IMO, that Bloomberg article on Thu-Fri is aimed at Interoil & they've bunched in OSH & KAR as potential targets, given the resource size, mkt cap & project status.
I dont think 'for sale' sign at KAR has even gone to the printers yet, too early. With a net NPV of US$2.76b, KAR can't b ignored & should b on someone's radar for sure. What's gonna stop COP frm taking up another 10-40%!!!
All the expenses incurred now, will b offset as deductions, when they start making profits & PRRT calculation kicks in 6 yrs time (just google PRRT calc's & refer KAR's Preso).
The dilemma facing KAR's board will b, do we take the few billions now or do we fatten this goose? Fairly elementary, IMHO.
On the other hand. Interoil are a unique case!!
They r based out of Cairns but aren't listed here only on the NYSE. They operate the Elk-Antelope field in PNG, which set a world record for a flowrate frm a vertical section, last December.
Their Antelope-2, made it to the Guiness Book of World records last year. It flowed 705 MMcfd + 11200 bcpd on a 4.375" choke (at 1255 psi) & broke its own record set by Ant-1 which had flowed 382 MMfd + 5k bcpd in March '09. So the Elk-Antl'pe field is now PNG's largest field.
Here read it for yrself, rather then get TOU'd by some poster who just cannot do their own research in this stoneage.
http://www.interoil.com/corp.asp
Little wonder IOC's SP shot up to US$84 on that news & they r a sitting t/o target, ever since. Do chk their 1th April presentation for some pretty photos of their monster flare in the PNG highlands.
IOC's Net Resource is 873.2 mmboe (mid-estimate) & 1063.6mmboe (high estimate).
With a mkt cap of US2.15 billion & 43.7 mil shares on issue, they r an easy target for the Chinese. GAIL (gas authority of india ltd) were also sniffing around, but the way Chinese operate (fast & furious) esp. with Canadian firms & given our current tax regime, who knows whats next. Anyway my point is, Mistui bailed out of Crux (NXS) & hopped onto Interoil (IOC) for a condensate stripping project early this year. CGR is 12-18 bbls/mmcf compared to Crux, but still is lucrative enough. Which reminds me to grab some NGE shares, b4 they spud next month in PNG.
I wouldn't b fussed abt Kronos's CGR of 9.5 bbls/mmcf, as its a separate fault-bound block then Poseidon - which had a higher CGR & low CO2. Example: Pluto in the NWS is dry gas (ie 4 bbls/mmcf & very little heavies). The 10% CO2 is consistent with WPL's Torosa (8-14%). I'd b worried if they said 25% which isn't the case. ITs abt the gas for now, condensate is just the topping.
Anyway, one continent that BHP-Petroleum aren't on, is Sth America (excluding the Falklands) & WPL are just a small fish in Brazil (12.5-15% JV with Repsol) with more acreage in Peru.
So, KAR has a very lucrative portfolio for now. Bottom drawer for now or whatever y'r strategy be. B happy with the foliage, Tree or the Forest, its all good folks :)
(20min delay)