Yes and no. From a 2P reserve perspective, that is correct....

Yes and no. From a 2P reserve perspective, that is correct. However, from a 2C resource perspective, there was 209PJ of 2C attributed to SE. SE2 and SE3 were going to convert 128PJ of that 2C to 2P. Even if we assume SE2 is a dud and the whole of SE only has 128PJ of 2P (which is already certified), the per barrel equilavent valuation matrix still looks cheap at a 2P+2C level. However, on a EV/2P BOe basis, it is now more expensive than the WGO transaction. To be clear, that is assuming no more gas will be found at SE other than what has been found at SE1, and no reserve upgrade for Walyering. Of course, this will change if we can convert the 2C at ED1 and SWE1 in the upcoming drills at WE.



So on the basis of SE3 (result for which is yet to be finalised as the flow test clearly contradicts the wirelogs and core samples), the market has pretty much written off all future potential of SE and assumes SE will only contain 128PJ of 2P.

Of course, I might just be spewing out a bunch of garbage as some had alluded to. At least I've put the money where my mouth is (perhaps foolishly) and bought up 600k today.

I'll re-quote Buffett - The market is a voting machine in the short term, but a weighing machine in the long term.

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