deeded direct working interest, page-2

Had another chat with WER
According to them, WER will pay maximum USD23 million for a 40% deeded direct working interest in the Sambuca prospect.

However, unlike a regular farmin, WER are not liable for any development/operating costs etc should the well be successful. WER's expenditure obligations end with the USD23mil. All costs post Sambuca commercial discovery will be paid for by the other JV partners.
WER will then get 40% of any profit.

This puts the farmin into perspective. On the one hand, its very poor terms for ADX compared to a farmin where the farminee continues to bare 40% of costs after the initial earnin.
On the other hand, the poorer terms make it a bit more believable given the high risk and costs associated with the area.

As for WER unit holders, they lose everything if the well is a duster. Obviously WER have done a good job on promoting the blue sky to their clients....assuming they have raised the necessary cash

It also makes sense why ADX are trying to farmout another 30% of the permit despite advertising that WER are funding 100% of Sambuca. Any tech/downhole problems could easily blowout the drilling costs beyond WER's USD23mil obligation.