in the short term , page-41

John wrote:

"The security deposit for Ranau is only recoverable after the work program has been completed ie Ranau has been drilled and the seismic program they agreed to do in their initial bid documents has been completed."

Hello John, with all due respect, this is actually incorrect. According to the Half Year Accounts report (14/03/2012), a US$1,500,000 performance bond was put in place for the Ranau work program, however, the performance bond will be reduced in tranches upon completion of certain exploration work program activities. This money will therefore be refunded directly back to Quest Petroleum upon meeting these milestones.

Unfortunately we are not privy to the contract and / or when and what each of these milestones are. Nonetheless, funds will be returning to Quest's pockets over this period, and not at the end.

I agree, funds will have to be sought at some point to continue the program (aside from refunds from the tranche payments) in order to complete all planned seismic and drilling operations. It is estimated that the first well will likely cost around $1.2M (low estimate) to complete, which as you know, is extremely inexpensive given the low cost requirements in Indo.

When and in what form the capital is acquired through has yet to be divulged by the company. I think it is worth bearing in mind that Saxon Palmer and Gus Simpson combined hold approximately 183M shares or 9% of the company. Hence, with this much "skin in the game" a capital raising, albeit a large one, would not be in their best interest, let alone their "mates" in NY, or the rest of the shareholders. I am certain plans have already been put in place and one can not rule out the possibility of a joint venture or access to some type of a loan facility given the "lucrative" connections Quest and their subsidiary company reps have in Indonesia.

Time will be the teller of all tales...until then, best of luck my friend.

Cheers!
S