conoco 2nd train? great for kar?, page-2

Aussie

thanks for trying to provide some useful info, but, to date, the stories you've received so far haven't been accurate. This isn't your fault, or even the fault of whoever you've been getting your goss from - it's just that the BOP technical problems have been too difficult for even KAR/COP to predict - so they don't try. If they did try to give a forecast date for resumption of drilling, and were wrong, they could be accused of misleading the market. So unless you or your sources are absolutely sure that your info is right, it's probably better not to offer forecasts of timing.

Interesting to note that KAR's volume yesterday was the lowest for more than a year and that today we saw almost 50,000 shares traded in the end-of-day match, or 17% of the day's volume. Still a low volume, and perhaps the jump at close and 6% rise in price today was more a reflection of the strength in the oil sector than presaging an imminent announcement of good tidings from KAR. (WPL and STO up 7% and 6% respectively after good production figures today.)

Re the Darwin plant, it came on stream at the end of 2005 at 3.2 mtpa, based on reserves at Balu Undan of 3.4 TCF. At that time, the plant had approval for expansion of two more trains, to a total of 10 mill tpa. But after seven years, there's been no announcement of additional reserves at Bayu Undan, 500 kms from Darwin, and I understand that the JV partners would like to see more reserves from Browse just to prop up existing capacity.

We have a P90 reserve of 3 TCF and P50 of 7 TCF, so it would seem likely that good flows from Boreas or another well in the current program would be enough to justify expansion of a least one train, with two the goal.

The wait is still terribly frustrating for KAR, COP and all the shareholders, but not only are we getting closer to the BOP issue being resolved, we are not too far away from drilling in Brazil and Peru.

Three years ago, in July 2009, KAR's price exceeded $12. South America was barely known then by the market. Where do you think the KAR price will be in 12 months?