new broker report- significantly undervalued

bwhite commendations for posting this new broker report as this was a good write up by the company, but i would unfortunatly like to state that this broker report is very very well far from the true value which qpn has above of it

ok, my other top post should point the company in the true direction of the blue sky ahead of it on an unrisked valuation analysis with the assumption that our upcoming louisiana drilling campaign reaps its rewards- with a high chance that we will gather some good gas reading in this drilling campaign, i wouldnt be one bit surprised on this one running hard prior to actual results-

the broker in this report is being very conservative in their assesment of this project, using p50 values whereas the actual mean estimates for this project is in the vicinity of over 430 bcf and over 40 mmbls of oil equivalent- this would prove to be an upside of some significance to quest's underlying share price valuation-

what should also be noted is the considerable conservative prices of input which the broker is placing on both oil and gas- the broker is in my honest opinion using totally unrealistic prices for oil and gas when coming to NPV targets for their projects. when the GFC crisis first hit and commodity traders were very sceptical of oil and gas prices, i didnt see many predicting oil sitting at $22 a barrel- wouldnt expect gas prices to remain stagnant at $1.6 - therefore, the price valuation for qpn is significantly mispriced. with oil analysts predicting higher oil prices in the medium to longer term, i would prefer to follow the morgan stanleys and deutsche banks price estimates for the black gold than to use a $22 barrel price to value our projects.

if we were to use correct, realistic inputs for the price of oil and gas- the 3.9 cps risked exploration value would easily be well north. the other factor that many should consider when considering this broker report, is the fact that absolutly no value has been added for the potential upside that our south sumutran asset could prove to be once studies are completed in june 2011- imho, i would be very happy to say that at least some value should be considered on there 2123 km2 ground held in south sumutra based on

a) close to existing oil and gas fields
b) infrastucture established in the area
c) basin has already identified 19 known oil and as fields
d) discovered reserves exceed 12 billion barrels of oil

based on the above facts, you would hardly call the ground we have acquired as being one of wildcat status. I for one am very positive and upbeat on our assets in indonesia with a proven hydrocarbon basin established, and am happy to hold for the medium to longer term even if our louisiana drilling campaign isnt the company maker we have all been waiting for. def happy holding and awaiting the drill bit to start churning - six days to go until drilling actions commence so dont be left out in the cold should our much anticipated pre spud run up commence by the end of thsi week leading into early next week-

good luck and be very weary of broker reports using unrealistic prices for input when assesing NPV for projects as realistic prices significantly changes valuation metrics- qpn blue skys ahead-