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Mayan Energy – placing inevitable warns the City’s No 1 oil analyst in damning email

By Tom Winnifrith | Friday 21 September 2018

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Given the lowly market cap of Mayan (MYN) any placing will have to be a heavily discounted bucket shop special. In light of that, investors should take heed of an explicit warning from the City’s No 1 oil analyst Zac “the Knife” Phillips of SP Angel. In an email he writes:

"Mayan Energy  – Funding is When, Not If:

We always enjoy reading the Company’s updates, especially when it relates to the disgraceful structure that is the Deloro investment, so we have that to look forward to next week. However, this update on next week’s update, which tells us very little that can create value for shareholders, does, however, tell us that operational breakeven for the Forrest Hill project is $80/bbl. What we don’t know is if that is the breakeven point for the 6 wells they are looking to recommission in Forrest Hill or the whole portfolio.

Either way, there is zero room for error, and with overheads yet to be included in that number, we, unlike the management team, are certain that the Company will need more funding in some form to advance their projects in the “near-term.” While management are not being clear, we will be and state that we consider near-term to be within 18 months.

While we are certain that there will be all sorts of obfuscation and discussion about what constitutes near-term, the language used does not provide clarity. Investors need to decide whether this is deliberate, or more evidence of the management’s paucity of judgement, especially with a December year-end and an all-important “going concern” assessment to be made by the auditors.

Whatever the timeline, we are certain that there will be a need for funding, so its a case of when not if."


Don’t sit on the fence Zac, why not tell it as it is?

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