Assuming no severe cost blowouts, Paralana should be fully funded up until the 7.5MW pilot plant (if the rig is leased). Infrastructure and plant development at that stage should be covered by the optional commitments of Beach.
"The Agreement between TRUenergy and Petratherm contains conditions subsequent (including Foreign Investment Review Board approval, modifications to existing JV documents and securing a drilling rig) that need to be satisfied over next three months.
On the matter of securing the drilling rig, Petratherm is pleased to advise that Beach Petroleum and Petratherm are in the advanced stages of negotiation of a suitable drilling contract. Petratherm is confident that all conditions will be satisfactorily met within the three month period."
Of course, purchasing a rig capable of the depths required to implement the HEWI model would accelerate the ramp up beyond 30MW, but would require PTR to sacrifice more of their ever-diminishing 34% equity.
It's a very good deal for TRUe - they get to assess the commercial viability of the project for $6M (10% equity), then elect whether or not to increase their equity by 20% with the significant cash injection (in two tranches) of $51M.
PTR Price at posting:
0.0¢ Sentiment: Hold Disclosure: Not Held
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