Where did they say income or production was going to double over the next quarter?
Page 4 says Gross Production for the last quarter increased to 4,000bpd but the average for the quarter was only 2,856 (this is the real number you have to look at). Then they are saying they won't reach gross production of 6,000 - 7,000bpd till December 2012.
If you have a look at the 5B 1.1 Receipts from Product Sales etc. is only $15.5m, you have to look at the cash revenue from sales, the additional revenue was most likely a one off or non-core sale. In other words it won't be ongoing.
Along with increase production comes increased cost of production, this is why looking at the Net Operating Cash Flow is more important than gross revenue.
Allowing for the assumed (at this stage) increased production and what may actually net production (actual oil sold) figure is (lets assume 4,400bpd) the overall impact on Net Operating Cash Flows will be minimal. It may by LNC a month or two, which is negligible in the scheme of things.
Raising funds in this market is difficult and takes time. Given that Bond is bloody hopeless with his time estimations and the fact that LNC could possibly be out of cash within 6 months if Teresa and/or GCL doesn't get concluded LNC should be planning a CR to role out within the next two months, because it will take a few months to raise money by the time they go through international roadshows etc.
Maybe BKK have some equity and/or debt funding solutions for LNC, they will need some serious funding soon IMO.
LNC Price at posting:
53.5¢ Sentiment: None Disclosure: Held
