Central Petroleum Shareholders Association, page-28

Part of an article from Australian Financial Review this morning.


Oh, and Macquarie Bank's move to take ownership of Central Petroleum says that it too might be a welcome guest at a prime ministerial gas showdown.

Macquarie has played a hand that says it is a true believer in the remunerative potential of this gas shortage. It is plainly now looking to play a role in creating a more liquid spot and forward market and, in a market structural under-supplied, the only way to do with any level of acceptable risk is to own gas.

Central's potential is obvious. It has legacy gas fields that once supplied 30 petajoules daily of gas but now only have customers enough for 10pj. The demand side of that will change when Jemena completes a new pipeline that will link the NT infrastructure to the east coast market through Mt Isa.

Central has the resources but nothing like the capital to make that gas available by the time the pipeline is ready in late 2018. Given the public markets currently do not know how to value stranded gas like Central's, access to new equity was going to be hideously expensive. So it has been obvious for sometime that private equity was where Central's fate would eventually lie.



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