RE: HEDGE FUND SELLING!!!!You better go back and read the NR’s from Nov 2007 and the most recent presentation. Your last post insinuates that IAE is not capitalized to continue with their operations until 2010, when Athena is expected to come online and provide CF to the company, b/c of the credit crunch.
Nov 2, 2007 - RBS approves $60 million credit to IAE for Athena and Jacky development.
Nov 6, 2007 – IAE completes a bought-deal financing for $100 million.
Currently producing 1,800 bod from Beatrice.
Bravo platform will add another 800 bod in H1-2009.
Jacky expected to come online in H1-2009 to bump overall production to 10,000 bod.
At US$100 oil this company will CF about US$280 million (@$80/bo netback over 350 production days).
So as of the beginning of 2008, IAE had $100+ million in the bank to drill anything they want. Whether its development or exploration drilling.
Then they have another $60 million at their disposal to develop Jacky.
Then if they do not want to go with another larger financing, debt or equity, they should CF near $210-280 million (based on US$100 oil and a 25% decline rate), to help pay for Athena development. This is on top of whatever is left over from the $60 million credit facility after the Jacky development, which should be a very cheap tiein to the Bravo platform and if anything remains from their last $100 million financing.
Oil companies are not having a hard time getting the financing they need. Not when oil is over US$100. Even Antrim Energy (AEN-T) got a $50 million working capital facility (March 6, 2008) from RBS to develop their Causeway oil deposit in the UK N. Sea.
From AEN’s March 6, 2008 NR
“The working capital facility is subject to satisfactory due diligence, execution of full documentation and achievement of all conditions precedent. Upon approval of the FDP,
the facility is expected to be replaced with a US $150 million senior secured field development facility and US $40 million contingent cost overrun facility.”
If IAE wants it they will also get another RBS credit facility as they get closer to Athena development as RBS always structures their loans the same. IAE’s loan from RBS is a development loan for Jacky and a pre-development loan for Athena.
2.5 years ago RBS did the same for Oilexco when they financed the pre-development of the Brenda and Nicol fields ($50 million) and then gave them $300+ million for the main development budget + more $ in case of an overrun. This is typical of how RBS finances oil development projects. IAE will be no different if they want to go this route.