CHI - Channel Infrastructure Ltd (NZR)

[Rawz]

Original post 6th October 2020




One year on.

Refining NZ + 45% No dividend

Occidental Warrants + 407%

CCR + 715% Plus dividends

ARLP + 350% Plus dividends

XOM + 88% Plus Dividends

VDE +105% Plus dividends

EPD + 49% Plus dividends

Nice one SailorRob. What does your crystal ball say for oil to Oct 2022?

[SailorRob]

Nice one SailorRob. What does your crystal ball say for oil to Oct 2022?

Absolutely no idea and nor does anyone is the truth. I had no idea back then either, all I was reasonably sure of was that buying at those prices I would do reasonably well over the next 3 to 5 years. What actually happened was total luck, or at least how quickly.

What I can say is that oil demand hasn't come close to peaking and there has been huge pull back of capital from the industry, shale was never profitable and won't get fresh money thrown at it, OPEC probably doesn't have the capacity they say, ESG narrative hurts production... All should be bullish for prices... But often what is obvious proves to be wrong!

I think the space is still cheap but if and when oil drops back, they will take a hammering. Need to be able to withstand that and hold on for the next few years.

[ralph]

Absolutely no idea and nor does anyone is the truth .
Absolutely correct no one is using a crystal ball and, the 1 year price change is 54.39% the six month change is 70% so pretty good for nzr in the nzx if you had your crystal ball .
And every commodity in the nzx would have better returns in different markets especially dividend returns in the U S markets ,as we all know .
So any stock in the nzx could be downramped with this method of comparing to The U S markets ,

[SailorRob]

Absolutely no idea and nor does anyone is the truth .
Absolutely correct no one is using a crystal ball and, the 1 year price change is 54.39% the six month change is 70% so pretty good for nzr in the nzx if you had your crystal ball .
And every commodity in the nzx would have better returns in different markets especially dividend returns in the U S markets ,as we all know .
So any stock in the nzx could be downramped with this method of comparing to The U S markets ,

Good on you Ralph.

Absolutly no idea whay you're on about.

While we're on crystal balls though... I'll guess that the original estimate of costs involved in terminal conversion will double (to begin with) and there will be some other costs come out as well.

Dividends forecast for year X will be pushed out to some other time in the future.

Remeber the further out into the future these streams of cash flow are... The less they are worth today. For every year you have to wait, you need to earn more in the future in order to have had a sufficent return from here.

Sometimes free ain't cheap.

[Yeet_Shares]

I assume we are just waiting for the ZED Ampol deal to complete before the final decision.....

[SailorRob]

I assume we are just waiting for the ZED Ampol deal to complete before the final decision.....

That's not what I've been told and I haven't followed the 'deal' closely but my understanding was that the Z deal was contingent on the final decision first. I.e. the Z deal wasn't going ahead until the refinery was officially killed.

I asked about the delay and was told that it's just due to final negotiations with customers taking longer than expected and should be announced shortly...

The ultimate line in the sand is the mid year shutdown which we can't run beyond and it isn't being planned for. So 6 Months before that, roughly the end of the year.

[Yeet_Shares]

Finally board approved and confirmed for all. Refinery closure and conversion to a terminal April 2022

[Sideshow Bob]

Refining NZ announces equity raising - NZX, New Zealand’s Exchange

The New Zealand Refining Company Limited, to be renamed Channel Infrastructure NZ Limited (Channel Infrastructure) upon commencement of import terminal operations from April 2022, announces that it plans to raise approximately NZ$43.5 million to fund Private Storage Services.

On 22 November 2021, the Company announced that it had executed long-term agreements to provide dedicated private storage to grow Channel Infrastructure beyond the shared Import Terminal System (ITS), with further opportunities under negotiation.

Private storage is a complementary growth opportunity, which provides customers with increased product supply scale and flexibility. The contracted private storage capacity will require an initial capital commitment of c.$30 million, and is expected to result in incremental revenue of c.$50 million (real) on a fixed rental basis over a 10 year term, with high EBITDA conversion. This capacity will be progressively made available following required works from the commencement of terminal operations through to early 2023.

Management is actively engaged with customers on additional private storage opportunities which could require a further capital investment of up to c.$25 million and deliver additional revenue of up to c.$60 million (real) over a 10-year term. The Company is working to agree these additional private storage services prior to the commencement date of ITS services under the Terminal Services Agreements.

The planned NZ$43.5 million equity raise will be used to fund contracted Private Storage Services and those under negotiation.

Capital Raising

Refining NZ will undertake the equity raise through an underwritten NZ$38.5 million placement of new shares (Placement) and a non-underwritten $5 million Share Purchase Plan (SPP), with the ability to accept oversubscriptions at Refinery NZ’s discretion (the Offer).
The $38.5 million Placement will be conducted during the course of today. The approximately 47.0 million new shares to be issued under the Placement will be issued at a price to be determined throughout the bookbuild process today, subject to an underwritten floor price of $0.82 per share. A trading halt has been granted by NZX to facilitate the Placement.

The underwritten floor price represents a discount of:

• 6.8% to the last close on 26 November 2021 of $0.88; and
• 8.5% to the volume weighted average price of Refining NZ shares traded on the NZX during the five days up to, and including 26 November 2021, of $0.896.

The Placement is underwritten by Forsyth Barr Group Limited.

The SPP will allow all eligible shareholders with a registered address in New Zealand on the record date to apply for up to NZ$15,000 of new shares in Refining NZ. The issue price of the new shares under the SPP will be the lower of the Placement price and a 2.5% discount to the volume weighted average price of Refining NZ shares traded on the NZX during the five trading days up to, and including, the end of the SPP offer period.

Refining NZ intends to raise NZ$5 million under the SPP, although we have the ability to accept additional applications above that amount at our discretion. The SPP has been structured to be as fair as possible to all existing shareholders and enables almost all shareholders to participate through either the Placement or the SPP (except where restricted due to legal constraints), and should scaling be required under the SPP, it will be by reference to existing shareholdings on the record date.

The SPP offer opens on 2 December 2021, with the offer document also being available from that date.
The new shares issued under the Offer will rank equally in all respects with Refining NZ’s existing ordinary shares on issue.
For further information in respect of the Offer, please refer to the investor presentation that accompanies this NZX announcement.

[hogie]

Refining NZ announces equity raising - NZX, New Zealand’s Exchange

The New Zealand Refining Company Limited, to be renamed Channel Infrastructure NZ Limited (Channel Infrastructure) upon commencement of import terminal operations from April 2022, announces that it plans to raise approximately NZ$43.5 million to fund Private Storage Services.

On 22 November 2021, the Company announced that it had executed long-term agreements to provide dedicated private storage to grow Channel Infrastructure beyond the shared Import Terminal System (ITS), with further opportunities under negotiation.

Private storage is a complementary growth opportunity, which provides customers with increased product supply scale and flexibility. The contracted private storage capacity will require an initial capital commitment of c.$30 million, and is expected to result in incremental revenue of c.$50 million (real) on a fixed rental basis over a 10 year term, with high EBITDA conversion. This capacity will be progressively made available following required works from the commencement of terminal operations through to early 2023.

Management is actively engaged with customers on additional private storage opportunities which could require a further capital investment of up to c.$25 million and deliver additional revenue of up to c.$60 million (real) over a 10-year term. The Company is working to agree these additional private storage services prior to the commencement date of ITS services under the Terminal Services Agreements.

The planned NZ$43.5 million equity raise will be used to fund contracted Private Storage Services and those under negotiation.

Capital Raising

Refining NZ will undertake the equity raise through an underwritten NZ$38.5 million placement of new shares (Placement) and a non-underwritten $5 million Share Purchase Plan (SPP), with the ability to accept oversubscriptions at Refinery NZ’s discretion (the Offer).
The $38.5 million Placement will be conducted during the course of today. The approximately 47.0 million new shares to be issued under the Placement will be issued at a price to be determined throughout the bookbuild process today, subject to an underwritten floor price of $0.82 per share. A trading halt has been granted by NZX to facilitate the Placement.

The underwritten floor price represents a discount of:

• 6.8% to the last close on 26 November 2021 of $0.88; and
• 8.5% to the volume weighted average price of Refining NZ shares traded on the NZX during the five days up to, and including 26 November 2021, of $0.896.

The Placement is underwritten by Forsyth Barr Group Limited.

The SPP will allow all eligible shareholders with a registered address in New Zealand on the record date to apply for up to NZ$15,000 of new shares in Refining NZ. The issue price of the new shares under the SPP will be the lower of the Placement price and a 2.5% discount to the volume weighted average price of Refining NZ shares traded on the NZX during the five trading days up to, and including, the end of the SPP offer period.

Refining NZ intends to raise NZ$5 million under the SPP, although we have the ability to accept additional applications above that amount at our discretion. The SPP has been structured to be as fair as possible to all existing shareholders and enables almost all shareholders to participate through either the Placement or the SPP (except where restricted due to legal constraints), and should scaling be required under the SPP, it will be by reference to existing shareholdings on the record date.

The SPP offer opens on 2 December 2021, with the offer document also being available from that date.
The new shares issued under the Offer will rank equally in all respects with Refining NZ’s existing ordinary shares on issue.
For further information in respect of the Offer, please refer to the investor presentation that accompanies this NZX announcement.

A further dilution of shares eh?

[bull....]

A further dilution of shares eh?

and more capital spending reducing the odd,s of any dividend for years lol ..... just more of the same nzr