Ann: Resignation of Director, page-19

How are you coming up with $13.5M revenue? What volume and assumed gas price?

$40M is probably about right for free cash from operations when they are fully maxxing out the NGP but the 2P reserves don’t currently support a very long life for that production (about 6 years) and there is a huge pile of interest and D&A to pay off, more development, drilling and SIB capex before they can deliver Mereenie Stage 2, and then a hefty rehab liability hanging over these fields too. There’s also risk around gas price down the track with LNG import terminals on the cards.

I’m thinking at full production NPAT will be around $20M pa. So I think it’s undervalued at 14c but ultimately I think this is worth somewhere around 25c with NGP and current 2P reserves. The real upside comes from the Qld CSG and any reserves upgrades they can deliver in the Amadeus.