Malcy - update3 Apr 2018 15:17
I only made a modest comment whilst on the move on Thursday but not everyone got my drift, maybe I had just seen the bits I thought the market would not like much. Since then I have spoken to Tony O�Reilly and he has put me straight on a few things�.
So, his strategic bull points are easy to understand, he�s not raising any equity and the APEC led consortium including COSL whom I know a lot and JIC a little less, are paying for three firm wells plus sidetracks and testing even to potentially include the deeper Jurassic play. PVR are not a development company and needed a partner to move forward and with a strong Chinese consortium able to take Barryroe to FID and beyond this will be a step change for the company.
A quick look at what I was concerned about, there will be no drilling until next year which seems tardy but I have been persuaded that firming up rig locations will be under way soon. This ties in with the fact that this deal will not close until the end of the 3rd quarter which I understand, just. No cash back still slightly surprises me but I suppose farm-outs just aint what they used to be and on that subject APEC will be loaning the money for the development to the partners which will be repaid from future production cashflow from Barryroe. Operatorship is a slightly moot point as EXOLA stay as operator but with the rig and all the kit and the services coming from APEC I suspect that there will be strong representation from them at the partners meetings.
The bottom line is that after all these years Barryroe is now going to be developed and in a serious and well funded way. Those of us who have been waiting for such a deal are older and greyer than when the hunt started but at least are mostly still here. This should provide a good background for all the other things that PVR have planned for the area and we mustn�t forget quite how valuable that portfolio might become now that so many majors are in the postcode, indeed I suspect that now that the Chinese are in town they might be taking a look at other partnerships along with their new Irish friends.
PS The APEC consortium have a substantial bundle of warrants at 12p, they might like it so much that they buy the company�