith Hill is going to retire/resign from Africa Oil and the company announces that they are going to cancel the search for accreative acquisitions and return the remaining capital to shareholders the stock will start a long term rally.
The company should start today by distributing the shares in the two public companies to the shareholder of Africa Oil pro-rate. We are getting ZERO value in Africa Oil for these 2 public exploration plays. Why not just distribute the shares to the shareholders of Africa Oil and let them decide IF they want to hold, divest, or reinvest more. It's a fallacy to think that Keith Hill or this managment team knows better how to allocate capital for the Africa Oil shareholders, certainly not any better than they can do on their own in this situation.
Company paid in Capital is like $1.3B over the years that Keith Hill has been in charge. Market Cap of the company today is about 1/2 of that. Why would anyone want to give this guy 5 or 10 more years of allocating capital for exploration plays is beyond me.
The news about ON-shore Kenya has not changed in years. Apparently there is NO partner and NO plan for a pipeline, and Africa oil should allocate ZERO capital back into that project.
They should just sell their interest for whatever they can get for it. The company Stock Price is being given NO VALUE for this asset either. Take cash and shares from whomever wants to hold it. Take cash and shares, and/or a royalty on future production for this asset.
If we decide to return all the capital back to the stockholders someday in the forms of dividends, return of capital, and buybacks thru a NCIB or SIB, and one day we are left with a bit of cash and the royalty in Kenya, that would be a blessing for all stockholders. I would like to be then holding the royalty and hopefully Keith Hill would move on to one of his pet exploration projects in Guyana or Africa Energy.
Finally, for this missive, I don;t think that Keith Hill really thinks of himself as an "owner" of the company. He is a professional manager, of the managment class. Not really a capitalist of the owner class. Reasons being, Earlier this year he and the CFO exerised options at a significantly lower stock price, thru apparently a cashless exercise, which would also then include a sale as the other end of that transaction. At a much lower price than today. Today the shares are substantially undervalued. I think the reason for this is that a small cap or micro cap company has a manager who wants to go invest Offshore in Exploration plays with long lead times to cash flow and much higher cap-ex per well. So, the higher cap-ex and longer lead times to production are just not compatable with a micro cap company. Nor do I think they are compatible with the long term future of Hydrocarbons anyway. Kenya, while onshore, is also a high cap-ex and long lead time because of the capital needed for the pipeline. This ain't the Delaware Basin of the Permain that is close to the existing infrastructure for easy hook up of each incremental well.
We are being given a DISCOUNT or haircut because Mr. Market has correctly figured out that this managment is just as likely to go BLOW the $$$ in some far flung high risk venture as it is to return the cash to shareholders in the near term.
Todays announcment about the new hires to help with their "disciplined" search for producing assets in West Africa tells me that this Keith Hill guy just doesn't care about his owners. The disciplined search is not going to find a more undervalued producing asset than their own shares and their 50% share of Prime, and the return of capital and eventual liquidation of Africa Oil should begin today instead of adding more G&A like there is a business to manage here for the long term.