Magellan Petroleum Corp. (MPET, Financial) filed Quarterly Report for the period ended 2010-12-31.
Magellan Petroleum Corp. has a market cap of $124 million; its shares were traded at around $2.37 with and P/S ratio of 4.4. Hedge Fund Gurus that owns MPET: Jim Simons of Renaissance Technologies LLC, Jim Simons of Renaissance Technologies LLC.
At December 31, 2010, the Company on a consolidated basis had approximately $28.1 million of cash and cash equivalents and $3.8 million in marketable securities. The Company considers cash equivalents to be short term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of change in interest rates. Cash balances were $11.7 million as of December 31, 2010 and the remaining $16.4 million was held in time deposit accounts in several Australian banks that have terms of 90 days or less.
When considering our liquidity and capital resources, we consider cash and cash equivalents and marketable securities together since all of these amounts are available to fund operating, exploration and development activities. The balance of cash and cash equivalents and marketable securities decreased $1.7 million during the six months ended December 31, 2010 compared to a $15.9 million increase in those balances during the six months ended December 31, 2009. In the prior year, the Company received stock issuance proceeds of $10 million as well as a $5.6 million deposit on the sale of Nockatunga, $1.5 million of proceeds from the sale of Aldinga, and $2.7 million of proceeds from the sale of securities available for sale significantly increasing cash and cash equivalents and marketable securities in the prior year, which was offset by the purchase of Nautilus Poplar for $7.3 million.
At December 31, 2010, MPAL had working capital of $26.9 million and has budgeted approximately (AUS) $4.9 million for specific exploration projects in fiscal year 2011 as compared to the (AUS) $927,000 expended during the six months ended December 31, 2010. Despite no SEC defined proved reserves, MPALs future revenues in the long-term are expected to be derived from the sale of oil and gas in Australia. MPALs current contract for the sale of Palm Valley gas will expire during fiscal year 2012. The price of gas under the Palm Valley gas contract is adjusted quarterly to reflect changes in the Australian Consumer Price Index. Future oil revenues will be impacted by any volatility in the world price for crude oil. MPAL will strive to optimize operating expenses with any reductions in revenues.
Under the Evans Shoal Agreement, MPAL is obligated to pay Santos time-staged cash consideration equal to (AUS) $100 million (Purchase Price) for its interest in the undeveloped Evans Shoal consisting of: (i) a 40% participating interest in the Evans Shoal Joint Operating Agreement and (ii) a 40% legal and beneficial ownership interest in the Evans Shoal Title (as defined in the Evans Shoal Agreement). MPAL is also obligated to pay additional contingent payments to Santos of (AUS) $50 million upon a favorable partner vote on a any final investment decision to develop Evans Shoal and (AUS) $50 million upon first stabilized gas production from Evans Shoal. Consistent with the terms of the Evans Shoal Agreement, MPAL made an initial cash deposit of (AUS) $15 million towards the Purchase Price (Initial Deposit) in March 2010 to an escrow account and that amount is included in the consolidated balance sheet at December 31, 2010. While the Evans Shoal Agreement, in its original form, provided for defined circumstances under which MPAL is entitled to reimbursement of the Initial Deposit, the original Evans Shoal Agreement provided that if MPAL is unable to pay the Purchase Price on the closing date of the Evans Shoal Transaction, MPAL shall forfeit the Initial Deposit. The Evans Shoal Agreement provides that, if MPAL is unable to pay the Purchase Price, when due, and the Company does not have its own right to terminate the Evans Shoal Agreement in accordance with its terms, then Santos may terminate the Evans Shoal Agreement and decline to proceed with the Evans Shoal Transaction. Under the Evans Shoal Agreement, MPAL purchase of Santos interest in Evans Shoal is subject to the satisfaction of certain conditions including receipt of consent to the transfer from the other three existing owners of Evans Shoal and applicable government approvals.
At December 31, 2010, Nautilus has debt comprising a note payable of $441,220 and short term borrowings of $575,000 on a $750,000 line of credit (LOC), all issued by the same bank.
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Magellan Petroleum Corp. has a market cap of $124 million; its shares were traded at around $2.37 with and P/S ratio of 4.4. Hedge Fund Gurus that owns MPET: Jim Simons of Renaissance Technologies LLC, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
However, results for this quarter versus the prior quarter reflect some positive developments. For the quarter, Magellan recorded a net loss of $2.1 million on total revenue of $4.5 million versus a net loss of $3.4 million on revenue of $3.7 million in the immediately preceding quarter. The following items impacted the quarter on quarter change.At December 31, 2010, the Company on a consolidated basis had approximately $28.1 million of cash and cash equivalents and $3.8 million in marketable securities. The Company considers cash equivalents to be short term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of change in interest rates. Cash balances were $11.7 million as of December 31, 2010 and the remaining $16.4 million was held in time deposit accounts in several Australian banks that have terms of 90 days or less.
When considering our liquidity and capital resources, we consider cash and cash equivalents and marketable securities together since all of these amounts are available to fund operating, exploration and development activities. The balance of cash and cash equivalents and marketable securities decreased $1.7 million during the six months ended December 31, 2010 compared to a $15.9 million increase in those balances during the six months ended December 31, 2009. In the prior year, the Company received stock issuance proceeds of $10 million as well as a $5.6 million deposit on the sale of Nockatunga, $1.5 million of proceeds from the sale of Aldinga, and $2.7 million of proceeds from the sale of securities available for sale significantly increasing cash and cash equivalents and marketable securities in the prior year, which was offset by the purchase of Nautilus Poplar for $7.3 million.
At December 31, 2010, MPAL had working capital of $26.9 million and has budgeted approximately (AUS) $4.9 million for specific exploration projects in fiscal year 2011 as compared to the (AUS) $927,000 expended during the six months ended December 31, 2010. Despite no SEC defined proved reserves, MPALs future revenues in the long-term are expected to be derived from the sale of oil and gas in Australia. MPALs current contract for the sale of Palm Valley gas will expire during fiscal year 2012. The price of gas under the Palm Valley gas contract is adjusted quarterly to reflect changes in the Australian Consumer Price Index. Future oil revenues will be impacted by any volatility in the world price for crude oil. MPAL will strive to optimize operating expenses with any reductions in revenues.
Under the Evans Shoal Agreement, MPAL is obligated to pay Santos time-staged cash consideration equal to (AUS) $100 million (Purchase Price) for its interest in the undeveloped Evans Shoal consisting of: (i) a 40% participating interest in the Evans Shoal Joint Operating Agreement and (ii) a 40% legal and beneficial ownership interest in the Evans Shoal Title (as defined in the Evans Shoal Agreement). MPAL is also obligated to pay additional contingent payments to Santos of (AUS) $50 million upon a favorable partner vote on a any final investment decision to develop Evans Shoal and (AUS) $50 million upon first stabilized gas production from Evans Shoal. Consistent with the terms of the Evans Shoal Agreement, MPAL made an initial cash deposit of (AUS) $15 million towards the Purchase Price (Initial Deposit) in March 2010 to an escrow account and that amount is included in the consolidated balance sheet at December 31, 2010. While the Evans Shoal Agreement, in its original form, provided for defined circumstances under which MPAL is entitled to reimbursement of the Initial Deposit, the original Evans Shoal Agreement provided that if MPAL is unable to pay the Purchase Price on the closing date of the Evans Shoal Transaction, MPAL shall forfeit the Initial Deposit. The Evans Shoal Agreement provides that, if MPAL is unable to pay the Purchase Price, when due, and the Company does not have its own right to terminate the Evans Shoal Agreement in accordance with its terms, then Santos may terminate the Evans Shoal Agreement and decline to proceed with the Evans Shoal Transaction. Under the Evans Shoal Agreement, MPAL purchase of Santos interest in Evans Shoal is subject to the satisfaction of certain conditions including receipt of consent to the transfer from the other three existing owners of Evans Shoal and applicable government approvals.
At December 31, 2010, Nautilus has debt comprising a note payable of $441,220 and short term borrowings of $575,000 on a $750,000 line of credit (LOC), all issued by the same bank.
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