The recent share trading and retrace was a cause for concern and...

The recent share trading and retrace was a cause for concern and I had a bad feeling HHR would be forced into a financial arrangement involving high interest rates and a large equity issue. I for one will sleep easier tonight on the back of this funding arrangement. HHR risk from here on is reduced significantly. We have a number of options depending how things go.
1) If there are cost overruns or major schedule delays, my take on the so called "financial backstop " is that Rock Rose will cover the increased cost entirely. Look what happened to IOG when they were exposed to large debt and poor well performance and added cost.
2) If the project is executed to plan and we are seeing good gas flows from the initial wells, we can go chase finance for a known cost and predictable cashflow and therefore get much better terms and take a bigger slice of the project pie.

The Market response today has been predictably ho hum. Who cares! Once we see the NPV from financial models in the FID and gas begins to flow as drilling starts, the value will be undeniable. When the Project is complete, Rock Rose will run the operation and our excellent team can get on with developing the engineering for Phase 2&3 and hopefully new prospects. We can just back and bank the cheques.

Happy days!