I envisage the main focus for a high percentage of OEX investors is towards the Timor potential farm-out and the facility to move Indonesian operations forward. Mention of a Cambay re-entry is incidental to the main focus and unlikely to have any real influence on the share price at this stage.
I believe it is Timor that will catch the headlines. The force majeure brought about by the rig cancellation put back the date for drilling operations to commence and in my view it was a fortunate situation to avoid the massive dayrates that would have applied. Perhaps that was a blessing in disguise. Nonetheless farm-out news was mentiond as being announced by the end of May 2009 but more specifically by the end of Q2, 2009. That is now under two weeks away.
Management credibility has been severely dented by slippage on a number of fronts. I expect a concise update before Q2 ends.
As for Indonesia, it is a thorn in the side for Oilex. It should be a good earner and the prospects for those operations to be just that extend back to 2007. With arbitration and change in the constitution of participating companies there seems to be no clarity in the way forward.
I certainly don't expect Bruce McCarthy and his team to be sitting there living in hope. I expect ongoing focus to resolve issues and grow the company. For the present I see no clear green shoots of recovery emerging yet.
Time will tell as always
All the best Jimmy
OEX Price at posting:
16.5¢ Sentiment: Hold Disclosure: Held
