RE: What happened to Morpheous spud?IAE is also not going to drill Pallas and what they called “Project B” (gas target).
My guess, pure spec, is that they are trying to conserve some cash to not do another equity financing (dilution) before Jacky comes online. Once Jacky is on production IAE should be able to drill anything they want in 2009 based off of internal CF. If they can pull this off it will set up a windfall down the road as they will then debt finance everything after and let the projects pay for themselves and keep a relatively small (by offshore company standards) share structure of about 117 mm shares (diluted).
Between the next two wells (Athena and Carna) it should cost about US$10 mm net combined to IAE from their current cash position.
Their cash position as of Dec 31, 2007 was $94.8 mm
Since then they’ve spent (net) the following (assuming $10mm/well gross):
$22 mm – Beatrice Acquisition (deal done prior to 2008, but not closed yet)
$7 mm – Poly drilling
$5.25 mm – Manuel drilling
$7 mm – Athena-17 well drilling
$15 mm – Stella Acquisition
That would leave them with a total of $38.55 mm in the bank + interest over 5 months – salaries + CF from 1,800 - 2,000 bod (Beatrice) over that time.
Drilling Morpheus, Pallas & Project B would eat about another $12.5 mm of capital.
I think the drilling of Carna is just to keep investors interested in the company between the Athena-18 well coming up and development of Jacky (expected online in Dec 2008).