Connacher Oil & Gas Ltd CLLZF

RE: Regarding needed cash---/2violins

[strzelin]

I posted this on privet CLL board as reply to the dilution question. "If your company makes $10 and has 10 shares; that would be $1/share. If it had 100 shares; that would be 10 cents/share. What is the difference between the 2?/mobius1965 " The difference would be the share price. The one which make $1/share would trade in the $10 price range and the other which make 10 cents per share would trade at $1. This is what the dilution does to the the share price. Going from your theoretical example to the CLL situation I think we have no much choice at this stage of the POD1 project. In my calculation we will have to dilute our shares about 15% to 20%. From the page #22 of the 2006 financial report we increase our bank debt in Q4 to $230 millions. Just the interest charges in Q4 were about $5 millions(page 26).The oil sands term loan was fix at 8.516%. CLL total capital budget for 2007 has initially been established at $249 million (page#4).(if we go for the joint venture pipeline additional $40 to $50 millions will be needed.) Cll remaining loan facility can handle additional $120 millions(on page #12-- at Dec 2006 the CLL had working capital of $118.6 mil including $123 mil of cash dedicated to POD1 completion). To pay for the $249 mil 2007 CAPEX we need additional $130 millions in CLL equity .At $4 per share it is 32.5 mil of new shares which is over 15% dilution (POD1 cash flow in 2007 will be to small to make for the short fall.) Can someone pinch me and tell me that this is just the bad dream and my numbers are one big error? JUREK