Resource levels were obviously going to come down because SEH lost 1000km2 of land and their percentage rights were also diminished, as announced recently. So there was absolutely no surprises there.
Most of the money owed has been paid to them - so that is a slightly positive surprise.
The only slight negative is that they have indicated that the plateau level has been moved back about 2 years, which is what the analysts have been saying for 1 year - there was never any way that SEH were going to be able to drill 1300 wells in 3 years - so minimal surprise here.
The only negative is that the production curves are not quite as good as we expected so there may be more costs due to infill wells. I'm a little annoyed at this one because they should have known, and announced this, quite a while back. They have been producing for a few years now.
Nothing Lone Star will be too worried about. They have had access to the data room for months now and would have known all of this. A stupid and unnecessary reaction by the market. Unfortunately I don't have any significant funds available to make it worthwhile to add to my holdings.
SEH Price at posting:
21.0¢ Sentiment: Hold Disclosure: Held
