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Rev
Agree with your analysis.
Think many of us feel so battered here we would welcome a farm in or a full bid at the moment. We've all lived and breathed HUR for too long and need a change of air.
Suresh: 'from where funds will come for FFD?'
Honest answer is we don't know (and this may be one of the question marks suppressing the SP) but there are a number of options and the most likely is a combination of one or more of the following:
Farm in by a major. This could be a 50% farm-in for full carry, which would at a stroke cancel all our funding requirements and give us and the market assurance that FFD will happen. Of course the Farm-in may be for less % or for less reasonable terms, in which case one of the following would come into play.
Senior debt backed by our ability to continue making money (requires some definitive clarification from the BoD that their modelling of the system is correct and the oil will flow for many years, I'm hoping this will be clarified at March's CMD or in a CPR sometime this year)
Fund raise through new shares (not likely at this SP as the numbers just wouldn't make sense)
Use the free cash from present production to develop a slow staged FFD over a number of years as and when sufficient money has accrued.
It's this last option that the BoD have to convince any major suiters that this is a valid plan in order to bring them to the table as otherwise they wait for us to fail like SXX and pick off the bones. Given that we are producing quantities of oil at a price far below the current PoO I am confident that this is an option we could, if no other option were available to us, develop, but I see that questions mark as what is driving the SP lower and feel we may bounce around for a while until such time as the CMD (or CPR) gives some more clarification, though of course I'm hoping that I'm worng and that something else, such as hire of the rig to drill another Lancaster well, will push the SP higher.
Rev.
I've never brought this. And after being down 80% on tullow. I need this to go to 10p to consider a massive stake..
from where funds will come for FFD?
not a deramping, i am potential investor