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Disturbed

84 Posts.

19/02/16

21:49

Post #: 17069961
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Originally posted by Harry3539 ↑

Maybe I've been shotdown.
I now read quarterlies (toward the bottom of the report) more thoroughly. Check out the subject "Red Gully Revenues" and against production figures at the top of the report e.g.

2015 December Quarterly
Red Gully Revenue
Gas..................$4.2m for 788.8tj
Condensate.....$1.0m for 28,077bbls
These look like revenue figures, not cash received ($5.346m).

A ramp-up in production through Dec and onward (I would think max targets of 800tj/month +) plus the reduction in direct op.costs starting Dec.2015 look positive for cash flows. EBITAD (net cash flows each quarter) could be in access of $2.7m. The forecast was $20m annual revenue with EBITAD of 50% or $10m ($2.5m/quarter).

I can see something coming out of this for financing of the ERM loan. If the RGN flow test only comes in for a reserves extension (somewhere around 5tj/d) then maybe a little delay on the $3m tie-in (we are at max production now and bringing RGN in at 50% would only reduce condensate sales). I acknowledge my idea of reduction while prices are low, but this could take a backseat until things improve.

Note 800tj/Q is a target, not a guaranteed output.

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Always great posts Harry, love your work. And thank you

EGO Price at posting: 33.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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