I think you will find that once reserves are proven, debt funding will be the way to go. This will prevent dilution of the share price and we will actually have income from production to repay the debt. FD3 and 4 are really about delineating the resource (to prove up reserves). The production profile of these wells is such that payback occurs relatively quickly (6 months), so at some point the ongoing cashflow from many wells will fund the ongoing drilling. So if all goes to plan, the debt funding will only be required to get us to critical mass.
Should be an interesting announcement this week?
Regards, Whippet
AZZ Price at posting:
66.5¢ Sentiment: Buy Disclosure: Held
