grahamc58 & others...Apart from the obvious prospectivity of the...

grahamc58 & others...

Apart from the obvious prospectivity of the Uganda permit, the company is so well cashed up that there is virtually no chance of a placement prior to this first well. The directors own over 30% of the equity and so will be anxious not to dilute their interest before this well at a price that would undervalue their investment. Right now there is around $33.5m of cash on the balance sheet and zero liabilities...market cap of $39m at Friday's closing price. The maximum cost of their well commitment is USD6.5m (dry hole) or USD7.5m if there is a drill stem test. The latter would be a fantastic outcome with certain (IMO) 10 bagger+ result on success.

What is the downside? They spend USD6.5m for dry hole and retain cash on balance sheet of about $23m which is equivalent to 13cps plus remaining assets.

Comments welcome.

regards
DF