Hi Wasa, We don't know yet the total no. of wells planned. One...

Hi Wasa,

We don't know yet the total no. of wells planned. One could use a $/day metric to work out a ballpark estimate. Use $1.2-15mil/d for a 4-6-12 month campaign & factor in FAR's 15% share. Production tests, sidetrks etc r expensive (as is unscheduled downtime/maintenance on the rig), so add a contingency of 20-25%. Reality chk from last year's delays, which reqd them to do a CR at the last minute.

FAR's cash on hand by Dec'14 end should b $44mil. (ie $83mil minus $38.7mil apprx).

So depending on if they plan to spud in Q4'15, then the nxt 3 qtrs will just b admin costs, plus costs related to lab analysis (ie geochem, TOC, kerogen, pyrolysis, SW core studies, biostrat, palynology etc).

Purchasing long lead items is Cairn's responsibility, so they should come up with an AFE budget for the appraisal plan & select a rig. Note capex should b low as rig operators want to lock in firm contracts at competitive rates.

Wont surprise me if both Cairn & FAR embark on roadshows mid year onwards to spread the word on their twin discoveries from last year.