Westside Corporation Limited (WCL) $ 0.51 Recommendation:...

Westside Corporation Limited (WCL) $ 0.51

Recommendation: BUY

Analyst: Scott Simpson Tel: +61 8 9263 1679


--------------------------------------------------------------------------------

2009 Program to Deliver Further Reserves Definition

Investment Highlights



· We are initiating coverage on WCL with a BUY recommendation and a price target of $1.00/sh based on assessment of current reserves and development objectives and highlight this is speculative pending further demonstration of the coals productivity. WCL is an Australian based CSG explorer with two permits in the Bowen basin in QLD with established production pilots and is also assessing the CSG potential of a number of coal deposits in Indonesia. WCL is operator in the most prospective areas of each permit with a 50% interest shared with JV partner QGC (BG).

· Strategic assets located in proven productive areas. WCL has established production pilots at its Paranui (ATP 769P) and Tilbrook (ATP 688P) projects. Paranui is located just 5km west of the producing Dawson Valley gas fields and along the Surat to Gladstone pipeline corridor, immediately adjacent to local pipeline infrastructure. The Tilbrook production pilot is located north of the producing Moranbah field and essentially on top of the North Queensland pipeline, providing immediate access to domestic markets and longer term pricing exposure to CSG/LNG via the proposed Mornabah to Gladstone pipeline.

· Initial goals achieved with certified 3P reserves of 211PJ. WCL achieved a major milestone in June this year when it booked maiden gas reserves at Paranui and Tilbrook from the pilot production. The reserve booking was across a relatively small area of coal and gives further confidence to estimates of a further 1682PJ of gas in place net to WCL.

· 2009 drilling program to drive growth. WCL have kicked off its $18m program with a number of coreholes and recently completed its first horizontal production well at Tilbrook. This well, together with further production wells and coreholes will allow for booking of additional 3P and maiden 2P reserves during Q4 2009.

· Reserve targets of 250PJ of 2P and 1000PJ of 3P. WCL are seeking to achieve these targets in the near term via its current program, proving up new reserves and seeking further CSG opportunities.

· Fully funded to complete 2009 program with $24m in cash following recent $18m in capital raisings.