KSD, Like yourself, I am also frustrated with the current price....

KSD,

Like yourself, I am also frustrated with the current price.

Management should have hedged 2016 when oil futues went up to the mid-70s around April-May (after falling to the mid 40s in the first quarter of this year). I know everyone has the benefit of hindsight but I think this was a very basic call that was missed (again). That is what they are paid for.

As far as numbers are concerned, if (hypothetically) oil remains in the high 30s for the whole of 2016, Tap still will make around US$20-25M from Manora (say at average of 4000bopd). Add around US$10M (net) from gas sales.

That's US$30-35M for 2016. Enough for US$21M in debt repayments and any development drilling, plus admin costs. This excludes around $4M in SPP (if they do get that) and the ~US$9M due from NGP. Also excludes US$8-9M share of cost over-run (in theory you can negate this with the monies due from NGP).

Not bad at all if oil remains in the high 30s for 2016. Which in my opinion will not. The most pessimistic forecasts have oil averaging in the high 40s. So it is even looking better.

As I have said previously, cap raising would have been avoided if NGP made their payments in a timely manner. I do not see any more cap raising needed unless oil price goes down further.

It is also interesting that CY is making noise again when the SP is depressed. Maybe he wants to buy his $15000 shares in the cheap by scaremongering and driving the SP lower? Maybe he wants to average down and bring his holdings back to 20%? Of course I am being sarcastic but I do not want to waste any more energy thinking about him...

All in all I am not happy with where the SP is at the moment, but I think it would be silly to sell now knowing there are significant gains to be had when oil prices go up again.