re: Ann: Rialto completes transaction with Vi...
Ps. I don't think financing of the capex will really impact them too much on the cashflow side immediately.
They should easily be able to gain access to a 5 year RBL facility (will be able to be rolled over) to fund the development of Gazelle, and likely also the ongoing developments of Hippo etc.
They would only need aroudn $21m I reckon (if Petroci exercise their right and pay their 16% share - unless this is also free carried and then RIA will need around $23m, again should be easy to get the RBL facility. Using an 11% rate of interest, interest would be circa $2.3-$2.5m, so will be covered no problem once production is up and running if my estimates for revenue splits are correct. I would also estimate that if production starts by mid 2015, then by start 2016, they will be at their 24.9% rate that would be the rate in the EEAA, as i would think all those complications may be out of the way (except maybe cost recovery, but thats all upside).
I would be hoping that RIA gain access to a larger facility upfront, maybe somewhere around $75m-$100m. Obviously wouldn't draw down on it yet, but would provide access to the capital that they will require for Hippo etc.
Fingers crossed for movement on the gas sales agreement, and the financing facility by the end of the year (along with the EEAA) so they can get to FID.
RIA Price at posting:
3.8¢ Sentiment: Buy Disclosure: Held
