Providence Resources Forum

Not sure, a lot will depend on what long term price they agree oil will be at. That will give a value to Barryroe. From this they will then agree what portion of this Sequa want to buy and agree a split of the money into cash and the rest into Sequa having to pay all costs etc. So the key will be the oil prices agreed. I also think that the delay over the last few years has some positives as well as negatives. Negative in that the price of oil has fallen, however that seems to have reached a bottom, and positive in that it shows PVR have been holding out for a good deal. I don't see any reason for them to take a bad deal now when they wouldn't six months ago.

Thanks Godot and what will the final percentages for Providence be in your opinion on Barryroe

A year ago there was nearly a one billion pound deal done. I would think that the deal will have reduced a good bit from that value. But not in terms of percentage of the deal remaining but in the value the oil to come up reducing and therefore the perceived value of the deal. I think the cash element will still be quite high. A lot higher than you think as either they will have to be paid enough to pay for their share of the barryroe development or carried by the partner for it and also receive enough cash to fund SP and repay the loan and function into the future. I don't see the point of doing a deal if that wasn't achieved. So I think Loan and spanish point 65m plus running costs into the future and other plans another 20. So I think Tony will have been looking for a good bit of money upfront and a carry on all future costs in Barryroe

Morning Godot
What do you think the final deal will look like. What will be the cash payment and what percentage of Barryroe will Providence retain ?

Its amazing how the pieces of the puzzle are slotting in Sully. There are a lot of people talking this down but you have to think they are doing it for a reason. After all last week they were giving out that no deal was done and now we have a deal they are complaining about it. Sure none of us know the terms. They must be decent enough if the third party has to get finance for it. And why bother doing a deal if you don't think you can get the money. Waste of their time. So I think this news is all very positive

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Fair play Sobeit and Jimmy for debating the issues.

Any chance PVR give up incremental stake in SP to Cairn in return for a free ride?

Jimmy, I think twice you have posted that we have an FX loss on the loan facility - do you really think the management would have been stupid enough to draw down the loan facility and convert to Euro?