Lovely presentation. Clean and simple... no matter how many...

Lovely presentation. Clean and simple... no matter how many times I read this, I marvel how significant NWE's assets are. I sleep very well when I remind myself of these facts.

Not much new info in this preso except 1 key slide, see below:



My key takeaway from this slide is that NWE are gunning hard to export their share of gas from LD. It's all about LNG.

They have flagged they are not intending to sign any GSA's... there is simply no need... buyers will be lining up to secure gas but NWE know very well they have the power. NWE are very well supported by all shareholders and have the cash to pursue their aggressive appraisal / exploration strategy.

My read of NWE's commercialisation strategy is that they plan to supply their WA mandated 15% domgas... and the 85% remainder will be earmarked for LNG export. And I reckon they will get it. You can see from the slide above when they talk about applying for exemption due to size of resource (LD looking like the biggest onshore discovery - ever), and the well publicised fact that the NWS needs more gas to keep exporting and making plenty of money for the WA govt.

Just look at the LNG netback price of A$40/GJ+... in fact just for fun...

If LD ended up being proved a 2TCF field, 2,000BCF or approx. 2100PJ (I've used a conservative 1.05 multiple conversion as the gas is not as pure as others in the PB). Note that Waitsia reserves is currently 860BCF but IMO will increase with their current 6 well appraisal campaign. Given we know the gas column of LD is ~800m and aerial extent of 100km2.. it's not hard to conclude that LD will trump Waitsia's field size.

So... NWE share is ~420PJ. 15% goes to domgas... leaves ~355PJ for potential export via NWS KGP... at gross sales price of A$40/GJ....

Assume NWE could process / export 40TJ per day that's potentially gross rev of $1.6m p/d... or ~$580m p/a. At ~14.5 PJ/a gives a field life of ~24 years. Not bad numbers right?

If NWE can process / export 60TJ p/d that's gross rev of $2.4m p/d or ~$870m p/a... with a field life of 16yrs.

All numbers above are gross... need to factor in processing costs, pipeline transmission costs, NWS clip, taxes etc. to get the net figures.

And the above does not include any numbers for the oil / condensate.

Not wanting to get too far ahead but you can see the economics here for exporting are simply outstanding, and from what I can read from this preso, NWE are going hard to secure this lucrative opportunity. IMO, it is only a matter of time before this is granted.

But first lets get the 2D and 3D completed and then the next 2 wells will be key in defining the field size.

But overall a truly transformational opportunity. It's all lining up very, very nicely for NWE.

GLTA