Dis, the cashflow is increasing because they are drilling and completing more wells each quarter. Just have a look at the comparison in the number of wells developed to various stages in the last 2 quarters:
In contrast to the 10 (Q1) and 13 (Q2) wells that RFE have added or underway in the last 2 quarters, from memory they did 2 wells in Q2 2012, plus some infrastructure work around development area 2.
Since the company is spending money on wells that successfully produce oil cost $3M and each with an IRR > 50% and an NPV of $4-5M, I am happy for them to invest more money in developing more wells. And as long as they keep developing successful wells then when the require more money I think the market will respond positively if they ask for more capital, or lenders will lend them more money.
Cheers, Sharks.
- Forums
- ASX - By Stock
- RFE
- Ann: Quarterly Activities and Cashflow Report
Ann: Quarterly Activities and Cashflow Report , page-31
-
- There are more pages in this discussion • 29 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)