santos' catch-22, page-12

PSI,

Fair and balanced. Isnt that the Fox News tag line?

The saturation and high gas contents with the ESG well design will mean that not only will the high flow quickly payback the initial investment, but we can also prognosticate that the ultimate recovery from the seams will mean the well life will be considerably past those in QLD. These seams will pay out for many years to come. And that is a significant factor.

Unfortunately we have to do some guessing here as we havent been given any details on how much the seam has been drawn down and what the target flows are from the BBW wells. Nor do we have data on what kind of field effects will hit the bohena seam later in its life. Will it swell and kill the flow?

I certainly hope that well design (that ESG is yet to apply) will give them the best (and most consistent) producers in the industry.

Its going to be a blood bath in January if the investors find out they have been played rather than ESG playing Santos.

Putting laterals down in the LNG feeder fields would also make a lot of sense in mitgating the production ramp up challenge. Do you know if the high perm affects the seam stability in a lateral? I thought they undereamed most of those wells so perhaps they cant apply the laterals as a viable concept?

Cheers,

SF