fabulous buying oppertunity, page-28

Gross sales $3.50, the material costs are Santos related.
This is historical - it is very difficult to reconcile the monthly / qtrly financials because of several anomolies.
1) the original contract with STO was based on take or pay volume hence there was a fixed monthly charge for toll/treatment (based on annual contracted throughput), hence summer months with lower production volume had the same cost base as higher production winter months - lumpy P&L / cashflow - you have to look at it on an annual basis.
2) Cash costs circa $1.50 per unit and amortisation about $1 per unit
3) Based on above LT should be producing $2 per unit free cashflow but it hasnt due to the operational downtime over the past years and not producing at capacity ---- re: fixed cost component above has a very high impact.
4) Evidence that the annual / high fixed cost component still exists can be gleaned from the June 30 Balance Sheets which show circa $22m prepaid Toll fees - wouldnt be the case if it was based on monthly production????
5) What also complicates the reconciliation is the Oil production - I have treated it as the cream, alternatively the proceeds could be allocated to reduce the $1.50 unit cost.
6)Numbers I have seen indicate that LT could be generating $120m free cashflow (higher +++ with increased volumes) post 2015 with a $9 unit price following a $100m drilling campaign to workover LT4 and drill LT5 & Gemfish
Plenty of IFs, Buts and Maybees and a few years away but I think very little understanding and attention has been given to the new STO commercial arrangements -- Main game has to be Sell Crux and pay out debt, settle Sedco, fully funded LT development, money to drill a Echuca Shoals well and NXS is on a PE ratio of less than 1 just two years out.
IMHO its achievable and why NXS will well and truly outperform all indexes over the next few years.