Good toread that you both (Clueless100 and Aesi) expect the PPA...

Good toread that you both (Clueless100 and Aesi) expect the PPA to be extended, thusunderpinning EWC’s continued secure revenue stream. From around 2024 onwards,EWC’s lng plant (eventually 4 trains at 500,000tons each) will become its majorsource of profit, even if all its lng production is going to supply the domestic market. From memory, Stewart publicly stated that he is at ease with supplying all 2mtpa to the domestic market, even though the price received is going to be lower than if it could be exported (eg. to its Philippines power plant). And this for good reasons:

Looking atthe financial, rather than the political side of future lng supplies, EWC’s2007 company overview assumes a price of US$6/mmBtu. This would yield an EBITDAof US$75million per 500,000 tons/year (ie. one train) and a profit of around US$40million/year.(4 trains at 500,00tons/year equals US160million/year). Iunderstand that the Indonesian government has set a cap of $8/mmBtu. On thisbasis, EWC’s anticipated supply of lng into the domestic market from 2024 onwards will be highly profitable.

In additionto this, Eromanga’s gas production to the east coast gas market will boost EWC’s revenue and profit, starting in the very near term.