RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:re-filing of Management's Discussion and Analysisgood40 wrote: Wallop13, from $10mm in quarterly cash flow, they need to pay the interest on $120mm in debt, the $4.275mm monthly payment to the government plus ~$16mm in capital expense. On top, if the $20mm loan is not rolled over in Q2, they will be required to pay it in full. 2016 looks to be a very tough year.
True. I believe there is also G&A expenses too. Let's take Q1, say they pay 3 million interest, 5 million G&A, 12.83 million tax deposit and 9.5 million capex (no drilling until Q3). That's 30.33 million. They have about 40 million cash plus the 10 million cash flow (50 million cash). So this budget is not sustainable for more then another 4 months.
One of the following needs to happen?
1) This is based on $30 brent. Brent could recover slightly (high probability)
2) The tax payment can be eliminated or reduced in Q1(high probability)
3) Capex could be cut (depends on brent)
4) BNK could borrow
If BNK does not get a favorable ruling on the tax issue and there is no recovery in brent by the end of Q1 then they will without a doubt need to borrow or cut capex. Now compare this to other companies at $30 brent and you will find that 95% are already utilizing these 2 options. $30 brent will never be comfortable for any producer. The question is more who can survive, how strong will they emerge and how much can I make. A year on I think BNK will be a winner.
US rigs just dropped another 2%