Have a look at a graph of the index over the last few months....

Have a look at a graph of the index over the last few months. We're at a lower point now than we were at the peak of the Japanese issues.

As STO are currently offering 1 share for every 14.7 we are tied to their price.

AFR apparently had an article rumouring the non renewal of PEL 238, which is an absolute joke in my book. No government with a financial brain would knock that application back.

We have also got an arbitrage fund on the books who are now free carrying a large % after loaning from what logically could only have been TRU or STO. It would be in STO's best interests to suppress the SP by any means possible as holders of ESG would be more happy to accept a 1 for 14.7 deal. At the moment you could buy on market and make a profit when the deal goes through. That means a high possibility of people new to the registry being happy to accept the deal if nothing better comes along. If it was the other way around the no vote would receive a big boost from more disgruntled holders.

The volume spiked today and it will be interesting to see what position we are in by the end of next week. My personal view is that it would be a very surprising situation if no counter offer came, or a least an upgraded one post reserves upgrade. We are one of the final three as far as a decent resource goes. One wouldn't be going too far off track to think that there are more than three companies who would like a bigger Australian asset base (or simply some exposure). Even though there has been an element of sovereign risk creeping in to Australia's policies, we are a very safe nation. China, South Korea, Japan, Indonesia, India, the list goes on and they will all be looking to guarantee supply. We are the most developed undeveloped option available. You'd be playing Russian roulette if you wanted supply but didn't bother having a dig at a company who's suitor has described as a good value acquisition.