I'm just getting started on this one, reading thru the prospectus for the June 22, 2007 private placement (PP). As of 5/31/2007 BZP had a cash balance of $35 million (raised from PP) with $13.8 million in 2006 operating expenses.
The capital expenditures for the Corvina gas to electricity project are noted at $132.3 million for:
refurbishing the drilling platform, refurbishing the existing well, drilling new wells, new pipeline from the off-shore platform to shoreline, gas processing facilities, electric generating plant, new pipeline from the generating plant to Ecuador.
My question is what portion of the $132.3 million in capital expenditures are required to book the first 2008 revenues? either from the recent Corvina discoveries (14D, 16X, and 21X), or whichever revenues will be first reported?
If BZP Energy can book significant 2008 revenue using exiting cash balances that is good news?
If, $100 million, or so, in additional capital expenditures is required to book significant 2008 revenues then this scenario is not as good!
The 410% increase in short interest from June to July leads me to the question the anticipated quarter when significant revenues will be reported?
As an example of significant revenue, Transglobe TGA reported Q2 2007 revenue of $31 million on production of 5,940 boepd. TGA market capitalization is similar to BZP Energy -- $270 million.
Just looking, no position in BZP Energy. - john |
