An honest report from CTP today. I'll keep this shortish but key...

An honest report from CTP today. I'll keep this shortish but key points for me are:


1. Decrease of Mereenie quarter on quarter. It is indicated c. 4TJ a day was due to field decline. I don't think anyone should be particularly surprised with this given Leon stated on the first webinar in May that maintenance capex will be needed. He also said this was taken into account for any debt amortisation projections too. His comments in May were:

"...self sustaining capex of c$10m per year to maintain production levels (on average)..."

The quarterly noted that workovers are being planned as part of the CY2020 program, so this will be in relation to the $10m of "self-sustaining capex":

"To mitigate ongoing field decline, a campaign of targeted recompletions is being planned for JV approvalto be executed in CY2020. Timing for future production wells to optimise Mereenie field productioncapacity is also under consideration."

2. PV-13 continuing to produce at 7TJ a day. This is the same exit rate from Jun-19 quarter, so you have to be happy with that. PV total production averaged 9.4TJ, so we have a fair bit of idle capacity given we can produce upto 15 TJ.

"With the capacity of surface equipment currently constrained by field production, opportunities are beingevaluated to increase field deliverability and recovery (i.e. convert 2C resources into 2P reserves) viareconfiguring the existing compression"

3. Gas sales agreement expected to be executed in the next couple of weeks with pricing still remaining strong. Great news.

"Central is in the advanced stages of completing a new gas sales agreement (GSA) to replace existing contracts expiring at the end of 2019. The east coast gas market remains buoyant, with strong demand and pricing. Central expects to execute a new GSA in coming weeks."

4. Refinancing expected to be aligned with the CY2020 exploration program. CTP noted this in their presentation but this confirms it. I'm ok with this if it means further flexibility and less costs. If successful and we can pay down say $20m (?), we may be able to obtain a facility of $50m and only having drawn down $40m-ish by mid-next year. Obviously we will have farmed out some production however...

With the yield curve continuing to fall, holding off a few more months might actually save us some financing costs but let's see.


Lots of other stuff in there but those are the main points for me.....

Does anyone believe MQ will also farm down some of their interest in Mereenie? It could provide an interesting "look through" value for the field if we can sell down a combined 30% of field.