Oil price is continuing to be positive for ATS and the Aust Dollar devaluing against the US dollar has been good. This stock still suffers the hangover of the previous drilling campaign where it exhausted its healthy cash position for modest results.
The knowledge gained during this previous drilling campaign must be invaluable and their operational execution next time will be different. I am sure they have learnt a lot.
They believe they have the answers to successfully drill in the future albeit don't have the cash to proceed further. The next $50-100 Mill drilling spend on this project could see a significant re rating. Managements ability to provide a sufficient incentive for a partner/s to proceed with further drilling is critical.
There are a number of ways to approach these dealings each will require a sacrifice on ATS behalf, once again with substantial upside if they get it right.
Clear proof of a consistent, successful and economic drilling concept is what they are after. The resource is there!!!!
Time will see something happen here.
ATS Price at posting:
4.9¢ Sentiment: Hold Disclosure: Held
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