Hi Friends,Farm-out of 12B is very positve news and may well be...

Hi Friends,

Farm-out of 12B is very positve news and may well be the trigger point of positive surge to come after recent downward trend. Why it means so much for Swala and its shareholders ?

* Swala was estimated to spend ~ 5 million for seismic (50% W.I previously) and now well covered for seismic costs of 12B

* Two free carried wells and 7.5 million for each well should be enough to cover full costs for 25% W.I

* Pay back all of Swala's past costs incurred

* Pay all of Swala's costs if there are any changes in work programme under PSA

* Strong signal of more active exploration work to come in 12B and gives Swala a free carry of Seismic, two exploration wells and recovery of all past costs (it does not get any better)

* Strong interest before any seismic stamps the value of 12B and how lucrative it is to be early mover of EARS

* Less dilution of shares

To have Tullow as a partner along with farm-in partner who is going to cover our share of Seismic and Exploration Drilling, I see only positives to come for Swala and we are in for VERY GOOD times ahead in Kenya. We have everything to gain and nothing to lose from here as far as 12B is concerned (subjected to Kenyan Government approval). There could be many 'Ifs and Buts' raised about farm-out, but IMO this is a very good deal for Swala on LT and eagerly waiting to know who is our mysterious Farm-in partner. Good luck to all and these are my opinions only, DYOR.!