Ann: Cuba Block 9 Farmout, page-24

Well, lots to take in .

Im not going to give full judgement of this until I have done some further research and spoken to some business colleagues.

I will just add... farm outs have been hard to get globally over the last few years, farm outs in Cuba haven’t happened at all in many years..

So congratulations must go to management .... whether it’s seen as good , bad or indifferent is moot, the facts are Melbana will pay not pay one more dollar in relation to activities in block 9 and will recieve sizeable income on a best success case for the block .

Anyone thinking that oil revenues and profits would come soon  after well was drilled really does not know the industry or the investment here.

Dependent on existing infrastructure , on a success , it will always be a 2-4 year period to move oil to a dollar generative downstream operation from pre drilling exploration operations ..

i need to quantify the 12.5 % figure on profit oil and see if profit oil is going to happen immediately after production as IMo the partnership cannot asign 100% of production as cost oil to recoup outlays .... this is normally not something that happens , however I note Melbana will not incur costs, so we need to see what proportion of initial future production is assigned to cost oil and what’s assigned to profit oil.

Will report back in a few days or so..