Hi cortinaboy there's no really good reason I can see for AWE to want to merge with ARC. ARC's Bass Gas and offshore south-west WA holdings are not enough to warrant such a move, ARCs other producing areas are also relatively small to do much for AWE, and while the Canning might have some potential it's no more than that for now, is expensive to drill and with no certainty it will deliver anything more than bills.
Tui is fabulous for AWE but to put $500-odd million from that into a merger with ARC looks to me to be a sin. As an AWE shareholder I'd hope for far smarter value-adding deals, perhaps with NZO or PPP. Or if it's too difficult to deal in the current environment a dividend to give shareholders some reason to hold than to trade would be a far better move - as opposed to a dilution and probably no decent dividend for years if they take up ARQ.
Hopefully this is all just (bad) wind.
AWE Price at posting:
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