Ann: Sino Gas - Significant flow rate & Sanjiaobei update, page-45

What a great report, first time I seen it.

Lots of gas, tick but can you get an economic return? Can you produce the gas long term?

In my view that isn't proven but let now look at the details as to how the NPV 10% has been calculated.

The NPV values are complete meaningless!!

Why you say, what is WN on? He is stupid and clueless....

Well look at page 8 and I quote

"Table 1-4: The estimated probability and NPV (10% real) of a range of outcomes are given in Table 1-4 with the expected monetary value (EMV or risked NPV). Economic evaluation is at 1/1/2015 with pre 2015 expenses treated as sunk costs."

Yep there you are Risc has modeled the return and hasn't included the 100's of million of USD it cost to drill any well or fund any MD salaries etc from pre 2015.

Complete bulldust in my view and totally wrong, its like say to Gina Rinehart that the cost of bringing Roy Hill into production should not be used to work out what the break even cost of mining a ton of iron ore is.

So we still don't know what a commercial rate is, the current MD mentioned that the wells are flowing above commercial rates but didn't disclose the actual rate that is commercial and the back ground on how he knows it commercial, another big fail in my view of the management.

If SEH was a normal USA tight rock gas producing company there would be no reason why in a simple presentation they could not publish some 12 month production curves and disclose what they believe to be a commercial rate and the rational behind those calculations.

4 cents here we come in my view

woof woof