(DES) Desire Petroleum

Ohtaxes,

I seem to recall the bottom line would be FIG arbitrating any disagreement or problems. So I can't see PMO/RKH trying it on as you say. FIG want everyone to work together and in the scheme of things if Desire say they can't get the funds, I'm pretty sure they would be carried, even if it was at a high rate of interest by PMO.

However I don't see it coming to that, as soon as a rig is booked and planned in, there is no doubt as that time draw near, that Desire will start to look attractive again to a whole new slew of investors. I think Phipps would then easily find the 20/30m pounds or so to fund their share of appraisal, he has never had trouble in the past as those investors have always made money, unlike RKH II's such as Odey.

Lets face it, RKH/PMO have to sort this out, they have to speak with Desire at some point and cut a deal either to farm in further if terms are good or carry them, there is no other way around it.

Wonder how many turn up for the AGM.

LTT

LTT,

Agree, DES's only problem (formal/contractual) is how to fund their required one drill prior to the FIG licence extension/deadline to May 2016.

Assuming RKH, drill in PL04, which is a given as per their recent presentaions, they'll need DES to contribute, but DES have no money.

If PMO/RKH drill more than once in PL04 (which they will), how will DES fund those additonal drill costs?

They have to do a deal with someone, If PMO/RKH don't reciprocate with DES in respect to the last campaign, they'll pi** oss FIG, and DES will get a further licence extension.

As one of the FI's Co's BoD's told me 'A deal is inevitable', whether he knew at that time, or was hoping, I don't know.

I'm willing to wait on this

Kind regards all

Oht

Well the AGM on the 29th should shed some light, then can hardly say "No comment".

My own thoughts are that there have been visitors, but offers have been on the ridiculous to "Your having a laugh, right!". Desire however despite what it may seem are at an advantage, they can afford to just sit back and wait, let RKH and PMO bring a rig and then raise their share of costs on the back of that, dilutive it may be, but Phipps will prefer to dilute (as he would be unaffected) rather than give say 50% of everything for just 2 or 3 drills! Once bitten, twice shy and all that.

Desire could end up with anything from 10% to >15% of SL complex once Casper etc have been appraised and added to the development plan, that could mean more than 8,000bpd in 2019/20. Ok they
have to find their share of costs, but they could also let PMO do a similar deal to that of RKH and fund the development recouping the cash from Desires share of production until paid off.

So what's the rush, let PMO and RKH do the work, then once the rigs on the way, get a couple of slots at a much higher share price, after all the nearer the rig gets, the nearer we are to first oil production and Desires share of revenue is not to be sniffed at, it would make this current share price look ridiculous.
So in the meantime dangle the carrot of wanting to drill and get a partner to fund it, all the while, realistically expecting to wait till back end of 2014 early 2015 for the PMO/RKH rig to arrive.

But until then, ridiculous the share price will remain, along with other AIM oilies who have great prospects but are currently unloved.

LTT

Anyone any thoughts as to when there could be an announcement,many visitors,no visitors come on DES give us a snippet please