Ann: AGM Presentation , page-11

Left with Galoc, linapacan and 63 is the lot really for now.

Yes, and it is not a bad lot either... a couple of decent producing assets with Galoc North offering the potential to extend the life and value of the assets there. And an exciting and large SC finally about to be drilled.

Until the Baragatan announcement I guess most of us felt the SC63 drill or drop deadline was going to pass and the SC was lost. Fortunately, no. And, in a better than expected outcome, we continue to hold our 50% WI. Back in the day, they used to do their "what a hit could do to their sp" calculations based on a 40% recovery x P50 OOIP x %WI x 15USD/bbl NPV divided by the shares on issue. Just for fun the numbers for Baragatan...
40% recovery
50% WI
676 mmbbls
15 USD/bbl NPV
2,044 m shares
Well at a 99c/share potential value, a sub 3c share price is a bargain...

Now of course, they have quoted a mean risked recoverable volume of 115mmbbls. This would still yield a healthy 42c/share implied value for the success case, not to mention the value created by derisking of other prospects in SC63.

Ok, enough of my blatant ramping... Suffice to say that, at 10 to 12m USD for NDO's share of drilling costs, there is no way I would want see a farm-in on this well...

I would also be hoping that we hang on to SC54b. It is good ground. There is no requirement to spend heavily on it in the near term, and no burning need to turn it in to cash. I think Shell did us a favour when they walked and gave back their WI. This is a nice one to keep in the back pocket.

SC54a... two wells drilled by NDO for two discoveries was a pretty good success rate. With 1x1 and Signal Head as well there is no question that there was a String of Pearls here. However, at perhaps 200mmbbl OOIP all up between upwards of 20 prospects, maybe it was always going to be a case of easy to find but too hard to develop economically. I can well imagine the emotion in the NDO office when this is let go. At the same time I just can't see that they are going to get a lot for it unless the buyer can take out the lame ducks in the same deal.

SC58... I suspect the geopolitical tensions argument is more a negotiating ploy than a real concern. Some of the brightest prospects are maybe just 20 to 30km further out than Malampaya - around 100km offshore. Its unlikely we would ever see Chinese gunboat diplomacy at work here - more likely subtle pressure on the participants. I can certainly see that a BHP might not want to farm in but how about a CNOOC? Or a major player without significant exposure to China. It will get drilled one day but I don't think it will be by NDO. There are some tantalising prospects but the cost, depth, logistics and our 100% funding to earn-in all look a bit hard - NDO are plainly running out of time to prove that they are up to it...

If we do end up with just Galoc, Linapacan, SC63 and SC54B, there will certainly be some regret at what has been given up but with the cash flowing from our cash cows, we've probably still got enough blue sky and the opportunity for a much more focused exploration effort. There could still be a great investment story in the bits that remain.