Very much dependent on the gas\oil price to try predict the future... IF current pricing then we can guessimate earnings over near 60Mil in 2012.
100Mil minus costs if Well 2 a goer and Gas Plant all running.
Worst case is Well 1 income only- if on current pricing they expect near 60 Mil pa when they let loose on flow rate.
Gas Plant built by 2012 so we keep the 17% free ride... meaning approx 60% of revenue. being approx 38Mil profits pa.
On a PE x10 forwards earnings basis this is 380Mil MC.
Easy to see upside on this Coy, little downside... main downside is a large correction in Oil\Gas will harm us greatly. But we will now live through any correction whilst most others would not.
Risk reward basis at 100M MC it is a winner... any reserves proven in Well 2 in the ST will greatly increase the current SP and rerate very quickly. Based on a forward earnings of 50-80Mil pa in 2012. Is a billion dollar Coy possible for 2013? As a holder I will say yes- lol yet I am biased.
Would need Well 3 online and in production as well for this to happen. Yet only need cashflow over 30 mil and MC over 300Mil over a period of time to gain entry into ASX300, on average. Then we looked at by all the Managed Funds... better value applied towards PE= 15 more likely on high growth.
Forget it if Oil\Gas corrects by half again is the disclaimer... in this period. As risk exited the market in the last month- we will hopefully see some risk reenter for bigger gains.
Cheers........
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