Well Mart is a service provider From what i understand , as of today MMT is a service provider. We do not own the UMU field and we are not the operator either (Midwestern is operator) , although it seems we are doing the work of an operator and a service provider. MMT does have a contract to share in the profits , taxes , at 50 % . As a service provider we make more money if we provide more drilling. Under the present system we could grow much faster if we had more drills going full time on more fields, but we need more drills and staff. We don't decide how much drill work we get to collect more profits beyond 50% unless ordered by the operator (Midwestern).
Using the last report regardless of stolen oil we received about $7.5 million in profits from delivering aprox 4900 bod on average for 90 days (allowing for down days )
Unless the taxes change , if we deliver 18000, bod net from 36,000 bod gross we would receive about 3.7 times the amount or 3.7 x 7.5 = about $28,000,0000 in profit per quarter once the new pipeline is in.
Of course one must realize the above includes no drilling!!! The UMU field would be one busy place if the pipeline gets the go ahead , so we could have 2 drills going an collect about 82% instead of 50 % for quite a long time..possibly 3 ++ years , even with 2 drills in development /exploration drilling.
If one takes into account the low ball underlift oil price we go plus adding in the 82% we might get , i would have to speculate that our profits at 18,000 bod net would rise to 82/50 x $28 million + 10% = approx 50 million per quarter profit ..or connsevatively 14 cents per share..so i guess as we ramp up even further at one point is possiby a tripling of the dividend..but possibly initially they could double the dividend .
At the AGM they discussed merger etc, but really Wade would weigh the advantages per field contracts and decide on a per diem basis . The PIB is not approved , so its all up in the air when we get more tax holidays and how MMT plays the fiscal game going forward to maximize profits . It really depends on what fiscal regimes, Nigeria and politics throws at us .
MM