Pretty encouraging announcement in my view, but not likely to...

Pretty encouraging announcement in my view, but not likely to set the world on fire in the ST given overall sentiment in the O&G sector.

Noting that the development costs for the three wells drilled to date are already ‘sunk’, if I’m reading the announcement right we make about $35 a barrel ($47 POO - $12 cash operating costs) for these three wells. We'll make more like $17/barrel from any future wells taking into account the finding costs.

Assuming 60BOPD from each of the three wells (180BOPD), cash flow will be $2.3m over the next twelve months from these wells alone.

Ignoring other wells we might drill, with $8.4M in the bank, that makes our total company value something like $10.7M. Over 950m shares, that equates to 1.1c per share with potential upside from oil price increases, future drills and/or acquisitions.