been looking at poe, page-16

For those too lazy to read through POE's 6 month report, here are a few notes/interesting takeaways:

Total POE capex for 1/4 $23m
Total POE exploration/appraisal capex $21m
Total JV capex $39m
Total JV exploration/appraisal capex $35m

15 wells
7-8 wells per quarter
$2.3-2.5m per well

8 producing
4 testing
3 non-producing
> 50% success with possible increase following current testing (could climb to 80%)


Foreign exchange (as mentioned previously by EL):
Note the discussion of the importance/influence of currency movements on net income due to CAD strength.

"...the carrying value of all current and long-term assets and liabilities in Thailand are revalued each quarter to the current rate of exchanges, resulting in a foreign exchange gain or loss."

POE had a net loss of $5.3m for 2Q09, but this included a net FX loss of $11.1m, compared to a $0.1m FX loss the previous quarter.


Cash flow:
- Significant increase in FFO YOY - $16.6m in 2Q09 from $10.9m in 2Q08
- 25% increase in realised crude price more than offset lower production levels
- oil price $123.98/bbl end 2Q08
- price $43.04/bbl start 2Q09
- price $59.20/bbl end 2Q09 (38% increase over quarter)
- price now $72/bbl (21% increase since end 2Q09 quarter)
- internally generated funds flow from operations (FFO) of $16.6m during quarter completely funded $14.9m of capex in Thailand, Indonesia and Canada


Expenses:
- transportation/operating expenses $6.66 per barrel
- expense allocation:
15% other royalties, transportation, operating, and general & administrative
23% government of Thailand for royalties, Special Remuneratory Benefit and Income Tax
62% Pan Orient (before interest income and realized foreign exchange gain)


Thailand Operation Update
"...the drilling program was shifted during the quarter from drilling Na Sanun East (NSE) field appraisal / development wells to drilling exploration / appraisal wells in the L44-W and Bo Rang areas. This decision was made on the basis of the success at L44-W early in the second quarter. The focus for the second and third quarters of 2009 is the appraisal of this new, high impact region to lay the technical foundation for the completion of production license applications for submission to the Thailand Department of Mineral Fuels (DMF)."


Aside fromm thee JV with SUR, the most immediate catalysts for CVN are the results from continued drilling/testing of L44 and Bo Rang.

The platform is being laid for production licensing and much stronger future production/reserves.

The JV continues to have seriously low finding costs and opex.

And the impact of the SRB is being limited as we drill to expand reserves.

A temporary fall in production (and share price) during a period of lower oil prices, for the benefit of far stronger future production/reserves.

6-12 months well managed in my view...