opinion on far's current low sp

FAR is placed in an interesting position at present with the current SP so low & market cap of only 48 mill.

Assets (Approx as I see them and stand to be corrected)

1) Cash on hand: $25 mill

2) Senegal Licences (Subject to Decree)

includes:

> 3D seismic survey $14 mill

> CSEM survey $ 7 mill

> Large equity (90%) / acreage (7,490 sq km) / operatorship available

> Over US$21m spent on 3D seismic and CSEM

> CSEM Summary

"Shell report concludes that not only does the technique have no bearing on the prospects in the Licence Area but importantly does not rule out the possibility of finding hydrocarbons"
Note: How applicable is this comment after Kora?

* Multiple Santonianage fan systems with stacked amplitude anomalies

* Large Albian shelf edge closure (up to 178 km2) > 1 billion barrels mean potential

* Adjacent Turoniansource rock kitchen in oil window

* Acquired 2050 km23D seismic at a cost of US$14 million in 2007

* 3D interpretation and Slope fan attribute work completed Q1 2008

*** FAR moves to 90% and becomes Operator December 2008

SUB TOTAL Senegal: $21 mill


3) Guinea Bissau

includes

> 240 mill boe 36 degree crude Sinapa discovery

> Far paid $6 mill for 15% stake

> Paid $ 3 mill for the substantial data acquisition programme consisted of some 1,200 km2 of high resolution ARKeX Gravity Gradiometry data and some 1,640 km2 of 3D seismic PGS Geostreamer data.

SUB TOTAL GB $9 mill

4) Still has 8.8 % stake in AGC block approx 9000 km2 with 16 other targets. Block now has a $80 mill control well to calibrate previous Seismic & CSEM survey

SUB TOTAL Far's contribution approx $9 Mill

*** TOTAL FAR CONTIBUTION + CASH $65 mill

West Africa total (approx) Money spent by FAR not including today�s value of FAR's licences


I look forward to comments regarding the possibility of an on market TO with the SP at these low levels. I am probably looking at this from the wrong angle but can a potential cashed up JV partner (Ophir, Noble, AP etc) buy a 50% controlling interest in FAR for only $24 mill or the lot for $48 mill.

The way I currently see it the cash on hand negates any risk of buying 50% of the shares on issue and by paying only another $25 mill they pick up in excess of 20,000 km of offshore WA acreage including a 240 mill boe discovery being evaluated for production.

I have written the above assuming the Presidential Decree comes in for Senegal. Is it the relationship FAR/ME has built up with Senegal Gov holding back any potential TO while we wait for the decree. Could the decree be the catalyst to get the SP back to a reasonable level preventing a TO?

I would also assume that the decree would need to come through with the next 54 days so Ophir can make a Senegal opt decision.

As always stand to be ridiculed on this as I have had no experience with an on market TO (may not even be an option) but be interested how it would play out for SH's still holding.

Interesting times ahead and look forward to seeing this weeks T20 and any substantial holdings coming out as trading volumes are still high 4 days post Kora with large mill & half mill bites being taken consistently.

Cheers

PDYOR