Providence Resources - Sequa - Having read more closely the...

Having read more closely the release from Sequa regarding its Purchase of Tellus petroleum AS it appears that the deal with sequa could still be on course. Sequa Petroleum will give 6m shares in Sequa and 4m dollars in cash (max) to buy Tellus. Tellus will buy into a series of producing and soon producing fields in the Norweigan Continental Shelf from Wintershall (a subsidiary of BASF). The cost of Tellus´s investment in the Wintershall fields is 602m dollars. No where does the statement from Sequa say that Sequa will have to raise or pay this 602M dollars to Wintershall. So it appears that Sequa is acquiring tellus for 6m shares plus 4m in cash and likely assuming the debt that tellus has likely issued to pay for this purchase. Given that the Oil fields in question are either producing or near to production the coupons on any issued bonds are likely to be paid from Oil revenue stream generated from the % of the fields purchased. This would mean that Sequa still has its recently raised cash on hand and the statement by Providence that no change in status of Barryroe Farm Out (if Sequa is the farminee) would make sense