Don't understand how you can be saying that they are going to...

Don't understand how you can be saying that they are going to run out of money for drilling. They had $270M in cash and investments as at end DEC 2008 and were only projecting $30M in exploration expenditure in the current quarter. There was minimal revenue in the DEC 2008 quarter, however this was due to management choosing not to have a offtake due to the depressed oil price and instead increasing storages in the FPSO.

Production for the quarter was 193,783 barrels (impacted by cyclone activity - by comparison production for previous quarter was 270,000 barrels) and as at the DEC 2008 quarter total crude inventory held was 389,008 barrels.

Total production costs (excluding exploration and development) was circa $19.2M AUD and is offset by the revenue to be received from the stored production during the quarter and even at current low oil prices this will limit the cash run off position. In addition the current cash held also generates interest revenue.

If you consider the normalised production levels using 270,000 barrels for previous quarter at current low price of circa $40USD x 1/0.7 to convert to USD = $56.8 x 270,000 = $15.336 + interest revenue of $3.652 (amount in DEC 08 figures) = circa $19M the current cash flow position from production is neutral and there is plenty of upside when the oil price improves.

E.g. if oil eventually settles at USD $70 per barrel (I have used this due to the statements from OPEC that they will look to cut global production untill it reaches around this level). $70USD x 270,000 x 1/0.7 = $27M approx which is surplus operating cash flow of circa $8M per quarter.

Management have also stated in the activity report that they are looking to defer expenditures given the current oil price.

Saying that AED will run out of cash is just scaremongering and I can only assume to be an attempt to ramp down the current share price.