Ann: Presentation Expanding in the Taroom Trough, page-46

I can see both sides of this. I'll start with the negative viewpoint, but I have put a couple of positive at the end.

On the negative side:

• Why raise/dilute to pay for a well and seismic to fulfil someone elses ATP obligations? Would it not be better to raise to drill a well in areas you own?
• If these Taroom Trough tenements are so good, why are Santos letting EXR have it for so little? When discussing Santos' future developments in January, Kevin Gallagher didn't even mention the Taroom Trough, so it seems they aren't all that interested in it. (https://www.upstreamonline.com/field-development/-leaner-and-more-efficient-santos-streamlining-organisation-in-2025-projects-put-on-back-burner/2-1-1768611)
• It feels a bit like a jump to the latest new "shiny" thing, and EXR seem to have a track record of being a bit too optimistic when assessing prospects, so it's hard to say how realistic their sales pitch is.

On the more positive side:

• Most unconcentional plays don't work, and even in those that do, most areas don't work. You need to be in sweetspots/fairways. By having more area to explore, EXR reduce the risk that they miss the sweetspots in the Taroom Trough. It may be that the poor results from Daydream 2 (and they were poor, no matter what EXR or hotcopper users say) were simply becuse that particular area of the trough isn't in a fairway, not that the whole Trough doesn't work. Taking a position in addditional ATPs really increases the chances that EXR are able to find something that is commmercially viable.
• Santos almost certainly have obligations under their ATP agreements, and will running out of time to fulfile those obligations. It might be that Santos do rate the Taroom Trough, but simply can't resource it right now due to having other more mature/better projects to deal with.
• $7 million dollars really isn't that much, and raising money is part and parcel of being a small explorer.

I can see why holders might be a bit unhappy about this move but I don't think it is all doom and gloom.