Borrowings increased to $18.3mil which was way more than most of...

Borrowings increased to $18.3mil which was way more than most of us estimated.

I expect they will knock a lot of that debt on the head in the next 6 mths however the depletion of reserves must also factor into the valuation equation.

Situation remains that a lot of eggs remain in the Worrior basket and STU must keep drilling in the CB to maintain reserves replacement.

I doubt STU will be able to fund Bazzard ($20mil) and drill CB wells and pay off the $18m debt all from the next 6 mths cashflow.
Thats not a major problem in itself and the sp should still appreciate somewhat as Bazzard gets closer.

If you look at Apaches drilling schedule (estimated 305 days to complete) , Wasabi has only just spudded so Bazzard probably wont spud until year end rather than 3rd qtr 2008.

Phase one of the refinery project is estimated to cost $45mil (STU 50%) so funding for that project will be an issue in the near future.

Might stay on the sidelines for a while now and look at STU later this year as the big drill gets closer.