Ann: Glenaras Gas Project - Production Update, page-7

Hey there, it's not always the case that the SP goes up when there is a positive announcement, you see it time and time again. I read the announcement a couple of times and maybe the only thing that may be disappointing is the fact that gas production is still at 15 - 20 Mscfd. This was the initial reading and I'd have hoped it would have increased by now?? I'm not an expert in this field so not sure if this is anything to worry about - Kiwitrev or some of the other cluey people on here may be able to set me straight.

I gather from past announcements and just from my own reading of the Coal Seam Gas process that we might be a month or two away from knowing whether we have gas at a commercial level. All of the announcements thus far have been very encouraging and my opinion is that we will hit the 2P reserve booking of gas 500PJ+. I am encouraged by the fact that most of the BOD and support crew did it all before when they steered Eastern Gas to a 2P booking of 1520PJ and then sold it off to Santos for $924 million back in 2011.

The price of gas back in 2011 was about $3/GJ - we're now looking at $9/GJ - $12/GJ for gas; so if you do your calcs, even though we may book only 500PJ for arguments sake vs 1520PJ by Eastern Star, given the higher cost of gas, we will be valued at min. $1B and that's why I'm here