RE:RE:RE:RE:RE:RE:RE:RE:RE:Back to 45 cents on the way to 35 cents or lower again hm then there s this but firstly they probably won t be doing much with red earth until next year, that acquisition is why they did a flow through,and try to bring bank line down
the elephant in the room is this
Under the lease acquisition capital commitment, the
Company had committed to annual capital expenditur
es
pursuant to the acquisition of approximately 73,500
net undeveloped acres in the Wheatland area. For
the first two
years of the leases (which ended on June 30, 2017),
if the average WTI prices for a calendar quarter w
ere below
US$50/bbl, PPR may defer a portion of the drilling
commitment from that commitment period to be alloca
ted over
the remaining term. Average WTI prices for the fir
st two calendar quarters of the second commitment p
eriod were
below US$50/bbl and the deferral option was exercis
ed in the second quarter of 2017 to extend the rema
ining 2017
capital commitment to July 1, 2018. As of June 30,
2017, the Company has incurred $8.7 million (Decem
ber 31,
2016 – $1.6 million) towards the remaining total le
ase acquisition capital commitment of $35.0 million
. In the event
that PPR does not incur the minimum capital expendi
tures by the end of a given commitment period, the
shortfall
may be payable to the vendor.
How is this kind of a sh tty deal even possible when junior oil was on it s knees at the time?