RE: RE: RE: RE: Darcy "TO1, you are too focused on short term stock trends, who cares? I'm an investor, and my call is that this will go down because they need further finacing, the increased production even if it starts tomorrow will not be enough. I might enter again further down when they have sorted out their capital needs."
Short term trends? I'm stating how the trading is hurting the shares.
If I were too focused on the short term I would have sold like some have been doing over the last little while, just because it hit $1 and didn't hold.
How do you figure they will need a financing. If capital needs are around $20 mm for 2012 and they have around $11 mm in cash. They need about $9 mm to cover that spread.
If they sell the Doris crude at $40/bo, assuming production costs of $7/bo, transportation costs of $7/bo and mineral tax of $1/bo. That's $25/bo in CF or $36.5 mm in annual CF from Doris alone. If they are able to get more trucks then they could get up to 6,000 bod or $54.75 mm CF.
So what's the issue?
That's not including any of the gas or other oil production they have.
Sure they are spending $20 mm on cap ex this year, but they are testing 3 huge plays that were already drilled in Kalypso, E. Olimtoi and Persea. So the drilling budgets were already sunk on those 3 plays last year. None of those 3 prospect have any value attributed to them by the markets. And if Persea is good, it comes on quick as its very close to existing infrastructure and gets premium pricing to Kazak domestic oil sales.
With that small budget they are going to drill at least another 2 wells in Doris and take a crack at Dyna as well, which is much larger than Doris aerially.
So potentially proving up 3 new oil/gas fields (drilled last year) and extending the main asset they have and drilling another prospect as well is not material?
Any farmin partner on the Tajik assets will have to put up $ up front on any farm-in for the work already done. And then they take a crack at the massive potential in the potential sub-salt reefs.
If you don't like the management aand trust them then thats fine. I'm not sure why you would hold them to begin with if thats how you feel.