Petsec announced yesterday that it was currently producing 24.5 mmcf a day. That's an annualised production of 8.9 Bcf significantly up on last year. If PSA got a net US$4.5 per mcf the net cash flow for the year would be US$40 million or A$52.6. That's huge.
But in two weeks time Petsec will be producing at a rate of maybe 28-29 mmcf when the second Vermillion accelerated dev well is in production. Moreover the onshore well that is due to intersect its first target in ten days could add another 5-10 mmcf a day. The there is Main Pass to drill and hopefully bring into production in 2H, the East Vermilion leases to drill etc, etc.
It looks to me like Petsec could make a conservative A$50 million profit in 2005 but still people sell. Am I missing something here?
Maybe it a rotation thing, out of PSA into Arc, I don't know, but it sure as heck is difficult to understand.
PSA Price at posting:
0.0¢ Sentiment: None Disclosure: Held
