NSE 0.00% 0.4¢ new standard energy limited

The problem is Sprout, NSE must drill 2 wells every six months...

  1. 11,480 Posts.
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    The problem is Sprout, NSE must drill 2 wells every six months to keep the permits...(as Whitenoise mentioned). NSE have basically admitted that they are only able to afford to drill the next 2 wells, but not frac them. That means no revenue from the wells, which I am pretty sure is the point of drilling them.

    If the oil price stays the same over the next 6 months or so, then how are they going to be able to drill another 2 wells, let alone frac them. If they did not have the drilling requirements, then NSE could simply sit, build up a cash pile and drill when they can afford to. Problem is they cannot. So there is no chance of them following your 'slow and steady' approach.

    Lastly, again on the hedging, I can only assume the hedging only gets completed when the next loan instalment is offered. Which would mean NSE would have to hedge at today's prices... not a good situation to be in.

    Again, sorry to holders. There is still a chance NSE can pull off a win and somehow reward shareholders (I hope).
 
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