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Gold/Mining/Energy : ARAKIS: HIGH RISK OIL PLAY (AKSEF) -- Ignore unavailable to you. Want to Upgrade?

To: Jim Lamb who wrote (7753)	2/11/1998 1:08:00 PM
From: lawrence smith	Read Replies (1) \| Respond to of 9164

sure. in the agreement the sudanese will eventually take over the pipeline after they reimburse the jv partners for all of the costs of the pipeline with interest at 15% for the first 150kbopd capacity and 18% for any additional capacity. it works out to a little over 16% per annum. so, arakis borrows the money at lets say 12%(thats just my figure, no one told me that) and makes about 16% on it.so, they make money. plus, they are going to receive money from the tarrif that the jv partners charge . plus, they receive funds (i think it is in the form of additional oil) for the oil that is now being trucked on a daily basis to the refinery. they are already making money, albeit a small amount.