Mart may have gross revenues of $15million a month now probably, now that drilling costs for UMU-9 have been recovered. We should probably bank on receiving revenues for 5,000bopd (net to Mart) as a minimum for at least part of the current quarter. Using simple math, assuming 5000bopd volume and $100/b price, it still amounts to 5000x100x30=$15million gross revenues per month.
However, we must deduct expenses, taxes, and royalties from that. Monthly/Quarterly profit is still immense, but I'm not sure how much royalty and tax expenses reduce that figure in order to come up with monthly/quarterly profit. DigiTech/Oullins did some good spreadsheet work on this at one time, but it's not current.
Starting UMU-10 by early July will probably cause high drilling expenses for the next six months (which are initially borne by MMT then reimbursed thru oil percentages from the JVs).
I presume that as MMT begins building the new pipeline to Shell facilities, Mart will also experience the costs initially and recover the cost from partners thru a share of their oil revenues.
All in all, no matter how you cut it, Mart is well-positioned for great production and revenue and profit over the next six months.
Bottom line is we have to expect Mart to bear the costs initially for UMU-10 drilling and the pipeline to Shell, and that's a lot of beans to a bean-counter. As the JVs pay Mart back for those costs by allocating a percentage of JV production to Mart, the JVs are probably taking ownership of all the facilities (wells, pipelines, pumping facilities, etc). In my mind the JVs have been building large amounts of equity in the UMU field.
One thing I don't know is how much equity Mart actually has vs. JVs in the UMU field (oil, facilities, etc.). If Mart does ever combine with JVs, we will probably be surprised about the equity that the JVs have relative to MMT.
My expectation is that current qtr (ending June30) profits will be down slightly from prior qtr record (due lower production percentage to Mart, plus the price of oil is certainly lower), but we shall see how all that shakes out over the next few months.
Mart does have a sweet deal in Nigeria, and it remains my largest investment.
GLTA MMT shareholders,
'peeker
Focus Focus Focus Focus !!!!
