MAY (ASX) Ann: Loan Facility

Originally posted by Spitfire ↑

Some negativity here... not sure it’s warranted.
The fact that the company is now able to secure funds without going to shareholders is absolutely significant and ImO would not have been even looked at by financiers over the last 4-5 years... this is paramount to what we have done here getting our company back on the rails to what very easily could have been the dead end buffers and complete wipeout a few years ago..
It is clear that the company needs funds to progress the portfolio until such time significant cash comes back.
Looks very much to me the company sees this as a very short term bridge , which is clear by the timelines Stated.
APs options at 2.2 c is a 90% increase from here , so if the SP is not there by Jan , he won’t exercise them and as such gain zilch for what is a pretty substantial personal guarantee over this loan..
I see it somewhat differently to most I think, I see a crystal clear message that people who know considerably more than us about where the company is going and how it is going to be get there are pretty sure the SP is going to be a lot higher than it is today in a relatively short to medium timeframe.

If they had announced a further CR , most here would be baying for blood, I myself advocated them that I would not tolerate a further Equity grab down at these levels...where we were selling ourselves so short.. the company has listened to shareholders.
So we have over $3 mm AUD in the coffers and no further dilution, we have production income from Puka and a disclosed NPV of circa $20 per barrel associated with the reserves there. I imagine that was used as a chip as well for the loan facility.

I will state clearly now, this is the year Melbana must define its path to the market and to shareholders and Bring in cash to secure it...
I acutely hope the next Equity raise will be associated with a dual listing and at a higher price thst we see how.

Lots of news to come here...
Also no comments on here on the headline news on a number of high profile outlets , announcing the end of the Castro regime in Cuba. Cuba is opening itself for business....
Santa Cruz is carte Blanche for May to prove itself as production consultant ....it will take time, but if they prove they can do it there, it could open up a whole new low cost / high return business model for the company and for Cupet.
I have it as circa $12 -15 mm invested now in Cuba block 9 including the bond lodgement..
Not withstanding a turnkey Drilling business model as already mooted and as advised how it would potentially work , the company would expect all or much of those back costs back as a minimum in any deal struck to partner drilling ....

My views only...

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Fair comment Spitfire!

A turnkey drill in exchange for a farm in % would pay for the drill but without an accompanying cash component, would still leave MAY in need of an acceptable cash balance. An AIM listing with a new share issue could achieve that of course, but also dilute existing shareholders. If MAY offered a similar share issue to existing holders the dilution would be mitigated but could result in an unattractive amount of shares in issue. It could prove a bit of a catch-22 situation. Anyway its all hypothetical at this early stage but the sooner MAY gets a decent cash balance on its books the better it will be. Cheers.

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Last 2.4¢		Change 0.001(4.35%)		Mkt cap ! $80.88M

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