Ann: Half Yearly Report and Accounts, page-2

This is from the half yearly report

Outlook
The Company is focused, in the short term, on completing its two well drilling program and continuing to
increase its HDNG supply volume in order to support the expansion of the HDNG supply trial with its initial
customer from two to six trucks.

Anticipated successful drilling and production testing results from the two new wells will enable State Gas
to seek accreditation for a maiden 2P reserve of 30-50PJs. Establishing an initial 2P reserve is a critical
next step in demonstrating the commercial viability of a substantial gas project at Rougemont West and
supporting an application for a petroleum lease over a substantial portion of ATP 2062.

It is the Company’s view, in line with that shared by many energy sector experts, that natural gas remains
the only reliable source of base and peaking electricity production and remains preferable to thermal coal
and diesel from an emissions standpoint. Reliable ongoing gas supply is required to meet both domestic
and export energy supply obligations over the short to medium term and to ensure that sustainable
electricity prices are maintained for both domestic consumer and commercial users.
Application of this newly developed HDNG technology to coal seam gas, provides an environmentally
favourable method for capturing and commercialising production testing gas which would traditionally be
vented into the atmosphere as part of the exploration and appraisal process. The HDNG technology
developed by State Gas provides it with significant first mover advantage to support increased demand
for natural gas to support the ongoing orderly de-carbonisation of industrial activities, such as coal
mining.
Successful commissioning of the HDNG production plant provides immediate revenues and uniquely
positions State Gas to meet the increasing demand for diesel fuel substitutes from miners in the Bowen
Basin. It simultaneously supports the proposition that the Rolleston West Project has the hallmarks of a
world class development project and, importantly, begins to unlock part of the substantial value inherent
in the Company’s asset base.

It is now up to the BOD to make this happen and for the SP to increase accordingly.
GLTAH