Hi @cmonaussie, I get PV9 of $645M for our assets Annual report...

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tt2000

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29/05/20

19:05

Post #: 44928013
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Originally posted by cmonaussie ↑

Yes concerning. So is no news & so it oil price going away from $40.

I keep coming back to the Term Loan as the potential default threat as opposed to the RBL, but I've reread it so many times and the PV-9 does refer to latest reserve report (which I haven't seen but is referenced in the 10k). And as you've posted that is based on adjusted strip pricing (local differentials) for the remaining economic life, using SEC guidelines AND with the following further adjustment.

The problem I see is not the actual PV-9 value but that PDP is not at least 40% ... at that they adjust for production during the Qtr. Now its been like that for a while (without a problem) but I guess that's because they were developing quickly which would correct that problem. But with curtailments and suspension of completion that problem gets worse. And maybe why a solution is necessary???

Tell me I'm dreaming (nightmare).

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Hi @cmonaussie,

I get PV9 of $645M for our assets

Annual report has PV10 by PDP. Dividing this by 0.6 gives maximum allowed PV10 such that only 40% is non PDP = $606M (which is otherwise $752M but then non PDP is >40%, so can't all be included)

has PV9 and PV10 values. Gross up PV10 by this ratio = $645M

so my guess is PV9 is around $645M ensuring the 40% PDP test is satisfied

With $365M debt = asset coverage ratio of 1.75

(But the question is what is that PV9 based on Strip pricing)....
Last edited by tt2000: 29/05/20

SEA Price at posting: 16.5¢ Sentiment: Buy Disclosure: Held
2 Upvote

2 Great analysis

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