Sorry folks.....forget your conspiracy theories about the share register,the capping!,price manipulation and whatever theory you can devise to explain the PRICE DROP.Sorry T4P and Aksier,I know you put a lot of effort into your posts,but the real reason for the price drop may be found here,especially,I say especially,when AJQ mention COSTS OVER-RUNS and drilling problems.As I said,compare AJQ with STO and you will find that the big picture IS changing.
Here,have a gander and keep yourselves informed.Sorry it's not good news,but thats life.
If you read the full article,you will find costs,costs and nothing but costs is the danger for Australia.So when AJQ mention costs,it will scare all serious investors away.
Africa Gas Rush Imperils $100 Billion In Australian LNG
The discovery along Africa’s east coast of the world’s biggest gas finds in a decade threatens to undo investment plans on the other side of the Indian Ocean.
scale back projects to build liquefied natural gas export plants in Australia and switch to Tanzania and Mozambique, where the new prospects lie and will cost about half as much,
The LNG boom in Australia, where $180 billion of planned investment was set to make gas the country’s fastest-growing export over the next five years, risks losing strength as labor and material shortages force up building costs.
“Because of the volume that’s been discovered in East Africa, the economics look to be able to challenge Australian LNG projects, given the cost inflation they have experienced,” said Peter Hutton, an RBC Capital Markets analyst in London. “All companies will have that on their radar.”
“There is real competition in the 2020 time frame,” said David Knox, the chief executive officer at Santos Ltd. (STO), which is developing Australia’s $18.5 billion Gladstone LNG venture together with Total, Petroliam Nasional Bhd. and Korea Gas Corp. “But we can compete, provided we keep our productivity up, our cost base under reasonable control and we can unlock the resources.”
Australia’s LNG industry faces a shortage of skilled workers and has to pay higher wages in the world’s fastest growing developed economy. The strong Australian dollar has also boosted costs for the developments in U.S. dollar terms after the currency rose 23 percent since 2008. “East Africa has got potential to be a bigger LNG supplier than for example Australia or Qatar on a much lower cost base,” said Barry Rushworth, the CEO at Australia’s Pancontinental Oil & Gas NL, which is drilling now a well off Kenya. “People are just not actually realizing how much potential East Africa has yet.”
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