PetroChina Australia is caught in a rock in a hard place. It...

PetroChina Australia is caught in a rock in a hard place. It will have to offer more than the previous indicative offer under LNG Limited ~ $168.7m cash, which equates to ~ 47 cent on undiluted basis as the current issued shares. Any lower offer will be likely rejected by the board and shareholders.

But PetroChina will also need approval from the National Development and Reform Commission of China for the transaction. They will be asking why they ended paying so much more for WCL than Molopo's Queensland coal seam gas asset. Yes I acknowledge the prior comment that WCL Meridian JV asset has more infrastructure than Molopo's ex-accreage and they also be acquiring WCL's operational team. But there is a magnitude difference in value, for example at the previous indicative offer values WCL at 23 cents per 3P reserve vs MPO's sale of $43.4m, equates to 7 cents per 3P reserve.