Ann: Weekly Drilling Update - Red Gully North-1, page-196

Yesterday I posted on the unheralded value of Empire's Perth basin holdings, probably badly
worded, maybe should have been potential value......I suggest it's a fair bit....

What also has come to my attention is the perceived thought that as soon as the consolidation
was done the instos would be buying....This is entirely unrealistic..

Instos have codes of practice and criteria to tick off before they can consider buying, afterall
they in the main are investing clients money.....
I think the main things they would have to sign off on are....

1.....Earnings and drill results.
2....Assets
3.....Potential of asset appreciation....

Earnings and assets are the interesting ones, simply because that's all we have at the moment...

Earnings to date have gone to buy gasplant with a bit left over from Sept quarter, It's hard
to quantify earnings at this point in time because in reality all we know is when we started
paying off the plant and when we finished paying off the plant....It seems a common school
of thought that we overpaid for the plant......Admittedly under different management but
still the same company.....Therefor I believe any interested parties would be be waiting for
earnings results for the Dec. quarter....

Number 2 depends on number 1......drill results have the potential to increase or decrease assets....

Number 3 also depends on number 1.......Good drilling results with earnings to rise is what it's
all about......

Bit long winded but just my thoughts...