MEO Australia (MEO) 54c Woodside Petroleum (WPL) $42.74
THOSE seeking the next Woodside should take a look at the North West Shelf hopeful, which is due to start drilling its Artemis field within seven days or so with the generous support of farm-in partner Petrobras. Petrobras, which has a 50 per cent interest, is fully funding the first well ($US41m) and will pay $US62m for another two if all goes well.
Petrobras has also paid MEO $US39m in seismic back costs and a bonus, all mere pin money for the Brazilian titan. Artemis already has stated P50 (50 per cent probable reserves) of 12 trillion cubic feet.
Its proximity to Woodside's Pluto field evokes strategic interest given Woodside has struggled to find enough gas to underpin the next two stages of the Pluto development.
Speaking of Woodside, hasn't the stock been punished enough since Shell's sell-down last week? After all, the Dutch were hardly going to attempt another takeover and were blocking the way for someone else (not necessarily BHP) to have a tilt.
We rate the cashed-up MEO a spec buy and Woodside a buy.
MEO Price at posting:
54.0¢ Sentiment: Hold Disclosure: Held
