Macro Tsimmis

intelligently hedged investment

Transmeridian (TMY) update #10

Posted by intelledgement on Thu, 01 Nov 07

Some good news and some potential good news on the Transmeridian Exploration (TMY) front for a change.

The good news is that the company have further resolved the gas flaring issue at their South Alibek field with the government of Kazakhstan: as announced a month ago, production has resumed after a three-month shutdown, but last week, management announced an agreement on gas flaring levels through 2008 that will afford them considerable flexibility in bringing new wells into production. TMY CEO Lorrie Olivier stated “The approval for associated gas flaring volumes provides continuity in the implementation of our operational strategies and should preclude any further disruption in production…. Our current production levels and the rationalization of surplus stock and non strategic Kazakhstan assets should allow us to meet all of our current operating needs, and with the resumption of development work and resulting new production, we expect to ease further cash demands….” Hopefully, this means no need for additional dilution to raise cash.

The potential good news is that the company has received bids from interested buyers (plural!) and that negotiations are now in progress. Maybe we will yet get bailed out of this (so far) bad bet.

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