Ann: Jacka Executes Farmout of Odewayne Block , page-22

No problems guys,
Valetta did you attend? I’m always interested in hearing other people thoughts/interpretations..

Litigant you are correct they have 12m in milestone payments (not the 10m I mentioned)

I would also just like to clarify the wording on offers on the Ruhuhu block, I can’t remember the exact wording if it was offers or interest, but they definitely had a chuckle at how much “interest” the block was generating already. ( I just don’t want anybody to be misled, over context )

RE: the option to re acquire the 5% in Odewayne, I had a quick glance over the new farmin announcement in the morning then raced off to the AGM, in the announcement they mention the option but didn’t go into detail, so I asked for some clarification (because you never know how much it may cost to execute the option)
Scott said it was from the original farm in agreement with Petrosoma, but I have been through both announcements (the original one and then the Genel farmin) and I thought it was pretty cut and dry IE
80% jacka if they can get a well drilled and 20% Petrosoma
Not 85% and 15%
So I don’t really know where this other 5% came from.
But Scott did say it comes from Petrosoma’s equity, once the well is drilled, and it was in the very original agreement, and he would know the finer details. (Though it is price sensitive information, it alters valuations quite a bit!)
So after the 1st well equity will be
Petrosoma 5%
Jacka 20%
Sterling energy 25%
Genel 50%
On a side note this has been a great deal for Jacka (and petrosoma), really shows how first mover can have a great advantage. They farmed in with petrosoma for 700k. using their industry connections turned it into a $100m block value. And have just recouped (with the latest farmin) over 1500% return of original investment.
+ they get a free well and 20% of the block (still valued at $20m)
If only the share price reflected this.
I do feel a lot better about funding options going forward and IMO they shouldn’t need to raise money (if they do, I get the feeling it will be at a much higher SP for full field developments :P )
It was also hinted that when they were first going to drill HW3 they approached ENI about using their production facility and were turned down because it was already at capacity, but they think now a few years on that Mamoura is not utilizing 100% of it, the story may be different.
So there is the opportunity to share production costs.

Once again guys I am happy to share, but this is oil and gas anything can happen.