From P.A. at Advfn13 Jan 2015 15:44
Besides the usual sad deramping ( you certainly wouldn't want to live next door to these people) I am slightly surprised by the continual reference to the oil price fall but not really surprised by the knock on effect on the share price.
For those without a calculator I have just run over the hedging for 2015 and if oil is at $40 ($44 before differental) for the year Caza gains $6m on the swaps,gas adds about $300k extra.
CASA's current debt is $43m costing $5.16m.
With Gaza's break even ( including G&A but not financing) at $30 /bo if they produce 1000 bod for the year they have a cash flow of $3.65m from production plus c. $1m surplus from hedge (after paying Apollo)‰6.
Further production would obviously require financing but remember the $30 figure includes G&A and the first 1000 bod covers almost all of that cost so any subsequent production would have the new finance but not the G&A cost in the break even.
New production could have a break even of less than $30.
Now here is the serious question.
Does anyone here seriously expect that world oil production will hold up for an entire year with the oil price at c.$42 ?
The North sea will be crippled , a large number of shale producers will be out of business and there will be civil unrest in many oil producing countries.
On a more mundane but practical note I see that Broadcaster produced 18k in its third month and that fits the graph produced in the presentation. The big story of the new fracking technique wasn't the initial flow but the promised of a MUCH bigger flow a 12,24 and 36 months,,.. one to watch!!
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