Bad DealAny company that has to pay 15% is a junk stock.
All figures in US dollar.
The Co still owes $176 million on its Btg Pactual loan at junk bond rate. Plus nearly $800 million more to a syndicate of international banks for its RBL loans secured by all Nigerian oil reserves.
As of Deal date in Jan 2020, it had its entitlement share of 49 million 1P reserves for OML 127 & 130. With production share of roughly 13 million boe per year, the reserves will be depleted in another 3 yrs unless they can prove up the probable 2P reserves.
Shareholders will just sit & watch how the Co attempts to work down its heavy debts. No prospects. Both Eco Atlantic and Africa Energy are speculative pumps.
The Co's reserves are worth less than two-thirds now with the drop in oil and production cutbacks. In Jan 2021, only one third of production is hedged. Good luck with Brent at current level vs projection of $80.
Bad stock,