Ann: Manaia-2/2A Progress Report No 11 , page-13

Does seem at odds with what the company has going on.

Potential bad news:...

1. NZ production does not come back on stream as expected in Dec'13. At the 900 bopd rate, every month costs roughly 27,000 bbls of production which I believe is close to $2M/mth in EBITDA (around AUD$70 Netback)

Without that then their forecast exit rate of 5,500 bopd (net)
Some may use valuation metric of around $80K per flowing bblo (which I think is lowish - but the coming growth is in PNG).

If thats the case then exiting at 4,000 (just China) gives a MC of $320M - where we are now.


2. There is some issue as yet to be announced with the Chinese asset. Beibu Gulf was ahead of schedule and under budget and Qtrly confirms all 15 wells online. Possible WHP issue - that puts production off for a period?

3. PNG Asset issue - that would be a real problem given the success HZN having with its program. OG seems like a long haul partner. PNG Gov't and Stanley PDL could be the issue - in particular possibly the GSA?


Was not expecting this, but like you Lordolean my inclination is this may be a buy on weaknesses??