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Using figures from the interim results for 6 mths ending Sept 14. 2900 bopd @$55 pb = $159,500 income per day. Cost of sales (less Depreciation, depletion and amortisation as I'm only interested in Cash at moment) was 49% of Sales or $78155 per day. Admin was 8.9% of sales so $14195 per day. Therefore, $159,500-$78,155-$14195=$67,150 cash per day. That's a surplus of $2,014,500 per month. These are fag packet calculations of course. What this tells me is that this company is far from dead. It is only debt that is the problem, sort it out and this company will survive and prosper. I've only got 85,000 shares as I thought "what the hell" and plowed a huge £140 into the stock. If things do sort them selves out this is going to be a traders dream and I will be in with more money; if it was trading at the moment I would definitely have a further punt.
Ural's Energy is a leading Russian independent, whose main assets are in Russia. I would think Sberbank would have great influence within the Russian Federation and able to have a significant influence on assets based in Russia regardless that the company is a Lse registered company. However, will they have more problems influencing decisions on UK companies based in Kazakhstan and registered in London. IMHO
Have AGR been scared off because Sberbank is playing hard ball and refusing to restructure the debt? Would they come back on board if the Bod's game of Russian Roulette with Sbeerbank ends in a restructured finance package?
So Sberbank a Russian bank (shivers) albeit the largest in Easter Europe has refused so far to talk extension? So if the Administrators (UK) are called in, what happens to the debt? Well Sberbank will be a secured creditor I would assume and therefore, would be first in line to get their money back. However, the process of Administration is not quick, a company of the size of MXP will take many months to sort out, the Administrators have 8 weeks to set out what they intend to do with the company and call a meeting of creditors; however, MXP could be in Administration for up to 12 months. Sberbank will not be getting a brass farthing until things are sorted, they might have to accept a settlement significantly lower than what they are owed. Poor old shareholdeers are stuffed they will most likely get nothing or very little. My point is though does Sberbank have the bottle to force MXP in to Administration? Russian banks are getting hammered from all sides at present. So this might be brinkmanship on the part of the BoD of MXP, dangerous but possibly leading to an accommodation. If the debt facility can be sorted then a third party investor/partner might be more willing to come on board. This is only one perspective and fraught with difficulty, lets hope something like this happens. MXP is certainly on everyones radar now, they say even bad publicity can be beneficial; is someone out there licking their lips and thinking Mmmm 4000 bod and half the company for a song? After all shareholders (most of them) had given tacit approval for a deal with ARG for 51% of the company.
Looking at Max Petroleum, I want them to pull through; A small investment keeps me interested and I'm not the slightest bit interested in gambling shares, it's a road to ruin for the inexperienced. I'm in to oil and gas companies at the moment because the best time to invest is when they are down in the doldrums; hopefully in 5/7yrs time I'm smiling because of my decisions now. Whether that smile will extend to MXP, well only time will tell, at least it won't be a long draw out death, within the next two weeks I should think? Good luck to those in the company who will be working frantically to pull this through.
I have just bought 80K shares as a bit of a punt. I haven't had chance to do any research on this company but hope that it can survive. 4K bopd is not to be sniffed at; have shares in LGO who currently produce 3K bopd, the difference being debt. The analogy of the personal loan and industrial financing is not correct; banks are aware when lending to oil and gas companies that debts are long term and cash flow can be adversely affected by the oil price. No one envisaged such a savage receding of the oil price and the bank will probably lose out if administrators are called in as well. Also if administrators are called, they will do everything they can to salvage the company as a complete entity and sell it off as a going concern; shareholders might yet get something back if a buyer can be found. There's only a small window to sort this out but sometimes when all is lost and companies stare in to the abyss something is salvaged. Anyhow, commiserations to those who have lost so much value but GL to MXP; I hope to make a good return on my speculative investment because that means they will have survived.