Why 6 months - because that is the term of the Equity Swap Agreement (ESA)
Just as a data point, 50% less drilling permits filed in TX in November than in October
http://fuelfix.com/blog/2014/12/01/texas-drilling-permits-fall-50-percent-in-november-data-shows/
Make of that what you wish.
Now to AKK. As I understand the ESA to get the full $4.5M we'll need the share price to be above 10.2cps for the next 6 monthly settlements. Correct me there if I'm wrong.
So what will contribute to pushing AKK over 10.2 (I'll call on Whisky for the full rahrah list). Proving to investors that AKK is a good investment and that mgmt is transparent and committed to low overheads.
1. Rising price of oil - macro condition on which AKK has no influence
2. (Profitable) New wells coming online in EFS Birch
a. Seaducer is next but minimal NRI of 2.6925%
b. Inferred well #7 coming in next few weeks. GREAT but what is WI/NRI/AWE of this well
c. What of Petromax farmout well?
3. IMPROVE EFS development DISCLOSURE
a. Tell the market what is AKK OPERATING NETBACK for EFS production. This is not difficult (of course the inference is if you don't say then it is not good)
b. Advise the market whether AKK has hedging in place via HK on oil produced by the JV
c. Advise the market on how the carried wells are doing wrt the APO and specifically estimate how many more months to go (and disclose price assumptions). The WI in these wells are also AKK's assets not just HK's. This is important because this is our "free money" from HK's farmin.
d. How many acres will be HBP after #7 drilled and what is the plan to HBP all the acres. What happens to AKK WI in the JV acreage should HK slow down drilling to a point where the primary lease expires and not all acres HBP.
4. What is the Pathfinder plan
a. Not updating production on COGCC was an ugly look. Smacks of disrespect to authorities and shareholders (or worse).
b. What are the remaining costs to fulfill primary lease term and/or HBP all acres at Pathfinder
c. What is AKK operating netback for OIL ONLY at Pathfinder. Prove it (as it who are you selling to and how).
d. What is AKK operating netback for the gas is sells. What if any $$ are contributed by GPA
5. KY/MS - Again to the NRI (after any JV payments etc) what is AKK share of production being sold for and what is the operating netback.
Investors want to know this. Knowing this will allow them to figure out operating cashflow (and the true extent as how much G&A there is - hint: I believe its too high given the operating structure).
Business as usual wont make the SP go up. Shareholder friendly action will (and POO rising of course).
