Ann: Gorgon Jetty Update, page-15

The way I read it is that as at 30 September they still had a contract asset of $1.13bn booked, however now that this judgment has come they only get net $43m. They had raised a provision against the $1.13bn, but how much is not clear, it forms part of their total $675m provision. So the way I read it is in previous years accounts, they had recognised revenue of $1.13bn and raised a receivable (asset) of $1.13bn, which still stood there until 30 September. At some point they raised a provision against the $1.13bn, but not for the full amount, and we don't know how much the provision was, but less than $675m, so that would have been accounted for as a doubtful debts expense and provision (liability). Now that they know they will only get net $43m, they will need to reverse the asset and the provision, so $1.13bn reduction in contract asset, unknown reduction in provision, lets guess $330m (half of their total provision). So $1.07bn reduction in asset (being $1.13bn less $43m received), $330m (guess) reduction in liability, leaves a $740m hole (again guessing how much provision was raised against this contract asset) which would be accounted for as a loss or expense. I think this is fairly major, and shareholders deserve to get a clearer picture of exactly how much the loss is, like I said it could wipe out most of the equity on their balance sheet (pre Thiess sale). Not knowing anything about their banking covenants etc, but could this make their lenders a little nervous, they usually like to have some equity they can get hold of.