RE:Big Merger in oil & Gas Canadian space WhiteCap and Torc OilLet's have a look at this deal (though I am sure some might think I am being too negtive again lol).
Before opening bell, TORC had a market cap of $549.8M CAD (~$429M USD). They also had debt of $335M. So in essence, Whitecap paid 0% premium for ~25,000 barrels of oil equivalent (~90% of this production is actual oil). The total cost per flowing barrel: $36,000 (~$28,000 USD). Assuming a low value of $5 USD profit per barrel (after taxes, OPEX/CAPEX, G&A), that's a net profit of around $228 Million USD (~$292M CAD) after five years.
As I mentioned before, Exxon JV is payiong roughly $33,000 USD/flowing barrel in development costs across there 3 major projects in Guyana.
I think everyone looking at Corentyne as part of the JV deals knows massive oil exists. They do not need a resource report to detail the size of the prospects as they can do there own internal calculations and risking. Bigger question to them will be how much money are they willing to spend to drill exploration wells and then eventually pony up ~$1-2B dollars USD to get the oil out of the ground. And all the while not make any profit in Guyana for a minimum of 5 years (more like 7-10 realistically).
This is the hold up in any JV deal. Frontera probably wants more money than anyone is willing to offer before actual drilling and development costs are even factored in. Yet everyone knows Frontera does not have the money to support a development program (even 30% costs of a $1B dollar development program is worth more than Frontera market cap). CGX does not even have enough money to probably fed a 80-man drilling crew on a rig for 100 days.
And again... there is nothing remotely negative about my post. Everything I mention is based on public data and 2020 trends. See what de Alba does. If he is as good as his profile suggests, he will make something happen. I sure hope so... was selfishly hoping CGX stock would have jumped since August and I could have taken the profits and bought into companies like Exxon or Suncor when they were at 25yr lows. That ship has sailed unfortunately. Another gamble betting on CGX I am afraid that failed. But again, I still think keeping 10% of the land base with a sole promise of carry on 3-4 wells is WAY better than demanding upfront money and hoping to keep more than 10% of the land. If this happens, we get a deal and our stock jumps above $1. If not, we sit below .40 cents and kill more time.