Hi All, Went to the Melbourne investor roadshow today. RC...

Hi All,

Went to the Melbourne investor roadshow today. RC indicated that, without disclosing the agreed price, the IPL contract will have a gas sales price of around 3 x CTP's estimated cost of production, although exact details still to be hammered out. He indicated a 10 year contract at 15 petajoules annually as previously announce. If you plug in $9 a gigajoule price (my estimate, also makes the math easy) and $3 cost, this would mean 6 million x 15 = $90 million profit, just over our current market cap. RC is reasonably excited about getting the pipeline discussed and now on the way to being built unsurprisingly. He was also quite chuffed about getting Ooramina back from Santos, who apparently didn't give the pipeline much chance of getting the go-ahead (and also that Santos were a bit upset they had let it go given the progress with the pipeline approval).

He also pointed out that CTP would be able to borrow against IPL's balance sheet with the sales contract, which will allow borrowing at substantially lower rates due to their better credit rating, a significant economic benefit to CTP.

I think the economic significance of this deal is being significantly underrated by the market at present. It is reliant on the pipeline getting built etc, but if everything goes to plan this really will be a game changer for CTP.

No further indication of results (positive or negative) regarding cores from Gaudi.

Still no indication of any great rush for further drilling at Surprise (RC claimed it was his and CTP's board's magnificent anticipation of the recent drop in oil prices that had led them to hold off further drilling, but it sounds more like 20/20 hindsight rather than foresight! - it would be a nice if this had been mentioned to the market more clearly). Santos will wait for seismic to come back before any more drilling at Mt Kitty, up to 12 months away.

If I have missed anything happy for other attendees to chip in.

Cheers,
Digging