waiting for godot

There seems to be a consensus in the market at the moment that there is unlikely to be any news from ESG in the short term.

Volumes have been very low. When you strip out the usual 25% shorting by one party, and add back in another 25% for the shorts being bought back, the volumes are very small. No one is heading for the exit. But nor are there any catalysts for new buyers either. Value doesn't cause most people to buy - catalysts do.

Everyone is waiting for the reserves upgrade.

If we have learned one thing about ESG's strategy over the stretch, it is that they do not do anything simply to push the share price up in the short term; they are firmly focussed on doing what they need to do to get the big result - reserves, infrastructure, markets. And that is what is happening.

It now seems very unlikely (although still possible) that Santos will make a hostile move upon ESG before the upgrade. The time to act swiftly has come and gone, and so now a buyer will have to come to an agreement with ESG.

Perhaps, as has been suggested, Santos is working with ESG and trying to convince their GLNG partners to pay what ESG is asking. And, probably, the buyers want to see the results from Tintsfield and the 2,000PJ+ of 2P. They are the kind of results needed to bridge the gap between what ESG will want and what the buyers demand if they are going to fork out the big dollars. Fair enough too.

So, even in an uncertain market, ESG remains flattish, with small volumes, and just the sound of price manipulation to break the silence. :)

Yaq