• Atlas 32tj/day can be sustained for 20 years
• Rom 24tj/day (post 8tj/day upgrade) can be sustained for 30 years
• Roma 8tj/day expansion from 16tj/day to 24tj/day has commenced - Early works commenced
• Atlas hit 18tj /32tj today.
• Program ended with 80/110 wells, under budget with majority of capex behind us
• Atlas contracted at favourable pricing, Roma North is based on oil linked price $5/GJ (based on USD27 and $0.60 exchange rate)
• Current free cash flow yield is 20%
• The extremely significant reserve upgrades means SXY has many organic growth opportunities, and because of the organic growth prospects there is no need to look for any acquisition (as they have enough development opportunities within SXY with good economics).
• Have tendered on land with QLD
• Likely to deliver upper end of EBITDA
My takes
• Management are not interested in acquisitions because our acreage generates enough return on itself, makes more sense to spend capex and grow SXY assets
• Management appear to have a preference to spend the cash growing SXY or paying a dividend
Looking in great shape.
SXY Price at posting:
26.0¢ Sentiment: Buy Disclosure: Held
