Southern Pacific Resource Corp STPJF

RE:RE:What's next?

[Eyeinvestor]

Much less insight on what pad 1 is capable of. I have always argued that Pad 1 is less important in valuing STP. But STP is right to see how ICDs help control this challenging pad. 184 out of 1P5 on average for March is interesting. The early March news release mentioned 2x fluid compared to January and February's 50 bbd. This means that March STARTED at 100 bbd but AVERAGED 184 bbd. So the second half of March was considerably better than 184 bbd. .................................................................................................................... I am surprised there were no questions on that...but if there had been I suspect company would have ducked them, because I think that it is probably very unstable and jumping around. When you take a well that is barely pushing out 50 bbd and increase production by 3.7x......the volume is going to be up and down. But bottom line, it is better than EYE expected. .......................................................... Still the strategic investors will be more interested in how pad 2 ICDs do. If pad 1 does well, that is cream on top, .......................................................... Cash burn ($4.5 million)is lower than eye figured it would be. They have $60 million in the bank. $28 million goes on ICDs and Senlac. (Did anyone else notice that Senlac is cheaper than the brokers were forecasting?) So they have $30 million of runway. How long is that runway? To be conservative, take the $4.5 million per quarter and add the additional interest (about $2.5 per quarter) gives 4 quarters to improve production to cash flow break even. Plenty of time. My bet is strategic deal gets done before then.