jka what does the future hold, page-43

I'm not sure if anyone has seen details on the change of ownerships currently occurring on OML113, which may well provide valuation help for valuing OML113 and what is really in the share price for Tunisia.

LekOil (new listing on AIM) has stated in a presentation that they have an agreement to purchase 12.19% (off the top of my head) of OML113 which appears to be Panoro Energy's stake. I've seen nothing yet on the value of this purchase.

The below was brought to my attention yesterday, it was in a circular for one of Afrens subsidiaries (First Hydrocarbon Nigeria) in the acquisitions section talking about FHN.

"On 2 April 2012, the Group signed an Asset Sale and Purchase Agreement (ASPA) jointly with EER
(Colobus) Nigeria Limited for the acquisition of a combined 18% interest in OML 113, with each party
holding 9% interest. OML 113 is an oil mining license located in the Benin Basin, approximately 24km
offshore of western Nigeria. Total consideration payable by the Group under the ASPA is US$40.0 million.
In the year ended 31 December 2012, the Group had paid a US$6.0 million deposit , with the remaining
US$34.0 million payable on completion of the acquisition, which is anticipated to be in 2013. As at
31 December 2012, the acquisition had not been completed and control had not yet passed. The deposit has
been recognised as a prepayment as at 31 December 2012."

Link to the circular is here http://www.afren.com/news_and_media/press_releases/5/2013/

The statement above is on P50.

There has been plenty of speculation over the last year or so, that Chevron were selling to EER, but it looks like FHN may have got in tgere too.

At $40m, FHN would be buying 9% of OML113 which assuming 226mboe (mean from JKA's last presentation), then FHN would have an interest in 20.34mboe which would value their stake at $1.97 / boe.

Assuming the same for JKA, their 5% stake would be worth ($40m/9%*5%) = $22.2m.

Based on a current market cap of $28m, theres not a lot in there for the other assets. Even assuming Odewayne is worth nothing (we have a free carry here) and Ruhuhu was worth nothing then the small amount of cash we will have after this drill (enough to drill Aje-5 by my calcs) and Tunisia is worth around $6m.

Pretty low ball for proven oil, so hopefully if the amounts are proven up (111mboe mean) and the flow rates are good, then I expect JKA to significantly re-rate.

We are in a unique situation where one of our assets (OML113) has been valued for us, and over the next 3-6 months, Tunisia should also get the same if Cooper can fins some interested parties (if HW-3 is successful and proves good flow rates, I doubt they will have trouble finding a buyer).