another euroz quick comment out...

another euroz quick comment out

http://www.carnarvon.com.au/wp-content/uploads/2018/07/CVN-Quick-Comment_18Jul18.pdf

Carnarvon Petroleum Ltd (CVN $0.26) Speculative Buy y We are reviewing our Valuation and Price Target. We look to the nearest peer in FAR as a relevant comparison, noting that the market ascribes A$7.8/bbl for its net (post Govt carry) 2C discovered 70mmbbls contingent resource; y Applying this to CVN’s current net 2C plus pre-drill Dorado resource est of ~45mmbboe, we suggest discovered resources command $351m of EV or ~$0.30/sh; y This is pre-cash and value ascribed to Buffalo and the broader exploration portfolio and notably pre any discovery at Phoenix South-3 and the deeper zones at Dorado; y What we like about an oil discovery as the commercialisation pathway is much simpler. We look to recent adjacent fields in Wanaea-Cossack, Mutineer-Exeter and Legendre as yardsticks: o Wanaea-Cossack – FID taken on 60mmbbls 2P gross; o Mutineer-Exeter – FID taken on 61mmbbls 2P gross; o Legendre – FID taken on 40mmbbls 2P gross; y Notably, all took circa 5yrs from appraisal to first oil.