psi81 thank you very much for your valued comments and I am...

psi81 thank you very much for your valued comments and I am indeed conscious of the weakness of the simplistic spread sheet model.

It is developing quite rapidly and now has provision at least for amortisation.

To get started I took advantage of the fact that the 10TJ/day NT GSA's were putting CTP somewhere near break even and would basically cover administration costs and that the NGP1 sales would start to contribute to profitability.

Back of cigarette pack economics I know but at least it gave me a starting point.

If I set all the APA pipelines to a 50% regulatory discount on published tariffs and take a "Cost of Production at the site gate" of $1.50 the model indicates a $5.55 COP + haulage to Sydney City gate which is in line with the number of around $5.00 that CTP have indicated.

With 90M amortised at 7.5% over 10 years to deal with the 50TJ upgrade costs (SOA P227) the share price line on the 50% regulated graph ranges from 38-54C on a corresponding selling price range of $9.50 -$10-50. I take your point it when you add the rest of the overheads it will come down).

As you pointed out it doesn't take tax Etc. into account.

I can't get specifics out of CTP but from my research on the Merimee debottlenecking project and again P227 in the SOA indicates that 50 TJ is the max that Mereenie surface facilities can process.

In order to fill the NGP and supply the prepaid 4.7 TJ/Day to MAC we would have to get our hands on another 10TJ/day from say Palm Valley.

If this 10 TJ (All CTP's gas here no sharing with MAC !), was not available the indicated share prices dropped to 16-35C.

The output graph has slide bars on important parameters and it is scary how quickly things change if they are adjusted.

In any case we appear to be at least getting the post first NGP1 gas share price somewhere in the football field.

We have to remember we need the trifecta of sustainable flow rates, low cost of production, serious pipeline haulage reform and the market price to hold up. It can easily look like lotto and supplementary.

This is why I am pressing CTP to give us an indication of the fundamental parameters they are using in their models so that shareholders can gain a bit of confidence.

It gets interesting though,when the same model is applied to the CSG operation that has triggered the NGP2 extension from Mount Isa to Wallumbilla targeted for first gas late 2022 because even though they appear to be marginally more expensive, they are working with relatively clean CSG but have a similar number of tightly controlled shares, no debt and a targeted output of 200TJ/day.

The upshot of all this is that they can drop their margin a bit and still provide an enviable return to shareholders.


That's enough not investment advice and DYOR .


Best regards

OGP