Quote:
quote: Hi Grumpy,
The Cap is part of the origonal processing fee agreement... it has 2 sides to it. The first side is something called the "Floor". This is the minimum amount of money that the customers will pay the refinery. The last time from memory that the floor was excercised was back in 1999 (I think) when margins were bad. The cap is the other dise of the coin, kind of a trade off to say that the oil coys will guarantee a fixed income but if prices go too crazy then they can be capped.
As far as I know, the floor is adjusted each year for inflation and increased capacity.
It appears that the cap however is not.
That aside, 36m bbl at $9usd bbl will still give you a revenue stream of roughly $360m NZD.... Then add the pipeline etc on top of that the revenue should be close to $400m..
This share has typically been a high yeilding dividend play share, I feel that now they are not paying out the 100% in dividends that they used to the money managers may re rate the stock a bit.
Cheers
Chris
Thanks Chris,