Each one in plain English, with the numbers worked through for a shareholder.
25 July 2008capital raising announcement● Neutral
FAR issued 38,750,000 shares at 8 cents on 25 July 2008, the first tranche of the placement announced 11 July. A further 11,250,000 shares will follow shortly, which would complete the 50 million share placement.
What it means for a shareholder
38.8m new shares at A$0.080 to raise about A$3.1m. That's 84% dilution: every existing holder's slice gets 84% smaller. If you held A$1,000 of shares (12,500 at the issue price), your slice goes from 0.167% to 0.027% of the company. To keep it you'd need 64,583 more shares - about A$5,167 at the issue price.
A rig is completing the 5500 ft sand in the Lake Long #6 well (FAR 31.375%), which the operator estimates could produce 1-2 million cubic feet of gas a day. A further Lake Long well, #28 ST, is planned for September at about US$1.8 million dry-hole cost.
Hunt's technical studies show multiple fan systems offshore Senegal (FAR 30%), with mean oil in place of 183 million barrels for a single fan and single reservoir. These add to the billion-barrel shelf-edge closure as drill targets. The farmout continues, and FAR still expects a free carry through one well.
FAR mailed the Share Purchase Plan offer: eligible holders at 11 July can buy up to $5,000 of shares at 8 cents. The letter repeats the work program: Stokes Bay-1 testing, NE Waller, Lake Long, Senegal and China. The first NE Waller well is now expected in August.
11 July 2008capital raising announcement● NeutralMajor
FAR resolved to raise up to $4 million through a placement of up to 50 million shares at 8 cents, with Hartleys as lead manager. It also offered eligible shareholders a Shareholder Purchase Plan of up to $5,000 each at the same price, to fund its work programme.
What it means for a shareholder
50.0m new shares at A$0.080 to raise about A$4.0m. That's 87% dilution: every existing holder's slice gets 87% smaller. If you held A$1,000 of shares (12,500 at the issue price), your slice goes from 0.167% to 0.0217% of the company. To keep it you'd need 83,333 more shares - about A$6,667 at the issue price.
FAR says Stokes Bay-1 testing has resumed, with potential of over 200 BCF gas or 10 million barrels of oil (FAR 8%). The first NE Waller well (FAR 34%) is expected in July or August, with a rig still being sourced. Lake Long and Senegal are also covered.
Empire Oil & Gas (14.8% partner) passes on ARC's Stokes Bay-1 inspection results with a cover letter. It is the same content: 1,200 psi and a brief gas flow. No new information.
Pancontinental, a Stokes Bay-1 partner with 10%, re-releases ARC's well inspection results. Wellhead pressure was 1,200 psi and gas flowed briefly. No new information for FAR shareholders.
Operator ARC inspected Stokes Bay-1: wellhead pressure was 1,200 psi and the well flowed gas for about six minutes, then slugged mud and gas. ARC calls this very encouraging, the first gas seen since testing began. A definitive test design is still to be settled.
Emerald Oil & Gas (12.75% partner) repeats ARC's Stokes Bay-1 inspection results. It notes that until this gas flow, no formation fluid had been recovered from the Nullara, only drilling fluids. No new information for FAR.
FAR re-releases the operator's Stokes Bay-1 inspection results. Wellhead pressure was 1,200 psi and gas flowed for about six minutes, which is interpreted as very encouraging. A definitive test method is still being worked out. FAR holds 8%.
This is Amadeus's release, not FAR's. Testing of Schwing #2's 12,500 ft oil zone (FAR 5%) found 39-degree oil but not at commercial rates, due to very limited permeability. The well will be recompleted in Lower Marg Tex sands at 11,800-11,900 ft.
Testing at Stokes Bay-1 (FAR 8%) is expected to resume in August, after the wet season curtailed it. FAR calls the porosity and permeability in the Nullara reef encouraging, but no formation fluids have yet been recovered from it.
12 June 2008security holder rights change● Neutral
Routine notice of a 10% convertible note interest payment of $0.0175 per note, covering 1 April to 30 June 2008, paid 30 June with a record date of 23 June.
Presentation repeating known Senegal and other project material. It gives market capitalisation of about $62.9m at 13c, cash $5m at 31 March 2008, and convertible notes $5.39m. Text is truncated.
FAR (34%) plans two NE Waller wells, targeting Frio at 3,850 ft and a Cockfield/Yegua fault closure, with drilling expected early third quarter 2008. FAR is participating in both, with dry-hole costs about US$300,000 and US$500,000. Over 50 BCFE potential is anticipated.
Re-statement of the Senegal marketing campaign (FAR 30%): the shelf-edge closure is described as having billion-barrel mean potential in place. Data rooms remain open and FAR still expects a free carry through one well if a farmout succeeds. No new data.
AGM presentation repeating known project updates. It states cash of $5 million at 31 March 2008, down from $12.46m a year earlier, and Stokes Bay Nullara testing resuming early third quarter 2008 rather than April.
Operator Hunt has begun a global farm-out campaign for the Senegal prospects (FAR 30%). Hunt's estimates put the shelf-edge closure's mean potential above 1 billion barrels of oil in place. If the farmout succeeds, FAR expects to be free carried through one well.
Non-executive director Warwick Grigor resigned on 1 April 2008 to focus on other commitments. He remains a consultant to FAR, having previously provided financial public relations services.
2007 annual report. Chairman cites the shift to prospect generation and Senegal as the focus. Oil and gas sales were $1,963,133, down from $2,999,975 in 2006. China development decision (FID) is expected mid 2008, with first production possibly 2010. Text is truncated.
This is ROC's release, not FAR's. It confirms Wei 6-12E-1A was plugged and abandoned on 14 March, and the joint venture will not drill Wei 12-2N-1 in the current program. The rest covers ROC's other wells.
Schwing #2 (FAR 5% to 14,500 ft) has been logged. The 14,000 ft primary target gas sands are low quality, so the well will be completed in the 12,500 ft sands. Wei 6-12E-1A was abandoned and the Wei 12-2N-1 well dropped from the program.
This is ROC's release, not FAR's. Wei 6-12E-1A reached 2,510 m, found only minor residual oil shows and will be abandoned. Development plans for Wei 6-12 and 6-12 South are said to be unaffected. The Wei 12-2N-1 well is under review.
Wei 6-12E-1A (FAR 5%) reached 2,510 m with only minor residual oil shows and will be abandoned, the second China dry well of the program. Development plans for Wei 6-12 reportedly unaffected. Schwing #2 reached 14,386 ft, to be logged through casing.
This is Petsec's release, not FAR's. It repeats that Wei 6-12E-1A reached 2,510 m, found only minor residual oil shows and will be abandoned. Development plans for the nearby fields are said to be unaffected; the next well is under review.
This is Petsec's release, not FAR's. Wei 6-12E-1A (FAR 5%) had drilled to 1,970 m on 4 March and is expected to reach about 2,520 m total depth by the end of the week.
This is Petsec's release, not FAR's. It repeats that Wei 6-12E-1A has cemented casing at 986 m, with total depth of about 2,520 m expected early March. FAR holds 5% through Oil Australia.
