Providence Resources Forum

Just reviewed the last full set of accounts and the 6 month update. Spanish Point drill commitment is 16m euro. The admin and wages cash burn is only 2.2m a year. And some of this is not cash as it is share based payments. So 16m plus 2m = 18m. At the last update there was just over 18m in the bank. Also we have the court case legal fees etc to come back. So there is funds to play through until June when the loan is due. This is a 24m credit facility with 17m drawn down. So were good on funds till June and then surely they can extend such a small loan or get finance elsewhere based on the Barryroe asset.

OK JR thanks for that. Makes some more sense now. Speak soon
bye
Keith

Thanks Godot !!!

Spot on JREwing. You know your accountancy!

Spuddy - If the case had been lost, PVR would have had to hand over cash to Transocean. The impact on the accounts would have been, reduce accrual liability and increase the creditor (Transocean) liability. Cash would have then been required to pay down Transocean as a creditor and clear the liability. In fairness to PVR management, taking the legal route proved to be very much to the benefit of shareholders. Without looking at the accounts, I'm assuming PVR's retained reserves are largely exploration losses. These can be used for offsetting tax liabilities when Barryroe enters production.

@Mmmmm know exacly what you mean, I'm all in on 2 pair

@ JREwing, drop in share price mean nothing here, most things at the moment are guesses or shorts. There isn't sufficient info to put a price on PVR. Share price is nothing to do with farm out progression, we cannot know that info until it finally happens as against the law for company to leak. Bit like playing poker holding this share if you knwo what i mean....

Hello there JR. can these retained reserves be used for anything. From what I understand 19m is the amount questioned. Was this cash ever handed over to Transocean ?? If this amount was never handed over to transocean and now does not have to be handed over are we 19m better off. Or was it a case that we would have had to find 19m if the case against Transocean had been lost

Spuddy, the accounting adjustment will be increase retained reserves and decrease accruals, with no impact on cash. The only sources of cash I can see in this, would be if Transocean had to pay for PVR legal costs already paid or if PVR were awarded damages. Cheers JR

Providence had fully covered the transocean costs in its accounts. Surely this ,eans that either cash was paid to Transocean or cash was set aside to cover the potential costs which were seen as current liabilities. So we have a figure of 18 or 19 million that has to be accounted for. You must cover it with something. If this was not the case how were the accounts for 2015 okeyed by Auditors. What would have happened if Providence lost the case. If the 19 million was not covered i.e. paid or cash set aside then surely providence should either have made this know to shareholders and or would have had to have sough additional loans. Thus I believe there must be some sort of cash return for the amount in question or a change in the balance sheet freeing up funds that had been tied down against this potential cost