low risk - high reward, page-3

Good title Trade4million.

Given the unrisked broker valuations that show the theoretical price if 120 and 105 come in who would'nt want exposure at these price levels to something that could exceed $5.

Based on the resource calculations of Netherland Sewell and Associates the magnitude of the targets of the two upcoming drills would indicate a success case from the lesser well coming in to both coming in of a multi bagger in the range of 5 to 20X.

I hav'nt seen any official "probability of Success" figures for either well but for those new to Neon it is important to realise to what extent both drills have been derisked.

Block 105 is already in a producing gas fairway. New seismic run by Neon and laterly Eni has shown stacked targets with DHI's (direct hydrocarbon indicators). This significantly reduces risk hence KC being so bullish that gas is there.

Block 120 has a BHP oil discovery from the 90's. The well was prematurely plugged and abandoned as BHP thought it to be uneconomic given the prevailing oil price. The two lots of new seismic indicate BHP in fact did not drill deep enough that they stopped short of further oil. This discovery itself appears to be economic at todays prices.

But even if not it serves as proof there is an active hydrocarbon system in this block reducing risk considerably.