Hi Friends,Wish you all a happy New year 2014. This could be the...

Hi Friends,

Wish you all a happy New year 2014. This could be the year Otto fulfills its potential and make us all happy. Why 2014 could be different from last 4 years where its SP is stuck within a very short range ? Below is my perspective,

1. Galoc Phase II completed successfully without any major hurdles and is an EXCELLENT asset to provide positive cash flow for next 7-8 years.

2. FPSO and Mooring upgrade completed in 2012 and Management has done an excellent job by opting to upgrade. If the vessel can survive super typhoon Haiyan, I am sure we are geared enough for a stable Production up-time in future.

3. 11 cargos to be uplifed in 2014 net to Otto from Galoc and cash revenue will be very good. I believe debt from BNP Paribas would be complete by Q3 2014 and all cash from then on will strengthen Otto cash register and will be used for exploration activities

4. Many investors and big fish are interested in SC55 drilled and is a key prospect of Otto. I believe, pulling out of BHP from SC55 COULD be a blessing in disguise story for Otto. Best bet for DOE is to allow Otto to find a new farm-in partner and get it drilled. Otto are confident of finding a farminee and I believe the terms would be better for Otto than we had with BHP as we have 3-D already covered and if needed, we can spend some cash for exploration well as BHP had saved us ~50 million if we are to drill at least 1 well in SC55 (3-D seismic is estimated to cost 25-30 million + 3 million on DOE approval for SC55 assignment + 24.5 million on first exploration well drilling). Upside potential from SC55 could be > 2$ per share to Otto and if all goes well and Otto goes on to drill, expect a mad rush in Market as Fear Of Missing Out will set in. Things could turn negative as well w.r.t SC55 if Otto cannot find a farm-in partner and there is still a possibility of SC55 license relinquishment. But, I believe probability of positive news is more than negative news. Also, I believe negative news will not dampen the SP as Market does not value SC55 at all and already trading below its Galoc valuation. On the contrary, positive news from SC55 could propel us to new heights.

5. Duhat 1 and 2 turned to be a DUD and I am sure, Otto's technical team are brain-storming to understand the failure and finding ways to plan to perfection and go for one last time. It could very well be third time lucky for us. Duhat is worth another try as expenses are very less and if we are succeed (mean of 34 mmbls), it could be a COMPANY MAKER in itself as we hold 80% W.I and can self-sustain for years to come financially.

6. In my personal opinion, I believe Kilosa-Kilombero and Pangani license in Tanzania would be the Company Maker for us than SC55. We have 5 basins and numerous prospects in these license which could hold multi-millions or even billions barrels of OIL. 2-D seismic completed has been the most exciting of all seismic results I have ever read and the probability of COMMERCIAL OIL DISCOVERY is very high in EARS region. All our basins are on-shore and will be relatively very cheap to drill. IMO, Otto would be more than cashed up to finance drilling in K-K/Pangani for its W.I. Kito prospect is estimated to contain mean of 60.4 mmbls net to Otto (best estimate) and even if it fulfills low estimate of 19.2 mmbls, it could add 25cps. Point to note is, Kito is very small area in one of the 5 basins and we would be drilling more prospects in future and un-covering better prospects than Kito. Below is Kito prospect estimate and important thing to note is, estimate is done based on 20% back-in right to TPDC included. COS of 8-9% is attributed to many factors viz., only 2-D seismic done and no 3-D seismic yet, no regional activity in the surrounding areas, no historical exploration activity in the license area. But, Swala and Otto believe Chance of Success is very good and going by the seismic, they could very well be right. More over, exploration drill costs would be very less as it is ON-SHORE and is worth a punt. 2 basins in Pangani and 1 basin in Kilombero are estimated to be Neogene plays and if it is proved right in future, Otto would be multi-bagger for sure.

Otto is trading below its Galoc valuation and Proven resources. Even if we attribute zero value to SC55 and Tanzania, Otto should be trading no less than 12cents but Market is a CRAZY PLACE TO BE IN AT TIMES. Once Market understands the potential of Otto assets and quality of our Management, our SP would propel better than anyone can expect. Have patience, we will be rewarded for sure. These are my opinions only, DYOR.!

Happy New Year to all and hope 2014 bring us NEW HOPE and reasons to CHERISH FOREVER.!!