psa finished, page-6

I respect your view on this but I dont agree at these levels it is finished///long from it.

Part of the problem with the delay is they do not want to be in a position to go below the $20m threshold they have set themselves.

If you listen to the jut complete call.they are looking at a high impact well this half and Hummer later in year.

They stated they have 2-3 wells in hand and intend to drill 3-5 this year. THEY UNDERSTAND the share price issues.The wells all have the impact according to Psa this morning to range from doubling assets of company up to 10 times the assets. So they are meaningful. The first is onshore with cheaper drilling costs and production.

On the cash they made the point that any impairment costs etc are already covered in the P10 value which is not represented int he share price. The reserves will come out in Feb and I do not think it will be 11.1 -3.6 as Psa have used a very conservative view of Marathon. The operator has it at 50% higher in its books. What Ryder Scott determines is to come but i do not think it will be a sever reduction.

So then we have whether we want to follow them into the new drilling and purchase on a base of $28.4m AU (cap $19M) and a PV10 asset base of probably now around $20MUS or $23MAU. The carrying value is the sale price they believe they could get for the assets which includes impairment bonds etc.

They have gone very very conservative to get the best bang for their buck. The biggest shareholders are the co holders so they are there to blow it up.They also have the tax losses etc.

Everyone will need to wait to see it unfold but at 70% cash and nil for assets etc I am not a seller.