a different spin on why opl goes up and neo doesn'

Basically the only big news we have had is that they both got a bigger share of SELH & some extra land.

OPL is re rating on the back of this but NEO is not - I believe the reason is that all the 'extra' value in the deal went straight to the Con Note holders - the effectively got 20% of NEO when NEO only got an extra 12.5% of SELH - its only asset.

In the end all NEO holders really only own the assets - you got and extra 12.5% of the only asset by giving Con note holders 20% of NEO - the vehicle that holds those assets - wanna see how they can earn a 30-odd % holding in NEO ??

Follow me -

assuming all conversion of notes is at 3.8c - 4.88m gives you about 128m AND 128m 6c options.

If they manage to keep it below 5c and listed options don't convert the they stand to own a total of 256m of 772m or about 33%. All for the cash to run the company for a little while longer and and pay for 12.5% of the assets - oh yeah don't forget they are getting 10% interest in the meantime.

Sorry folks but I am with Salty on this one - you have been sold out and I bet Kain hasn't even figured it out yet.

If the options don't excercise then the European fund will take over after converting to own 33%. The options are a nice way to get around owning 20% without making a T/O bid too.

A final question you need to ask -

In the announcement about geting the extra 12.5% it states that the second tranche of notes (taking the total to 2.5m) will be drawn -

"The funding is as follows with draw down triggers varied by mutual agreement:
i. $1,300,000 upon signing of the purchase agreement to acquire the 12.5% interest in the Project;
ii. $1,200,000 upon attainment of revenue production in excess of 2 million cubic feet of gas per day by the Project; and
iii. $2,380,000 upon attainment of revenue production in excess of 4 million cubic feet of gas per day by the Project."

But in the AM presentation they said the 2.5m has already been drawn - stil no gas and certainly not 2 million cubic feet per day flowing but they have already drawn the second 1.2m ????

Of course it says it can be varied by mutual agreement - and there is no doubt Aton select will be agreeing given what I outlined above - my question is - why is Kain drawning fund so quickly - is he really running out of cash that quick???

If he is then prepare for more CN's and good luck having anything left when all the potential finally hits the grid.

Sorry to sound so down but now I've had a chance to go through things properly it stinks.