Let's put things in perspective. This is a simple back of the...

Let's put things in perspective. This is a simple back of the envelope guide to SGC potential valuation based on VERY conservative numbers.

If we assume a fully diluted shareholding, with options exercised, plus conversion of convertible notes, in rounded numbers we end up with 820 million shares.

If we assume current Henry Hub gas price (in US dollars) of $1.62 per MMBtu (assume equal to 1 Mcf actually more like 0.976), assume exchange rate USD=AUD0.70 ((again very conservative).

Assume 10% recoverable of a potential 1 --) 5 TCF, say 100 bcf assigned to SGC (holding just under half of Borba well).

This equates to a current share price of $0.28 (on fully diluted shares of 820 million).

I'm happy for anyone to correct my calculation, I'm quite sure I've used the correct numbers (there's a lot of conversions involved, and I've been very conservative).

Now of course Borba hasn't been drilled yet, it's not guaranteed, but this provides the background to potential of Borba.

This may help to explain why I believe that the current share price is excessively discounted.