EXPM:AZBCF - Post by User
Post by
Cabrio1on Dec 13, 2013 8:20am
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Post# 22002157
The Deal
The Dealhttps://www.stockhouse.com/news/press-releases/2013/12/12/azabache-energy-inc-announces-participation-agreement-for-vaca-muerta-assets
I have not had time to study the deal yet.
Dilution - yes.
But dilution can be thought of in 2 ways, negative or positive.
On the negative side, we are diluted. But without the dilution, we have no money to proceed.
On the positive side, some big money corporations/people believe in our VM resources, enough to bet $5M dollars right away to frac COV-x2, and it looks like another $5M (round numbers) to do more development in the VM. We need to frac COV-x2 and see what's down there. If we can show production, we have a LOT of acreage available for production. The negative side of the dilution then becomes unimportant.
Also, in my opinion, the warrants are no big deal, since they start at 18 cents. So no new investors gets any financial reward unless the stock price rises substantially above 18 cents. To me, that's a fair deal.
I will study this more later, and add other comments.
Supra, what do you think?
Cabrio