1/6
The market is questioning #I3E ability to fund its 3 drill programme.
The market assumes that the cost is $41m for a 94 day programme.
Nowhere are these 2 figures presented together.
2/6
#I3E c.$41m figure (inclusive of considerable contingencies) appeared in 10th Jan RNS when the 3 well programme included a horizontal development well at L2 location.
The 94 day programme appeared in 9th April RNS when the L2 pilot well was introduced.
3/6
Vertical pilot wells dont take as long as a horizontal well.
What happened in between those 2 dates, was the junior debt facility negotiations, post the term sheet sign off on 25th Feb. Actual closure came on 3rd June.
Between 25th Feb/9th April, #I3E pilot well came about.
4/6
Proactive June presentation slide 6 states the cost of the revised 3 well programme as $36m (same contingencies will apply).
3rd July #I3E agrees $3m deferred payment with BGHE.
Total cost reduces to $33m
5/6
#I3E have raised over $49m in 2019 through junior debt, placement, open offer and I3E management/directors.
Summer drills at 120 days inclusive of contingencies are costing c.$33m
Misread born out of change from development to pilot well & failure to appreciate contingency.
6/6
The same change to the drilling campaign has driven the perceptions associated with the failed L2 well, and its COS.
#I3E could have communicated better but that doesn't change the facts.
I3E is massively misunderstood right now because of a drill change.
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