market cap under $150 mill !! ???, page-37

I wish some posters would stop interfering and stay objectively on the subject. Here are my 2 bobs worth:

IMO, the purchase of MGN assets Palm Valley and Dingo were positive for CTP holders.

Reasons:

Positives:
New long-term gas supply contracts. Potential of $10million annual cash flow for up to 20 years
Current contracted Palm Valley gas sales 1.3 Bcf gas/year, growing to 1.5 Bcf gas/year
New long-term-contract for supply from Dingo up to 30 Bcf over 20 years
Infrastructure in place for Palm Valley and planned for Dingo, oth connecting to export facilities in Darwin and providing short distance connection to Surprise Field.
Acreage size = 40% of Texas
CTP takes the step from explorer to income generating gas producer
Negatives:
Cash outlay for Dingo development
Debt and small dilution of shares (MGN shareholder)
Additional (but IMO calculated) risk

From a letter to MGN shareholders by Magellan's President & CEO J. Thomas Wilson:

“Together, if fully contracted, the Palm Valley and Dingo fields can provide the Company with up to $10million of annual cash flow and in excess of $200 million in cumulative net cash flow (undiscounted) over the life of the assets.”

From MGN Annual Report 2013 :

“Gas reserves at Palm Valley are currently contracted to Santos through the Palm Valley GSPA (as defined
below), and gas sales volumes are expected to increase under this contract to an annualized rate of 1.3 Bcf by the end of fiscal year 2014 and 1.5 Bcf by the end of fiscal year 2015. In addition, in September 2013, the Company signed the Dingo GSPA, a long term, inflation-indexed contract with PWC, for the sale of Dingo gas reserves, under which gas sales are expected to commence in early calendar year 2015.

Under Palm Valley's current gas supply and purchase agreement with Santos (the "Palm Valley GSPA"), gas sales volumes and revenues are currently expected to increase materially in the second half of fiscal year 2014. Under the terms of the Dingo GSPA signed in September 2013, new gas sales volumes and revenues from Dingo are expected to commence in early calendar year 2015.”

Dingo:
“In fiscal year 2013, the Company undertook marketing efforts to identify and attract long term customers for Dingo's gas resources. These efforts resulted in the signing of the Dingo GSPA with PWC in September 2013 for the supply of up to 31 petajoules ("PJ") (30 billion cubic feet ("Bcf")) of gas over a 20-year period at a fixed price escalating with Australian CPI. In parallel to the marketing efforts, during the fiscal year Magellan completed a pre-front-end engineering and design ("pre-FEED") study to evaluate the cost and logistics of installing gas treatment facilities and laying a pipeline to tie the Dingo field into the existing pipeline infrastructure at Brewer Estate, south of Alice Springs, where PWC will take delivery of the gas.
This study will serve as the basis for bringing Dingo to operational capability at the beginning of calendar year 2015.”

Sources:
http://content.stockpr.com/_news/magellanpetroleum/2013-05-28_Magellan_Petroleum_Corporation_s_CEO_Issues_Letter_113.pdf

http://content.stockpr.com/magellanpetroleum/db/Quarterly+Results/99/annual_report/Magellan%2B2013%2BAnnual%2BReport%2B-%2BFINAL.pdf

http://ir.magellanpetroleum.com/press-releases/detail/117/magellan-signs-long-term-gas-sale-contract-for-dingo-field-in-northern-territory-australia