I've seen several attempts on here to calculate how much cash...

I've seen several attempts on here to calculate how much cash rfe would have on hand at 31 march. The answers ranged from $30m to $37m including the $11m from the land sale. I think that anyone believing they have that much cash on hand are in for a rude shock when the quarterly comes out.

All of the calculation attempts have taken the December cash balance and just adjusted for sales revenue, operating expenditure, interest etc and all of these assumptions seemed quite reasonable. What nobody has done though is adjust their cash position for movements in debtors and creditors.

Now debtors from the result of sales should remain fairly constant as production has been reasonably flat between December and March, so no adjustment required there.

Creditors on the other hand is a different story. The December accounts show that rfe had $37m in trade creditors and that they pay on 45 day terms. So rfe would have paid for these cost of past drilling in the march quarter which would have reduced their cash balance significantly. On the flip side they would not have paid for any costs of drilling that were invoiced less than 45 days prior to the end of March. Now they have slowed drilling significantly so I can't see them owing more the 2 wells at a 70% WI, so probably about $5m.

This all nets off to a $32m additional outflow on top of other posts estimates of $30m to $37m cash on hand, leaving $5m at best.

How management got themselves into this mess I will never understand.