Ann: Q2 FY21 Quarterly Activities Report, page-36

RMC,

The really short answer is the banking syndicate recourse lies in the covenants that apply to the loan and while COE is in compliance they are likely to insist on anything ... were we wanting to change something already agreed they might likely want to do something also.

I look first to the Balance sheet for the Debt info (look at Annual Report and Half Yearly) and then at Liquidity which also gets updated in the Qtrly

From AR ...



And from latest Qtrly



Note we are in a NET DEBT position ...which means while we have $115M of cash on hand we also have almost $230M of debt outstanding ... and we need cash to operate and expand the business .... so POINTLESS to repay debt with the money drawn from it in the first place. We have a lot of CapEx planned for OP3D so cash needs to stay for that.


Note 2 from above taken from AR tells you that

And we know that SGP is "complete" as the GSAs have started Dec 1 and Jan 1. The fact that COE noted that there were fortnightly discussions on technical issues shouldn't be "spooky" ... it is prudent for both sides to be aligned so that the repayment schedule is optimal based on the expected production and since it is a RESERVES BASED facility there is key field half life measure that is generally considered (banks like to see their loan repaid in the front half of production reserves).

You would do well to read this closely



IF and its a big IF, the asset becomes impairmed that reduces "Equity" on the Balance (Total Assets = Total Equity + Total Liabilities) while the "Debt" (which I look at as not Net Debt but Total Liabilities) doesn't change ... meaning D/E increases .... and that may cause the banks to ask COE for additional equity to be added to balance sheet (as we wait for the cash to roll in from GSAs).

Thats the long answer. Unlikely IMO.