Hmmm, i'm a bit confused as to the intricacies of the Cairn/CP...

Hmmm, i'm a bit confused as to the intricacies of the Cairn/CP farmout deals. I'd really appreciate input as think everyone is a bit confused here!!!



"Under the terms of the ConocoPhillips agreement, ConocoPhillips will provide funding equivalent to a carry of FAR through the first exploration well to a cap of US$116 million in exchange for a 10% working interest in the Senegalese permits. This funding takes the form of cash payments and well carry cost payments. All cash payments to FAR have now been completed by ConocoPhillips (totalling US$10.4 million of which US$8.89 million was paid to FAR during this quarter)."

"Cairn will fund 100% of FAR’s costs of the second exploration well offshore Senegal to an investment cap of US$80 million. In addition, Cairn has paid FAR US$9.82 million for past costs."

-Reading the above it sounds to me like all of the cash payments have been made, totalling $20.3mil.

" future funding contribution for the drilling program from its existing cash reserves will be approximately $24.2 million."

-It seems to me that "well carry costs" are a free ride up to $116mil for the first well and $80mil for the second. So anything from cash reserves are beyond this free ride. Therefore the $24.2 mil must be our share of the maintenance and delays.
So we've already spent all of the cash from the farm-in and more? We're only halfway through the first drill, will further delays cost us more? seems premature to give such an exact figure halfway through the first drill.

I know there was a lot of similar confusion and posts when the maintenance first happened, but these new releases have confused me further.

Aqua, you said that the overrun was $2 million of the $24mil... That implies that the $22mil was expected.. How so?

Sorry to ask so many questions but its all so confusing!