1.32 per share valuation, page-2

Recommendation: For an estimated
$77 million, Antares has purchased
Permian Basin leases which when fully
developed, could have an NPV of over
$500 million or $1.75 per share. The
company?s net cash and hydrocarbon
assets, valued largely at cost, underpin a
value of 38 cent per share, with risked
development upside lifting target value
to $1.32 per share.

After payment for its Permian Basin lease purchases,
drilling and completion costs at the Harrison well and
ongoing share buyback activity, Antares is estimated to
hold about $48 million of cash but has a likely tax liability
of about $20 million relating to the sale of its McMullen
County assets. Permian assets are valued at close to their
purchase price with risked development upside shown as
Exploration Value. The company?s estimated net $28
million of cash after tax payments but before repayment of
$15 million of convertible note debt, provides the company
with adequate capital backing to run a substantial
development drilling programme on its Permian Basin
leases, building production and cash flow from an
estimated current level of around $10 million pa to a level
which should support ongoing field development.