Hi Wazza,
Bear with me here and correct me if I am wrong, but the only Exploration and Evaluation going on would be at Pathfinder right? Also wasn't the rig and equipment on an annual fee basis with Math Energy. Assume that means 12 fixed monthly installments.
Q1'16 E&E expenses = $166,665
Q2'16 E&E expenses = $815,973
Also Administration (and since the executive team are essentially the drilling roughnecks) is as:
Q1'16 Administration = $277,330
Q2'16 Administration = $304,476
I wouldn't contest that AKK would need temp contract help with drilling so a slight increase makes sense (as would salary increases for all the promotions).
What do you think of the difference in E&E expense. Yes, Q1'16 was elk season and drilling wasn't happening and yes there is more costs to drilling than just rig rental (e.g. pipe, cement and such). So if $166,665 is 3 months of fleet rental then in Q2 there must be $815,973 - $166,665 = $649,308 of other costs. And that could easily be explained as the costs of drilling 3 wells (Total cost now $982,638) so roughly $330K/well so far ... still have the deviated section to go.
Is that your understanding?
So Q3 E&E expense of $670,751 puts total for 3 Qtrs at $1.653M or about $551K/well for D&C plus tested and tied into production (assuming goes well).
So spending the $1M in Q3 will leave them with $1M going into Q4. The facility to which you speak - wasn't that "eliminated"? Or is the suggestion the debt was repaid and the convertible facility remains open to be tapped again. Or is this something new altogether?
That cash flow machine from other properties (Kentucky and remaining TX wells) ended up contributing $2,632 of revenue.... Since production payments were $29,905 that doesn't appear to be even cash margin positive unless I'm looking at it incorrectly???
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