Post by
pablo87 on Sep 13, 2018 1:04am
Another (Wild) Guess - flow thru
If the offers aren't good, maybe another option is a flow thru. The Cdn drill ready locations would improve annual cashflow in the first year (and zar's cdn oil production by 25%) by over $6M by my guesstimate. It would be very dilutive of course but consider that current break even is $55 WCS, US$68 WTI by my guess based on latest presentation so with current working capital position, its tight IMO.
Whereas with a drilling investment, it would lower the company's break-even point substantially (to 45 wcs and 55 wti) so any financial concerns would be alleviated (good for debbies) and in fact in most scenarios, the company would then be in a position to invest in further drilling like most non financially constrained companies do.
Comment by
pablo87 on Sep 13, 2018 1:19am
Yet another scenario would be North Dakota being sold, debentures being partially paid back and the rest of proceeds used to drill those Cdn drill ready locations. Not dilutive but not as good as a pure flow thru as far as overall corporate cashflow going forward. But better than current situation. GLTA.
Comment by
TheJakeMoore on Sep 21, 2018 3:04am
See Saturn Oil and Gas for how to succeed in the current oil market! Saturn just got 20 million financing to drill their SK ground like Swiss cheese!! Grest chart developing!! I will do some DD here. I like depressed oil stocks! Especially big board stocks!