fyi, page-4

It is unfortunate if NDO cops some negative sentiment out of the OEL situation as they are in vastly different financial situations.

NDO is receiving cashflow from Galoc and made a profit (albeit only due to a gain on the value of the convertible note attached option). A couple more months production and the next quaterly report should actually look quite healthy.

OEL on the other hand do not receive any Galoc cash until the debt in GPC is paid out. The whole Galoc/GPC deal was a shocker for OEL with too high a price paid and far too much debt concealed in the structure of GPC.

So as it stands NDO have a head start on their commitments for their service contracts, no imminent major spend due and cash coming in. OEL however are deep in $$ intensive drilling commitments and have no cashflow - in fact GPC is actually consuming cash out of OEL.

In my opinion the board and management of OEL set it up as a punt, with massive internal leverage and now the coin toss has gone against them - every gambler has to be prepared to loose once in a while... but hey, it could have been brilliant if Galoc had started up on time and oil was $200/bbl.

Nido, with less debt had the capacity to withstand the fall in the oil price and the delays.

I wonder what StockAnalysis will make of the current OEL situation?

p1000