annual report, page-44

I don't want to have a go at Lilac. I know he is sincere and passionately believes in the value of ESG. I do too. And of course I think the current deal undervalues the future value of ESG.

Whether we differ is 'where to from here'. Like it or not, the current Board has put us into a deal situation with Santos. ESG has been set upon a course to merge with Santos (barring a superior offer). If the Board are committed to that course of action, only an intervention by a 3rd Party, or a mutiny from shareholders will stop it from going through.

Some things to think about, in relation to the NO VOTE:

- What will happen to the price if a NO VOTE gets up?

- How to manage the next capital raising

- To whom do we sell ourselves to in the future, if no other parties are willing to step up?

- How to commercialise the resource independent of Santos? Will other parties negotiate with us from here on in, or will they assume that Santos will trump any negotiations they enter into?

- What to do with the Board? So we vote down the SoA recommended by the Board... So presumably the Board has to go..? And even if you get the numbers for the NO VOTE, how can you get up the numbers to unseat the current board?

- OR, if you leave the Board in place, you are saying to these very same people, 'go back and try again', 'cut us a better deal with Santos' ... the only difference is Santos now own 25% of the company, with another 10% being The Board and associates who presumably support the deal. Why will they negotiate a better deal for us (and themselves) this time, which they couldn't do before? ... same Board, remember...


How we got to here is past history. We are here now. But before anyone decides what they are going to do, think through all these questions. Let's not start a fight unless we have thought through how it will be finished. I for one am not doing the corporate version of invading Afghanistan, without knowing what the objective is, and how we are to achieve that objective.

Yaq