great sleeper

At some point, this stock will get discovered. It has tremendous potential and is tremendous value at the current price. In fact, I think it would be good value at 3x the current price.

PNG is an extremely attractive location for Oil & Gas, as evidenced by the big players that are playing and the very large discoveries that have been and continue to be made.

Valuing NGE
Current market Cap is 40m

Easy to get the first 100 m value ......
Cash 7m
Exxon / oil search payment for PPL277 15m
PPL 268 & 269 77m
Total 99m

This is just cash, the payment coming from Exxon / OSH, plus valuing the 50 pc equity in PPL 268 prorata at the price that Mitsubishi paid (in April) for the 20 pc stake they have purchased in each of these leases.

From the announcement...
Talisman has advised that the arm’s length value of the consideration payable by Mitsubishi for these transfers is as follows:
a) For 20% participating interest in respect of PPL 268, US$5.18 million (US$259,000 per 1% participating interest acquired); and
b) For 20% participating interest in respect of PPL 269, US$25.7 million (US$1,285,000 per 1% participating interest acquired).

On top of that you get...
The largest leaseholding in PNG totalling around 40000km2 (not counting PPL277). These leases are all on trend of existing discoveries and highly prospective. 21TCF gas has already been established in PNG (North West Shelf has 33TCF). High condensate content has been typical in PNG, and numerous oil producers are already established. Exxon are widely believed to be committed to Train 3 of PNG LNG.

A 20m payment from Exxon / OSH if PPL2 becomes a producer

A royalty from Exxon over production from PPL277 that would range from 48 to 312m for recoveries between 100 and 2000 Bcf

A fit for purpose drill that NGE have purchased and is on site.

Short term upside potential as Exxon /OSH are drilling Tapia-1 right now. This well is immediately adjacent to PPL227. It they hit, prospectivity in PPL277 is greatly increased and Tapia may well extend into PPL277

PPLs 265 and 267. Principally oil plays. Targets identified. 100km trend of visible oil seeps

PPL 266 principally a gas play

Significant expenditure to date on seismic, drilling and technical analysis that has established a great funnel of leads.

So whats it worth? Ultimately, either a hell of a lot or nothing. For now, IMO, a lot more than 40m. Seems Exxon, Oilsearch, Mitsubishi and Talisman feel the same