AGM presentation., page-9

Good to meet up with you GH and Retep. A big drive for you Retep coming up all the way from Canberra just for this meeting...and then to nearly get washed away in a storm on your first night in Brisbane!! I hope it was well worth it for you?

For all those who didnt make it to the meeting....you didnt miss much! The mood was depressing...the link up with Singapore sort of worked but in the end it didnt matter.

Gone are the days of the adoring and the faithful coming to listen to the guru about the panacea to the worlds energy problems! Gone are the days where we sat around large round tables and were served food and drinks while the meeting progressed.

The hall was very small and even that wasn't required because there was lucky to be 100 people. The body language from all those that were there (including LNC management) spoke very loudly and at the first opportunity for anyone to speak the complaints flowed.

Mostly from all those that got caught out with the voting shambles. It nearly seemed as if the whole AGM would look like it was going to be cancelled. It was only after some profuse and repeated appoligies from both PB and Craig that control was established and we got to move on.

Looking at the video of the Singapore shareholders seemed no better. There was maybe 15 people and they were slouched over their chairs and looked highly disinterested. One of them got up to give a list of complaints during the resolution to appoint PB as a director and PB had to get up and explain that he was the only reason that LNC had what it had and was where it was today...... so sad!

PB went on to give the usual presentation and though he looked very washed out he did show glimpses of his old self when he got a little excited about some future prospects of the business.

GH hogged the mic for most of the questions (good questions I might add) ( just joking mate) but I did get a look in just before we adjourned to the outside for the real question time.

Dicko....As GH has already said...non of the Chinchilla gear has gone anywhere! let alone Poland... most of the groundwork in Poland has been completed and the only real problems are the political ones. There are three or four other companies in the running for the gas supply project and we are looking at supplying one billion cubic meters.

I asked about the possible timeline and tried to throw in a possible 2 year time-frame but was told that at the present time the company was trying to focus available resources where they would get the best and quickest return......this was the theme for any questions relating to any project development.....so that answers your question on what will be the project most likely to come to maturity first?

Mojohand.. you wanted to know more about the unsolicited offers for our world class oil assets; The negotiations are continuing (surprise surprise) ....but I did ask him outside if the values that have been recognised by the potential suitors are close to the values that we are familiar with?.... no of course not!

I get the distinct feeling that everything is up in the air at the moment and that LNC is looking for the biggest "bang for buck" as well as trying to keep a lid on costs and some sort of focus on cost/value operations and that this upcoming year will see the "dust settle" and direction will become clearer with fewer assets. In other words...very much a directional "work in progress".

I came away from the meeting a little confused ...but upon reflection I think it was because there are no "real" answers because all options are being considered based on what they think, or what might turn out to be, the project to push through. As PB said when I asked what project will mature first and he replied...."ask three directors and you will probably get three different answers"

We did get to see a bit of the "old PB" outside when GH asked him about the drilling operations around Umiat..only four pads will be used to get the 50,000 BPD and Canadian drilling rigs which are set up to already be semi-horizontal could be used ...GH will elaborate on that I'm sure .....but PB did not think it would be a lengthy procedure to get the access road and pipe to the TAPs pipe along with a gas line for down hole pressure. Work would commence from both ends at the same time.

But what PB was most excited about was the use of UCG for retrieving the heavy oil.... this was a no-brainer he explained;

*Low cost (just air, no oxygen).
*Quick to set up...average drilling cost $2m for a 400PPD operation.
*Lots of opportunity... companies are foregoing ground due to high start-up costs using current steam and other methods.
*No depletion...400BPD maintains until the UCG is extinguished.
*Easy to start small and then to multiply and duplicate as revenues allow.

I got to talking to other directors re- a Genting takeover.....the general opinion was that PB is in for the long game and that it is not a likely scenario for the likes of Genting...because its not their game (makes me wonder why they bought into LNC??? and put two oil and gas men in as directors???)...but the general opinion was Genting are unlikely to make a move and if PB wanted out he would have done so when the SP was in the $5's...I'm still not 100% convinced...but at the end of the day I can feel some confidence that it wont be a cheap takeover because these words came from PB during the presentation still ring in my ears;

"If we get taken out it can only be a good thing if done with value...because at the end of the day all of us in this room are capitalists"