Santos value, will oil producers agree to freeze out put?, page-4

Hi Sircop

They are not my numbers but I dont think the author is saying they are a bad investment, they even said it warrants a close look?

In regards to your points

1) 2015 revenue was was AU$3.2 billion not 4.5 billion as you state. Have you even read the latest annual report? Underlying net profit was 50m, you can pay off debt with cash not with revenue that doesnt even have costs taken out of it yet!!

2015 debt was $7.4b. Your number of $6.3b is the net debt. I.E debt minus the cash.
Where are your numbers coming from?

yes they received $520m for Kipper. Santos only just received the cash last month so yes they may or may not choose to pay down debt with it.

2) Iran extra capacity is is a short term thing happening NOW!
According to Reuters OPEC Crude Oil production rose in March to 32.5m bpd from 32.37m bpd. The increase was driven by Iran continuing to increase production post lifting of Western sanctions and Iraq. Saudi Arabian production was flat.
yes I agree Indian demand more so that China will eventually so this up but that is a longer term trend.

3) Saudi Arabia has more than US$600-billion worth of foreign currency reserves. Is that enough cash?
They keyword is restart! re-starting usually takes a lot less cash building from scratch.
Kuwait is already one of the lowest cost producers in the world

So yes I see many flaws in your points.