Hi jophda,
I think you have hit the nail on the head with this comment -
"The Market has been telling us for a while that the revenue from Valli and Odin may not be as lucrative as expected". Back in December last year, Blue Ocean Equity estimated annual cash generation of $5-10m to MEL for the initial years of the project based on initial flow rates of 12 MMscf/d (the capacity of the new pipeline to Vali). They did not say whether this was raw gas (12MMscf/d) or hydrocarbon gas (9MMscf/d) but I assume raw gas since they talk about pipeline capacity (Hydrocarbon gas + CO
2). So, at a minimum ($5m pa) about $417,000 per month or $1,668,000 per quarter to MEL. MEL's last quarterly (End Dec. 2022 - see below) had outgoings of $2,268,000 which may rise to about $2,500,000 (End March 2023) to accommodate loan interest and principal payments if the loan is fully drawn down. Hopefully when Odin-1 comes online, MEL can turn cashflow positive. but they may struggle to be cashflow positive this year. Happy for any input.
I trust Glennon and Keybridge Capital did their own cashflow forecasts before providing the $5 million loan facility and must think the MEL SP will eventually rise to 2.5cents+ option exercise price.
Phew, MEL is a tough ride.
Kind regards OldGeo
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