THIS...is real27 Feb 2022 14:11
Afternoon...
I STRONGLY believe that PRD now has SEVERAL viable options...
Terrific of course
and quite extraordinary for a tiny outfit :):):)
The purpose of THIS note is simple:
I want to try to understand the views of PIs on the way forward ...
As we know...
one of the interesting aspects of PRD is that it appears that a significant proportion of shares is held by PIs
with large holdings and a high level of conviction ... stemming from research
Of itself, that does not give clout ...
but, given the levels of PI holdings, we are all certainly thinking intensely about the options...
as of course will be PG/LB :):)
So ...what would YOU do...
if you were in the board room?
Not as an armchair general ...but for real :) :) :)
Of course... we can surmise about the state of the available options
but I would be genuinely interested to hear the views of those on this BB
about the broad range of possibilities.
I will kick off the conversation by setting out just SOME of the options...
They are not in any order of preference ...but just to get the debate going
1) A conventional farm-out...
This would usually be structured to leave PRD with a fully carried interest until $XYZm has been spent
on exploration and/or other agreed activities and /or facilities
2) A deal with local industrial off takers...
they get discounted gas,
PRD gets capital to drill.
This was the route that PG initially spoke about
3) A placement...
Dilutes future earnings from ALL sources.
Yes, options 1 and 2 also dilute future earnings...but 'confined' to Morocco.
These first three options can each be further split into
(A) doing a deal before testing MOU-1
or
(B) doing a deal after testing MOU-1.
4) Test MOU-1
and, if successful, raise debt finance secured on the asset.
One needs to be VERY careful to constrain the nature of the 'security' provided against such debt
Former GKP shareholders will recall the pitfalls of granting wider 'security'!
5) Wait until PRD can monetise one of the Irish assets
Perhaps now closer than even 10 days ago
And then use part of the proceeds to mount a 3 or 4 well campaign in Morocco
OF COURSE...
There may be other options….
What are your views
PLEASE ?
And if Flagstaff monitors the BB discussion, who knows, our views may even feed back to PRD!
Thank you
Regards
GRH
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