discovery , page-4

Samscout you can't just take the valuation of a deal beased on reserves and then apply that to a prospective Resource.

The 2 TCF mentioned for Zola is the mean estimate of the lowest certainty of classification, being a prospective resource. If every company was valued on their 'Prospective Resource' then all of them would be worth $1bn+. Prospective resources are effectively a guesstimate based on seismic. Look back historically at any company's prospective resource and then compare it to the reserves booked, it is always a FRACTION of what was initially suggested.

Zola only has a contingent resource (not even classified as reserves yet) of 378 BCF.

Let assume that all of that contingent resource was booked as reserves (drawing a long bow) you would come up with a valuation of:

378 bcf / 978 bcf * US$981m = US$379m

Tap's share of that is 10% which would be US$37.9m

Remembering again the jump from contigent resource to reserves is a large jump and as such the market would be discounting this valuation even further.