ROS .. the gamblers anonymous thread !!!

as we`re on the interesting subject of infrastructure let me quote you the following from the 2004 accounts...


"Decommisioning.
The decommisioning provision of £4.9m (2003: £4.5m) relates to the producing wells in the Seven Heads Gas field. The provision has been estimated using existing technology at current prices esculated at 2.5% and discounted at 7%. Decommisioning costs are expected to be incurred in 2009"



...........maybe this has been the stumbling block?ie, the decommisioning cost....if a £4.9m + provision has already been made and ROS are going to try and reclaim as much of the `pie` as possible?...the banks may argue that this belongs to the sale?...but if Marathon expands the field to try and find the missing 64bfc of gas then the decommisioning may become negotiable...all in all the decommisoning costs could be proving to be a serious sticking point ie, to `throw in` the infrastructure as part of the sale and at the same time withholding the decommisioning costs. On the othehand, should they not sell the infrastructure then they inturn may require intermediate recourse from the new operator before the decomming date?.....scenarios abound...in any event...£4.9m for Ramco is a lot of money..ie, half it`s valuation....if they managed to hold on to this ...could be worth as much as 15p a share.

If I was negotiating this deal.. I would go for hanging onto the decommisioning costs, for three reasons, Marathon,Island, Global and Ramco/Island are all going to open up the area next year, ie, the Schull Prospect, Globals Block 57, Roscraberry , Ramco/ Island oil, not to mention Marathon/Island partnerships....therefore the infrastructure may be still required for these satelite projects. Then of course the company hangs onto a very usefull $4.9m cash...and they can decommision them selves in 2009...by which time Ramco would be large enough to off set this against tax...in the mean time migh even earn some usefull `rent` from the infrastruture itself.....just my opinion of course.