I’m just trying to put together a few clues from the Quarterly to determine if GAS is a buy at these levels.
1) How much value can the compression plant deliver? Well, we know it maxes out at 1.7 TJ/day. A GJ of gas is worth roughly $15 now. So a TJ is worth $15,000 and 1.7 TJ is $25,500. Let’s say $765,000 per month.
At the moment they’re only supplying 1 truck and it has taken $40,000 of gas in the first month. That client could use gas for 5 trucks. That might result in $200,000 in sales per month. So plenty of upside yet for sales.
2) How much gas in the ground? Just the Rolleston West lease has a 2C of 275 PJ. Management are hinting that they might get a 2P figure of 30 PJ from that (about 11% of the 2C). As 30 PJ = 30,000 TJ, it has a value of about $450 million. (They say they can sell it for a premium, yada yada yada. I’m just going with $15/GJ.)
All 2Cs sum to 534 PJ. 11% of that is 58 PJ or $870 million. So plenty of $$$.
If we consider the compressor plant fully operational and earning a gross of $750,000 per month, that is $8,250,000 for 11 months, allowing for a month of down time.
GAS has SOI now of 225 million. But we know this will increase. I don’t have an exact number but let’s say to 350 million.
Let’s say operating expenses are 30%. That means earnings are 577,000,000 cents over 350 million shares, or 1.6 cps. If that represents a ROI of 5%, then the SP should be 20 x 1.6 = 32c. Well north of where we are now.
Of course this is overly simplistic and doesn’t take into account other spending like drilling and pipeline development. But I think, if the possible 2C reserves are proven, it should be profitable.
I’m sure there are some errors in my estimate. Please point them out so I can make corrections.
The timescale of development I will leave for others to debate.
cheers
FHC
- Forums
- ASX - By Stock
- GAS
- Ann: Share Purchase Plan Results
Ann: Share Purchase Plan Results, page-25
Featured News
AVH
Avita boosts skin restoration product portfolio with 'dermal matrix' – a kind of next-level gauze made of fake skin
GML
Gateway Mining sells WA Eastern Montague gold project to Brightstar for $14M – half of that in shares
TG1
TechGen Metals kicks off airborne geophys survey at Sally Downs copper play – a first for the permit
Add GAS (ASX) to my watchlist
|
|||||
Last
9.3¢ |
Change
0.000(0.00%) |
Mkt cap ! $25.50M |
Open | High | Low | Value | Volume |
0.0¢ | 0.0¢ | 0.0¢ | $0 | 0 |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
1 | 52632 | 9.5¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
9.5¢ | 100000 | 1 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
1 | 52632 | 0.095 |
1 | 19194 | 0.093 |
1 | 7682 | 0.082 |
1 | 15000 | 0.081 |
1 | 129727 | 0.077 |
Price($) | Vol. | No. |
---|---|---|
0.095 | 100000 | 1 |
0.105 | 85000 | 1 |
0.110 | 39900 | 2 |
0.125 | 19354 | 1 |
0.130 | 262991 | 3 |
Last trade - 16.12pm 02/08/2024 (20 minute delay) ? |
Featured News
STX
Strike hands $48.5M contract to Clarke Energy to produce 20x 4.5MW gas engines for Sth Erregulla
GML
Gateway Mining sells WA Eastern Montague gold project to Brightstar for $14M – half of that in shares
KAI
Pilbara Minerals buys land off Kairos part of its York gold project for $20M – and a 2% royalty on any PLS gold sales
GAS (ASX) Chart |
Day chart unavailable