Malboro,
You are absolutely right.
CLL will not be in the position to convert the debenture to the 20 millions common shares.
It is hard to believe that CLL common share will move above $5 in 2011 or 2012. As of today the CLL net asset value per share (NVAPS) is about 2.5 to $2.7
2P reserves would have to double to move the SP above $5.
NAVPS is calculated as 2P + 2C which is widely accepted evaluation commonly used by market annalists which is main driver for upgrading / downgrading and making recommendations.
This should not be confused with the CLL NAVPS (quoted by Sharky $4+) and calculated by the management using their own criteria for their slide show purpose only.
In 2011/2012 CLL will need major equity injection to pay for the debenture and expansion if this is what the management is planning to do.
Some of you are pointing out to the cash flow generated by POD1 and Algar. I like to remind you that the cash flow from the operation is not a net cash which you can deposit to the bank.
In addition sometime in 2011 the POD1 cash flow will be cut in half due to post-payout royalties rate (30%) apply to the POD1 bitumen revenue. CLL slide-show cash flow and the netbacks are based on the 1% pre-payout rate.
