I wouldn't expect the covenants to have a clause on market...

I wouldn't expect the covenants to have a clause on market capitalisation.

From the debt agreement announcement only a few months ago (!!) the due diligence was performed on the underlying assets that were secured against the loan and hence OEL management touting that the MQ DD was a testament to the underlying portfolio strength of OEL.

Who knows, maybe this capital raising won't be to pay down debt and is only a few million to make things more comfortable but given it's right before quarter end covenants, I expect it will be.

I suspect F5 failure was the straw that broke the camels back as the cashflows are now substantially less.

If I had my way, I would:
- Cash in all hedges
- Cut board and management back along with pay
- Raise sufficient cash to enable payback of the MQ loan. Trouble is the loan is only payable after 12 months.
- Reduce production at SM71 to hedged position and wait for a better day of prices. BYE won't be up for that though. I wonder how long before they breach their covenants....