Ann: Kuda Tasi & Jahal Development Concepts & Costings, page-4

Although it hurts to see downward pressure on stocks because of oil prices, medium term volatility is a normal part of the sector - up-cycles and down-cycles.

The positive side for FDR is that depressed oil prices end up reducing capex spend by current producers with higher opex, which results in a few things;

1. More warm and cold stacked equipment becomes available, and becomes cheaper to acquire or lease, and
2. Eventually supply/demand flips, lower cost producers and certain oil cartels gain market share control and raise prices

It’s a tale that has played out numerous times.

Our project is becoming weirdly synonymous with BHP’s Buffalo project in Timor Leste/Australia which had an FID green light when oil prices were around $US11/bbl and started producing into $US25/bbl oil 16 months later. That type of outcome would be optimal for KTJ and FDR