Future strategy has not changed substantially from the previous board i.e. the Macquarrie J.V. strategy is not new, just the J.V. participants are brought back to one.
The capital raising strategy is still in place (biggest one I have seen to boot). Up till the June Quarterly, the board's attitude was to protect the shareholder's from dilution with the options of selling the plant,encumbering the to-be reserves etc.Ken's appointment in May took him several weeks to take this by the scruff of the neck. Those options are too slow and would be expensive. The purest and quick-fit option is the C.R. - you set deadlines and hell there is no debt to pay back (repayment is some notion that in the future you will create value to the grantors of those funds). The C.R's under the old board would have been a lot worse - they would have been placements for working capital, plant repairs, perforations, plus this biggy would have been rights + placements (no ERM's $7.5m).
I really don't think they will be able to achieve the $10m from the mums and dads (some of the attitudes here seem to reflect that even if it is voted in the affirmative). I believe that the $17.5m will be totally expended by the end of 12 months (drilling Black Arrow, Drilling Gin Gin, IrregularGully seismic, repay $4m, tenement commitments, $2.1m on plant plus administration) Wonder if Gin Gin drill is still in the first two after is was seriously downgraded ?
It would be good to see this budgeted cash flow model made available to the grantors of funds so we can form an opinion. Might loosen a few more pockets .
I am going to vote yes for the plan. Don't worry about this plus plus 70% on the $16.34. (The farmin will ameliorate this debt) I think the attitude of some is that is looks like greed. ERM are taking the biggest risk here by taking a massive shareholding. If there is no farmin within 2 years, lets hope more oil is flowing by then. I think the odds are in our favour
I would vote no to the sale of the plant until a min of 20mmcf/d is achievable.
A farmin is a "Company Making Deal" - not a Capital Raising.
Cavlierie Ken - "He Who Dares Wins"
My opinion is humble. I should have sent this off earlier as I would expect some of you would have been propping up the bar for a while by now being Friday Arvo and I may be even more humbled by uninhibited critiques (from the heart of course).
EGO Price at posting:
0.7¢ Sentiment: Hold Disclosure: Held
