At Brent =US$ 50, PTA operating cash flow is close zeroAccording to last MD&A report, PTA has:
Royalty rate: 20% (page 6 of the report)
production cost: US$ 15,46/b (page 6)
transportation cost: US$ 14,87/b (page 6)
G&A cost: US$ 9,30/b (page 7)
So, for Brent= US$50/b, netback per barrel will be:
US$ 50 (1-20%) - US$ 15,46/b - US$ 14,87/b - US$9,30/b: US$ 0,37/b
With cero operating cash flow, PTA will have to burn existing cash in order to fund their capital expenditure programme for 2015
I would like to hear how management is planning to deal with the present situation, by taking all necessary measures to reduce costs going forward. In particular, G&A expense seems particularly high for me, in comparison with other companies.
Comments?
Fernando