Ann: Wizard Lake Rex-2 Drilled, page-44

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alexei ii

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11/08/19

01:07

Post #: 39953284
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Originally posted by saltbus: ↑

Gosh.
The oil price has been sinking rather badly during the last week.

Strangely I’m not getting that sinking feeling. With the negotiations unfolding over PLX’s forced sale of their 50% share of Wizard Lake their worst nightmare must be a sharpe
collapse of the oil price.
Remember gas prices are very low in Alberta because sales are restricted because of the lack of pipeline space to outside markets and of course the over supply in the US..

WBE has no debt and has money in the bank to pay for Rex2 and Rex 3.

Currently WBE is receiving 100% of the money from Rex 1 until it has been reimbursed for funding the production infrastructure at Wizard Lake. When Rex 2 is completed and production starts (maybe by the end of August) , WBE will receive 70% of the cash flow from Rex 2 until it is reimbursed for funding the drilling and completion of Rex 2.

PLX in the short term is in a world of pain, their share price is sitting at 10.5 cents which is a 52 month low, they have $5M debt they can’t service, their leases except for Wizard Lake are dominated by gas production.

WBE has a right to buy out PLX’s share of Wizard Lake at whatever price they negotiate with outside buyers.
I see this as the opportunity of a lifetime and a company maker for WBE.

Whilst WBE has no debt and has money to fund Rex 2 and 3, they don’t have funds to buy the other 50% of Wizard Lake. I presume PLX need a minimum of $5M to escape bankruptcy.

As I have previously mentioned I see a window of opportunity for WBE to fund Wizard Lake if the options are in the money ( one cent options) which would require the share price to be attractive for option holders to convert them to shares. I would think a share price above 1.5 cents could do the trick.

Interesting times for WBE with oil production about to double and another well (Rex 3) at the planning stage.

Saltbus

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got to hand it to mgt. the deal they struck for the extra share at Rex, is gold. ...

WBE Price at posting: 0.7¢ Sentiment: Hold Disclosure: Held
2 Upvote

0 Great analysis

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