agm, page-23

Hi MEOmites

It was worth the trip from WA to go to the AGM and meet up with management, other investors and, of course, say hi to fellow HC posters, even though Daz remains anonymous:) The vibe in the room was positive – and so it should be with three wells on the go with another, Thailand’s Sainampueng-1, due straight after Anchan-1 in the same permit.

*N.B. I have included comments in italics.*

There is a video of both the AGM Presentation and the Technical supplement due to be released but I know how it is to be left wondering how the meeting went so I will try and cover the main points.

The Pdf for the first presentation can be found here:

* AGM Presentation *

The CEO Jürgen Hendrich (JH) was upbeat in his usual way as we have seen from a number of presentations over his 5 years as Managing Director. He reminded us that in the Oil and Gas industry a lot of luck is involved but his aim is to increase that luck by employing well qualified people.

In introducing the well-credentialed team he made special mention of Robert Zammit, who joined MEO as Executive Manager – Business Development. Included in his qualifications is the Gorgon Project acting lead negotiator and he has made great inroads into shoring up the Tassie Shoal (TS) Projects by finding a methanol market and bringing the TS costing/comparisons up to date.

I have always thought of TS as the gleam in MEO’s eye and, even though this is now being supported by numerous projects will be instrumental in putting MEO on the market map.

JH confirmed this and said it took two years of negotiation to regain the 100% interest in TS but when RZ came on board he decided that the it was time to bite the bullet and finalise with Air Products.

JH also noted that no adjacent gas fields had a commercial path as he could see it.

This, as always, puts TS as the obvious neat solution as the downstream solution.

JH went on to describe the exploration portfolio and made note that 360P was not getting any immediate attention but is still good real estate. The extensive seismic programme had been a large work load and each one took 6-8 months to interpret and be ready for the data room.

In my mind this was the hold up for the Seruway farmout

but it was said that there was no interest in Gurame, probably because of its history, but there was plenty of interest in the rest of the PSC.

JH said that there could be gas and oil at Gurame but the decision to explore the gas first was that it could be monetised immediately as it is close to Arun with the oil being an option to developm later.

I am hoping that the geology team are proved right in their interpretation of Gurame.

JH said they are still working on the Ibu Horst seismic but were looking at Feb to start negotiations. By then Gurame could be an asset to add value to the sale.

Of course JH was more upbeat about the present drilling programmes at Heron South, Seruway and Thailand but said he would leave the technical details to the Exploration Manager, David Maughan.

Regarding Blackwood 2 (East?) JH said that there had been no official notification but an Eni representative (didn’t catch his name) did mention at a conference in Darwin that a well at Blackwood was planned in Q2-2013.

It was confirmed that the $28m cost of the extensive seismic programme over the portfolio followed MEO’s business plan in adding value for SHs.

The first well in Thailand (Anchan 1) was expected to be spudded 15 Nov and would be followed immediately by the main well (Sainampueng 1). This would save costs to MEO as the casings from the first well would be lifted and use in the MEO shared cost well. David Maughan said later in his presentation that the first well was just a token well to fulfil the work programme.

Pending farmouts at least 3 wells are planned for years 2013/14. On the time line they have noted 1-2 wells at both Seruway and WA-454-P bringing the total to 5 wells.

Finally JH said everyone is pulling together to make a lasting company.

The second presentation was by David Maughan (DM). The Pdf file can be found here:

* Technical supplement *

The video of this presentation will also be released and already HC posters have made notes about the content. It would be better for all to listen to the video but I will add a few brief points.

First of all DM said that the MEO and Eni have a slightly different interpretation of the Blackwood seismic, which is still being processed, but whatever the final analysis it will be a positive pointer to the size of the reservoir(s).

Regarding Heron South DM explained the problems Eni have been having and the point at the top of the Elang/Plover sands where the 7in liner got stuck. The forward plan is to clear out the bottom hole and insert the 4.5in liner as per the progress report.

DM said the rock composition was similar to Heron North but the fact that there was no indication of mud loss could mean a tight reservoir.

I did get the impression that MEO still have technical data to wade through and, of course, are waiting for the production test

I notice that on P3 the red contour has been indicated at 4460m by a red line. This indicates the Lowest Known Gas as we have been discussing recently. It does not quite link up the total Greater Heron with Evans Shoal but DM confirmed that TD had not reached the bottom and it is only another 20m (4600m) to complete the link (by following the next contour in black). The deeper they go the larger Heron becomes! Porosity and permeability is the key.

On P4 the point where the blockage occurred is at the top of the second sand interval at HS1. This diagram also goes a long way in explaining how the three wells and faults line up, which I have been trying to do in recent posts.

As Jazzasax says there is a gross interval of 237m in the Baong sands.

DM said that mud loss was an indication of fractures and, at the moment, it is looking good for a producing reservoir. He did also indicate that the mud loss could be because of lower weight mud being as they did not want to fall into the trap of previous wells being overweight which ended up compromising the reservoirs.

As I said before DM said not to expect much from Anchan-1, in Thailand, but Sainampueng-1 was targeting oil leads as shown on P8.

The WA-454-P data room is open and will be until Q1 and whilst DM had a positive vibe about Marina he was even more excited about Breakwater especially the bright spots.

DM went on to describe the leads at Seruway and AC P50, 51 and 53 which can all be viewed on the video.

The ongoing theme of the presentation was that the investment in seismic studies had been well worth it and should be repaid with interest.

All in all it was a very informative AGM presented by a committed team, including those working in the background with what must be a heavy workload.

I encourage everyone to watch the videos as there will be a lot to be gained from their content and plenty to discuss.

But, of course, we still wait for the flare(s).

#:>))