just a theory ..., page-25

Hi

very intersting.

The cost to bring Tiof to full production is $US 2.2 billion - I am not sure of the cost of the early production plan - but is probably about $US800 million.

I don't think Hardman can fund this fully from future profits - as some funds will have to be committed ahead of early cash flows. In any case, debt (especially project finance) funding is cheaper than equity - and better for us existing shreholders not be diluted.

Kahuna, if I understand your view - its that in the future the JV will attempt to undertake as much field development work as they can prior to declaring a formal view of Tiof reserves and commerciality. Makes sense - but there would be a limit as to how far they can push it. One constraint will be their desire to get some production at Tiof early which will involve some announcements in early to mid 2005.

Sterling energy have certainly found an interersting way of dealing themselves into Chinguetti - but Toif is at least 3-4 times bigger.

I have been puzzling over Scott's statement to the presentations in Sydney and Belbourne about JV confidentiality. Its over the top - they have the acreage - and I actually can't see them relinquishing much - but rather farming out acreage that they decide has a higher risk profile - and let someone else start spending their money and taking the risk. At that point, they have to show their data to the potentail farm-inees - albeit under cover of confidentiality agreements.

Again - very intersting - and certainly helps me to think about aspects of the project I have not really looked at. Kepop it up - I always enjoy your posts and appreciate the thought and effort you are making.