BRK luncheon, page-51

Ok, enough crappy metaphors .

Time to get serious.

David has never said there was only 1 pathway for monetisation. In all the presentations, interviews there have always been the three options given.

1) Sale, part of full,
2) JV/ farm out
3) Full development by BRK

or some combination thereof.

The end result of the monetisation would eventually lead to redeployment of capital to reinvest and return to shareholders via cash and or buy back.

In answers to shareholders posted on the investor hub, BRK have never said anything different. At AGM's the message has been the same.

Can anyone show where BRK have said there is only 1 way it plans to monetise, and what that 1 plan was?... if someone can show me a statement by the company saying that then I will shut up and go away.

There has been indications that option 1 was the most preferred and that option 3 was the least preferred.

These are preferences, that's all.

The BRK mantra of prospect, prove up and revalue , monetise has been consistent and we are now at the monetise phase.

The mantra for monetisation has also always been they will monetise in a fashion that will give shareholders the best return at the time. It has never been only we will sell everything regardless of the circumstances.

Monetisation in a fashion that will give shareholders the best return at the time is a wishy washy statement, but it does indicate some flexibility to the path taken ( of the 3 base options) depending on the circumstances . It stands to reason that as circumstances can change , (which could be commodity price driven, geological, development parameter driven , political etc, etc ) this can influence the financial outcomes of the pathways and therefore result in a change the preferences, does it not?

If BRK decided not to do anything at all, ever. Not sell , not JV or not develop and let the current wells run dry , turn green and start to grow hash, then THAT will be a change of plan.

If circumstances , whatever they may be, cause BRK to change a monetisation pathway preference, the plan hasn't changed , just the preference has. Monetisation is just a term for capturing the increased value of the acreage and depositing the proceeds into the bank account. Either in 1 go with an outright sale, or less of an amount in a partial sale, or through production cashflow which will provide more cash over a long period of time. If the production is through farmin or JV, then there will be no or little upfront capital expenditure by BRK to harness the cashflow, which will be lower because the price BRK will pay will be a dilution of the asset via equity sale/ transfer to the partner. Rapid BRK drilling for production of a full equity basis over the entire asset will be more difficult because of the high upfront cost involved to drill and complete a whole lot of wells at a rapid pace.

The different pathways chosen will have an impact on any return to shareholders and timing thereof for obvious reasons. I suspect this is part of the problem because and cause of frustration as many want BRK to go down the sale pathway, and receive an immediate return . The production pathway would led to greater cashflow over a longer period by a significant margin, but would delay a return, or diminish the short term return to shareholders .

Now I'm not saying BRK communication has been perfect.. it has not . BRK is a complex company to evaluate with many layers to un-peal and operational nuances to understand. It is difficult to value as quite a few of the metrics used to value the company are not readily available.

Some mixed messaging regarding the 20 well, 4 wells a year over 5 year development plan has not been helpful. That message was interpreted by all of us, myself included that BRK were going to develop the Sycamore zone in the DSU's at a rate of 4 wells a year was confusing as hell, the company has admitted that and tried , without complete success IMO to set the record straight on that. I would argue that many still think that BRK will be drilling 4 wells a year to develop the SWISH resource.

There are other examples of lack of communication but no point in going over those right now except to acknowledge they exist .

The crux of the matter is, BRK will monetise and capture that increase in value that has been generated by the successful HBP program. They have been consistent in that message all along. They have not given a definitive description of exactly how that value capture will look like, nor precisely given a timeline , except to fire the start gun on monetisation after the HBP drill program was completed.... and they have consistently articulated the pathway options .

That is not good enough for many holders, which is fair enough. The fact that the share price is in the toilet is a source of frustration for all of us, the board and management included.

BRK have a simple and clear strategy of prospect, prove up and monetise. They have completed the first 2 steps, and will execute the third.

You either believe it , or you don't.. simple as that.

Cheers

Dan