Another interesting and informative post. I follow ARQ, it makes up a large part of my portfolio. I was initially disappointed when the company decided to sell Cliffhead but after further research I believe they made a good decision. When you do the maths on the field ARC's share calculated on a 30M barrel field was about $15M before development costs and capex. To get $9M was a good deal. The only thing is that it discounts future discoveries in the area.
Streitberg has said that the funds from Cliffhead will be used for a fully funded exploration and development program late 2003.
Blackgold made the suggestion on another forum with 20 something prospects still to drill ARQ could consider purchasing their own rig, this was something I hadn't considered but would be economical if they are going to drill L1/L2 like a piece of cheese.
From memory Amsol pulled out of Dongara completely in the middle of last year, it is now 100% ARQ. I'm sure they will get this up and running later, it seems they are preoccupied with bigger fish at the moment.
I think your speculation that ARQ has been tardy in getting government approvals could be spot on, although this could be due to a holdup at the other end, apparently there is some concern about the transport of the oil from Hovea to Kwinana, too much tanker traffic on the Brand Highway, with Jingemia producing this issue is even more pertinent.
In ARQ's teleconference Streitberg alluded to the fact that the Hovea production hub could tie in discoveries such as Eremia and Jingemia. The company said in a past presentation that the Hovea production facility could be expanded to handle as much as 24,000 bpd.
Finally we have to remember that not all of L1 and L2 is 50%, Origin are excluded from Dongara, Mondarra and Yardarino. I have tried researching the JV agreement but have not been able to find much information. What is the actual agreement? I don't believe it was ever fully released. Which propspects are 50/50s and which are wholly ARQS?
ARQ are keeping us in suspense I think they may have a few tricks up their sleeve, only time will tell. Earlier this year they mentioned doing further extensive 3D seismic, heard nothing else of that. They may have also tendered for additional licence grants in the Perth Basin, applications closed on April 24th. Takeover also always a possibility.
I think ARQ will trade down until the drilling program starts but don't be surprised if there is some unexpected action in the meantime. As Streitberg seems to always say there are exciting times ahead. Do your own reserach.
