What's there to like about Australis?, page-8

Thanks for your input Minim. I think you've fairly and adequately summarized the risks here. I'll comment my views briefly on a few of them.

Self appointed Tier One resource. They keep on saying that. Others in the region and industry don't seem to recognise it as such. Why couldn't ATS drill with the same outcomes as Encana's last 15 wells. ATS only got 2 maybe 3 of their 6 wells right, despite having 6 more years knowledge about the resource and better technology at their access.

From my understanding, the TMS is a very large area, with only a small portion of that really being Tier One. Historically drillers have been all over the acerage, with some wells performing well and others poorly. It was not only exits, but largely bankruptcies from over-leveraged competitors that left the play with a negative sentiment. Similar story when they headed Aurora around sentiment.

ATS have acknowledge there were some issues with the previous wells, and they go forward approach is to JV with a company who's core competency is just that.

Management have not taken a real reduction in income since the economic downturn. Unlike most others they continue to take their full $ return albeit in a mix of shares and cash not straight cash. Some would argue that their work load has diminished with no active drilling and a large part of the companies activities on hold. Why would they buy the company, they are slowly acquiring it in percentage terms anyway (at your expense). Dilution!!!

I'm not overly concerned with management having a vested interest in SP, in fact I welcome it. This would be different if the SP was significantly lower than my buy price.

Portugal was purposely a good buy/punt. After spending good money on progressing it, they dumped it for zero dollars. They paid good money for something that was worth nothing? Good management?Portugal was always a punt - the environmental aspect was always going to be difficult and didnt play into their favour.

Biden is not a supporter of Shale/Fracking

This could be a good think for ATS. Biden plans to ban permits on federal land. ATS is not on federal land. Texas will be greatly affected, so competitors will be stretched. Some small environmental costs under Biden may come into play but not material to the ATS cost base.

Oil production diminishing along with hedging position

Production curbed to get the best return for cost. Agree the hedge is diminishing but its about survival not growth at this point, which is fiscally prudent.

Very tough market to introduce partner/capital
Agreed - this is a key challenge.

The resource is there however its cost of extraction is far from economically viable and the future oil price does not look good.
The cost to extract per barrel is significantly lower than its competitors. Agreed short term oil prices aren't going anywhere.

Covid has revalued oil and enhanced world governments push for renewables on the world stage
Agreed that there is a renewables push but this is going to take a generation to come to fruition. This will certainly be my last oil exposure, as long term you're correct - going nowhere.

Sorry guys for upsetting the love fest, just food for thought. In saying all that, ATS must be worth something as a punt!

Not at all, appreciate the input and comments. As with any small cap, comes with risk. DYOR friends!