Hi,

I just posted this on Investor Village - it's my assessment of how things stand now.

I think the main issue now is not with the prospectivity of the licence, but with finding the cash to pay for further exploration. I believe CIVC have a few million left in the bank that would pay for wells in Alberta, but Barrhead's recent analysis of the Alberta play indicated that any cash flow coming from that would be spread over a number of years. The immediate revenue of $800,000 a year gross I don't think will get very far with the kind of expense needed for continued exploration of licence EL1070. More seismic would be the first stage after everything possible has been gleaned from 2K-39-Z, and I would suspect several wells would have to be drilled to fully evaluate the Green Point Shales, and this is going to be very costly.

We haven't been told exactly what agreement between SPE and Union Gold was finalised at the Union Gold AGM. It could be that SPE would be well placed to raise money through equity funding if this goes ahead. It remains to be seen whether the failure to strike oil in the primary target will affect plans for the reverse takeover, which is a few months down the line anyway.

If Garden Hill proves successful then revenue from that would be more than enough, and I am fairly sure that negotiations will be underway. However, Barrhead, I think described the long association between SPE and CIVC, and said that these two were 'reluctant bedfellows' with Enegi Oil. I would have to agree with this assessment considering past evidence. So how things stand now, and whether a way forward can be hammered out between the three associated companies, is again something that remains to be seen.

To be short, it is my opinion that there is still mileage in the prospect at Shoal Point, but we are in for interesting times as events unfold, and money will be the central consideration.

Regards
Dunnock