GREY:MGMCF - Post by User
Comment by
oregonmcmon Mar 07, 2013 1:51pm
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Post# 21095226
RE: RE: RE: RE: RE: Thoughts
RE: RE: RE: RE: RE: Thoughts Sigma -
This is a good point, and one I did not explicitly consider. I guess I wouldn't rule out a farmout or further dilution, which would then cut into my estimates. On the other hand, if they're doing that, it means their not just going to get bought out, and the netback would likely be higher than $10.
Also, MGM has said they have enough money to continue operating "through to 2014" (not sure if this means through the end of 2014 or until sometime in 2014). They didn't pay for the well they just drilled, as that was paid for entirely by Shell in the first farmout agreement. By 2014 with a better idea of the recoverability of Canol oil, they will likely have sufficient assets to take on debt. While this seems ridiculous given their current situation, it may not be so ridiculous then, and with interest rates as low as they are, it's probably the best route.