MZ-1, page-5

PVD are truly un-capped so here is how it works (see press releases).
They have a carry on drilling 2 wells to a cap of $215MM. MZ-1 was AFE'd at ~137MM to firm TD so any overuns from MZ-1, then PVD has an election, prior to spud no. 2 (8 month gap between rig slots and wells 1 & 2) to invoke the option to go un-capped. This option means that any expenditure over and above the gross cap of 215 is based on a dilution of PVD's holding (at a rate that is every 4.5MM gross overspend then FMI earn 1% from PVD. This is valid down to a floor of 4% equity at which point FMI can not earn more equity from PVD in the event of yet more overruns.
So,
FMI could earn a maximum of a further 19% equity but at a gross cost to them of $85.5MM
So PVD are covered in the event that well costs end up at $300MM (215+85.5) at which point they remain fully covered with 4% equity remaining. I think this is highly un-likely but a great to have.

Now one would only ever use this dilution mechanism in the event of a dry hole in MZ-1 and you still had well 2 to drill and in this situation a likely inability to raise funds to safe guard against more over run. IF MZ-1 finds oil then PVD are less likely to use this mechanism and instead more likely to look to other funding mechanisms.

Hope this helps with the understanding of the brilliant deal PVD has in Morocco and why I for one believe the stock price is ridiculously low.

Good luck to all who hold