AJQ (ASX) Ann: Armour APLNG JV Awarded Qld Exploration Block

Originally posted by rmkpro: ↑

Certainly some big numbers being thrown about @thehunter

Based on last quarters actual revenue of $7.7m a 100tj plant would be $77m quarterly and $308m annually.
For easy maths sake, last quarters production, staff and admin OPEX was $8mil. So a negative cashflow scenario still for the Kincora plant. The plant metrics will improve as production is ramped up as a large component of those OPEX costs relating to staffing admin is pretty fixed. However to ramp up production obviously requires more feed being the costly part of this business. $4.85m of expenditure for last quarter for little improvement in plant production since year end Dec 18 is certainly a disappointment.

Perfect world we can get the plant enough feed soon enough without raisng any more capital/dilutionary events for shareholders to bring it up to 20TJ production where the customer receipts, opex and field development costs should largely balance themselves out. As for a return to shareholders... that is a tough one. Once Kincora is producing 30tj more consistently as they plan, then maybe it is possible however there will no doubt be a heavy capex requirement in the next 5 years that will wipe out any chance of that I think...

We have no sales issues with the product, its just a difficult balance of lean cashflows and heavy expenditure for now and easily the next 12-24 so a 100tj plant seems a long way away at the moment!!

Im interested to hear others thoughts as always, perhaps I am a little too pessimistic in this opinion?

Expand

Great post ! You are being realistic from what I read. You have stated accurate commentary which unfortunately in our current situation can also be a bit pessimistic.

Some time ago I was pretty keen to discuss some more facts in relation to Company performance in these threads,specifically looking at costs versus income etc etc ... because this actually tells us an important story. However, the story is not all rainbows, and can even be a bit distressing.... turns out there was not a lot of appetite for it, which I can also understand.

I've mentioned on here a couple of times that AJQ is by far my largest Shareholding, by number of shares, so there is not a lot of incentive for me to rubbish this stock, but on the other hand it has been very frustrating to see the Shareprice fall continuously year after year after year into penny stock territory.

I guess we can always 'feel' that this stock will eventually come good, ie become profitable, but the sunk costs for our latest wells (even mostly defrayed by grants received) have yielded disappointing results... we cant afford many more duds in a Region that we thought would hold so much promise. Perhaps Origin Energy departed for good reason ?

Just my view, but I think the best way forward for Shareholders is if the Company actively sought a Takeover offer. I was totally against the last one that Shareholders rejected, and in hindsight that was probably a bit naive. A Takeover will probably be the only way our Shares will again hit up to $0.25c in the medium to long term. Happy for someone else to have a go..... if they pay us for it.

GLTH