make or break over the next 2 years, page-4

Sandy,

Save for Galoc, where they have a loan to proceed (although it doesn't cover everything), they cannot go into any of their SC's, deep or shallow, without a bigger JVP taking the reins and the lions share of costs.

I don't know when they'll drill SC63, but by Nov 2013 is the current requirement.
Have they got the money put aside like Phil alluded to? If so, why doesn't it show in the qtly financials?
That drill is going to cost NDO US$9M minimum...when they can share a rig and have the cash on hand to pay for it. Galoc won't start delivering til mid 2013 at the earliest...more likely to be later.

IMO, the first big crux for them next year is going to come with the 'drill or drop' decision on SC58 required by 30 June. This has already been extended by 18 mths from 12 Jan 2012 (this is at least the 2nd 18mth ext).
The costs for this deep water drill are huge, most certainly unaffordable by NDO...this leaves them only 7 mths to lock in a major JVP to carry an SC58 drill, or drop the block if PNOC-EC say "no more time".

Next time somebody rings the 'brass' at NDO, ask what NDO's cost obligation on the first SC58 well is to PNOC-EC under the terms of the farmin agreement between them...methinks a surprise awaits.

Without another relatively soon income source, life is going to get too tough for them to meet their commitments.
Galoc II will only get them just above water again if it's 12K bopd...they couldn't get it done when Galoc was pumping 15K bopd...what if Galoc Nth is dry?..it's production is 18 - 24 mths away anyway. Different co. today if they'd got Tindalo right.

So we don't get anymore dilution with a fixed amount of 'extra money', we need the likes of a Viking or someone in the shallows where money is waiting to be pumped in relatively short project time...imo.