N/R
On one hand Humbolt et al are putting $8 million into the company, throwing the dice perhaps. On the other hand 10.5% and a 20% discount to market on the conversion price. Will be interesting to see how many bonds are purchased by non Humbolt investors.
The move into oil has been painfully slow but consistent with the company's development of it's gas properties, what was there peak production after years of drilling? How many million dollars has been invested to achieve production of 128 bbls/day of rapidly declining production rates? How many of the 128 bbls are from wells that were drilled by Husky as operator? The $7 million after loan repayment is not going to go very far when somewhere around $5 million in 2 years generates 128 bbls per day production.
With the president holding a huge majority of the shares he can not be booted out, but some of the long of tooth hang ons should perhaps be replaced based on an inability to produce or increase production. If success was measured by how many shares are outstanding this management group would be hugely successful. Perhaps DZR should farm out some of the Sask land to operators that are up to date with drilling techniques and current oil technology and able to find and produce oil successfully, something better than 128 bbls per day at a cost of $5 million. How can a person spend $5 million to produce 128 bbls/day even accept a pay cheque? Maybe $10 million invested in the US is now worthless?
Perhaps the first step to recovery would be to face the fact that DZR's major problem is not energy prices. They have had many years to improve the company, maybe it is time for tough decisions to be made before the DZR ship sinks.