We should soon see if MZ Group is going to add any value to MILL
Over the last year Miller has successfully drilled or reworked several wells:
1) RU-1 added a minimum of 210 BPD of production with potentially up to 480 BPD of production (RU-7 dependant?)
2) Added RU-4 at 1 MMcfd of added production with a cost savings of over $5 million/year
3) Brought RU-3 back on line with currently an unknown production rate
4) In the process of bringing RU-7 back on line with a TBD production rate
5) Drilled 1st Tenn Horizontal with initial production of 487 BOE/day in production with 100-200 BPD estimated long term production rate
6) Drilled 2nd Tenn Horizontal with similar characteristics to 1st Horizontal
7) Favorably re-termed their loan agreements with Apollo
8) Raised $14.3 million dollars with recent preferred C offering
9) Is due $15 to $20 million dollars in drilling cost rebates from the state of Alaska
Despite all this good news the stock trades below $4/share and the short position is almost 10 million shares.
If MZ Group cannot add value to the stock price under these conditions, with all this good news then Miller shareholders are being ripped off. Personally I expect to see some significant added value to the shares over the next month. Otherwise MZ Group should be canned.
I agree Volfan. If we aren't seeing more interest from shareholders from MZ marketing then why waste any money on retaining them. I'm curious why last year the news related to Mill had to do with the new rig, financing terms, and leases in Cook Inlet which caused the share price to rise from 3.20 to 5. Now we are seeing all of the above production starting to come online with a massive rebate check coming over the next couple of weeks, months and the stock is still under $4. I just don't understand why there isn't any volume/demand for the stock. Hopefully MZ will start to generate a lot of institutional interest.
Is it really good news that they raised $14.3 million that costs 11 3/4% (including the discounted offering price but excluding the underwriter's discount)? That seems expensive knowing that it gets paid before shareholders do. Then again, viewing it positively, it was awfully encouraging that they could get the financing done at what was seemingly a premium price to the then present market price for the preferred, particularly ex-div price. That implies to me there were big buyers looking to buy and willing to pay just to get a good amount vs. a good price.
Am wondering if they can also get going again on Otter and Olsen Creek. The pressure in the Otter well should have built up over the winter and that may help them get the fluid out. They may also choose to deepen the well, since they missed the target sand on the first try. Also, wonder if the road to Olsen creek is now repaired.
Since the road to Olsen Creek was a wash out I doubt they will even start work until after ice out. Which, if my understanding of Alaskan weather is correct won't happen until the end of march or into April