$1.20, page-30

Veeone, u make an interesting point there.

As per the reserves update, they have 3P-418.4 bcf. What we know is PB#1 flowed 1.5 mmcfd for a 24hr test. There is potential for more here later. Here's a scenario u could go through.

Conservatively speaking if both wells are brought into prodn at combined rate of 5mmcfd, then at current gas price of say US$4/mcf (or US$20k/day), they can generate US$7.3m/yr gross revenue. Take away 22% royalties payable to the state govt & apprx. 30% tax, GDN ends up with US$3.5m/yr net. This flowrate could b 8-10-12 mmcfd in time, I've used 5 as a base case.

U've got to remember that a field may not necessarily flow for 365 days, depending on the in-situ pressure, there could b some shut-in period involved before re-opening the wells.

However, base case scenario, should everything go well, with rates of minimum 5 mmcfd from 2 wells, GDN can generate US$3.5m/annum. Higher flow rates & a decent gas price, will get them more revenue. To drain this field they could also look at drilling more wells & focus on either shallow or deep target whichever is easy access on a trouble-free basis.

At this stage, I am only looking at them as a gas producer, oil is there, perhaps residual or too tight to flow (as no fluorescence descriptions were mentioned on PB-1 so I'm not too fussed abt that).

It all comes down to how soon they tie-in these 2 wells into production, by late May/mid June perhaps.

cheers