a gsa with santos?, page-5

Let's look at this proposition through the eyes and headspace of the ESG directors.

If a STO offtake was on offer at fair commercial value, would this be bad for ESG?

Answer: No! At the very, very least it would give us negotiating leverage and a genuine commercial reason for being.

Is it the best we could do?

Answer: It depends upon the alternatives. If there are no other alternatives, then it is acceptable.

If there are other alternatives, are we forced into an "either or" situation where we will have to pick the most commercially advantageous choice for ESG. This may or may not be STO.

Then again, if there are alternatives, can we diplomatically service both companies who would seek to use our gas?

If we step into the Knoxsters slippers for a minute, it's not a bad outcome either.

GLNG of which STO owns approximately 1/3rd enters into a long term agreement for gas. GLNG gas now assured and STO hasn't had to outlay cash or issue scrip to acquire ESG.

BUT...what about the Knoxsters desire to control? He's not the operator of the PEL238 gusher and he is a powerless 19.9& shareholder. Is this a $175m investment that becomes immaterial? Or is it there to be used at a mutually advantageous time...like trains 3 and 4!