MJS, what is being missed I think is that as you say cash flow...

MJS, what is being missed I think is that as you say cash flow may be say $6m or $7m per quarter but that is after all exploration costs. This company is focussed on reinvesting a large % of its cashflow into exploration opportunities, and is seemingly quite successful at this, and has been ramping up this focus. The programme this year is much larger than last year.

My point is this. As you say net operational cash flow was around $4mUS last quarter, however, that was after exploration and development exp. of over $4mUS. The question is what development and exploration exp. would maintain production into the future? 1P reserves increased 19% last year, and we are yet to learn what the 2P reserves did, as they are still under assessment, but, they are sounding positive on that score and given the drilling success from last year, you would have to assume 2P reserves are up quite a lot. My guess is that it may only be around $1.5mUS required each quarter to keep things on a stable footing, and the rest of the exploration spend is for the purpose of growing the business. Who knows the actual number? I am sure the company has a fair idea on this. However, if I am right, then net operational pre exploration expenditure directed at growing the business, was more like $6.5mUS last quarter, and if as you say production is consistent following the divestment of Racoon bend, and given the increase in dollar oil and gas, cash flow from operations might be more like $3m/month ($9m/quarter) at present. And this is why I and others perhaps see this is as cheap as chips. Moreover they can plough their net cash flow into further upside with terrific tax effectiveness. Always nice to see the taxman lending a helping hand.

It will be interesting to review all this once the quarterly comes out.