Ann: Quarterly Activities and Cashflow Reports , page-7

re: Ann: Quarterly Activities and Cashflow Re... The borrowing base should really take-off, and I expect SEA will start using that a lot more substantially than it has recently (it's basically been purely cash recently). I expect SEA to generate an additional $100 million credit facility (on top of the current $33 million available), based on my back of envelope calculations. Don't quote me on this, but I believe the borrowing base is ~40% of the 1P NPV.

Production will obviously absolutely fly up by the end of Q2. A hugeee number of EFS pad producers as well as 3.1 Net Wattenberg horizontals will be coming online.

Hopefully some Asset divestiture proceed as soon as possible (Eric mentioned the company is progressing very well with the final Bakken sale), as the extra cash injections will certainly bolster the company's financial position. I do agree that it's a bit of a cash burn at present, but it's laying the groundwork for some phenomenal growth.

SEA have out of nowhere, increased their EFS position from ~8,200 net acres to ~14,000 net acres, and have suggested it should continue to rise. Add to that some incredible production growth just around the corner near the middle of Q2, and strong reserves growth (which will continually be impressive for the next 24 months). SEA's metrics (production, acreage, reserves) have skyrocketed recently,

Eric's just being prudent by using cash to ensure that SEA doesn't end up bogged down in debt. See Lonestar Resources for a company who is looking really attractive on an operational front......... except it's huge amounts of debt.

I'd guess SEA will probably be searching for a stronger financial position sometime in July/August. What will be interesting is to see whether the company opts for a renewed IPO effort, a conventional AUS cap raise, or even seek some convertible notes. Personally I'd support a further cap raise if SEA can keep expanding their EFS acreage holdings (along with the usual production and reserve advancements), I just hope it'd be at attractive prices for us investors...... and hope that there's no 2 month delay (capping the share price) whilst the cap-raising gets approved by shareholders!