10-Q may hold further surprises about Treaty’s assets in Belize. IMO.
Since getting access to the Belize concession on April 20, 2010, when Treaty entered into a 50/50 Joint Venture agreement with Princess Petroleum Limited, Treaty have almost continually diluted their interest in this concession and wells. IMO this is not the normal behaviour of a company that is confident of a good exploration outcome.
The recent 10-k showed that:
On July 15, 2010, Treaty sold a 10% interest (5% total) working interest in their Belize concession to an undisclosed investor.
On September 2, 2011, Treaty sold a 25% working interest (50% of Treaty’s working interest) in Belize well numbers 1 and 2.
On September 12, 2011, Treaty sold 4% of their interest in Treaty Energy Belize Ltd (2% working interest in their Belize concession) to All Energy Corp.
The cumulative impact of all these dilutions is that Treaty has 18% working interest in these wells left.
Could the delay in the 10-Q be caused by further dilution?
If any of you care to call Treaty IR to confirm Treaty’s current shareholding in these wells, I would be interested if you post their response.
In the 10-K, if oil is confirmed production potential of the first well is said to be 50 bpd. Based on Treaty’s previous forecasting accuracy IMO this is likely to be high. However if we accept this number, Treaty’s share would be 9bpd.
With this type of production level, I guess you’ll have to put those Pina Coladas on hold for a while.
