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ARPETROL LTD V.RPT

"ArPetrol Ltd is engaged in the exploration for and development and production of oil & natural gas, and also provides natural gas processing services for third parties in Argentina."


TSXV:RPT - Post by User

Comment by TheRock07on Oct 31, 2014 10:22am
182 Views
Post# 23081272

RE:RE:RE:Gas reserve value to a major

RE:RE:RE:Gas reserve value to a majorThats easy.
The gas processing plant nets us just over $5 million per year in free cash flow.
That cash flow is unencumbered.

If it were gas production, then we would have to invest a goodly portion of that into exploration and development capex.

Not so with the cash flow from the gas processing plant which has a contract for processing fees for a 5 year period ( 2018 ).

RPT's limited gas/fluids production pays the expenses, so the free $5 million ( $5/23 million shares ) goes right to the bottom line and adds $0.21/share to the NAV each year.

Its that simple.

Its why RPT has been able to pay down all of its debt and can now envision growth initiatives.

Which is why, RPT is incredibly undevalued, trading at less than 2 times cash flows.

Value always emerges.

Buy on any weakness
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