broker note

From brokers note yesterday:

Subject: Woodside Metasource exit GDY

Key points:

* It would appear that Woodside Metasource has exited GDY with a cross of
circa 11.5m hitting the screens today.

* Woodside's exit is not a huge surprise as it has not participated in any
of the more recent capital raisings. The timing of the exit is a little
more surprising given the current status and potential newsflow over the
next 6 months.

* It would appear that the buy side was a spread of financial institutions
and high net worth's.

* Reaction to the exit is likely to be mixed. The exit of Woodside is,
obviously, not a positive endorsement for GDY. However, it has long been
apparent that GDY was not a core investment and GDY's JV with Origin, with
respect to the Cooper Basin operation, in hindsight may have perceivably
made Woodsides position untenable in the long term.

* On the positive side the pending entry of SunSuper and Sentient (in
addition to Origin) as cornerstone investors is a positive endorsement,
particularly given the extensive due diligence we believe both have
undertaken over the past year. Also it may be argued that a spread of
institutional investors is a positive.

* One thing we do know is the number of enquiries we have been receiving
from large international and domestic, financial and industry institutions
has increased significantly in recent months. It would appear that since
the completion of Habanero#3 global awareness of the Cooper Basin project,
and GDY, has increased.

* We expect increased volatility following this announcement but note that
project fundamentals have not changed and retain a positive view. There are
some significant milestones looming, which we believe will catalyse further
interest. Also, the market re-rating of the East Australian energy market,
as seen across the CSG sector, must, if real, be equally relevant to GDY
and its Cooper basin project, assuming the project is commercially viable.

* Our current recommendation and price target is Buy and A$2.06. We are
reviewing our conservative valuation assumptions with respect to recent
energy related events (CSG) and note that Eastern Australian energy price
expectations and GDY's commercial viability would have to be positively
correlated.