analyser, page-3

re: questions

1. Do you believe that PNOC would give up part of their 50% to YGL in SC58 and/or Area 1? - and if so for what given that in SC58 Nido has already farmed in for 50% for 100% of costs for seismic acquisition and interpretation? Why would PNOC let go of more interest at this stage? Maybe later to a major if drilling takes place?

Possible answer to question 1

PNCO is a govt agency, so for them to farm out more is almost a cert imo. It would really only do this when the seismic is done or a major comes calling imo.Maybe nido will farm out some of its holding and get yilgarn to split some of the seismic costs like it did in sc54?


2. Do you believe that NDO would give up part of their 50% interest to YGL (as per SC54 where they held 100%) - and for what cost and how might YGL fund that? Why would NDO do that rather than raise cash via other means?

Possible Answer to question 2
Nido has been very good at securing this ground but it simply does not have the funds to do everything. If nido can end up with a free carried position in all these leases and get others to foot the bills, then its a winner imo. This is what nido seems to have made very clear so far. YGL can raise money for these projects if it needs it. Brown and co helps with all that and these areas are very hot. Maybe the yglo can be paid up? there are 177m oppies out there and they tend to be held by the bigger players who have been there from day one. Those oppies would raise around $8.5m. Maybe they go back to the same guys who did the last placement and get some more?

3. Do you think that NDO would dilute their interests in ROD assets (ie West Linapacan) to give YGL a share for $$$$ - and again how might YGL fund that?

possible Answer to question 3

These projects have had some cost blow outs, so nido selling down some of their interest may be logical.