Africa Oil Corp (AOIFF)

[douginil]

Africa Oil

[[ Thanks to Lonegaurdian19 at stockhouse ]]

Date and time: 3/8/2021 3:19:46 AM

Text: I think they may have to hedge to alleviate any volatility that the banks clearly are not fans of. That being said those who were in charge at Prime absolutely killed it with the last round of hedges. Yeah, we may not get the spot rate in Q2 but that is because we hedged for security. In the present environment we have an asset with a higher NPV than before and way less debt. Interest rates maybe rising but not nearly as fast as oil has in the past 5 months. This is good news, it will put the banks at ease and allow for a longer duration loan at a more reasonable rate. Whither they hedge for the rest of the year is to be seen but if they do I'd imagine it is to secure better financing as opposed to making a gamble.