GREY:VFGGF - Post by User
Comment by
ofirmeon Jan 15, 2014 4:02pm
287 Views
Post# 22095629
RE:RE:Faith and Confidence
RE:RE:Faith and ConfidenceYou should really never believe a ceo. their agenda is to promote their company. especially
oil people.
I look at the numbers, not what the ceo says.
Every asset has a price and my assumptions are that waterflooding works (earlier ones worked)
and (if my calculations are right) the company should be above 3000BOPD this year (due to
waterflooding) with minimal capex. using $20M capex (maintanance + 4 extra waterflooding
projects) + $10M interest should leave $30M - $40M for partial debt repayment.
At Q4 they had to put close to $10M into waterflooding.
At $130M debt, it means they produced only $8M of cash on 2,500 BOPD which tells me high
opex like in Q3.
There should not be too many reasons to warry about the debt, but the conduct of the ceo is
very problematic. the good thing is that the company will end up being sold unless the share
price goes up quickly. the assets are worth too much for them to be just trading at less than
$200M EV.
Waterflooding works because of physics. it works even for this ceo...