The attached chart is from AEMO, suggesting field decline is running at 4-5 TJ/d per annum.
Development wells drilled at Mereenie in 2021 increased production from 30TJ/d to 45TJ/d.
If they can get 10TJ/d from this campaign, then 25PJ would be close to 7 years production.
It's unclear what operating margins CTP will have on the new offtake agreements, but if you assume $5/PJ then they'll be earning an extra $4.5m per annum EBITDAX on the new wells - so less than 2 years payback.
That'll be on top of $20m EBITDAX on existing prodution, so $25m pa all up or 3.3cps for a 5cps stock.
You can play around with the operating margin to get the sensitivity, but the key point is it's all take or pay agreements with the NT government - so that will bring revenue certainly over the next 5 years.
IMO this is a low risk play that will enable CTP to explore it's vast average, and potentially become a new frontier to the East Coast gas market.
GLTAH
The attached chart is from AEMO, suggesting field decline is...
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